Just like the ancient Roman Empire, Harley-Davidson’s gradual downward trend seems unstoppable, as yet another scratchy full-year result evidenced. BDN financial editor Roger Willis reports.
At a glance, Harley-Davidson consolidated net revenue for 2023 was narrowly positive, 1.6% up to £4.576bn. But the main HDMC entity producing motorcycles and related parts, accessories, etc, was actually 0.9% down year-on-year at £3.824bn. However, Harley’s HDFS consumer credit and dealer inventory funding arm grew its revenue by 16.2% to £752.5m, neatly bridging the gap.
HDMC operating profit copped a 2.4% decline to £521.6m. Then a £92.1m operating loss from Harley’s stumbling LiveWire electric bike subsidiary had to be factored in. And HDFS operating profit unfortunately plunged by 26.1% to £185.2m. Higher interest rate expenses and an abruptly increased provision for credit losses, relating to the currently abysmal macro-economic environment, took the blame for putting a spanner in its money-lending works. Eventual combined operating profit finished 14.3% down on £614.3m. Finally, net profit was 4.7% in arrears to £557.3m. A satisfactory outcome? Probably not.
As for wholesale shipments to dealers worldwide during the 12 months in question, output slumped by 7% to 179,984 motorcycles. “Grand American Touring” models, including new CVO kit, was 3.2% up to 92,683. “Cruiser” grew too, rising by 8.4% to 63,945. “Sport and Lightweight” took a 46.2% dive to 18,228. And “Adventure Touring”, represented by the solitary Pan America, more than halved to just 5128 bikes shipped. Separately, LiveWire electric shipments rose by 10.6% to 660 machines as the Del Mar arrived.
Harley’s global retail sales declined in almost every market during 2023. US domestic volume fell by 9.8% to 98,468 units. Canada was 6.3% down to 7422. The EMEA region (mainly Europe) went backwards by 11.5% to 27,005. Asia Pacific had a 3.4% retreat to 26,953. Latin America enjoyed the dubious stardom of adding just one more bike, taking its tally to 2923.
Exercising his right to address investors with the longest sentence to match his longest corporate title, Harley-Davidson chairman, president and chief executive officer Jochen Zeitz said: “In the third year of our Hardwire strategic plan, we have made progress in key elements, focusing on our most profitable products and markets, which we believe will continue to yield benefits to the business and have set us up for long-term value creation, despite the current challenging environment for the industry.”
$-£ currency translation at forex rates applicable on 12 February