ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Wisconsin | 39-1382325 | |
(State of organization) | (I.R.S. Employer Identification No.) | |
3700 West Juneau Avenue Milwaukee, Wisconsin | 53208 | |
(Address of principal executive offices) | (Zip code) |
Large accelerated filer | ý | Accelerated filer | ¨ | ||
Non-accelerated filer | ¨ | Smaller reporting company | ¨ |
Part I | ||
Item 1. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
Part II | ||
Item 1. | ||
Item 2. | ||
Item 6. | ||
Three months ended | |||||||
March 31, 2013 | April 1, 2012 | ||||||
Revenue: | |||||||
Motorcycles and related products | $ | 1,414,248 | $ | 1,273,369 | |||
Financial services | 156,965 | 156,322 | |||||
Total revenue | 1,571,213 | 1,429,691 | |||||
Costs and expenses: | |||||||
Motorcycles and related products cost of goods sold | 894,806 | 816,859 | |||||
Financial services interest expense | 40,554 | 51,256 | |||||
Financial services provision for credit losses | 13,110 | 9,014 | |||||
Selling, administrative and engineering expense | 271,499 | 265,653 | |||||
Restructuring expense | 2,938 | 11,451 | |||||
Total costs and expenses | 1,222,907 | 1,154,233 | |||||
Operating income | 348,306 | 275,458 | |||||
Investment income | 1,615 | 1,933 | |||||
Interest expense | 11,391 | 11,495 | |||||
Income before provision for income taxes | 338,530 | 265,896 | |||||
Provision for income taxes | 114,401 | 93,861 | |||||
Net income | $ | 224,129 | $ | 172,035 | |||
Earnings per common share: | |||||||
Basic | $ | 1.00 | $ | 0.75 | |||
Diluted | $ | 0.99 | $ | 0.74 | |||
Cash dividends per common share | $ | 0.210 | $ | 0.155 |
Three months ended | |||||||
March 31, 2013 | April 1, 2012 | ||||||
Net Income | $ | 224,129 | $ | 172,035 | |||
Other comprehensive income, net of tax | |||||||
Foreign currency translation adjustments | (10,570 | ) | 4,661 | ||||
Derivative financial instruments | 10,601 | (4,826 | ) | ||||
Marketable securities | (244 | ) | 1,013 | ||||
Pension and postretirement benefit plans | 10,239 | 7,933 | |||||
Total other comprehensive income, net of tax | 10,026 | 8,781 | |||||
Comprehensive income | 234,155 | 180,816 |
(Unaudited) | (Unaudited) | ||||||||||
March 31, 2013 | December 31, 2012 | April 1, 2012 | |||||||||
ASSETS | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 1,018,759 | $ | 1,068,138 | $ | 1,276,337 | |||||
Marketable securities | 135,246 | 135,634 | 134,946 | ||||||||
Accounts receivable, net | 259,673 | 230,079 | 264,272 | ||||||||
Finance receivables, net | 2,074,036 | 1,743,045 | 1,885,489 | ||||||||
Inventories | 416,050 | 393,524 | 467,941 | ||||||||
Restricted cash | 197,025 | 188,008 | 246,995 | ||||||||
Other current assets | 232,190 | 292,508 | 237,550 | ||||||||
Total current assets | 4,332,979 | 4,050,936 | 4,513,530 | ||||||||
Finance receivables, net | 3,959,903 | 4,038,807 | 3,991,914 | ||||||||
Property, plant and equipment, net | 790,245 | 815,464 | 791,064 | ||||||||
Goodwill | 28,861 | 29,530 | 29,740 | ||||||||
Other long-term assets | 223,133 | 236,036 | 279,099 | ||||||||
$ | 9,335,121 | $ | 9,170,773 | $ | 9,605,347 | ||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | 360,018 | $ | 257,386 | $ | 355,902 | |||||
Accrued liabilities | 464,317 | 513,591 | 577,619 | ||||||||
Short-term debt | 687,705 | 294,943 | 629,143 | ||||||||
Current portion of long-term debt | 715,143 | 437,162 | 1,020,563 | ||||||||
Total current liabilities | 2,227,183 | 1,503,082 | 2,583,227 | ||||||||
Long-term debt | 3,892,469 | 4,370,544 | 3,918,384 | ||||||||
Pension liability | 152,132 | 330,294 | 118,212 | ||||||||
Postretirement healthcare liability | 274,597 | 278,062 | 265,871 | ||||||||
Other long-term liabilities | 131,692 | 131,167 | 144,994 | ||||||||
Commitments and contingencies (Note 16) | |||||||||||
Total shareholders’ equity | 2,657,048 | 2,557,624 | 2,574,659 | ||||||||
$ | 9,335,121 | $ | 9,170,773 | $ | 9,605,347 |
(Unaudited) | (Unaudited) | ||||||||||
March 31, 2013 | December 31, 2012 | April 1, 2012 | |||||||||
Balances held by consolidated variable interest entities (Note 6) | |||||||||||
Current finance receivables, net | $ | 432,079 | $ | 470,134 | $ | 546,350 | |||||
Other assets | $ | 5,229 | $ | 5,288 | $ | 5,932 | |||||
Non-current finance receivables, net | $ | 1,402,541 | $ | 1,631,435 | $ | 1,971,878 | |||||
Restricted cash | $ | 185,657 | $ | 176,290 | $ | 246,995 | |||||
Current portion of long-term debt | $ | 375,835 | $ | 399,477 | $ | 620,624 | |||||
Long-term debt | $ | 892,737 | $ | 1,048,299 | $ | 1,133,696 |
Three months ended | |||||||
March 31, 2013 | April 1, 2012 | ||||||
Net cash used by operating activities (Note 3) | $ | (108,489 | ) | $ | (73,616 | ) | |
Cash flows from investing activities: | |||||||
Capital expenditures | (22,261 | ) | (24,680 | ) | |||
Origination of finance receivables | (622,373 | ) | (645,247 | ) | |||
Collections on finance receivables | 665,520 | 681,904 | |||||
Sales and redemptions of marketable securities | — | 20,042 | |||||
Other | 6,656 | — | |||||
Net cash provided by investing activities | 27,542 | 32,019 | |||||
Cash flows from financing activities: | |||||||
Proceeds from issuance of medium-term notes | — | 397,377 | |||||
Repayments of securitization debt | (178,923 | ) | (333,026 | ) | |||
Net increase (decrease) in credit facilities and unsecured commercial paper | 392,564 | (224,508 | ) | ||||
Net borrowings of asset-backed commercial paper | (17,063 | ) | — | ||||
Net change in restricted cash | (9,017 | ) | (17,340 | ) | |||
Dividends paid | (47,308 | ) | (35,943 | ) | |||
Purchase of common stock for treasury | (126,411 | ) | (20,745 | ) | |||
Excess tax benefits from share-based payments | 14,468 | 7,962 | |||||
Issuance of common stock under employee stock option plans | 13,887 | 16,281 | |||||
Net cash provided (used) by financing activities | 42,197 | (209,942 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | (10,629 | ) | 926 | ||||
Net decrease in cash and cash equivalents | $ | (49,379 | ) | $ | (250,613 | ) | |
Cash and cash equivalents: | |||||||
Cash and cash equivalents—beginning of period | $ | 1,068,138 | $ | 1,526,950 | |||
Net decrease in cash and cash equivalents | (49,379 | ) | (250,613 | ) | |||
Cash and cash equivalents—end of period | $ | 1,018,759 | $ | 1,276,337 |
March 31, 2013 | December 31, 2012 | April 1, 2012 | |||||||||
Available-for-sale: | |||||||||||
Corporate bonds | $ | 135,246 | $ | 135,634 | $ | 134,946 | |||||
$ | 135,246 | $ | 135,634 | $ | 134,946 |
March 31, 2013 | December 31, 2012 | April 1, 2012 | |||||||||
Components at the lower of FIFO cost or market | |||||||||||
Raw materials and work in process | $ | 121,481 | $ | 111,335 | $ | 113,127 | |||||
Motorcycle finished goods | 203,275 | 205,660 | 252,979 | ||||||||
Parts and accessories and general merchandise | 137,184 | 122,418 | 145,362 | ||||||||
Inventory at lower of FIFO cost or market | 461,940 | 439,413 | 511,468 | ||||||||
Excess of FIFO over LIFO cost | (45,890 | ) | (45,889 | ) | (43,527 | ) | |||||
$ | 416,050 | $ | 393,524 | $ | 467,941 |
Three months ended | |||||||
March 31, 2013 | April 1, 2012 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 224,129 | $ | 172,035 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation | 42,850 | 43,203 | |||||
Amortization of deferred loan origination costs | 19,753 | 18,547 | |||||
Amortization of financing origination fees | 2,204 | 2,743 | |||||
Provision for employee long-term benefits | 16,684 | 17,293 | |||||
Contributions to pension and postretirement plans | (182,047 | ) | (206,832 | ) | |||
Stock compensation expense | 11,096 | 11,744 | |||||
Net change in wholesale finance receivables related to sales | (336,927 | ) | (151,046 | ) | |||
Provision for credit losses | 13,110 | 9,014 | |||||
Foreign currency adjustments | 9,846 | (2,911 | ) | ||||
Other, net | (1,805 | ) | 1,505 | ||||
Changes in current assets and liabilities: | |||||||
Accounts receivable, net | (36,165 | ) | (43,745 | ) | |||
Finance receivables—accrued interest and other | 1,246 | 3,299 | |||||
Inventories | (28,613 | ) | (47,168 | ) | |||
Accounts payable and accrued liabilities | 79,861 | 117,460 | |||||
Restructuring reserves | (12,388 | ) | 1,296 | ||||
Derivative instruments | (342 | ) | (486 | ) | |||
Other | 69,019 | (19,567 | ) | ||||
Total adjustments | (332,618 | ) | (245,651 | ) | |||
Net cash provided by operating activities | $ | (108,489 | ) | $ | (73,616 | ) |
Three months ended March 31, 2013 | |||||||||||||||||||||||||||||||
Kansas City | New Castalloy | Consolidated | |||||||||||||||||||||||||||||
Employee Severance and Termination Costs | Other | Total | Employee Severance and Termination Costs | Accelerated Depreciation | Other | Total | Total | ||||||||||||||||||||||||
Balance, beginning of period | $ | 2,259 | $ | — | $ | 2,259 | $ | 9,306 | $ | — | $ | 145 | $ | 9,451 | $ | 11,710 | |||||||||||||||
Restructuring expense | — | — | — | 474 | 2,092 | 444 | 3,010 | 3,010 | |||||||||||||||||||||||
Utilized—cash | — | — | — | (1,416 | ) | — | (456 | ) | (1,872 | ) | (1,872 | ) | |||||||||||||||||||
Utilized—non-cash | (790 | ) | — | (790 | ) | — | (2,092 | ) | — | (2,092 | ) | (2,882 | ) | ||||||||||||||||||
Balance, end of period | $ | 1,469 | $ | — | $ | 1,469 | $ | 8,364 | $ | — | $ | 133 | $ | 8,497 | $ | 9,966 |
Three months ended April 1, 2012 | |||||||||||||||||||||||||||||||
Kansas City | New Castalloy | Consolidated | |||||||||||||||||||||||||||||
Employee Severance and Termination Costs | Other | Total | Employee Severance and Termination Costs | Accelerated Depreciation | Other | Total | Total | ||||||||||||||||||||||||
Balance, beginning of period | $ | 4,123 | $ | — | $ | 4,123 | $ | 8,428 | $ | — | $ | 305 | $ | 8,733 | $ | 12,856 | |||||||||||||||
Restructuring expense | 542 | — | 542 | 571 | 2,099 | 349 | 3,019 | 3,561 | |||||||||||||||||||||||
Utilized—cash | — | — | — | (156 | ) | — | (361 | ) | (517 | ) | (517 | ) | |||||||||||||||||||
Utilized—non-cash | — | — | — | — | (2,099 | ) | — | (2,099 | ) | (2,099 | ) | ||||||||||||||||||||
Balance, end of period | $ | 4,665 | $ | — | $ | 4,665 | $ | 8,843 | $ | — | $ | 293 | $ | 9,136 | $ | 13,801 |
Three months ended March 31, 2013 | Three months ended April 1, 2012 | ||||||
Employee Severance and Termination Costs | Employee Severance and Termination Costs | ||||||
Balance, beginning of period | $ | 10,156 | $ | 20,361 | |||
Restructuring expense | — | 1,886 | |||||
Utilized—cash | (9,607 | ) | (26 | ) | |||
Balance, end of period | $ | 549 | $ | 22,221 |
Three months ended March 31, 2013 | |||||||||||||||
Motorcycles & Related Products | |||||||||||||||
Employee Severance and Termination Costs | Accelerated Depreciation | Other | Total | ||||||||||||
Balance, beginning of period | $ | 5,196 | $ | — | $ | 161 | $ | 5,357 | |||||||
Restructuring expense | — | — | 638 | 638 | |||||||||||
Utilized—cash | (808 | ) | — | (623 | ) | (1,431 | ) | ||||||||
Utilized—non-cash | — | — | — | — | |||||||||||
Non-cash reserve release | (710 | ) | — | — | (710 | ) | |||||||||
Balance, end of period | $ | 3,678 | $ | — | $ | 176 | $ | 3,854 | |||||||
Three months ended April 1, 2012 | |||||||||||||||
Motorcycles & Related Products | |||||||||||||||
Employee Severance and Termination Costs | Accelerated Depreciation | Other | Total | ||||||||||||
Balance, beginning of period | $ | 10,089 | $ | — | $ | — | $ | 10,089 | |||||||
Restructuring expense | 323 | — | 5,681 | 6,004 | |||||||||||
Utilized—cash | (1,846 | ) | — | (5,669 | ) | (7,515 | ) | ||||||||
Utilized—non-cash | — | — | — | — | |||||||||||
Balance, end of period | $ | 8,566 | $ | — | $ | 12 | $ | 8,578 |
March 31, 2013 | December 31, 2012 | April 1, 2012 | |||||||||
Retail | $ | 4,981,488 | $ | 5,073,115 | $ | 5,043,584 | |||||
Wholesale | 1,159,243 | 816,404 | 956,322 | ||||||||
6,140,731 | 5,889,519 | 5,999,906 | |||||||||
Allowance for credit losses | (106,792 | ) | (107,667 | ) | (122,503 | ) | |||||
$ | 6,033,939 | $ | 5,781,852 | $ | 5,877,403 |
Three months ended March 31, 2013 | |||||||||||
Retail | Wholesale | Total | |||||||||
Balance, beginning of period | $ | 101,442 | $ | 6,225 | $ | 107,667 | |||||
Provision for credit losses | 11,085 | 2,025 | 13,110 | ||||||||
Charge-offs | (25,243 | ) | — | (25,243 | ) | ||||||
Recoveries | 11,258 | — | 11,258 | ||||||||
Balance, end of period | $ | 98,542 | $ | 8,250 | $ | 106,792 | |||||
Three months ended April 1, 2012 | |||||||||||
Retail | Wholesale | Total | |||||||||
Balance, beginning of period | $ | 116,112 | $ | 9,337 | $ | 125,449 | |||||
Provision for credit losses | 8,705 | 309 | 9,014 | ||||||||
Charge-offs | (25,852 | ) | — | (25,852 | ) | ||||||
Recoveries | 13,892 | — | 13,892 | ||||||||
Balance, end of period | $ | 112,857 | $ | 9,646 | $ | 122,503 |
March 31, 2013 | |||||||||||
Retail | Wholesale | Total | |||||||||
Allowance for credit losses, ending balance: | |||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | — | |||||
Collectively evaluated for impairment | 98,542 | 8,250 | 106,792 | ||||||||
Total allowance for credit losses | $ | 98,542 | $ | 8,250 | $ | 106,792 | |||||
Finance receivables, ending balance: | |||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | — | |||||
Collectively evaluated for impairment | 4,981,488 | 1,159,243 | 6,140,731 | ||||||||
Total finance receivables | $ | 4,981,488 | $ | 1,159,243 | $ | 6,140,731 | |||||
December 31, 2012 | |||||||||||
Retail | Wholesale | Total | |||||||||
Allowance for credit losses, ending balance: | |||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | — | |||||
Collectively evaluated for impairment | 101,442 | 6,225 | 107,667 | ||||||||
Total allowance for credit losses | $ | 101,442 | $ | 6,225 | $ | 107,667 | |||||
Finance receivables, ending balance: | |||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | — | |||||
Collectively evaluated for impairment | 5,073,115 | 816,404 | 5,889,519 | ||||||||
Total finance receivables | $ | 5,073,115 | $ | 816,404 | $ | 5,889,519 | |||||
April 1, 2012 | |||||||||||
Retail | Wholesale | Total | |||||||||
Allowance for credit losses, ending balance: | |||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | — | |||||
Collectively evaluated for impairment | 112,857 | 9,646 | 122,503 | ||||||||
Total allowance for credit losses | $ | 112,857 | $ | 9,646 | $ | 122,503 | |||||
Finance receivables, ending balance: | |||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | — | |||||
Collectively evaluated for impairment | 5,043,584 | 956,322 | 5,999,906 | ||||||||
Total finance receivables | $ | 5,043,584 | $ | 956,322 | $ | 5,999,906 |
March 31, 2013 | |||||||||||||||||||||||
Current | 31-60 Days Past Due | 61-90 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Total Finance Receivables | ||||||||||||||||||
Retail | $ | 4,855,128 | $ | 83,265 | $ | 22,837 | $ | 20,258 | $ | 126,360 | $ | 4,981,488 | |||||||||||
Wholesale | 1,157,596 | 535 | 310 | 802 | 1,647 | 1,159,243 | |||||||||||||||||
Total | $ | 6,012,724 | $ | 83,800 | $ | 23,147 | $ | 21,060 | $ | 128,007 | $ | 6,140,731 | |||||||||||
December 31, 2012 | |||||||||||||||||||||||
Current | 31-60 Days Past Due | 61-90 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Total Finance Receivables | ||||||||||||||||||
Retail | $ | 4,894,675 | $ | 113,604 | $ | 37,239 | $ | 27,597 | $ | 178,440 | $ | 5,073,115 | |||||||||||
Wholesale | 814,706 | 984 | 278 | 436 | 1,698 | 816,404 | |||||||||||||||||
Total | $ | 5,709,381 | $ | 114,588 | $ | 37,517 | $ | 28,033 | $ | 180,138 | $ | 5,889,519 | |||||||||||
April 1, 2012 | |||||||||||||||||||||||
Current | 31-60 Days Past Due | 61-90 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Total Finance Receivables | ||||||||||||||||||
Retail | $ | 4,930,739 | $ | 75,560 | $ | 21,023 | $ | 16,262 | $ | 112,845 | $ | 5,043,584 | |||||||||||
Wholesale | 955,493 | 354 | 149 | 326 | 829 | 956,322 | |||||||||||||||||
Total | $ | 5,886,232 | $ | 75,914 | $ | 21,172 | $ | 16,588 | $ | 113,674 | $ | 5,999,906 |
March 31, 2013 | December 31, 2012 | April 1, 2012 | |||||||||
Prime | $ | 3,942,294 | $ | 4,035,584 | $ | 4,056,602 | |||||
Sub-prime | 1,039,194 | 1,037,531 | 986,982 | ||||||||
Total | $ | 4,981,488 | $ | 5,073,115 | $ | 5,043,584 |
March 31, 2013 | December 31, 2012 | April 1, 2012 | |||||||||
Doubtful | $ | 4,843 | $ | 8,107 | $ | 13,108 | |||||
Substandard | 10,441 | 2,593 | 5,599 | ||||||||
Special Mention | 11,125 | 3,504 | 8,618 | ||||||||
Medium Risk | 7,804 | 8,451 | 6,365 | ||||||||
Low Risk | 1,125,030 | 793,749 | 922,632 | ||||||||
Total | $ | 1,159,243 | $ | 816,404 | $ | 956,322 |
March 31, 2013 | |||||||||||||||||
Finance receivables | Allowance for credit losses | Restricted cash | Other assets | Total assets | Asset-backed debt | ||||||||||||
On-balance sheet assets and liabilities | |||||||||||||||||
Consolidated VIEs | |||||||||||||||||
Term asset-backed securitizations | $1,871,419 | $(36,799) | $185,657 | $4,935 | $2,025,212 | $1,268,572 | |||||||||||
Asset-backed U.S. commercial paper conduit facility | — | — | — | 294 | 294 | — | |||||||||||
Unconsolidated VIEs | |||||||||||||||||
Asset-backed Canadian commercial paper conduit facility | 174,420 | (2,923 | ) | 11,368 | 167 | 183,032 | 154,596 | ||||||||||
$2,045,839 | $(39,722) | $197,025 | $5,396 | $2,208,538 | $1,423,168 | ||||||||||||
December 31, 2012 | |||||||||||||||||
Finance receivables | Allowance for credit losses | Restricted cash | Other assets | Total assets | Asset-backed debt | ||||||||||||
On-balance sheet assets and liabilities | |||||||||||||||||
Consolidated VIEs | |||||||||||||||||
Term asset-backed securitizations | $2,143,708 | $(42,139) | $176,290 | $4,869 | $2,282,728 | $1,447,776 | |||||||||||
Asset-backed U.S. commercial paper conduit facility | — | — | — | 419 | 419 | — | |||||||||||
Unconsolidated VIEs | |||||||||||||||||
Asset-backed Canadian commercial paper conduit facility | 194,285 | (3,432 | ) | 11,718 | 255 | 202,826 | 175,658 | ||||||||||
$2,337,993 | $(45,571) | $188,008 | $5,543 | $2,485,973 | $1,623,434 | ||||||||||||
April 1, 2012 | |||||||||||||||||
Finance receivables | Allowance for credit losses | Restricted cash | Other assets | Total assets | Asset-backed debt | ||||||||||||
On-balance sheet assets and liabilities | |||||||||||||||||
Consolidated VIEs | |||||||||||||||||
Term asset-backed securitizations | $2,564,585 | $(56,810) | $245,912 | $5,620 | $2,759,307 | $1,754,320 | |||||||||||
Asset-backed U.S. commercial paper conduit facility | 10,689 | (236 | ) | 1,083 | 312 | 11,848 | — | ||||||||||
Unconsolidated VIEs | |||||||||||||||||
Asset-backed Canadian commercial paper conduit facility | — | — | — | — | — | — | |||||||||||
$2,575,274 | $(57,046) | $246,995 | $5,932 | $2,771,155 | $1,754,320 |
March 31, 2013 | |||||||||||||||
Balance | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
Assets: | |||||||||||||||
Cash equivalents | $ | 812,725 | $ | 606,722 | $ | 206,003 | $ | — | |||||||
Marketable securities | 135,246 | — | 135,246 | — | |||||||||||
Derivatives | 11,737 | — | 11,737 | — | |||||||||||
$ | 959,708 | $ | 606,722 | $ | 352,986 | $ | — | ||||||||
Liabilities: | |||||||||||||||
Derivatives | $ | 2,165 | $ | — | $ | 2,165 | $ | — | |||||||
December 31, 2012 | |||||||||||||||
Balance | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
Assets: | |||||||||||||||
Cash equivalents | $ | 852,979 | $ | 690,691 | $ | 162,288 | $ | — | |||||||
Marketable securities | 135,634 | — | 135,634 | — | |||||||||||
Derivatives | 317 | — | 317 | — | |||||||||||
$ | 988,930 | $ | 690,691 | $ | 298,239 | $ | — | ||||||||
Liabilities: | |||||||||||||||
Derivatives | $ | 7,920 | $ | — | $ | 7,920 | $ | — | |||||||
April 1, 2012 | |||||||||||||||
Balance | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
Assets: | |||||||||||||||
Cash equivalents | $ | 997,669 | $ | 823,694 | $ | 173,975 | $ | — | |||||||
Marketable securities | 134,946 | — | 134,946 | — | |||||||||||
Derivatives | 6,345 | — | 6,345 | — | |||||||||||
$ | 1,138,960 | $ | 823,694 | $ | 315,266 | $ | — | ||||||||
Liabilities: | |||||||||||||||
Derivatives | $ | 2,234 | $ | — | $ | 2,234 | $ | — |
March 31, 2013 | December 31, 2012 | April 1, 2012 | |||||||||||||||||||||
Fair Value | Carrying Value | Fair Value | Carrying Value | Fair Value | Carrying Value | ||||||||||||||||||
Assets: | |||||||||||||||||||||||
Cash and cash equivalents | $ | 1,018,759 | $ | 1,018,759 | $ | 1,068,138 | $ | 1,068,138 | $ | 1,276,337 | $ | 1,276,337 | |||||||||||
Marketable securities | $ | 135,246 | $ | 135,246 | $ | 135,634 | $ | 135,634 | $ | 134,946 | $ | 134,946 | |||||||||||
Accounts receivable, net | $ | 259,673 | $ | 259,673 | $ | 230,079 | $ | 230,079 | $ | 264,272 | $ | 264,272 | |||||||||||
Derivatives | $ | 11,737 | $ | 11,737 | $ | 317 | $ | 317 | $ | 6,345 | $ | 6,345 | |||||||||||
Finance receivables, net | $ | 6,108,934 | $ | 6,033,939 | $ | 5,861,442 | $ | 5,781,852 | $ | 5,961,825 | $ | 5,877,403 | |||||||||||
Restricted cash | $ | 197,025 | $ | 197,025 | $ | 188,008 | $ | 188,008 | $ | 246,995 | $ | 246,995 | |||||||||||
Liabilities: | |||||||||||||||||||||||
Accounts payable | $ | 360,018 | $ | 360,018 | $ | 257,386 | $ | 257,386 | $ | 355,902 | $ | 355,902 | |||||||||||
Derivatives | $ | 2,165 | $ | 2,165 | $ | 7,920 | $ | 7,920 | $ | 2,234 | $ | 2,234 | |||||||||||
Unsecured commercial paper | $ | 687,705 | $ | 687,705 | $ | 294,943 | $ | 294,943 | $ | 662,343 | $ | 662,343 | |||||||||||
Global credit facilities | $ | — | $ | — | $ | — | $ | — | $ | 150,195 | $ | 150,195 | |||||||||||
Asset-backed Canadian commercial paper conduit facility | $ | 154,596 | $ | 154,596 | $ | 175,658 | $ | 175,658 | $ | — | $ | — | |||||||||||
Medium-term notes | $ | 3,169,807 | $ | 2,881,444 | $ | 3,199,548 | $ | 2,881,272 | $ | 2,936,475 | $ | 2,698,232 | |||||||||||
Senior unsecured notes | $ | 337,600 | $ | 303,000 | $ | 338,594 | $ | 303,000 | $ | 366,651 | $ | 303,000 | |||||||||||
Term asset-backed securitization debt | $ | 1,276,046 | $ | 1,268,572 | $ | 1,457,807 | $ | 1,447,776 | $ | 1,768,140 | $ | 1,754,320 |
March 31, 2013 | December 31, 2012 | April 1, 2012 | |||||||||||||||||||||||||||||||||
Derivatives Designated As Hedging Instruments Under ASC Topic 815 | Notional Value | Asset Fair Value (a) | Liability Fair Value (b) | Notional Value | Asset Fair Value (a) | Liability Fair Value (b) | Notional Value | Asset Fair Value (a) | Liability Fair Value (b) | ||||||||||||||||||||||||||
Foreign currency contracts(c) | $ | 449,078 | $ | 11,528 | $ | 944 | $ | 345,021 | $ | 169 | $ | 6,850 | $ | 219,484 | $ | 6,345 | $ | — | |||||||||||||||||
Commodity contracts(c) | 969 | 97 | — | 1,064 | 148 | 683 | 918 | — | 262 | ||||||||||||||||||||||||||
Interest rate swaps(c) | 33,200 | — | 97 | 35,800 | — | 373 | 95,100 | — | 1,972 | ||||||||||||||||||||||||||
Total | $ | 483,247 | $ | 11,625 | $ | 1,041 | $ | 381,885 | $ | 317 | $ | 7,906 | $ | 315,502 | $ | 6,345 | $ | 2,234 | |||||||||||||||||
March 31, 2013 | December 31, 2012 | April 1, 2012 | |||||||||||||||||||||||||||||||||
Derivatives Not Designated As Hedging Instruments Under ASC Topic 815 | Notional Value | Asset Fair Value(a) | Liability Fair Value(b) | Notional Value | Asset Fair Value(a) | Liability Fair Value(b) | Notional Value | Asset Fair Value(a) | Liability Fair Value(b) | ||||||||||||||||||||||||||
Commodity contracts | $ | 15,390 | $ | 112 | $ | 1,124 | $ | 16,237 | $ | — | $ | 14 | $ | — | $ | — | $ | — | |||||||||||||||||
$ | 15,390 | $ | 112 | $ | 1,124 | $ | 16,237 | $ | — | $ | 14 | $ | — | $ | — | $ | — |
(a) | Included in other current assets |
(b) | Included in accrued liabilities |
(c) | Derivative designated as a cash flow hedge |
Amount of Gain/(Loss) Before Tax Recognized in OCI | |||||||
Three Months Ended | |||||||
Cash Flow Hedges | March 31, 2013 | April 1, 2012 | |||||
Foreign currency contracts | $ | 15,720 | $ | (6,215 | ) | ||
Commodity contracts | 159 | (315 | ) | ||||
Interest rate swaps | (2 | ) | (15 | ) | |||
Total | $ | 15,877 | $ | (6,545 | ) |
Amount of Gain/(Loss) Before Tax Reclassified from AOCI into Income | |||||||||||
Three Months Ended | Expected to be Reclassified | ||||||||||
Cash Flow Hedges | March 31, 2013 | April 1, 2012 | Over the Next Twelve Months | ||||||||
Foreign currency contracts(a) | $ | (740 | ) | $ | 2,421 | $ | (10,730 | ) | |||
Commodity contracts(a) | 47 | (318 | ) | (97 | ) | ||||||
Interest rate swaps(b) | (263 | ) | (967 | ) | (97 | ) | |||||
Total | $ | (956 | ) | $ | 1,136 | $ | (10,924 | ) |
(a) | Gain/(loss) reclassified from accumulated other comprehensive income (AOCI) to income is included in cost of goods sold. |
(b) | Gain/(loss) reclassified from AOCI to income is included in financial services interest expense. |
Amount of Gain/(Loss) Before Tax Recognized in Income on Derivative | |||||||
Three months ended | |||||||
Derivatives | March 31, 2013 | April 1, 2012 | |||||
Commodity contracts | $ | (630 | ) | $ | — | ||
Total | $ | (630 | ) | $ | — |
Three months ended March 31, 2013 | ||||||||||||||||||||
Foreign currency translation adjustments | Marketable securities | Derivative financial instruments | Pension and postretirement benefit plans | Total | ||||||||||||||||
Beginning balance | $ | 51,335 | $ | 677 | $ | (3,837 | ) | $ | (655,853 | ) | $ | (607,678 | ) | |||||||
Other comprehensive income (loss) before reclassifications | (11,472 | ) | (388 | ) | 15,877 | — | 4,017 | |||||||||||||
Income tax | 902 | 144 | (5,881 | ) | — | (4,835 | ) | |||||||||||||
Net other comprehensive income before reclassifications | (10,570 | ) | (244 | ) | 9,996 | — | (818 | ) | ||||||||||||
Reclassifications: | ||||||||||||||||||||
Realized (gains) losses - marketable securities (a) | — | — | ||||||||||||||||||
Realized (gains) losses - foreign currency contracts(b) | 740 | 740 | ||||||||||||||||||
Realized (gains) losses - commodities contracts(b) | (47 | ) | (47 | ) | ||||||||||||||||
Realized (gains) losses - interest rate swaps(c) | 263 | 263 | ||||||||||||||||||
Prior service credits(d) | (527 | ) | (527 | ) | ||||||||||||||||
Actuarial losses(d) | 16,790 | 16,790 | ||||||||||||||||||
Total before tax | — | — | 956 | 16,263 | 17,219 | |||||||||||||||
Income tax (benefit) expense | — | — | (351 | ) | (6,024 | ) | (6,375 | ) | ||||||||||||
Net reclassifications to net income | — | — | 605 | 10,239 | 10,844 | |||||||||||||||
Other comprehensive (loss) income | (10,570 | ) | (244 | ) | 10,601 | 10,239 | 10,026 | |||||||||||||
Ending Balance | $ | 40,765 | $ | 433 | $ | 6,764 | $ | (645,614 | ) | $ | (597,652 | ) |
Three months ended April 1, 2012 | ||||||||||||||||||||
Foreign currency translation adjustments | Marketable securities | Derivative financial instruments | Pension and postretirement benefit plans | Total | ||||||||||||||||
Beginning balance | $ | 49,935 | $ | 327 | $ | 6,307 | $ | (533,302 | ) | $ | (476,733 | ) | ||||||||
Other comprehensive income (loss) before reclassifications | 5,258 | 1,609 | (6,545 | ) | — | 322 | ||||||||||||||
Income tax | (597 | ) | (596 | ) | 2,424 | — | 1,231 | |||||||||||||
Net other comprehensive income before reclassifications | 4,661 | 1,013 | (4,121 | ) | — | 1,553 | ||||||||||||||
Reclassifications: | ||||||||||||||||||||
Realized (gains) losses - marketable securities (a) | — | — | ||||||||||||||||||
Realized (gains) losses - foreign currency contracts(b) | (2,421 | ) | (2,421 | ) | ||||||||||||||||
Realized (gains) losses - commodities contracts(b) | 318 | 318 | ||||||||||||||||||
Realized (gains) losses - interest rate swaps(c) | 967 | 967 | ||||||||||||||||||
Prior service credits(d) | (223 | ) | (223 | ) | ||||||||||||||||
Actuarial losses(d) | 12,824 | 12,824 | ||||||||||||||||||
Total before tax | — | — | (1,136 | ) | 12,601 | 11,465 | ||||||||||||||
Income tax (benefit) expense | — | — | 431 | (4,668 | ) | (4,237 | ) | |||||||||||||
Net reclassifications to net income | — | — | (705 | ) | 7,933 | 7,228 | ||||||||||||||
Other comprehensive (loss) income | 4,661 | 1,013 | (4,826 | ) | 7,933 | 8,781 | ||||||||||||||
Ending Balance | $ | 54,596 | $ | 1,340 | $ | 1,481 | $ | (525,369 | ) | $ | (467,952 | ) |
(a) | Amounts reclassified to net income are included in investment income. |
(b) | Amounts reclassified to net income are included in motorcycles and related products cost of goods sold. |
(c) | Amounts reclassified to net income are presented in financial services interest expense. |
(d) | Amounts reclassified are included in the computation of net periodic period cost. See note 14 for information related to pension and postretirement benefit plans. |
Three months ended | |||||||
March 31, 2013 | April 1, 2012 | ||||||
Balance, beginning of period | $ | 60,263 | $ | 54,994 | |||
Warranties issued during the period | 15,120 | 14,912 | |||||
Settlements made during the period | (11,638 | ) | (13,958 | ) | |||
Recalls and changes to pre-existing warranty liabilities | 3,964 | 1,154 | |||||
Balance, end of period | $ | 67,709 | $ | 57,102 |
Three months ended | |||||||
March 31, 2013 | April 1, 2012 | ||||||
Numerator: | |||||||
Net income used in computing basic and diluted earnings per share | $ | 224,129 | $ | 172,035 | |||
Denominator: | |||||||
Denominator for basic earnings per share- weighted-average common shares | 224,429 | 228,988 | |||||
Effect of dilutive securities—employee stock compensation plan | 1,719 | 2,296 | |||||
Denominator for diluted earnings per share- adjusted weighted-average shares outstanding | 226,148 | 231,284 | |||||
Earnings per common share | |||||||
Basic | $ | 1.00 | $ | 0.75 | |||
Diluted | $ | 0.99 | $ | 0.74 |
Three months ended | |||||||
March 31, 2013 | April 1, 2012 | ||||||
Pension and SERPA Benefits | |||||||
Service cost | $ | 8,997 | $ | 8,420 | |||
Interest cost | 19,812 | 20,816 | |||||
Expected return on plan assets | (31,832 | ) | (29,277 | ) | |||
Amortization of unrecognized: | |||||||
Prior service cost | 437 | 740 | |||||
Net loss | 14,652 | 10,969 | |||||
Net periodic benefit cost | $ | 12,066 | $ | 11,668 | |||
Postretirement Healthcare Benefits | |||||||
Service cost | $ | 1,965 | $ | 1,853 | |||
Interest cost | 3,900 | 4,578 | |||||
Expected return on plan assets | (2,384 | ) | (2,356 | ) | |||
Amortization of unrecognized: | |||||||
Prior service credit | (964 | ) | (963 | ) | |||
Net loss | 2,138 | 1,855 | |||||
Net periodic benefit cost | $ | 4,655 | $ | 4,967 |
Three months ended | |||||||
March 31, 2013 | April 1, 2012 | ||||||
Motorcycles net revenue | $ | 1,414,248 | $ | 1,273,369 | |||
Gross profit | 519,442 | 456,510 | |||||
Selling, administrative and engineering expense | 239,743 | 236,995 | |||||
Restructuring expense | 2,938 | 11,451 | |||||
Operating income from Motorcycles | 276,761 | 208,064 | |||||
Financial services income | 156,965 | 156,322 | |||||
Financial services expense | 85,420 | 88,928 | |||||
Operating income from Financial Services | 71,545 | 67,394 | |||||
Operating income | $ | 348,306 | $ | 275,458 |
Three months ended March 31, 2013 | |||||||||||||||
Motorcycles & Related Products Operations | Financial Services Operations | Eliminations | Consolidated | ||||||||||||
Revenue: | |||||||||||||||
Motorcycles and related products | $ | 1,416,809 | $ | — | $ | (2,561 | ) | $ | 1,414,248 | ||||||
Financial services | — | 157,297 | (332 | ) | 156,965 | ||||||||||
Total revenue | 1,416,809 | 157,297 | (2,893 | ) | 1,571,213 | ||||||||||
Costs and expenses: | |||||||||||||||
Motorcycles and related products cost of goods sold | 894,806 | — | — | 894,806 | |||||||||||
Financial services interest expense | — | 40,554 | — | 40,554 | |||||||||||
Financial services provision for credit losses | — | 13,110 | — | 13,110 | |||||||||||
Selling, administrative and engineering expense | 240,076 | 34,316 | (2,893 | ) | 271,499 | ||||||||||
Restructuring expense | 2,938 | — | — | 2,938 | |||||||||||
Total costs and expenses | 1,137,820 | 87,980 | (2,893 | ) | 1,222,907 | ||||||||||
Operating income | 278,989 | 69,317 | — | 348,306 | |||||||||||
Investment income | 186,615 | — | (185,000 | ) | 1,615 | ||||||||||
Interest expense | 11,391 | — | — | 11,391 | |||||||||||
Income before provision for income taxes | 454,213 | 69,317 | (185,000 | ) | 338,530 | ||||||||||
Provision for income taxes | 89,286 | 25,115 | — | 114,401 | |||||||||||
Net income | $ | 364,927 | $ | 44,202 | $ | (185,000 | ) | $ | 224,129 |
Three months ended April 1, 2012 | |||||||||||||||
Motorcycles & Related Products Operations | Financial Services Operations | Eliminations | Consolidated | ||||||||||||
Revenue: | |||||||||||||||
Motorcycles and related products | $ | 1,275,783 | $ | — | $ | (2,414 | ) | $ | 1,273,369 | ||||||
Financial services | — | 155,906 | 416 | 156,322 | |||||||||||
Total revenue | 1,275,783 | 155,906 | (1,998 | ) | 1,429,691 | ||||||||||
Costs and expenses: | |||||||||||||||
Motorcycles and related products cost of goods sold | 816,859 | — | — | 816,859 | |||||||||||
Financial services interest expense | — | 51,256 | — | 51,256 | |||||||||||
Financial services provision for credit losses | — | 9,014 | — | 9,014 | |||||||||||
Selling, administrative and engineering expense | 236,579 | 31,072 | (1,998 | ) | 265,653 | ||||||||||
Restructuring expense | 11,451 | — | — | 11,451 | |||||||||||
Total costs and expenses | 1,064,889 | 91,342 | (1,998 | ) | 1,154,233 | ||||||||||
Operating income | 210,894 | 64,564 | — | 275,458 | |||||||||||
Investment income | 226,933 | — | (225,000 | ) | 1,933 | ||||||||||
Interest expense | 11,495 | — | — | 11,495 | |||||||||||
Income before provision for income taxes | 426,332 | 64,564 | (225,000 | ) | 265,896 | ||||||||||
Provision for income taxes | 70,618 | 23,243 | — | 93,861 | |||||||||||
Net income | $ | 355,714 | $ | 41,321 | $ | (225,000 | ) | $ | 172,035 |
March 31, 2013 | |||||||||||||||
Motorcycles & Related Products Operations | Financial Services Operations | Eliminations | Consolidated | ||||||||||||
ASSETS | |||||||||||||||
Current assets: | |||||||||||||||
Cash and cash equivalents | $ | 672,977 | $ | 345,782 | $ | — | $ | 1,018,759 | |||||||
Marketable securities | 135,246 | — | — | 135,246 | |||||||||||
Accounts receivable, net | 966,688 | — | (707,015 | ) | 259,673 | ||||||||||
Finance receivables, net | — | 2,074,036 | — | 2,074,036 | |||||||||||
Inventories | 416,050 | — | — | 416,050 | |||||||||||
Restricted cash | — | 197,025 | — | 197,025 | |||||||||||
Other current assets | 174,125 | 58,065 | — | 232,190 | |||||||||||
Total current assets | 2,365,086 | 2,674,908 | (707,015 | ) | 4,332,979 | ||||||||||
Finance receivables, net | — | 3,959,903 | — | 3,959,903 | |||||||||||
Property, plant and equipment, net | 758,333 | 31,912 | — | 790,245 | |||||||||||
Goodwill | 28,861 | — | — | 28,861 | |||||||||||
Other long-term assets | 282,675 | 16,703 | (76,245 | ) | 223,133 | ||||||||||
$ | 3,434,955 | $ | 6,683,426 | $ | (783,260 | ) | $ | 9,335,121 | |||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||
Current liabilities: | |||||||||||||||
Accounts payable | $ | 291,162 | $ | 775,871 | $ | (707,015 | ) | $ | 360,018 | ||||||
Accrued liabilities | 369,127 | 98,467 | (3,277 | ) | 464,317 | ||||||||||
Short-term debt | — | 687,705 | — | 687,705 | |||||||||||
Current portion of long-term debt | 303,000 | 412,143 | — | 715,143 | |||||||||||
Total current liabilities | 963,289 | 1,974,186 | (710,292 | ) | 2,227,183 | ||||||||||
Long-term debt | — | 3,892,469 | — | 3,892,469 | |||||||||||
Pension liability | 152,132 | — | — | 152,132 | |||||||||||
Postretirement healthcare benefits | 274,597 | — | — | 274,597 | |||||||||||
Other long-term liabilities | 114,536 | 17,156 | — | 131,692 | |||||||||||
Shareholders’ equity | 1,930,401 | 799,615 | (72,968 | ) | 2,657,048 | ||||||||||
$ | 3,434,955 | $ | 6,683,426 | $ | (783,260 | ) | $ | 9,335,121 |
December 31, 2012 | |||||||||||||||
Motorcycles & Related Products Operations | Financial Services Operations | Eliminations | Consolidated | ||||||||||||
ASSETS | |||||||||||||||
Current assets: | |||||||||||||||
Cash and cash equivalents | $ | 727,716 | $ | 340,422 | $ | — | $ | 1,068,138 | |||||||
Marketable securities | 135,634 | — | — | 135,634 | |||||||||||
Accounts receivable, net | 781,642 | — | (551,563 | ) | 230,079 | ||||||||||
Finance receivables, net | — | 1,743,045 | — | 1,743,045 | |||||||||||
Inventories | 393,524 | — | — | 393,524 | |||||||||||
Restricted cash | — | 188,008 | — | 188,008 | |||||||||||
Other current assets | 230,905 | 57,609 | 3,994 | 292,508 | |||||||||||
Total current assets | 2,269,421 | 2,329,084 | (547,569 | ) | 4,050,936 | ||||||||||
Finance receivables, net | — | 4,038,807 | — | 4,038,807 | |||||||||||
Property, plant and equipment, net | 783,068 | 32,396 | — | 815,464 | |||||||||||
Goodwill | 29,530 | — | — | 29,530 | |||||||||||
Other long-term assets | 292,764 | 19,468 | (76,196 | ) | 236,036 | ||||||||||
$ | 3,374,783 | $ | 6,419,755 | $ | (623,765 | ) | $ | 9,170,773 | |||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||
Current liabilities: | |||||||||||||||
Accounts payable | $ | 221,064 | $ | 587,885 | $ | (551,563 | ) | $ | 257,386 | ||||||
Accrued liabilities | 439,144 | 74,447 | — | 513,591 | |||||||||||
Short-term debt | — | 294,943 | — | 294,943 | |||||||||||
Current portion of long-term debt | — | 437,162 | 437,162 | ||||||||||||
Total current liabilities | 660,208 | 1,394,437 | (551,563 | ) | 1,503,082 | ||||||||||
Long-term debt | 303,000 | 4,067,544 | — | 4,370,544 | |||||||||||
Pension liability | 330,294 | — | — | 330,294 | |||||||||||
Postretirement healthcare benefits | 278,062 | — | — | 278,062 | |||||||||||
Other long-term liabilities | 114,476 | 16,691 | — | 131,167 | |||||||||||
Shareholders’ equity | 1,688,743 | 941,083 | (72,202 | ) | 2,557,624 | ||||||||||
$ | 3,374,783 | $ | 6,419,755 | $ | (623,765 | ) | $ | 9,170,773 |
April 1, 2012 | |||||||||||||||
Motorcycles & Related Products Operations | Financial Services Operations | Eliminations | Consolidated | ||||||||||||
ASSETS | |||||||||||||||
Current assets: | |||||||||||||||
Cash and cash equivalents | $ | 929,028 | $ | 347,309 | $ | — | $ | 1,276,337 | |||||||
Marketable securities | 134,946 | — | — | 134,946 | |||||||||||
Accounts receivable, net | 581,569 | — | (317,297 | ) | 264,272 | ||||||||||
Finance receivables, net | — | 1,885,489 | — | 1,885,489 | |||||||||||
Inventories | 467,941 | — | — | 467,941 | |||||||||||
Restricted cash | — | 246,995 | — | 246,995 | |||||||||||
Other current assets | 174,053 | 63,497 | — | 237,550 | |||||||||||
Total current assets | 2,287,537 | 2,543,290 | (317,297 | ) | 4,513,530 | ||||||||||
Finance receivables, net | — | 3,991,914 | — | 3,991,914 | |||||||||||
Property, plant and equipment, net | 761,191 | 29,873 | — | 791,064 | |||||||||||
Goodwill | 29,740 | — | — | 29,740 | |||||||||||
Other long-term assets | 336,167 | 15,970 | (73,038 | ) | 279,099 | ||||||||||
$ | 3,414,635 | $ | 6,581,047 | $ | (390,335 | ) | $ | 9,605,347 | |||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||
Current liabilities: | |||||||||||||||
Accounts payable | $ | 280,738 | $ | 392,461 | $ | (317,297 | ) | $ | 355,902 | ||||||
Accrued liabilities | 478,227 | 102,722 | (3,330 | ) | 577,619 | ||||||||||
Short-term debt | — | 629,143 | — | 629,143 | |||||||||||
Current portion of long-term debt | — | 1,020,563 | — | 1,020,563 | |||||||||||
Total current liabilities | 758,965 | 2,144,889 | (320,627 | ) | 2,583,227 | ||||||||||
Long-term debt | 303,000 | 3,615,384 | — | 3,918,384 | |||||||||||
Pension liability | 118,212 | — | — | 118,212 | |||||||||||
Postretirement healthcare liability | 265,871 | — | — | 265,871 | |||||||||||
Other long-term liabilities | 130,278 | 14,716 | — | 144,994 | |||||||||||
Shareholders’ equity | 1,838,309 | 806,058 | (69,708 | ) | 2,574,659 | ||||||||||
$ | 3,414,635 | $ | 6,581,047 | $ | (390,335 | ) | $ | 9,605,347 |
Three months ended March 31, 2013 | |||||||||||||||
Motorcycles & Related Products Operations | Financial Services Operations | Eliminations & Adjustments | Consolidated | ||||||||||||
Cash flows from operating activities: | |||||||||||||||
Net Income | $ | 364,927 | 44,202 | $ | (185,000 | ) | $ | 224,129 | |||||||
Adjustments to reconcile net income to cash provided by operating activities: | |||||||||||||||
Depreciation | 41,484 | 1,366 | — | 42,850 | |||||||||||
Amortization of deferred loan origination costs | — | 19,753 | — | 19,753 | |||||||||||
Amortization of financing origination fees | 118 | 2,086 | — | 2,204 | |||||||||||
Provision for employee long-term benefits | 16,684 | — | — | 16,684 | |||||||||||
Contributions to pension and postretirement plans | (182,047 | ) | — | — | (182,047 | ) | |||||||||
Stock compensation expense | 10,330 | 766 | — | 11,096 | |||||||||||
Net change in wholesale finance receivables | — | — | (336,927 | ) | (336,927 | ) | |||||||||
Provision for credit losses | — | 13,110 | — | 13,110 | |||||||||||
Foreign currency adjustments | 9,846 | — | — | 9,846 | |||||||||||
Other, net | (1,759 | ) | (46 | ) | — | (1,805 | ) | ||||||||
Change in current assets and current liabilities: | |||||||||||||||
Accounts receivable | (291,616 | ) | — | 255,451 | (36,165 | ) | |||||||||
Finance receivables—accrued interest and other | — | 1,246 | — | 1,246 | |||||||||||
Inventories | (28,613 | ) | — | — | (28,613 | ) | |||||||||
Accounts payable and accrued liabilities | 21,476 | 313,836 | (255,451 | ) | 79,861 | ||||||||||
Restructuring reserves | (12,388 | ) | — | — | (12,388 | ) | |||||||||
Derivative instruments | (328 | ) | (14 | ) | — | (342 | ) | ||||||||
Other | 66,976 | 2,043 | — | 69,019 | |||||||||||
Total adjustments | (349,837 | ) | 354,146 | (336,927 | ) | (332,618 | ) | ||||||||
Net cash provided by (used by) operating activities | 15,090 | 398,348 | (521,927 | ) | (108,489 | ) | |||||||||
Cash flows from investing activities: | |||||||||||||||
Capital expenditures | (21,379 | ) | (882 | ) | — | (22,261 | ) | ||||||||
Origination of finance receivables | — | (1,744,023 | ) | 1,121,650 | (622,373 | ) | |||||||||
Collections of finance receivables | — | 1,450,243 | (784,723 | ) | 665,520 | ||||||||||
Other | 6,656 | — | — | 6,656 | |||||||||||
Net cash (used by) provided by investing activities | (14,723 | ) | (294,662 | ) | 336,927 | 27,542 | |||||||||
Cash flows from financing activities: | |||||||||||||||
Loan to HDFS | 100,000 | (100,000 | ) | — | — | ||||||||||
Repayments of securitization debt | — | (178,923 | ) | — | (178,923 | ) | |||||||||
Net decrease in credit facilities and unsecured commercial paper | — | 392,564 | — | 392,564 | |||||||||||
Net borrowings of asset-backed commercial paper | — | (17,063 | ) | — | (17,063 | ) | |||||||||
Net change in restricted cash | — | (9,017 | ) | — | (9,017 | ) | |||||||||
Dividends paid | (47,308 | ) | (185,000 | ) | 185,000 | (47,308 | ) | ||||||||
Purchase of common stock for treasury | (126,411 | ) | — | — | (126,411 | ) | |||||||||
Excess tax benefits from share based payments | 14,468 | — | — | 14,468 | |||||||||||
Issuance of common stock under employee stock option plans | 13,887 | — | — | 13,887 | |||||||||||
Net cash used by financing activities | (45,364 | ) | (97,439 | ) | 185,000 | 42,197 | |||||||||
Effect of exchange rate changes on cash and cash equivalents | (9,742 | ) | (887 | ) | — | (10,629 | ) | ||||||||
Net (decrease) increase in cash and cash equivalents | $ | (54,739 | ) | $ | 5,360 | $ | — | $ | (49,379 | ) | |||||
Cash and cash equivalents: | |||||||||||||||
Cash and cash equivalents—beginning of period | $ | 727,716 | $ | 340,422 | $ | — | $ | 1,068,138 | |||||||
Net (decrease) increase in cash and cash equivalents | (54,739 | ) | 5,360 | — | (49,379 | ) | |||||||||
Cash and cash equivalents—end of period | $ | 672,977 | $ | 345,782 | $ | — | $ | 1,018,759 |
Three months ended April 1, 2012 | |||||||||||||||
Motorcycles & Related Products Operations | Financial Services Operations | Eliminations & Adjustments | Consolidated | ||||||||||||
Cash flows from operating activities: | |||||||||||||||
Net income | $ | 355,714 | $ | 41,321 | $ | (225,000 | ) | $ | 172,035 | ||||||
Adjustments to reconcile net income to cash provided by operating activities: | |||||||||||||||
Depreciation | 41,708 | 1,495 | — | 43,203 | |||||||||||
Amortization of deferred loan origination costs | — | 18,547 | — | 18,547 | |||||||||||
Amortization of financing origination fees | 118 | 2,625 | — | 2,743 | |||||||||||
Provision for employee long-term benefits | 16,780 | 513 | — | 17,293 | |||||||||||
Contributions to pension and postretirement plans | (206,832 | ) | — | — | (206,832 | ) | |||||||||
Stock compensation expense | 10,967 | 777 | — | 11,744 | |||||||||||
Net change in wholesale finance receivables | — | — | (151,046 | ) | (151,046 | ) | |||||||||
Provision for credit losses | — | 9,014 | — | 9,014 | |||||||||||
Foreign currency adjustments | (2,911 | ) | — | — | (2,911 | ) | |||||||||
Other, net | (1,954 | ) | 3,459 | — | 1,505 | ||||||||||
Change in current assets and current liabilities: | |||||||||||||||
Accounts receivable | (186,466 | ) | — | 142,721 | (43,745 | ) | |||||||||
Finance receivables—accrued interest and other | — | 3,299 | — | 3,299 | |||||||||||
Inventories | (47,168 | ) | — | — | (47,168 | ) | |||||||||
Accounts payable and accrued liabilities | 57,993 | 202,188 | (142,721 | ) | 117,460 | ||||||||||
Restructuring reserves | 1,296 | — | — | 1,296 | |||||||||||
Derivative instruments | (390 | ) | (96 | ) | — | (486 | ) | ||||||||
Other | (18,058 | ) | (1,509 | ) | — | (19,567 | ) | ||||||||
Total adjustments | (334,917 | ) | 240,312 | (151,046 | ) | (245,651 | ) | ||||||||
Net cash provided by (used by) operating activities | 20,797 | 281,633 | (376,046 | ) | (73,616 | ) | |||||||||
Cash flows from investing activities: | |||||||||||||||
Capital expenditures | (23,441 | ) | (1,239 | ) | — | (24,680 | ) | ||||||||
Origination of finance receivables | — | (1,617,867 | ) | 972,620 | (645,247 | ) | |||||||||
Collections of finance receivables | — | 1,503,478 | (821,574 | ) | 681,904 | ||||||||||
Sales and redemptions of marketable securities | 20,042 | — | — | 20,042 | |||||||||||
Net cash (used by) provided by investing activities | (3,399 | ) | (115,628 | ) | 151,046 | 32,019 | |||||||||
Cash flows from financing activities of continuing operations: | |||||||||||||||
Proceeds from issuance of medium-term notes | — | 397,377 | — | 397,377 | |||||||||||
Repayments of securitization debt | — | (333,026 | ) | — | (333,026 | ) | |||||||||
Net decrease in credit facilities and unsecured commercial paper | — | (224,508 | ) | — | (224,508 | ) | |||||||||
Net change in restricted cash | — | (17,340 | ) | — | (17,340 | ) | |||||||||
Dividends paid | (35,943 | ) | (225,000 | ) | 225,000 | (35,943 | ) | ||||||||
Purchase of common stock for treasury | (20,745 | ) | — | — | (20,745 | ) | |||||||||
Excess tax benefits from share based payments | 7,962 | — | — | 7,962 | |||||||||||
Issuance of common stock under employee stock option plans | 16,281 | — | — | 16,281 | |||||||||||
Net cash (used by) provided by financing activities | (32,445 | ) | (402,497 | ) | 225,000 | (209,942 | ) | ||||||||
Effect of exchange rate changes on cash and cash equivalents | 745 | 181 | — | 926 | |||||||||||
Net (decrease) increase in cash and cash equivalents | $ | (14,302 | ) | $ | (236,311 | ) | $ | — | $ | (250,613 | ) | ||||
Cash and cash equivalents: | |||||||||||||||
Cash and cash equivalents—beginning of period | $ | 943,330 | $ | 583,620 | $ | — | $ | 1,526,950 | |||||||
Net (decrease) increase in cash and cash equivalents | (14,302 | ) | (236,311 | ) | — | (250,613 | ) | ||||||||
Cash and cash equivalents—end of period | $ | 929,028 | $ | 347,309 | $ | — | $ | 1,276,337 |
(1) | Note Regarding Forward-Looking Statements |
• | 2009—$91 million (91% operating expense and 9% cost of sales) (actual); |
• | 2010—$172 million (64% operating expense and 36% cost of sales) (actual); |
• | 2011—$217 million (51% operating expense and 49% cost of sales) (actual); |
• | 2012—$280 million (42% operating expense and 58% cost of sales) (actual); |
• | 2013—$305 million (approximately 40% operating expense and approximately 60% cost of sales) (estimated); and |
• | Ongoing annually upon completion—$320 million (approximately 35% operating expense and approximately 65% cost of sales) (estimated). |
Three months ended | ||||||||||||||
(in thousands, except earnings per share) | March 31, 2013 | April 1, 2012 | Increase (Decrease) | % Change | ||||||||||
Operating income from motorcycles & related products | $ | 276,761 | $ | 208,064 | $ | 68,697 | 33.0 | % | ||||||
Operating income from financial services | 71,545 | 67,394 | 4,151 | 6.2 | ||||||||||
Operating income | 348,306 | 275,458 | 72,848 | 26.4 | ||||||||||
Investment income | 1,615 | 1,933 | (318 | ) | (16.5 | ) | ||||||||
Interest expense | 11,391 | 11,495 | (104 | ) | (0.9 | ) | ||||||||
Income before income taxes | 338,530 | 265,896 | 72,634 | 27.3 | ||||||||||
Provision for income taxes | 114,401 | 93,861 | 20,540 | 21.9 | ||||||||||
Net income | $ | 224,129 | $ | 172,035 | $ | 52,094 | 30.3 | % | ||||||
Diluted earnings per share | $ | 0.99 | $ | 0.74 | $ | 0.25 | 33.8 | % |
Three months ended | |||||||||||
March 31, 2013 | March 31, 2012 | Increase (Decrease) | % Change | ||||||||
North America Region | |||||||||||
United States | 34,706 | 39,762 | (5,056 | ) | (12.7 | )% | |||||
Canada | 2,059 | 2,067 | (8 | ) | (0.4 | ) | |||||
Total North America Region | 36,765 | 41,829 | (5,064 | ) | (12.1 | ) | |||||
Europe, Middle East and Africa Region (EMEA) | |||||||||||
Europe(b) | 7,700 | 8,882 | (1,182 | ) | (13.3 | ) | |||||
Other | 1,483 | 1,412 | 71 | 5.0 | |||||||
Total Europe Region | 9,183 | 10,294 | (1,111 | ) | (10.8 | ) | |||||
Asia Pacific Region | |||||||||||
Japan | 2,173 | 2,076 | 97 | 4.7 | |||||||
Other | 3,785 | 3,267 | 518 | 15.9 | |||||||
Total Asia Pacific Region | 5,958 | 5,343 | 615 | 11.5 | |||||||
Latin America Region | 2,348 | 2,211 | 137 | 6.2 | |||||||
Total Worldwide Retail Sales | 54,254 | 59,677 | (5,423 | ) | (9.1 | )% |
(a) | Data source for retail sales figures shown above is new sales warranty and registration information provided by Harley-Davidson dealers and compiled by the Company. The Company must rely on information that its dealers supply concerning retail sales and this information is subject to revision. |
(b) | Includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom. |
Three months ended | |||||||||||
March 31, 2013 | March 31, 2012 | Decrease | % Change | ||||||||
United States(b) | 61,680 | 73,881 | (12,201 | ) | (16.5 | )% | |||||
Three months ended | |||||||||||
March 31, 2013 | March 31, 2012 | Decrease | % Change | ||||||||
Europe(c) | 66,454 | 83,942 | (17,488 | ) | (20.8 | )% |
(a) | Heavyweight data includes street legal 601+cc models. Street legal 601+cc models include on-highway, dual purpose models and three-wheeled vehicles. |
(b) | United States industry data is derived from information provided by Motorcycle Industry Council (MIC). This third party data is subject to revision and update. |
(c) | Europe data includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and the United Kingdom. Industry retail motorcycle registration data includes 601+cc models derived from information provided by Association des Constructeurs Europeens de Motocycles (ACEM), an independent agency. Europe market data is reported on a one-month lag. This third-party data is subject to revision and update. |
Three months ended | |||||||||||||||||
March 31, 2013 | April 1, 2012 | Increase | % Change | ||||||||||||||
United States | 50,683 | 67.4 | % | 41,293 | 64.3 | % | 9,390 | 22.7 | % | ||||||||
International | 24,539 | 32.6 | % | 22,970 | 35.7 | % | 1,569 | 6.8 | |||||||||
Harley-Davidson motorcycle units | 75,222 | 100.0 | % | 64,263 | 100.0 | % | 10,959 | 17.1 | % | ||||||||
Touring motorcycle units | 31,332 | 41.6 | % | 27,158 | 42.3 | % | 4,174 | 15.4 | % | ||||||||
Custom motorcycle units(a) | 30,302 | 40.3 | % | 24,572 | 38.2 | % | 5,730 | 23.3 | |||||||||
Sportster motorcycle units | 13,588 | 18.1 | % | 12,533 | 19.5 | % | 1,055 | 8.4 | |||||||||
Harley-Davidson motorcycle units | 75,222 | 100.0 | % | 64,263 | 100.0 | % | 10,959 | 17.1 | % |
(a) | Custom motorcycle units, as used in this table, include Dyna, Softail, VRSC and CVO models. |
Three months ended | ||||||||||||||
March 31, 2013 | April 1, 2012 | Increase (Decrease) | % Change | |||||||||||
Revenue: | ||||||||||||||
Motorcycles | $ | 1,153,827 | $ | 995,902 | $ | 157,925 | 15.9 | % | ||||||
Parts & Accessories | 184,038 | 199,058 | (15,020 | ) | (7.5 | ) | ||||||||
General Merchandise | 72,144 | 74,606 | (2,462 | ) | (3.3 | ) | ||||||||
Other | 4,239 | 3,803 | 436 | 11.5 | ||||||||||
Total revenue | 1,414,248 | 1,273,369 | 140,879 | 11.1 | ||||||||||
Cost of goods sold | 894,806 | 816,859 | 77,947 | 9.5 | ||||||||||
Gross profit | 519,442 | 456,510 | 62,932 | 13.8 | ||||||||||
Selling & administrative expense | 202,570 | 206,993 | (4,423 | ) | (2.1 | ) | ||||||||
Engineering expense | 37,173 | 30,002 | 7,171 | 23.9 | ||||||||||
Restructuring expense | 2,938 | 11,451 | (8,513 | ) | (74.3 | ) | ||||||||
Operating expense | 242,681 | 248,446 | (5,765 | ) | (2.3 | ) | ||||||||
Operating income from motorcycles | $ | 276,761 | $ | 208,064 | $ | 68,697 | 33.0 | % |
Net Revenue | Cost of Goods Sold | Gross Profit | |||||||||
April 1, 2012 | $ | 1,273.3 | $ | 816.8 | $ | 456.5 | |||||
Volume | 149.1 | 100.0 | 49.1 | ||||||||
Price | 9.9 | — | 9.9 | ||||||||
Foreign currency exchange rates and hedging | (13.6 | ) | 1.5 | (15.1 | ) | ||||||
Shipment mix | (4.5 | ) | (3.6 | ) | (0.9 | ) | |||||
Raw material prices | — | (1.5 | ) | 1.5 | |||||||
Manufacturing costs | — | (18.4 | ) | 18.4 | |||||||
Total | 140.9 | 78.0 | 62.9 | ||||||||
March 31, 2013 | $ | 1,414.2 | $ | 894.8 | $ | 519.4 |
• | Volume increases were driven by the increase in wholesale shipments partially offset by lower sales volumes for Parts and Accessories and General Merchandise which fell with the decrease in retail sales during the period. |
• | On average, wholesale prices on the Company’s 2013 model-year motorcycles were higher than the prior model year resulting in a favorable impact on revenue and gross profit during the period. |
• | Foreign currency exchange rates during the first three months of 2013 resulted in a negative impact on net revenue. In addition, cost of goods sold was negatively impacted by unfavorable losses related to foreign currency hedging and the revaluation of foreign currency denominated balance sheet accounts. |
• | Shipment mix changes negatively impacted gross profit and resulted primarily from unfavorable product mix changes within the Company’s motorcycle families, and an unfavorable shift in the geographic mix of shipments partially offset by favorable changes in mix between motorcycle families which resulted from a shift towards custom motorcycles. |
• | Raw material prices were slightly lower in the first three months of 2013 relative to the first three months of 2012. |
• | Manufacturing costs in the first three months of 2013 benefited from restructuring savings, lower temporary inefficiencies and a lower fixed cost per unit as a result of higher production volumes compared to the same period in 2012, partially offset by cost pressure from the Company's suppliers of purchased components. |
Three months ended | ||||||||||||||
March 31, 2013 | April 1, 2012 | (Decrease) Increase | % Change | |||||||||||
Interest income | $ | 143,947 | $ | 143,979 | $ | (32 | ) | — | % | |||||
Other income | 13,018 | 12,343 | 675 | 5.5 | ||||||||||
Financial services revenue | 156,965 | 156,322 | 643 | 0.4 | ||||||||||
Interest expense | 40,554 | 51,256 | (10,702 | ) | (20.9 | ) | ||||||||
Provision for credit losses | 13,110 | 9,014 | 4,096 | 45.4 | ||||||||||
Operating expenses | 31,756 | 28,658 | 3,098 | 10.8 | ||||||||||
Financial services expense | 85,420 | 88,928 | (3,508 | ) | (3.9 | ) | ||||||||
Operating income from financial services | $ | 71,545 | $ | 67,394 | $ | 4,151 | 6.2 | % |
Three months ended | |||||||
March 31, 2013 | April 1, 2012 | ||||||
Balance, beginning of period | $ | 107,667 | $ | 125,449 | |||
Provision for credit losses | 13,110 | 9,014 | |||||
Charge-offs | (25,243 | ) | (25,852 | ) | |||
Recoveries | 11,258 | 13,892 | |||||
Balance, end of period | $ | 106,792 | $ | 122,503 |
2013 | 2014 - 2015 | 2016 - 2017 | Thereafter | Total | |||||||||||||||
Principal payments on debt | $ | 970,287 | $ | 2,073,810 | $ | 1,318,634 | $ | 932,586 | $ | 5,295,317 | |||||||||
Interest payments on debt | 117,450 | 297,990 | 151,473 | 29,094 | 596,007 | ||||||||||||||
$ | 1,087,737 | $ | 2,371,800 | $ | 1,470,107 | $ | 961,680 | $ | 5,891,324 |
March 31, 2013 | |||
Cash and cash equivalents | $ | 1,018,759 | |
Marketable securities | 135,246 | ||
Total cash and cash equivalents and marketable securities | 1,154,005 | ||
Global credit facilities | 662,295 | ||
Asset-backed U.S. commercial paper conduit facility(a) | 600,000 | ||
Asset-backed Canadian commercial paper conduit facility(b) | 41,984 | ||
Total availability under credit facilities | 1,304,279 | ||
Total | $ | 2,458,284 |
(a) | The U.S. commercial paper conduit facility expires on September 13, 2013. The Company anticipates that it will renew this facility prior to expiration.(1) |
(b) | The Canadian commercial paper conduit facility expires on August 30, 2013 and is limited to Canadian denominated borrowings. The Company anticipates that it will renew this facility prior to expiration.(1) |
Three months ended | |||||||
March 31, 2013 | April 1, 2012 | ||||||
Net cash used by operating activities | $ | (108,489 | ) | $ | (73,616 | ) | |
Net cash provided by investing activities | 27,542 | 32,019 | |||||
Net cash provided by (used by) financing activities | 42,197 | (209,942 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | (10,629 | ) | 926 | ||||
Net decrease in cash and cash equivalents | $ | (49,379 | ) | $ | (250,613 | ) |
March 31, 2013 | April 1, 2012 | ||||||
Global credit facilities | $ | — | $ | 150,195 | |||
Unsecured commercial paper | 687,705 | 662,343 | |||||
Asset-backed Canadian commercial paper conduit facility | 154,596 | — | |||||
Medium-term notes | 2,881,444 | 2,698,232 | |||||
Senior unsecured notes | 303,000 | 303,000 | |||||
Term asset-backed securitization debt | 1,268,572 | 1,754,320 | |||||
Total debt | $ | 5,295,317 | $ | 5,568,090 |
Short-Term | Long-Term | Outlook | |||
Moody’s | P2 | Baa1 | Positive | ||
Standard & Poor’s | A2 | BBB+ | Positive | ||
Fitch | F2 | A- | Stable |
Principal Amount | Rate | Issue Date | Maturity Date | |||
$500,000 | 5.75% | November 2009 | December 2014 | |||
$600,000 | 1.15% | September 2012 | September 2015 | |||
$450,000 | 3.875% | March 2011 | March 2016 | |||
$400,000 | 2.70% | January 2012 | March 2017 | |||
$933,511 | 6.80% | May 2008 | June 2018 |
• | incur certain additional indebtedness; |
• | assume or incur certain liens; |
• | participate in certain mergers, consolidations, liquidations or dissolutions; and |
• | purchase or hold margin stock. |
(i) | execute its business strategy, |
(ii) | adjust to fluctuations in foreign currency exchange rates, interest rates and commodity prices, |
(iii) | manage through inconsistent economic conditions, including changing capital, credit and retail markets, |
(iv) | implement and manage enterprise-wide information technology solutions, including solutions at its manufacturing facilities, and secure data contained in those systems, |
(v) | anticipate the level of consumer confidence in the economy, |
(vi) | continue to realize production efficiencies at its production facilities and manage operating costs including materials, labor and overhead, |
(vii) | manage production capacity and production changes, |
(viii) | manage changes and prepare for requirements in legislative and regulatory environments for its products, services and operations, |
(ix) | provide products, services and experiences that are successful in the marketplace, |
(x) | manage risks that arise through expanding international operations and sales, |
(xi) | manage the credit quality, the loan servicing and collection activities, and the recovery rates of HDFS’ loan portfolio, |
(xii) | successfully implement with our labor unions the agreements that we have executed with them that we believe will provide flexibility and cost-effectiveness to accomplish restructuring goals and long-term competitiveness, |
(xiii) | effectively execute the Company’s restructuring plans within expected costs and timing, |
(xiv) | manage supply chain issues, including any unexpected interruptions or price increases caused by raw material shortages or natural disasters, |
(xv) | develop and implement sales and marketing plans that retain existing retail customers and attract new retail customers in an increasingly competitive marketplace, |
(xvi) | adjust to healthcare inflation and reform, pension reform and tax changes, |
(xvii) | retain and attract talented employees, |
(xviii) | manage the risks that our independent dealers may have difficulty obtaining capital and managing through changing economic conditions and consumer demand, |
(xix) | continue to have access to reliable sources of capital funding and adjust to fluctuations in the cost of capital, |
(xx) | continue to develop the capabilities of its distributor and dealer network, and |
(xxi) | detect any issues with our motorcycles or manufacturing processes to avoid delays in new model launches, recall campaigns, increased warranty costs or litigation. |
2013Fiscal Month | Total Number of Shares Purchased (a) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs | |||||||
January 1 to February 3 | 120 | 47 | 120 | 14,635,250 | |||||||
February 4 to March 3 | 1,520,505 | 53 | 1,520,505 | 14,240,978 | |||||||
March 4 to March 31 | 865,428 | 54 | 865,428 | 13,459,756 | |||||||
Total | 2,386,053 | 53 | 2,386,053 |
(a) | Includes discretionary share repurchases and shares of common stock that employees surrendered to satisfy withholding taxes in connection with the vesting of restricted stock awards |
HARLEY-DAVIDSON, INC. | |
Date: 5/9/2013 | /s/ John A. Olin |
John A. Olin | |
Senior Vice President and | |
Chief Financial Officer | |
(Principal financial officer) |
Date: 5/9/2013 | /s/ Mark R. Kornetzke |
Mark R. Kornetzke | |
Chief Accounting Officer | |
(Principal accounting officer) |
Exhibit No. | Description | |
31.1 | Chief Executive Officer Certification pursuant to Rule 13a-14(a) | |
31.2 | Chief Financial Officer Certification pursuant to Rule 13a-14(a) | |
32.1 | Written Statement of the Chief Executive Officer and the Chief Financial Officer pursuant to 18 U.S.C. §1350 | |
101 | Financial statements from the quarterly report on Form 10-Q of Harley-Davidson, Inc. for the quarter ended March 31, 2013, filed on May 9, 2013, formatted in XBRL: (i) the Condensed Consolidated Statements of Operations; (ii) the Condensed Consolidated Statements of Comprehensive Income; (iii) the Condensed Consolidated Balance Sheets; (iv) the Condensed Consolidated Statements of Cash Flows; and (v) the Notes to Condensed Consolidated Financial Statements. |
1. | I have reviewed this quarterly report on Form 10-Q of Harley-Davidson, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors: |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: May 9, 2013 | /s/ Keith E. Wandell |
Keith E. Wandell | |
Chairman, President and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Harley-Davidson, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors: |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: May 9, 2013 | /s/ John A. Olin |
John A. Olin | |
Senior Vice President and | |
Chief Financial Officer |
Date: May 9, 2013 | /s/ Keith E. Wandell |
Keith E. Wandell | |
Chairman, President and Chief Executive Officer | |
/s/ John A. Olin | |
John A. Olin | |
Senior Vice President and | |
Chief Financial Officer |
Fair Value Of Financial Instruments (Summary Of Fair Value And Carrying Value Of Company Financial Instruments) (Detail) (USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2013
|
Dec. 31, 2012
|
Apr. 01, 2012
|
Dec. 31, 2011
|
---|---|---|---|---|
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Cash and cash equivalents | $ 1,018,759 | $ 1,068,138 | $ 1,276,337 | $ 1,526,950 |
Marketable securities | 135,246 | 135,634 | 134,946 | |
Accounts receivable, net | 259,673 | 230,079 | 264,272 | |
Restricted Cash and Cash Equivalents | 197,025 | 188,008 | 246,995 | |
Accounts payable | 360,018 | 257,386 | 355,902 | |
Derivatives | 2,165 | 7,920 | 2,234 | |
Fair Value [Member]
|
||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Cash and cash equivalents | 1,018,759 | 1,068,138 | 1,276,337 | |
Marketable securities | 135,246 | 135,634 | 134,946 | |
Accounts receivable, net | 259,673 | 230,079 | 264,272 | |
Derivatives | 11,737 | 317 | 6,345 | |
Finance receivables, net | 6,108,934 | 5,861,442 | 5,961,825 | |
Restricted Cash and Cash Equivalents | 197,025 | 188,008 | 246,995 | |
Accounts payable | 360,018 | 257,386 | 355,902 | |
Derivatives | 2,165 | 7,920 | 2,234 | |
Unsecured commercial paper | 687,705 | 294,943 | 662,343 | |
Credit facilities | 0 | 0 | 150,195 | |
AssetBackedCanadianCommericalPaper | 154,596 | 175,658 | 0 | |
Medium-term notes | 3,169,807 | 3,199,548 | 2,936,475 | |
Senior unsecured notes | 337,600 | 338,594 | 366,651 | |
Term asset-backed securitization debt | 1,276,046 | 1,457,807 | 1,768,140 | |
Carrying Value [Member]
|
||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Cash and cash equivalents | 1,018,759 | 1,068,138 | 1,276,337 | |
Marketable securities | 135,246 | 135,634 | 134,946 | |
Accounts receivable, net | 259,673 | 230,079 | 264,272 | |
Derivatives | 11,737 | 317 | 6,345 | |
Finance receivables, net | 6,033,939 | 5,781,852 | 5,877,403 | |
Restricted Cash and Cash Equivalents | 197,025 | 188,008 | 246,995 | |
Accounts payable | 360,018 | 257,386 | 355,902 | |
Derivatives | 2,165 | 7,920 | 2,234 | |
Unsecured commercial paper | 687,705 | 294,943 | 662,343 | |
Credit facilities | 0 | 0 | 150,195 | |
AssetBackedCanadianCommericalPaper | 154,596 | 175,658 | 0 | |
Medium-term notes | 2,881,444 | 2,881,272 | 2,698,232 | |
Senior unsecured notes | 303,000 | 303,000 | 303,000 | |
Term asset-backed securitization debt | $ 1,268,572 | $ 1,447,776 | $ 1,754,320 |
Employee Benefit Plans (Tables)
|
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2013
|
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Components Of Net Periodic Benefit Costs | ents of net periodic benefit costs were as follows (in thousands):
Durin |
Subsequent Event (Detail) (USD $)
In Millions, unless otherwise specified |
Mar. 31, 2013
|
---|---|
Line of Credit Facility [Line Items] | |
Line of credit facility, maximum borrowing capacity | $ 600.0 |
Finance Receivables (Tables) (USD $)
|
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2013
|
Mar. 31, 2013
Wholesale [Member]
|
Dec. 31, 2012
Wholesale [Member]
|
Apr. 01, 2012
Wholesale [Member]
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Finance Receivables | Finance receivables, net, consisted of the following (in thousands):
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes In The Allowance For Credit Losses On Finance Receivables | Changes in the allowance for credit losses on finance receivables by portfolio were as follows (in thousands):
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance For Credit Losses And Finance Receivables By Portfolio Individually And Collectively Evaluated For Impairment | The allowance for credit losses and finance receivables by portfolio, segregated by those amounts that are individually evaluated for impairment and those that are collectively evaluated for impairment, was as follows (in thousands):
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Finance Receivables That Are Individually Deemed To Be Impaired | $ 0 | $ 0 | $ 0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Aging Of Past Due Finance Receivables Including Non-Accrual Status Finance Receivables | An analysis of the aging of past due finance receivables was as follows (in thousands):
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Recorded Investment Of Retail Finance Receivables By Credit Quality Indicator | The recorded investment of retail finance receivables, by credit quality indicator, was as follows (in thousands):
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Recorded Investment Of Wholesale Finance Receivables By Internal Credit Quality Indicator | The recorded investment of wholesale finance receivables, by internal credit quality indicator, was as follows (in thousands):
|
Finance Receivables (Recorded Investment Of Wholesale Finance Receivables By Internal Credit Quality Indicator) (Detail) (Wholesale [Member], USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2013
|
Dec. 31, 2012
|
Apr. 01, 2012
|
---|---|---|---|
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Finance receivables, gross | $ 1,159,243 | $ 816,404 | $ 956,322 |
Doubtful [Member]
|
|||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Finance receivables, gross | 4,843 | 8,107 | 13,108 |
Substandard [Member]
|
|||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Finance receivables, gross | 10,441 | 2,593 | 5,599 |
Special Mention [Member]
|
|||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Finance receivables, gross | 11,125 | 3,504 | 8,618 |
Medium [Member]
|
|||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Finance receivables, gross | 7,804 | 8,451 | 6,365 |
Low [Member]
|
|||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Finance receivables, gross | $ 1,125,030 | $ 793,749 | $ 922,632 |
Restructuring Expense (Restructuring Plan Reserve Recorded In Accrued Liabilities Related To 2010 Plan) (Detail) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | |
---|---|---|
Mar. 31, 2013
|
Apr. 01, 2012
|
|
Restructuring Cost and Reserve [Line Items] | ||
Restructuring expense | $ 2,938 | $ 11,451 |
2010 Restructuring Plan [Member] | Employee Serverance And Termination Costs [Member] | Motorcycles And Related Products [Member]
|
||
Restructuring Cost and Reserve [Line Items] | ||
Balance, beginning of period | 10,156 | 20,361 |
Restructuring expense | 0 | 1,886 |
Utilized-cash | 9,607 | 26 |
Balance, end of period | $ 549 | $ 22,221 |
Additional Balance Sheet and Cash Flow Information (Narrative) (Detail) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | |
---|---|---|
Mar. 31, 2013
|
Apr. 01, 2012
|
|
Investment [Line Items] | ||
Gross unrealized gains (losses) | $ (0.4) | $ 1.6 |
Gross unrealized gains (losses), net of taxes | $ (0.2) | $ 1.0 |
Contractual maturities period of marketable securities, minimum (in months) | 1 | |
Contractual maturities period of marketable securities, maximum (in months) | 38 |
Asset-Backed Financing (Assets And Liabilities Of Variable Interest Entities) (Detail) (USD $)
|
Mar. 31, 2013
|
Dec. 31, 2012
|
Apr. 01, 2012
|
Dec. 31, 2011
|
---|---|---|---|---|
Variable Interest Entity [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | $ 600,000,000 | |||
Loans and Leases Receivable, Allowance | 106,792,000 | 107,667,000 | 122,503,000 | 125,449,000 |
Restricted cash | 197,025,000 | 188,008,000 | 246,995,000 | |
SPEs [Member]
|
||||
Variable Interest Entity [Line Items] | ||||
Restricted cash | 185,657,000 | 176,290,000 | 246,995,000 | |
SPEs Facility [Member]
|
||||
Variable Interest Entity [Line Items] | ||||
Restricted cash | 0 | |||
Asset-backed Securities [Member]
|
||||
Variable Interest Entity [Line Items] | ||||
Finance receivables | 2,045,839,000 | 2,337,993,000 | 2,575,274,000 | |
Loans and Leases Receivable, Allowance | 39,722,000 | 45,571,000 | 57,046,000 | |
Restricted cash | 197,025,000 | 188,008,000 | 246,995,000 | |
Other assets | 5,396,000 | 5,543,000 | 5,932,000 | |
Total assets | 2,208,538,000 | 2,485,973,000 | 2,771,155,000 | |
Secured Debt | 1,423,168,000 | 1,623,434,000 | 1,754,320,000 | |
Asset-backed Securities [Member] | SPEs [Member]
|
||||
Variable Interest Entity [Line Items] | ||||
Finance receivables | 1,871,419,000 | 2,143,708,000 | 2,564,585,000 | |
Loans and Leases Receivable, Allowance | 36,799,000 | 42,139,000 | 56,810,000 | |
Restricted cash | 185,657,000 | 176,290,000 | 245,912,000 | |
Other assets | 4,935,000 | 4,869,000 | 5,620,000 | |
Total assets | 2,025,212,000 | 2,282,728,000 | 2,759,307,000 | |
Secured Debt | 1,268,572,000 | 1,447,776,000 | 1,754,320,000 | |
Asset-backed U.S. Commercial Paper Conduit Facility [Member] | SPEs [Member]
|
||||
Variable Interest Entity [Line Items] | ||||
Finance receivables | 0 | 0 | 10,689,000 | |
Loans and Leases Receivable, Allowance | 0 | 0 | 236,000 | |
Restricted cash | 0 | 0 | 1,083,000 | |
Other assets | 294,000 | 419,000 | 312,000 | |
Total assets | 294,000 | 419,000 | 11,848,000 | |
Secured Debt | 0 | 0 | 0 | |
Asset-backed Canadian Commercial Paper Conduit Facility [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
|
||||
Variable Interest Entity [Line Items] | ||||
Finance receivables | 174,420,000 | 194,285,000 | 0 | |
Loans and Leases Receivable, Allowance | 2,923,000 | 3,432,000 | 0 | |
Restricted cash | 11,368,000 | 11,718,000 | 0 | |
Other assets | 167,000 | 255,000 | 0 | |
Total assets | 183,032,000 | 202,826,000 | 0 | |
Secured Debt | $ 154,596,000 | $ 175,658,000 | $ 0 |
Commitment And Contingencies (Detail) (USD $)
In Millions, unless otherwise specified |
3 Months Ended |
---|---|
Mar. 31, 2013
|
|
Commitment And Contingencies [Line Items] | |
Estimate of Company's share of York environmental matters | 2.7 |
Navy [Member]
|
|
Commitment And Contingencies [Line Items] | |
Portion of settlement contribution percentage | 53.00% |
Harley Davidson, Inc. [Member]
|
|
Commitment And Contingencies [Line Items] | |
Portion of settlement contribution percentage | 47.00% |
Product Warranty And Safety Recall Campaigns (Narrative) (Detail) (USD $)
In Millions, unless otherwise specified |
Mar. 31, 2013
|
Dec. 31, 2012
|
Apr. 01, 2012
|
---|---|---|---|
Net Amount at Risk by Product and Guarantee [Line Items] | |||
Liability for safety recall campaigns | $ 4.1 | $ 4.6 | $ 8.0 |
Finance Receivables (Allowance For Credit Losses And Finance Receivables By Portfolio Individually And Collectively Evaluated For Impairment) (Detail) (USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2013
|
Dec. 31, 2012
|
Apr. 01, 2012
|
Dec. 31, 2011
|
---|---|---|---|---|
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for credit losses | $ 106,792 | $ 107,667 | $ 122,503 | $ 125,449 |
Finance receivables, gross | 6,140,731 | 5,889,519 | 5,999,906 | |
Individually Evaluated For Impairment [Member]
|
||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for credit losses | 0 | 0 | 0 | |
Finance receivables, gross | 0 | 0 | 0 | |
Collectively Evaluated For Impairment [Member]
|
||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for credit losses | 106,792 | 107,667 | 122,503 | |
Finance receivables, gross | 6,140,731 | 5,889,519 | 5,999,906 | |
Retail [Member]
|
||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for credit losses | 98,542 | 101,442 | 112,857 | |
Finance receivables, gross | 4,981,488 | 5,073,115 | 5,043,584 | |
Retail [Member] | Individually Evaluated For Impairment [Member]
|
||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for credit losses | 0 | 0 | 0 | |
Finance receivables, gross | 0 | 0 | 0 | |
Retail [Member] | Collectively Evaluated For Impairment [Member]
|
||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for credit losses | 98,542 | 101,442 | 112,857 | |
Finance receivables, gross | 4,981,488 | 5,073,115 | 5,043,584 | |
Wholesale [Member]
|
||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for credit losses | 8,250 | 6,225 | 9,646 | |
Finance receivables, gross | 1,159,243 | 816,404 | 956,322 | |
Wholesale [Member] | Individually Evaluated For Impairment [Member]
|
||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for credit losses | 0 | 0 | 0 | |
Finance receivables, gross | 0 | 0 | 0 | |
Wholesale [Member] | Collectively Evaluated For Impairment [Member]
|
||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for credit losses | 8,250 | 6,225 | 9,646 | |
Finance receivables, gross | $ 1,159,243 | $ 816,404 | $ 956,322 |
Restructuring Expense
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3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2013
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Restructuring Expense | Restructuring Expense 2011 Restructuring Plans In December 2011, the Company made a decision to cease operations at New Castalloy, its Australian subsidiary and producer of cast motorcycle wheels and wheel hubs, and source those components through other existing suppliers (2011 New Castalloy Restructuring Plan). The Company expects the transition of supply from New Castalloy to be complete in 2013. The decision to close New Castalloy came as part of the Company’s overall long term strategy to develop world-class manufacturing capability throughout the Company by restructuring and consolidating operations for greater competitiveness, efficiency and flexibility. In connection with this decision, the Company will reduce its workforce by approximately 200 employees by the end of 2013. Under the 2011 New Castalloy Restructuring Plan, restructuring expenses consist of employee severance and termination costs, accelerated depreciation and other related costs. The Company expects to incur approximately $31 million in restructuring charges related to the transition through 2013. Approximately 35% of the $31 million will be non-cash charges. On a cumulative basis, the Company has incurred $25.2 million of restructuring expense under the 2011 New Castalloy Restructuring Plan as of March 31, 2013, of which $3.0 million was incurred during the three months ended March 31, 2013. In February 2011, the Company’s unionized employees at its facility in Kansas City, Missouri ratified a new seven-year labor agreement. The new agreement took effect on August 1, 2011. The new contract is similar to the labor agreements ratified at the Company’s Wisconsin facilities in September 2010 and its York, Pennsylvania facility in December 2009, and allows for similar flexibility, increased production efficiency and the addition of a flexible workforce component. The actions to implement the new ratified labor agreement (2011 Kansas City Restructuring Plan) result in approximately 145 fewer full-time hourly unionized employees in its Kansas City facility than would have been required under the previous contract. The Company expects all actions related to the 2011 Kansas City Restructuring Plan to be completed by the end of 2013. Under the 2011 Kansas City Restructuring Plan, restructuring expenses consist of employee severance and termination costs and other related costs. On a cumulative basis, the Company has incurred $6.9 million of restructuring expense under the 2011 Kansas City Restructuring Plan as of March 31, 2013 of which approximately 10% is non-cash. The following table summarizes the Motorcycles segment’s 2011 Kansas City Restructuring Plan and 2011 New Castalloy Restructuring Plan reserve activity and balances as recorded in accrued liabilities (in thousands):
2010 Restructuring Plan In September 2010, the Company’s unionized employees in Wisconsin ratified three separate new seven-year labor agreements which took effect in April 2012 when the prior contracts expired. The new contracts are similar to the labor agreement ratified at the Company’s York, Pennsylvania facility in December 2009 and allow for similar flexibility and increased production efficiency and the addition of a flexible workforce component. The actions to implement the new ratified labor agreements (2010 Restructuring Plan) result in approximately 250 fewer full-time hourly unionized employees in its Milwaukee-area facilities than would have been required under the previous contracts and approximately 75 fewer full-time hourly unionized employees in its Tomahawk, Wisconsin facility than would have been required under the previous contract. The Company expects all actions related to the 2010 Restructuring Plan to be completed by the end of 2013. Under the 2010 Restructuring Plan, restructuring expenses consist of employee severance and termination costs and other related costs. On a cumulative basis, the Company has incurred $59.7 million of restructuring expense under the 2010 Restructuring Plan as of March 31, 2013, of which approximately 45% is non-cash. The following table summarizes the Motorcycles segment’s 2010 Restructuring Plan reserve activity and balances as recorded in accrued liabilities (in thousands):
2009 Restructuring Plan During 2009, in response to the U.S. economic recession and worldwide slowdown in consumer demand, the Company committed to a volume reduction and a combination of restructuring actions (2009 Restructuring Plan) that were expected to be completed at various dates between 2009 and 2012. The actions were designed to reduce administrative costs, eliminate excess capacity and exit non-core business operations. The Company’s announced actions include the restructuring and transformation of its York, Pennsylvania production facility including the implementation of a new more flexible unionized labor agreement which allows for the addition of a flexible workforce component; consolidation of facilities related to engine and transmission production; outsourcing of certain distribution and transportation activities and exiting the Buell product line. In addition, the Company implemented projects under this plan involving the outsourcing of select information technology activities and the consolidation of an administrative office in Michigan into its corporate headquarters in Milwaukee, Wisconsin. The 2009 Restructuring Plan results in a reduction of approximately 2,700 to 2,900 hourly production positions and approximately 800 non-production, primarily salaried positions within the Motorcycles segment and approximately 100 salaried positions in the Financial Services segment. The Company expects all actions related to the 2009 Restructuring Plan to be completed by the end of 2013. Under the 2009 Restructuring Plan, restructuring expenses consist of employee severance and termination costs, accelerated depreciation on the long-lived assets that will be exited as part of the 2009 Restructuring Plan and other related costs. The Company expects total costs related to the 2009 Restructuring Plan to result in restructuring and impairment expenses of approximately $397 million, of which approximately 30% are expected to be non-cash. On a cumulative basis, the Company has incurred $395.3 million of restructuring and impairment expense under the 2009 Restructuring Plan as of March 31, 2013. The following table summarizes the Company’s 2009 Restructuring Plan reserve activity and balances recorded in accrued liabilities (in thousands):
Other restructuring costs under the 2009 Restructuring Plan include items such as the exit costs for terminating supply contracts, lease termination costs and moving costs. During the first three months of 2013, the Company released a portion of its 2009 Restructuring Plan reserve related to employee severance costs as these costs are no longer expected to be incurred. |
Earnings Per Share (Reconciliation Of Earnings Per Share Basic And Diluted) (Detail) (USD $)
In Thousands, except Per Share data, unless otherwise specified |
3 Months Ended | |
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Mar. 31, 2013
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Apr. 01, 2012
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Earnings Per Share [Line Items] | ||
Net income | $ 224,129 | $ 172,035 |
Denominator for basic earnings per share- weighted-average common shares | 224,429 | 228,988 |
Effect of dilutive securities-employee stock compensation plan | 1,719 | 2,296 |
Weighted Average Number of Shares Outstanding, Diluted | 226,148 | 231,284 |
Earnings Per Share, Basic | $ 1.00 | $ 0.75 |
Earnings Per Share, Diluted | $ 0.99 | $ 0.74 |