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HARLEY-DAVIDSON, INC. POSTS RECORD FOURTH QUARTER/YEAR-END SALES AND EARNINGS

 MILWAUKEE, Feb. 18 /PRNewswire/ -- Harley-Davidson, Inc. (NYSE: HDI) today announced record sales and earnings for its fourth quarter and year ended Dec. 31, 1992. Additionally, the company reported that its annual consolidated revenue exceeded $1 billion for the first time, that it had eliminated virtually all of its long-term debt by year-end and that its Holiday Rambler Corporation subsidiary generated a positive operating profit after a $13.4 million loss in 1991.
 Fourth Quarter Results
 Net sales for the quarter totaled $312.2 million, a $74.5 million or 31.3 percent increase over the comparable year-ago quarter. Net income and earnings per share were $14.5 million and $.40, respectively, on 36.2 million shares outstanding, compared to $7.2 million and $.20 on 35.6 million shares in the year-ago quarter, an earnings per share increase of 100 percent.
 The sales increase was driven by both of the company's business segments. The Motorcycles and Related Products segment reported fourth quarter sales of $238.6 million, a $51.9 million or 27.8 percent increase over the year-ago quarter. The Transportation Vehicles (Holiday Rambler Corporation) segment reported sales of $73.6 million, a $22.6 million or 44.3 percent increase. Holiday Rambler's Recreational Vehicle division posted sales of $52.2 million, up $15.3 million or 41.3 percent over the year-ago quarter, while its Commercial Vehicle (Utilimaster Corporation) division reported sales of $18.4 million, a $7.1 million or 62.8 percent increase.
 The Motorcycles and Related Products segment shipped 22,561 motorcycles in the fourth quarter, up 3,722 or 19.8 percent from the year-ago quarter. Similar to the year-ago quarter, the total shipments included additional units shipped from planned year-end factory inventory, in response to high market
demand. This resulted in a shift of 1,400 units intended for the first quarter of 1993 to the fourth quarter of 1992, according to Richard F. Teerlink, president and chief executive officer, Harley-Davidson, Inc. Factory and in-transit inventories were lowered to below customary operating levels and will need to be built back up in the first quarter, he added.
 ``We entered the fourth quarter carrying a 1,200 unit backlog,'' Teerlink said. ``By the end of the quarter, our entire unit backlog was eliminated and some additional production was gained on both daily and Saturday overtime. Through the tremendous team effort of our employees, we were consistently hitting our increased production goal of 345 units per eight-hour day by year-end and were painting all 1993 model colors by the end of January.''
 ``Our worldwide Parts and Accessories business continued to grow, reporting sales of $36.7 million, a 28.7 percent increase over the year ago quarter,'' Teerlink said, ``due to continued enthusiastic market acceptance of our new and existing products and improved dealer merchandising.''
 ``Holiday Rambler's fourth quarter recreational vehicle sales increase was partially the result of our very successful performance at the industry's largest dealer show in many years,'' Teerlink said. ``Dealer response to our new units was very favorable and these new units were available for immediate shipment.'' Another contributor to recreational vehicle sales improvement, Teerlink said, was the Navigator motorcoach, which was introduced in June, 1992.
 Teerlink cautioned, however, that the recreational vehicle industry's momentum of 1992 does not appear to have carried over to the first quarter of 1993. ``Our Holiday Rambler dealers are reporting a slowdown in showroom traffic, which we are watching very closely as we enter the key months of our selling season,'' he said.
 The commercial vehicle market continues to remain soft and fiercely competitive, Teerlink said, although Utilimaster signed two new contracts during the last half of the year, totaling approximately $17 million, with Penske Truck Leasing Company and Ryder Truck Rental, Inc.
 Production on these contracts, which will return lower than normal gross margins, will start in the first quarter of 1993 and will extend into the first quarter of 1994, he added.
 Fourth quarter consolidated operating profit was $24.8 million, an $11.8 million or 90.9 percent increase over the year-ago quarter, with the increase driven largely by the Transportation Vehicles segment, which reported a $.7 million operating profit, versus a loss of $6.9 million in the year ago quarter. ``Our Motorcycles and Related Products segment's operating profit increased less than the proportionate increase in its revenue due mostly to a $5 million charge for two motorcycle recalls voluntarily initiated during the quarter,'' Teerlink said. ``Consequently, motorcycle operating margins were only 10.9 percent of net sales in the fourth quarter compared to 11.8 percent in the year-ago quarter.''
 Holiday Rambler's fourth quarter operating profit improvement is largely the result of improved cost controls, new product offerings in December and restructuring efforts introduced late in the year-ago quarter, Teerlink said.
 1992 Year-End Results
 For the year, net sales totaled $1.105 billion, an increase of $165.4 million or 17.6 percent over 1991. Income before extraordinary items and earnings per share increased, respectively, to $54.2 million and $ 1.51 on 35.9 million shares outstanding versus $37.0 million and $1.04 on 35.6 million shares in 1991, or an earnings per share before extraordinary items increase of 45.2 percent.
 The net sales increase was driven by both segments, with the Motorcycles and Related Products segment reporting 1992 net sales of $822.9 million versus $702.0 million in 1991, a 17.2 percent increase, and the Transportation Vehicles segment reporting net sales of $282.4 million versus $237.9 million, an 18.7 percent increase over 1991.
 Consolidated operating profit totaled $97.2 million, a $28.6 million or 41.6 percent increase over 1991, due largely to improvement at the Transportation Vehicles segment and increased motorcycle unit volume. Harley-Davidson's balance sheet is showing solid improvement as well, Teerlink said, due to the conversion to common stock of most of the company's outstanding long-term debt during the fourth quarter, as previously reported.
 For the year, worldwide motorcycle unit shipments totaled 76,495 -- an increase of 7,869 units or 11.5 percent over 1991. ``We're pleased with our progress to-date in achieving quality and production improvements,'' Teerlink said. ``In 1993, much of our manufacturing efforts will be focused on process improvements and production predictability.''
 ``Motorcycle retail demand and sales continue to outweigh supply in nearly all of our worldwide markets and dealer inventories are at their lowest levels
in recent history,'' Teerlink said. Through November (most current data) Harley-Davidson claims a 62.9 percent share in the United States superheavyweight (850cc+) market.
 As in the last two years, Harley-Davidson exported approximately 31 percent of motorcycle production, or 23,253 units, in 1992. ``The overall worldwide motorcycle market continued to grow in 1992 -- including the United States -- and we hope to see further growth in 1993. We believe export markets continue to hold attractive long-term growth potential for us,'' Teerlink said.
 ``Our Parts and Accessories business continues to grow on a worldwide basis, generating 1992 sales of $155.7 million, a $25.4 million or 19.5 percent increase over 1991,'' Teerlink said. ``Our MotorClothes product offerings, in particular, have grown at a steady rate and have generated continuously improving levels of revenue and income. Although MotorClothes does not generate profit margins as high as our motorcycle replacement parts and accessories, it generates additional floor traffic and attracts non-traditional customers into our dealerships,'' he said.
 ``At Holiday Rambler, cost control improvement, restructuring and positive market acceptance of new product offerings generated welcome sales and earnings improvement over 1991,'' Teerlink said. For the first 11 months of 1992, Holiday Rambler outperformed the Class A motorhome market, generating an 8.0 percent increase in unit registrations, compared to a 2.9 percent increase for the overall market. The most current data shows Holiday Rambler holding a 5.4 percent share of the Class A motorhome market, compared to 5.2 percent for the same period in 1991.
 ``We continue to follow, rather than lead, in the travel trailer and fifth wheel markets,'' Teerlink said, ``because the majority of our product development and manufacturing improvement efforts have focused on our motorized product lines. In 1993, we will be focusing on trying to create similar levels of overall improvement in our travel trailer and fifth wheel operations as we've created in motorized.''
 Utilimaster continues to produce units under its Ford Motor Company/United States Postal Service contract through October of 1993, Teerlink said, and has begun delivery on its Ryder contract. ``We don't expect to see dramatic growth in the commercial vehicle market in 1993, however we hope to see further improvements in Utilimaster's financial performance, due to manufacturing efficiencies and improved cost controls.''
 1993 Accounting Change
 In accordance with new Financial Accounting Standards Board rules governing provisions for retiree benefits, Harley-Davidson, Inc. will take a one-time charge of $32 million (after tax) during the first quarter of 1993. This accounting charge will also have the impact of increasing the annual cost recognition of post-retirement health benefits by approximately $3 million annually (after tax), but has no immediate impact on cash, Teerlink said.
 Harley-Davidson, Inc. the only major American motorcycle manufacturer, produces heavyweight motorcycles and a complete line of motorcycle parts and accessories. Its Holiday Rambler Corporation subsidiary is a leading manufacturer of premium recreational vehicles, specialized commercial vehicles and a diverse range of related products.
 HARLEY-DAVIDSON, INC.
 Condensed Consolidated Statements of Income
 (In millions, except per share amounts)
 Periods ended Dec. 31 Three Months Ended Year Ended
 1992 1991 1992 1991
 Net sales $312.2 $237.7 $1,105.3 $939.9
 Operating profit 24.8 13.0 97.2 68.6
 Interest expense .9 .6 4.9 7.3
 Other expense .2 1.7 3.5 3.2
 Income before provision for taxes
 and extraordinary item 23.7 10.7 88.8 58.1
 Provision for income taxes 9.2 3.5 34.6 21.1
 Income before extraordinary item 14.5 7.2 54.2 37.0
 Extraordinary item, net of tax - - (.4) -
 Net income 14.5 7.2 53.8 37.0
 Earnings per share:
 Assuming no dilution
 Income before
 extraordinary item $ .40 $ .20 $ 1.51 $ 1.04
 Extraordinary item, net of tax - - (.01) -
 Net income $ .40 $ .20 $ 1.50 $ 1.04
 Assuming full dilution
 Income before
 extraordinary item $ .38 $ .20 $ 1.46 $1.04
 Extraordinary item, net of tax - - (.01) -
 Net income $ .38 $ .20 $ 1.45 $ 1.04
 Shares outstanding (A):
 Assuming no dilution 36.2 35.6 35.9 35.6
 Assuming full dilution 38.3 35.6 38.3 35.6
 Segment Data
 Units
 Motorcycle Shipments:
 United States 15,380 12,817 53,242 46,993
 Export 7,181 6,022 23,253 21,633
 Total 22,561 18,839 76,495 68,626
 Revenue (Millions)
 Motorcycles and Related Prod's $238.6 $186.7 $822.9 $702.0
 Transportation Vehicles 73.6 51.0 282.4 237.9
 Total $312.2 $237.7 $1,105.3 939.9
 Operating profit (Millions)
 Motorcycles and Related Prod's $ 25.9 $ 21.9 $ 102.3 $ 89.5
 Transportation Vehicles .7 (6.9) 2.1 (13.4)
 Corporate Expenses (1.8) (2.0) (7.2) (7.5)
 Total $ 24.8 $ 13.0 $ 97.2 $ 68.6
 NOTE: (A) Restated to reflect June 26, 1992 two-for-one common stock split.
 -0- 2/18/93
 /CONTACT: Jim Ziemer, financial, 414-935-4750, Ken Schmidt, media 414-935-4538, both of Harley Davidson/
 (HDI)


CO: Harley-Davidson, Inc. ST: Wisconson IN: AUT SU: ERN

TM -- NY095 -- 8202 02/18/93 20:13 EST
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