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Bill Stankiewicz Copy Hd Annual2009

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Harley Davidson financials

Harley Davidson financials


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  • 1. C o urage. You can call it character.You can call it determination.Or you can just call it guts. But couragechanges everything. Ask any rider.It’s the stuff that gives you the conf idenceto power forward, seize the road andlive your dream. And it’s at the heart ofevery hard decision. 2009 was a yearthat called on Harley - Davidson to focusour direction, move boldly and do theright things to f uel our future.After all, there’s a reason we’ve beenaround 107 years. We know what ittakes to succeed.HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORT
  • 2. CONTINUOUS IMPROVEMENT ONE COMPANY, ONE TEAM, ONE DIRECTION moving with appropriate urgency and mak- We also believe we have significant oppor- When my journey here at Harley-Davidson ing great progress toward our goal to doCOURAGE, FOCUS tunity to run our business more effec- began last May, it was obvious that people just that. We appreciate the trust you have tively and efficiently through continuous were passionate about the brand. As I have placed in us to move this company forward.AND DIRECTION. improvement in manufacturing, product development and business operations. had the opportunity to get to know our cus- tomers, dealers and employees, join them at While there is still plenty of hard work ahead, I could not feel better about the Our focus on continuous improvement rallies and events and ride with them, it is progress we have made and the path we goes beyond simply reducing costs. It clear the passion is far stronger and deeper have chosen. extends to our ability to deliver the right than anything I could ever have imagined.DEAR FELLOW SHAREHOLDERS : In the worst economic downturn in decades, 2009 was a year bikes to the right markets at the right All of us at Harley-Davidson are fully Sincerely, time, an essential capability when it comes committed—as one company, working asthat required Harley-Davidson to respond with tough, courageous decisions. to customer satisfaction and effectively one team and pulling in one direction—to We had two key priorities. First, we executed on our strategy to manage the business managing supply in line with demand. doing the right things for this companyeffectively in the near term and address the immediate challenges. But we needed to The transformation currently underway and for the collective future of all stake- at our vehicle operations in York, Pa., dem- holders. By aligning the organization K EITH E. WANDE L L THdo more than simply persevere. We needed to establish a bold, clear strategic direction onstrates our commitment to reshaping behind a clear strategic direction, we are PRES I DEN T AND S CH I EF EX ECUT I VE OF F ICERthat would maximize our opportunities going forward and restore the Company as a the face of Harley-Davidson manufacturing, with much greater flexibility and significantstrong business that could consistently grow over the long haul. We set that direction, savings from a more efficient operation.and the word that best describes our new strategy is “focus. ” Just as important is the transformation under way in Harley-Davidson product development. Our work focuses on productWe wasted no time in bringing this strategy to 2008. Managing supply in line with HIGH-POTENTIAL BRAND selection, cost reduction and time compres-to life, moving quickly to focus our resourc- demand remains a top priority as a key The heart of our strategy is our strong sion, to reduce time to market and consis-es behind the unique strengths and growth underpinning of brand strength. belief that focusing our investment behind tently deliver on customer expectations.potential of the Harley-Davidson brand. We embarked on a major consolidation the powerful Harley-Davidson brand pro- These actions represent important early In light of the 2009 landscape and the and restructuring of our production vides a superior path to tapping the full steps in what will be an ongoing journeyactions we took, our 2009 financial results operations to get our cost structure right potential of the brand and to sustained in continuous improvement.were not surprising. Income from con- at lower volumes. long-term growth. The Harley-Davidsontinuing operations of $70.6 million, or We also succeeded in obtaining the fund- brand consistently ranks among the stron- THE ROAD AHEAD$0.30 per share, decreased 89.7 percent ing needed to support the lending activities gest globally, across many demographic 2009 was indeed a year that tested ourfrom the prior year, on a 23.1 percent of Harley-Davidson Financial Services— groups. Even in today’s more practical, company, but it was also a year of genuinedrop in revenue from motorcycles and another priority for us in 2009. Our ability cautious consumer environment, people achievement as we embarked on a newrelated products to $4.29 billion. These to fund motorcycle loans for customers was of all ages and backgrounds still dream course. It was a year in which we tookresults primarily reflect the impact of re- a key strategic advantage in 2009 and was about the Harley-Davidson experience. many courageous actions to positionduced motorcycle shipments, restructuring one of the reasons for our market share We see great potential to drive growth Harley-Davidson for the future.and Buell exit costs, and non-cash charges growth during the year. As a result of our globally and in the U.S. through unique Our accomplishments were possible onlyrelated to Harley-Davidson Financial Ser- actions, HDFS is on much stronger footing, products and experiences, both through through the hard work, unwavering spiritvices. When the loss from MV Agusta and we believe we have provided for its outreach to new customers and our com- and dedication of our employees, dealersdiscontinued operations is included, the anticipated funding needs for 2010. mitment to core customers. and suppliers, who focus every day onCompany reported a full-year net loss of Our strategy is multi-generational and delivering an outstanding experience for$55.1 million. At the same time, even with STRATEGIC FOCUS multi-cultural. It calls for us to grow sales our customers. I thank all the membersthe decrease in profitability due to the Looking out across a longer horizon, in to our core customers, while growing sales of our team for their many contributions.reduction in motorcycle shipments and October we unveiled our long-term “Deliv- to outreach customers at a faster rate. As we execute on our strategy, we do notrestructuring spending, the Company’s ering Results Through Focus” business Our Dark Custom products, including promise easy solutions. Consumers willcontinuing operations generated $609 mil- strategy, with its four pillars: growth, the Iron 883, are a strong draw for young likely continue to be cautious in an economiclion in cash flow from operating activities continuous improvement, leadership de- adults, and motorcycles like the Street environment that remains challenging.in 2009. This speaks well for the ability velopment and sustainability. As part of Glide, Tri Glide and Electra Glide Ultra However, we believe our strategy andto generate cash, even in a challenging this strategy to focus our efforts, we Limited have earned the ongoing com- the performance measures we have laid outbusiness environment. announced we would exit from the Buell mitment of core riders. are based on an appropriate and prudent product line and sell MV Agusta, focusing In international markets we plan to add approach to the market. Delivering on ourADDRESSING THE IMMEDIATE CHALLENGES our resources on the Harley-Davidson 100 to 150 dealer points through 2014 , plans will take discipline, determination andTo address the immediate challenges of brand, which includes continuing to and in the same period increase inter- intense focus, but we are confident we can2009 and the deep recession, we decreased expand the brand globally. national retail unit sales to more than 40 achieve our goals through our strategy.Harley-Davidson motorcycle shipments to percent of total retail unit sales, up fromdealers by nearly 27 percent compared about 33 percent in 2009.
  • 3. 02 HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORT 03 GROWTH Harley-Davidson is not only one of the strongest brands in the world, it is also, we believe, a brand with tremendous untapped potential. We have chosen to focus our investments behind the Harley-Davidson brand because we believe it provides a superior means for realizing the substantial long- term opportunities of the global motorcycle industry. CONTINUOUS IMPROVEMENT We do many things very well at Harley-Davidson. But the reality is that there is tremendous opportunity to do many things even better—in our product development, our business processes and our manufac- turing operations. Continuous improvement is about much more than reducing costs. We are driving out unnecessary steps and complexity and building in greater flexibility and efficiency in a product’s path from design to dealership. It’s how we get better at managing supply and demand, continuously improving quality, and responding faster and more effectively to the needs of our markets and the desires of riders. LEADERSHIP DEVELOPMENT The third pillar of our strategy is leadership develop- ment, the foundation for our ability to compete and win for decades to come. We will only succeed with great people—individuals who will challenge the The future is calling. And it’s asking more At a high level, we will expand our strength WE BELIEVE OUR STRATEGY WILL status quo, and who are creative, collaborative and accountable. To fulfill our from us than ever before. In 2009, we as one of the most customer-centered EXPAND OUR STRENGTH AS ONE OF answered the call with Harley-Davidson’s brands in the world, anchor our leader- THE MOST CUSTOMER - CENTERED brand and business potential, we must prepare strong, committed leaders go-forward business strategy to “Deliver ship of the custom touring and cruiser BRANDS IN THE WORLD. who live our values and deliver every day. Results Through Focus.” motorcycle segments, and develop rel- These are fundamental points on a strate- evant products to attract customers inWE’RE MOVING ON FOUR FRONTS new demographic segments. We’ll expand gic agenda that we must execute in orderTO POSITION HARLEY- DAVIDSON our global presence by accelerating our to maximize our potential and take fullFOR SUSTAINED, MEANINGFUL, reach into key international markets. advantage of our opportunities. In short,LONG - TERM RESULTS. And, of course, we remain highly committed our strategy to deliver results through focus is about delivering the full Harley- Based on four pillars—growth, continuous to our core customers. From product improvement, leadership development and development to manufacturing to our Davidson experience in a harder-working, SUSTAINABILITYThe stature of our company— and the visibility of our brand in smarter and more effective way. sustainability— our strategy has a single- dealer network, we are concentrating on society—gives Harley-Davidson a particular obligation to seize the opportunities minded focus on the unique strengths of motorcycles and market activities that the Harley-Davidson brand, coupled with create new demand for our motorcycles of sustainability and giving back. We are continually expanding the ways in an unprecedented commitment of efforts and related products. which we incorporate social and environmental responsibility in our work, our and resources to enhance productivity, profitability and value. manufacturing processes and our products.
  • 4. 04 HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORTMACHINES THATFIT THE MINDSET.Everyone has a vision of what a Harley- Tri Glide™ and motorcycles from CustomDavidson® motorcycle should be. And as Vehicle Operations™ deliver a premiumwe build on our position as the leader of experience for our core customers, givingtwo-wheeled authenticity, we’re looking them reasons to trade up and ways todeep into the dreams of new riders, long- extend the ride. And through customiza-time customers and young customers alike tion and MotorClothes® riding gear, eachto develop motorcycles that fit individual riding experience can truly be individu-lives and lifestyles. alized to fit the owner’s mindset. There’s a powerful reason for thisapproach: it works. Motorcycles are all THE DISCIPLINE OF PRODUCT DE VELOPMENTabout emotion, and no motorcycles inspire The best companies do more than moveas much of it as ours. the market; they move ahead of it. To further strengthen our effectiveness atTHE RIDE COMES F IRST delivering twist-of-the-throttle emotionMore than ever, we’re developing prod- to diverse customers, we are transformingucts that appeal across generations and product development in ways that sharpencultures. Dark Custom™ bikes like the Iron our focus on what riders want, deliver883™ and the new Forty-Eight,™ with relevant products in each global market,their stripped-down, rebellious attitude, improve speed to market and grow ourare drawing in young adult riders. Prod- family of riders.ucts like the Electra Glide® Ultra Limited, Inspiration comes in many shapes T O P & B OT T OM and colors; the 2010 CVO™ Ultra Classic® Electra Glide motorcycle in Scarlet Red Pearl with Dark Slate flames for an ultimate custom touring ride, and the Iron 883 motorcycle, with its blacked-out street smarts.
  • 5. 06 HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORT 07A BOND THAT HAS ® The devotion of our most loyal custom- EXPANDING THE COMMUNITY with them. The Harley Owners Group, ers has brought us a long way. Their We’re highly committed to keeping the now with more than a million membersNO BOUNDARIES. passion will continue to be a powerful force. We see it in the motorcycles they Harley-Davidson experience rich and re- warding for our current riders and extend- in 1,458 chapters globally, is a compelling connection with riders wherever our mo- ® ride, the individuality they express and ing their journey. We’re also focused on torcycles travel. H.O.G. riding events like their dedication to the ultimate riding bringing in more riders like them. In fact, Million Mile Monday and the Pony Express experience. When you have such an about a third of new Harley-Davidson Ride, and rallies from China to South expansive and devoted global community motorcycle purchasers in the core rider Carolina, keep our most passionate cus- of riders, it’s more than a business ad- segment are either new to motorcycling tomers riding more. We’re also staying vantage; it’s an obligation we take very or coming to us from other brands. close to customers at major events like seriously to exceed expectations. Naturally, our motorcycles are key to Daytona and Sturgis, where we’re dial-L E F T Dave Grohl of the band Foo Fighters with his CENTERMany customer journeys lead to Milwaukee. FAR RIG H T Harley Owners Group members in China, attracting these riders, and so are the ing up our focus to deliver a custom rally ®customized 2009 Tri Glide™ Ultra Classic, his Randy Haase stops at Harley-Davidson’s Juneau taking it to the streets at the country’s second great rides, rallies and events that go experience like never before.latest motorcycle acquisition—one of five Harley- Avenue headquarters. annual H.O.G. rally in Huangshan, Anhui province.Davidson motorcycles in his personal collection.
  • 6. 08 HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORTOPPORTUNITYIS FOUNDON MANY ROADS.For those who dream about their first Our Rider’s Edge® New Rider Course isHarley-Davidson motorcycle, there’s a instrumental in growing new relation-moment when desire turns into ownership. ships, helping more than 200,000 studentsBringing those moments closer within take to the streets with confidence sincereach for young adults,women and diverse 2000. Thirty-three percent of them areriders everywhere is one of the things under age 35 and 37 percent are women.we and our dealers enjoy the most. We continue to introduce ourselves to prospective owners through venues likeNEW CUSTOMERS FOR LIFE the South By Southwest ® music andYoung adults—those under age 35—hold culture festival, online communities, andour brand in virtually the same high es- Garage Party™ events just for women.teem as long-time customers. For this new And to help new customers feel confi-generation, we’ve created motorcycles, dent on the machine of their dreams, weexperiences and entire communities— developed the Harley-Davidson Fit Shop,both real-world and virtual—to immerse which enables dealers to outfit most anythem in the brand, expand our universe of bike for any rider.enthusiasts and make them customers In short, we live by the belief that “everyfor life. customer is a custom.” Every customer Bikes like the Iron 883, one of our fast- deserves an individualized experience inest-selling motorcycles in 2009, have done every aspect of ownership, whether they’reexceedingly well among young adults. a long-time rider or just getting started.TOPRising country music artist and devoted The Forty-Eight motorcycle with its BOT TOM LEFTHarley-Davidson enthusiast Krista Marie, peanut tank, fat front tire and no-frills Darkaboard her V-Rod Muscle® motorcycle at Custom appeal.a 2009 Women’s Ride for MDA. B OT T O M R I G H T Chontell Brown, Michael Rawls and John Roberts of New Jersey take in the Daytona Bike Week scene.
  • 7. 10 HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORT 11OVER OUR Harley-Davidson is crossing borders like we’re fueling demand in more mature a primary role in defining the emerging never before. Our brand has remarkable international motorcycle markets. Today, leisure riding market. We’ve studied theHANDLEBARS, global strength and we’re translating that appeal in ways that speak powerfully to we’re a major player in Europe, climb- ing into the number three spot in the market in depth, laid the groundwork and will start selling this summer. AndWE CAN SEE local enthusiasts. Our motorcycles now roll out of dealerships in more than 70 heavyweight segment in 2009 with a market share that’s double what it was consumer enthusiasm is greater than we ever imagined. We see long-term oppor-THE WHOLE WORLD. countries on six continents. By 2014, our plans call for international retail sales a decade ago. We did it through strong execution on the basics of product selec- tunities in India, as disposable incomes and aspirations rise. Over time, when of Harley-Davidson motorcycles to exceed tion, distribution, effective marketing and riders look to hit the roads, we believe we 40 percent of our total retail unit sales. retail execution, and above all, outstand- will be at the leading edge of the market. ing customer experiences.L E F T The XR1200X™ motorcycle, with its race- CENTER Anoop Prakash, Managing Director of R IG H T More leisure time, enthusiasm for the brand BUILDING SUCCESS, MARKET BY MARKET A disciplined, systematic approach isinspired riding position and hard-hitting Harley-Davidson India, with media at the and rising disposable income equal opportunity in Europe continues to be a prime Harley- also key to growing our global family instyle, is part of the product appeal behind our Delhi Auto Expo, introducing 12 Harley-Davidson India for Harley-Davidson as the ultimate symbol Davidson destination—an example of how places like India, where we are takingmarket share growth in Europe. motorcycle models destined for the India of freedom of the open road. market in 2010.
  • 8. 12 HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORTREVVING UPSTREET -LEVELPASSION.Dealers are the local heartbeat of Harley- connected with customers and manageDavidson. In cities and towns far and near, their businesses more effectively.they are the vital connection between riderand machine, fulfilling dreams and build- MANY POINTS OF CONNECTIONing lifelong relationships. Because customers come into the family in all kinds of ways, dealers understandTHE HIGHER ROAD that every part of their dealership is anDealerships are destinations that bring important opportunity to connect. Topthe entire Harley-Davidson experience to caliber sales and service teams are a keythe world. And dealers are more focused to customer engagement; so are test ridesthan ever on exceeding customer expec- and Authorized Rentals, which fuel dreamstations every day. They and their teams and inspire new bike purchases. And pre-understand the importance of personal- owned motorcycles are just the ticketizing every customer interaction, from in for some riders, starting a lifetime ofsales, service and customization to great ownership and customization.rides and events. They are dedicated to There’s a reason Harley-Davidson deal-continuous improvement —learning best ers are the best in the industry. To them,practices from one another and through Harley-Davidson is much more than aHarley-Davidson University. And, with business; it’s a way of life and a personalthe adoption of advanced technology passion which shows at the street levelsolutions, they are able to stay better in destinations around the world.TOP LEFTGreat service is a point of differentiation TOP RIGHTSharing passion for the brand andfor Harley-Davidson dealers, including Harley- business experience at a recent Harley-David-Davidson of North Texas in Carrollton and techni- son dealer convention are dealers (from left):cian Tom Talamantez. Joaquín R. Trejos, San José, Costa Rica; Irv Fossaen, Onalaska, Wis.; Ferdinand Fischer, Harley-Davidson Borie, the oldest Harley-BO T T OM Vienna, Austria; Tan Lin Lin, Qingdao, China; andDavidson dealership in France, in its new store Tommie Loos, Johannesburg, South Africa.just outside Paris. Through great execution ofall the details, Harley-Davidson new motorcycleretail sales rose in France in 2009.
  • 9. 14 HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORT 15WE’RE BUILDING To succeed as a manufacturer in today’s global economy takes a lot more than the manufacturing environment that maxi- mizes flexibility and efficiency, enhances the flexibility to produce multiple product families on the same assembly line everyTHE BEST latest factory equipment or the right thickness of steel to form into motorcycle quality at every step and delivers value for our customers. At the heart of these efforts day. The work that’s under way at York will greatly improve our ability to buildBIKES BETTER. fenders and gas tanks. It takes a relentless commitment to customers and quality, a is a major restructuring of our production operations that began in 2009. the right bikes at the right time to meet the needs of our customers. skilled and engaged workforce, the agility Of course, the restructuring of our to flex with the needs of the marketplace TRANSFORMATION IN PROGRESS production operations is about more than and a drive to continually improve. The biggest transformation is under way efficiency; it reflects our commitment to at our factory in York, Pa., and by 2012, build the best bikes better every day FOCUS ON QUALITY, FLEXIBILITY AND EFFICIENCY we will have completely revamped how and deliver quality and value with eachLEFT Harley-Davidson’s Kansas City operations RIGHT Attention to quality in every detail remains Today, Harley-Davidson is focused like we build motorcycles there. This restruc- Harley-Davidson motorcycle we make.now build V-Rod® and Sportster® motorcycles on a top priority at our York facility, where never before on achieving a best-in-class turing will reduce complexity and createthe same line for greater flexibility and efficiency. we are transforming our operations for best-in- class capability.
  • 10. 16 HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORTWHEN YOU RIDEWITH US,WE SHARE APURPOSE.The Harley-Davidson family shares a employees and suppliers, has raised morepowerful purpose: giving back. It’s as than $70 million for patient services andingrained in our nature as sharing an research through rides and events.open stretch of road. RESPECTCHAMPIONING A CAUSE A shared purpose goes beyond philan-In 2007, through The Harley-Davidson thropy. Every day, we look for ways toFoundation’s $1 million gift, we teamed incorporate sustainable practices intoup with the nonprofit Disabled American our business, our manufacturing opera-Veterans to fund a fleet of offices on wheels tions and our products, to minimize thethat help veterans get the government impact we have on the environment. Forbenefits to which they’re entitled. At more example, as noted in our 2009 Sustain-than 1,700 stops over the last three years, ability Report, we have reduced green-including many at Harley-Davidson deal- house gas emissions through changes toerships, DAV advisers helped some 48,000 our heat-treating operations and savedveterans obtain $540 million in benefits. enough natural gas to heat 1,312 homes a Giving back is also behind a remarkable year. And the Harley-Davidson Museum—thirty-year partnership with the Muscular our newest facility — has been highlyDystrophy Association. Since 1980, Harley- awarded for transforming a brownfieldDavidson and MDA have shared the road site into an environmentally sustainablein the battle against neuromuscular dis- community resource. It all adds up toease. As a national MDA sponsor, Harley- respect— for our environment, our com-Davidson, together with riders, dealers, munities and our future.T OPHarley’s Heroes™ DAV Mobile Service RIGHTAbbey Umali, Muscular DystrophyOffice staff counsel veterans at Ft. Washington Association National Goodwill Ambassador,Harley-Davidson during the Rolling Thunder rally and Bill Davidson, Harley-Davidson Vicein Washington, D.C. President, Core Customer Marketing, share a moment at the National H.O.G. Rally inB O T T O M Since opening in 2008, the Harley-Davidson Oklahoma City.Museum in Milwaukee has been recognized forits environmental sensitivity, including a 2009GREENGUARD Indoor Air Quality Certification.
  • 11. 18 HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORT 19FINANCIAL HIGHLIGHTS FINANCIAL PERFORMANCE SUMMARYIn thousands, except per-share amounts 2009 2008 2007 In 2009, Harley-Davidson’s revenue from administrative costs and exiting non-core motorcycles in our international marketsSTATEMENT OF OPERATIONS DATA: motorcycles and related products on a business operations. Consequently, 2009 decreased 15.4 percent compared to 2008.Motorcycles and related products revenue $ 4,287,130 $ 5,578,414 $ 5,726,848 continuing basis decreased 23.1 percent results were significantly affected by For the same period, retail sales of Harley-Gross profit 1,386,196 1,931,144 2,114,100 to $4.29 billion compared to 2008 and non-recurring charges. Harley-Davidson Davidson motorcycles decreased 11.2 per-Selling, administrative and engineering expense 851,165 942,267 900,708 income from continuing operations de- expects restructuring activities announced cent in the Europe Region, 27.2 percentRestructuring expense and other impairments 220,976 12,475 – creased 89.7 percent from the prior year in 2009 to deliver between $240 million in the Latin America Region, 30.9 percentOperating income from motorcycles and related products 314,055 976,402 1,213,392 to $70.6 million. These results reflect the and $260 million in annual ongoing sav- in Canada and 9.0 percent in the Asia performance of the Company’s motorcycle ings upon completion of those restruc- Pacific Region.Financial services revenue 494,779 376,970 416,196 business, operating losses at Harley- turing activities. In 2009, the Company shipped 223,023Financial services expense 581,059 294,205 204,027 Davidson Financial Services and the impact Harley-Davidson’s share price increased Harley-Davidson motorcycles worldwide,Restructuring expense 3,302 – – of restructuring charges. 48.5 percent during 2009 and the Company compared to 303,479 in 2008. In 2009,Goodwill impairment 28,387 – – Revenue from sales of Harley-Davidson paid out dividends of $0.40 per share in 35 percent of the Harley-Davidson mo-Operating (loss) income from financial services (117,969) 82,765 212,169 motorcycles decreased to $3.17 billion in 2009. Harley-Davidson has paid a dividend torcycles shipped went to international 2009, a decline of 25.2 percent from 2008, every year since 1993. markets compared to 32 percent in 2008.Operating income 196,086 1,059,167 1,425,561 on a 26.5 percent reduction in shipmentsInvestment income 4,254 11,296 22,258 of Harley-Davidson motorcycles. Revenue HARLEY-DAVIDSON MOTORCYCLES HARLEY-DAVIDSON FINANCIAL SERVICESInterest expense 21,680 4,542 – from Genuine Parts and Accessories in Worldwide retail sales of Harley-Davidson Financial Services incurred an operatingIncome before income taxes 178,660 1,065,921 1,447,819 2009 totaled $767.3 million, a 10.7 per- motorcycles declined 22.7 percent in 2009 loss of $118.0 million in 2009 compared toProvision for income taxes 108,019 381,686 513,976 cent decrease from the previous year, and compared to 2008. operating income of $82.8 million in 2008,Income from continuing operations 70,641 684,235 933,843 General Merchandise revenue was $282.2 In the United States, 2009 retail sales largely due to a $72.7 million credit lossLoss from discontinued operations, net of tax (125,757) (29,517) – million, a decrease of 10.1 percent com- of 162,385 Harley-Davidson motorcycles provision for a one time reclassificationNet (loss) income $ (55,116) $ 654,718 $ 933,843 pared to 2008. decreased 25.8 percent from 2008 and of Held for Sale receivables to Held for During 2009, Harley-Davidson took overall U.S. heavyweight market regis- Investment and a $28.4 million good-Earnings per common share from continuing operations: actions to lower its cost structure through trations declined 36.6 percent. For the full will impairment charge. Basic $ 0.30 $ 2.92 $ 3.75 eliminating excess capacity, reducing year 2009, retail sales of Harley-Davidson Diluted $ 0.30 $ 2.92 $ 3.74Loss per common share from discontinued operations: Basic $ (0.54) $ (0.13) $ – Diluted $ (0.54) $ (0.13) $ –(Loss) earnings per common share: Basic $ (0.24) $ 2.80 $ 3.75 Diluted $ (0.24) $ 2.79 $ 3.74Weighted-average common shares: Basic 232,577 234,225 249,205 Diluted 233,573 234,477 249,882 HARLEY-DAVIDSON, INC. VS. STANDARD & POOR’S 500 COMPOSITE INDEX In dollarsCash dividends per common share $ 0.40 $ 1.29 $ 1.06 23,191CONSOLIDATED BALANCE SHEET DATA (AT DECEMBER 31): 25,000 19,476 Total assets $ 9,155,518 $ 7,828,625 $ 5,656,606 Total debt $ 5,636,129 $ 3,914,887 $ 2,099,955 17,169 16,709 15,687 20,000 15,133 Total equity $ 2,108,118 $ 2,115,603 $ 2,375,491 14,645 12,544 15,000 10,084WORLDWIDE 9,061 WORLDWIDE 7,4342009 MOTORCYCLES AND RELATED PRODUCTS REVENUE BY PRODUCT LINE 2009 MOTORCYCLES AND RELATED PRODUCTS REVENUE BY REGION 10,000 5,956Dollars in millions Dollars in millions 4,257 74.1 % H-D Motorcycles . . . . .$3,174.8 67.9 % United States. . . . . . . . $2,910.1 3,650 2,224 17.9 % Parts & Accessories . . . . .767.3 . 16.3 % Europe . . . . . . . . . . . . . . . . .700.9 2,152 1,686 1,433 5,000 6.6 % General Merchandise . . . 282.2 6.0 % Japan . . . . . . . . . . . . . . . . . . 255.9 930 981 860 852 803 782 782 766 689 618 690 710 553 537 414 367 337 220 204 245 156 242 1.1 % Buell Motorcycles . . . . . . . .46.5 4.1 % Canada . . . . . . . . . . . . . . . . 175.9 0.3 % Other . . . . . . . . . . . . . . . . . . . 16.3 3.2 % Australia. . . . . . . . . . . . . . . 137.6 0 2.5 % Rest of World . . . . . . . . . . 106.7 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 Total Net Revenue $4,287.1 Total Net Revenue $4,287.1 S&P 500 H-D COMPARISON OF YEAR-END VALUE OF $100 INVESTED DEC. 31, 1986 (20 YEARS SHOWN). ASSUMES FOR BOTH HARLEY-DAVIDSON AND S&P THAT ALL DIVIDENDS ARE REINVESTED.
  • 12. 20 HARLEY - DAVIDSON, INC. 2009 ANNUAL REPORT 21 CORPORATE SUMMARYHARLEY- DAVIDSON MOTORCYCLE HARLEY- DAVIDSON, INC. HARLEY- DAVIDSON, INC. UNITED STATES (1) BOARD OF DIRECTORS HARLEY- DAV IDSON PATRICK SMITH the Company’s trademarks areWORLDWIDE SHIPMENTS MOTORCYCLES AND RELATED PRODUCTS REVENUE INCOME FROM CONTINUING OPERATIONS 651+ CC MOTORCYCLE REGISTRATIONS HARLEY- DAV IDSON INC. MOTOR COMPANY Vice President and owned by H-D Michigan, LLC, H-D vs. Industry, units in thousands LEADERSHIP General Manager, a subsidiary of the Company,Units in thousands Dollars in millions Dollars in millions ,043 MARKET SHARE BARRY K. ALLEN General Merchandise which also manages the 349.2 349.2 UNITED STATES Dollars in millions Senior Advisor, Providence CHARLES R. BAKER Company’s trademark strategy 1,043 UNITED STATES 5,801 330.6 329.0 5,727 48.8 45.6 45.0 47.5 49.5 49.2 49.0 49.3 48.7 45.5 53.3 % 330.6 329.0 MARK VAN GENDEREN 5,594 INTERNATIONAL INTERNATIONAL Equity Partners, President, Vice President, and portfolio. The MV Agusta 317.3 317.3 5,342 303.5 Vice President and Managing 303.5 350 Allen Enterprises, LLC OE Engineering trademarks are owned 350 6,000 1,1 00 960 543.0 5,015 Director, Latin America 291.1 934 by MV Agusta Motor S.p.A. 291.1 517.6 516.1 890 600 4,624 RICHARD I. BEATTIE JOANNE M. BISCHMANN 494.0 63.7 1,000 263.7 479.8 BUE L L MOTORCYCLE SHAREHOLDER 4,287 461.2 300 300 Chairman, Simpson Vice President, Licensing 442.3 5 4,091 5,000 234.5 900 Thacher & Bartlett LLP and Special Events COMPANY LEADERSHIP INFORMATION 761 223.0 500 394.3 204.6 800 3,407 684 250 MARTHA F. BROOKS RODNEY J. COPES JON R. FLICKINGER ANNUAL SHAREHOLDERS 304.0 340.0 4,000 President and177.2 Former President and Chief Senior Vice President, Inter- MEETING 2,943 580 700 400 Operating Officer, Novelis Inc. national Sales, Marketing Chief Operating Officer, The Annual Meeting of 275.6 200 2,453 600 and Business Development Buell Motorcycle Company Shareholders will convene at 438 3,000 GEORGE H. CONRADES 10:30 a.m., CT, on Saturday, 500 300 Executive Chairman, WILLIAM G. DAVIDSON HARLEY- DAV IDSON 348 150 April 24, 2010, at the Akamai Technologies, Inc. Senior Vice President and FINANCIAL SERVICES 400 Harley-Davidson Museum, 267 2,000 200 Chief Styling Officer LEADERSH I P 400 Canal Street, 100 300 JUDSON C. GREEN Milwaukee, WI 53201. Vice Chairman, NAVTEQ WILLIAM J. DAVIDSON STEVEN E. CUNNINGHAM 1,000 200 100 Vice President, Vice President and Chief 50 SEC FORM 10 -K 71 DONALD A. JAMES Core Customer Marketing Financial Officer, Harley- 1 00 A copy of the Company Chairman and Chief Davidson Financial Services Annual Report, as filed with the 0 0 0 0 Executive Officer, Deeley KARL M. EBERLE 99 00 01 02 03 04 05 06 07 08 09 Securities and Exchange99 00 01 02 03 04 05 06 07 08 09 99 00 01 02 03 04 05 06 07 08 09 99 00 01 02 03 04 05 06 07 08 09 Harley-Davidson Canada/ Senior Vice President, LAWRENCE G. HUND Commission on Form 10-K, Fred Deeley Imports Ltd. Manufacturing President, Harley-Davidson H-D MOTORCYCLES REST OF INDUSTRY may be obtained from the Financial Services SARA L. LEVINSON FRED C. GATES Company without charge to Former President of the Vice President and M V AGUSTA the shareholders or via theHARLEY- DAVIDSON, INC. HARLEY- DAVIDSON, INC. HARLEY- DAVIDSON, INC. Women’s Group of Rodale, Inc. General Manager, GROUP LEADERSH I P Company’s Web site.CAPITAL EXPENDITURES ON CONTINUING OPERATIONS DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS DIVIDENDS PER SHARE EUROPE (1) York Vehicle Operations N. THOMAS LINEBARGER CLAUDIO CASTIGLIONI DIRECT STOCK REPURCHASEDollars in millions In dollars In dollars, adjusted for splits 651+ CC MOTORCYCLE REGISTRATIONS AND DI VIDEND President and Chief Operating DONALD M. GOGAN Chairman, MV Agusta H-D vs. Industry, units in thousands Officer, Cummins, Inc. Vice President, Global REIN V EST MENT PL AN 1.290 MARKET SHARE ENRICO D’ONOFRIO To obtain information on our 3.93 Advanced Manufacturing 323.9 President and Managing Direct Stock Purchase and 3.74 6.1 7.2 7.1 7.1 8.1 7.7 8.9 9.5 10.0 10.6 12.0 % GEORGE L. MILES, JR. 350 4.00 1.300 President and Chief Executive JAMES E. HANEY Director, MV Agusta Dividend Reinvestment Plan, 290.4 3.41 1.060 Officer, WQED Multimedia Vice President and please contact our registrar COMPANY 389.7 387.9 Chief Information Officer and transfer agent: 3.50 3.00 300 1.100 450 INFORMATION 242.1 JAMES A. NORLING 361.3 2.92 229.0 227.2 Computershare CIP 335.4 336.7 Former Chairman of 333.3 333.2 MICHAEL P. HEERHOLD 219.6 0.810 400 213.6 323.9 322.7 321.3 2.50 3.00 HARLEY- DAV IDSON, INC. 313.6 203.6 the Board, Chartered Vice President and General 250 Royall Street, 198.4 250 0.900 3700 West Juneau Avenue 350 Semiconductor Manager, Powertrain Mail Stop 1A 0.625 2.50 P Box 653 .O.165.8 Manufacturing Ltd. Operations, Pilgrim Road Canton, MA 02021 1.90 200 300 (now known as Milwaukee, WI 53201-0653 www.computershare.com 0.700 414-343-4680 2.00 GlobalFoundries, Inc.) TIMOTHY K. HOELTER 866-360-5339 toll-free 116.7 1.43 0.405 250 Vice President, or 312-360-5339 0.40 150 Internet Addresses: 1.13 0.500 KEITH E. WANDELL Government Affairs 1.50 200 www.harley-davidson.com CONTACT IN VESTOR President and Chief 0.86 www.buell.com REL ATIONS AT: 0.195 Executive Officer, EDWARD M. KRISHOK 100 0.135 1.00 150 www.mvagusta.com 0.115 0.300 Harley-Davidson, Inc. Vice President, 877- HDSTOCK toll-free 0.098 0.088 0.30 General Counsel 414-343-4782 50 100 JOCHEN ZEITZ MUSEUM INFORMATION: or e-mail: investor.relations 0.50 0.100 Chief Executive Officer and MICHELLE A. KUMBIER Harley-Davidson Museum @harley-davidson.com 50 Vice President and 400 Canal Street 0 0 Chairman of the Board, 0 General Manager, Milwaukee, WI 53201 Corporate Governance99 00 01 02 03 04 05 06 07 08 09 99 00 01 02 03 04 05 06 07 08 09 99 00 01 02 03 04 05 06 07 08 09 0 Puma AG Materials Management 877-436-8738 materials may be obtained 99 00 01 02 03 04 05 06 07 08 09 HARLEY- DAV IDSON, INC. www.h-dmuseum.com via our Web site at H-D MOTORCYCLES REST OF INDUSTRY LEADE RSH I P MATTHEW S. LEVATICH www.harley-davidson.com, President and PL ANT TOUR INF ORMATION: including our Code of Business TONIT M. CALAWAY Chief Operating Officer 877-883-1450HARLEY- DAVIDSON, INC. HARLEY- DAVIDSON, INC. Conduct, which is available Vice President, York, PA motorcycles in eight languages. In addition,COMMON SHARES OUTSTANDING YEAR-END STOCK PRICES ROBERT N. LINDLEY Kansas City, MO motorcycles This document contains statements of our beliefs, expecta- (1) U.S. industry data is derived from submissions of motorcycle Human Resources we maintain an ethicsShares outstanding, in millions In dollars, adjusted for splits Vice President and tions and objectives and other forward-looking statements retail sales by each major manufacturer to an independent hotline at 800-688-2316. that are subject to risks that could cause actual results to third party. This third party data is subject to revision and PERRY A. GLASSGOW* Managing Director, Europe The following are among be materially different. Those risks include, among others, update. 2009 and 2008 U.S. industry data includes three-wheeled Vice President, Treasurer the Company’s trademarks: 70.47 Communication with the302.7 302.7 302.7 302.1 301.5 350 80 that we may not be able to execute our long-term strategy, vehicles. The Company did not ship three-wheeled vehicles and Controller JAMES A. McCASLIN HARLEY-DAVIDSON, HARLEY, Board c/o the Secretary of Executive Vice President, 294.3 the Bar & Shield Logo, 274.0 capital markets uncertainties and matters we have noted until 2008 and does not believe three-wheeled vehicle retail Harley-Davidson, Inc. 60.75 258.1 70 in our filings with the SEC, including risk factors that we registrations were significant in the U.S. for 2007 and prior. SUSAN K. HENDERSON Corporate Product Planning MOTORCLOTHES, RIDER’S 3700 West Juneau Avenue 300 238.5 54.31 identified in our Annual Report on Form 10-K for 2009, a Europe data includes registrations in Austria, Belgium, Vice President, 234.3 EDGE, HARLEY OWNERS 232.8 P Box 653 .O. 51.49 copy of which is included as a separate enclosure. Harley- Denmark, Finland, France, Germany, Greece, Italy, Netherlands, Communications JEFFREY A. MERTEN GROUP H.O.G., SPORTSTER, , 60 Milwaukee, WI 53201-0653 47.53 46.71 46.20 Davidson disclaims any obligation to update information in Norway, Portugal, Spain, Sweden, Switzerland, and the United Vice President and 250 V-ROD, ELECTRA GLIDE, this document. Kingdom. The Company derives its Europe industry data GAIL A. LIONE* General Manager, TRI GLIDE, DARK CUSTOM, © 2010 Harley-Davidson, Inc. 39.75 50 from information provided by Giral S.A., an independent Executive Vice President, North American Sales STREET GLIDE, IRON 883, 200 agency. This third party data is subject to revision and update. General Counsel, Secretary 32.03 FORTY-EIGHT, GARAGE Design: VSA Partners, Inc. Europe industry data includes three-wheeled vehicles. and Chief Compliance Officer SCOTT C. MILLER 40 PARTY, SCREAMIN’ EAGLE Printing: Lake County Press 25.20 The retail registration data for Harley-Davidson motorcycles Vice President and 150 and BUELL. The HARLEY- Paper: Sappi Somerset presented in these tables may differ slightly from the Harley- JOHN A. OLIN* General Manager, 30 DAVIDSON trademark has Photography: Eric Perry, 16.97 Davidson retail sales data presented elsewhere in this report. Senior Vice President and Parts and Accessories The Company’s source for retail sales presented elsewhere in been used since 1903 and Peter Turnley, various 100 Chief Financial Officer this report is sales and warranty registrations provided by the Bar and Shield trademark 20 Harley-Davidson dealers as compiled by the Company. The MARK-HANS RICHER since at least 1910. The differences are not significant and generally relate to the KEITH E. WANDELL* Senior Vice President and BUELL trademark has been 10% 50 10 timing of data submissions to the independent sources. President and Chief Marketing Officer used since 1984. With the Cert no. SW-COC-001613 Chief Executive Officer exception of the MV Agusta 0 0 trademarks, substantially all of99 00 01 02 03 04 05 06 07 08 09 99 00 01 02 03 04 05 06 07 08 09 *Corporate Officer
  • 13. OUR VISIONWe fulf ill dreams inspired by the many roads ofthe world by providing extraordinarymotorcycles and customer experiences. We fuelthe passion for freedom in our customersto express their own individuality.HARLEY - DAVIDSON, INC.3700 West Juneau AvenueP Box 653 .O.Milwaukee, Wisconsin 53201-0653www.harley- davidson.com