Supplemental Consolidating Data

9 Months Ended

Sep. 27, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Supplemental Consolidating Data

Supplemental Consolidating Data

The supplemental consolidating data is presented for informational purposes and is different than segment information due to the allocation of consolidating reporting adjustments to the reportable segments. Supplemental consolidating data is as follows (in thousands):

	Three months ended September 27, 2020
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
Revenue:
Motorcycles and Related Products	$	969,399	$	—	$	(5,370)	$	964,029
Financial Services	—		200,448		1,207		201,655
	969,399		200,448		(4,163)		1,165,684
Costs and expenses:
Motorcycles and Related Products cost of goods sold	676,796		—		—		676,796
Financial Services interest expense	—		67,533		—		67,533
Financial Services provision for credit losses	—		7,835		—		7,835
Selling, administrative and engineering expense	199,829		35,774		(3,882)		231,721
Restructuring expense	43,581		334		—		43,915
	920,206		111,476		(3,882)		1,027,800
Operating income	49,193		88,972		(281)		137,884
Other income, net	155		—		—		155
Investment income	2,672		—		—		2,672
Interest expense	7,783		—		—		7,783
Income before income taxes	44,237		88,972		(281)		132,928
Income tax (benefit) provision	(6,347)		19,057		—		12,710
Net income	$	50,584	$	69,915	$	(281)	$	120,218
	Nine months ended September 27, 2020
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
Revenue:
Motorcycles and Related Products	$	2,743,562	$	—	$	(10,471)	$	2,733,091
Financial Services	—		591,206		4,858		596,064
	2,743,562		591,206		(5,613)		3,329,155
Costs and expenses:
Motorcycles and Related Products cost of goods sold	2,019,310		—		—		2,019,310
Financial Services interest expense	—		182,193		—		182,193
Financial Services provision for credit losses	—		178,433		—		178,433
Selling, administrative and engineering expense	627,874		111,903		(5,720)		734,057
Restructuring expense	84,586		1,278		—		85,864
	2,731,770		473,807		(5,720)		3,199,857
Operating income	11,792		117,399		107		129,298
Other income, net	466		—		—		466
Investment income	103,082		—		(100,000)		3,082
Interest expense	23,307		—				23,307
Income before income taxes	92,033		117,399		(99,893)		109,539
Income tax (benefit) provision	(14,014)		25,857		—		11,843
Net income	$	106,047	$	91,542	$	(99,893)	$	97,696

	Three months ended September 29, 2019
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
Revenue:
Motorcycles and Related Products	$	1,074,397	$	—	$	(5,455)	$	1,068,942
Financial Services	—		201,308		2,269		203,577
	1,074,397		201,308		(3,186)		1,272,519
Costs and expenses:
Motorcycles and Related Products cost of goods sold	748,878		—		—		748,878
Financial Services interest expense	—		53,390		—		53,390
Financial Services provision for credit losses	—		33,747		—		33,747
Selling, administrative and engineering expense	269,080		42,996		(3,045)		309,031
Restructuring expense	7,629		—		—		7,629
	1,025,587		130,133		(3,045)		1,152,675
Operating income	48,810		71,175		(141)		119,844
Other income, net	3,160		—		—		3,160
Investment income	52,041		—		(50,000)		2,041
Interest expense	7,789		—		—		7,789
Income before provision for income taxes	96,222		71,175		(50,141)		117,256
Provision for income taxes	13,517		17,176		—		30,693
Net income	$	82,705	$	53,999	$	(50,141)	$	86,563
	Nine months ended September 29, 2019
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
Revenue:
Motorcycles and Related Products	$	3,714,091	$	—	$	(15,508)	$	3,698,583
Financial Services	—		584,258		6,677		590,935
	3,714,091		584,258		(8,831)		4,289,518
Costs and expenses:
Motorcycles and Related Products cost of goods sold	2,576,342		—		—		2,576,342
Financial Services interest expense	—		158,387		—		158,387
Financial Services provision for credit losses	—		94,621		—		94,621
Selling, administrative and engineering expense	764,848		129,170		(8,745)		885,273
Restructuring expense	31,682		—		—		31,682
	3,372,872		382,178		(8,745)		3,746,305
Operating income	341,219		202,080		(86)		543,213
Other income, net	11,857		—		—		11,857
Investment income	151,970		—		(140,000)		11,970
Interest expense	23,304		—		—		23,304
Income before provision for income taxes	481,742		202,080		(140,086)		543,736
Provision for income taxes	85,422		48,175		—		133,597
Net income	$	396,320	$	153,905	$	(140,086)	$	410,139

	September 27, 2020
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	733,704	$	2,827,246	$	—	$	3,560,950
Accounts receivable, net	473,530		—		(240,685)		232,845
Finance receivables, net	—		1,701,478		—		1,701,478
Inventories, net	322,375		—		—		322,375
Restricted cash	—		160,155		—		160,155
Other current assets	81,551		102,156		(4,776)		178,931
	1,611,160		4,791,035		(245,461)		6,156,734
Finance receivables, net	—		5,142,014		—		5,142,014
Property, plant and equipment, net	736,589		48,576		—		785,165
Prepaid pension costs	82,378		—		—		82,378
Goodwill	64,884		—		—		64,884
Deferred income taxes	46,676		92,318		(1,034)		137,960
Lease assets	42,639		4,960		—		47,599
Other long-term assets	176,873		32,853		(94,185)		115,541
	$	2,761,199	$	10,111,756	$	(340,680)	$	12,532,275
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	265,263	$	264,525	$	(240,685)	$	289,103
Accrued liabilities	424,391		170,830		(3,940)		591,281
Short-term debt	—		1,227,763		—		1,227,763
Current portion of long-term debt, net	—		2,109,284		—		2,109,284
	689,654		3,772,402		(244,625)		4,217,431
Long-term debt, net	743,806		5,427,870		—		6,171,676
Lease liabilities	26,951		4,274		—		31,225
Pension liabilities	57,853		—		—		57,853
Postretirement healthcare liabilities	68,379		—		—		68,379
Other long-term liabilities	168,037		45,256		2,520		215,813
Commitments and contingencies (Note 17)
Shareholders’ equity	1,006,519		861,954		(98,575)		1,769,898
	$	2,761,199	$	10,111,756	$	(340,680)	$	12,532,275

	December 31, 2019
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	470,649	$	363,219	$	—	$	833,868
Accounts receivable, net	369,717		—		(110,383)		259,334
Finance receivables, net	—		2,272,522		—		2,272,522
Inventories, net	603,571		—		—		603,571
Restricted cash	—		64,554		—		64,554
Other current assets	110,145		59,665		(836)		168,974
	1,554,082		2,759,960		(111,219)		4,202,823
Finance receivables, net	—		5,101,844		—		5,101,844
Property, plant and equipment, net	794,131		53,251		—		847,382
Prepaid pension costs	56,014		—		—		56,014
Goodwill	64,160		—		—		64,160
Deferred income taxes	62,768		39,882		(1,446)		101,204
Lease assets	55,722		5,896		—		61,618
Other long-term assets	166,972		19,211		(93,069)		93,114
	$	2,753,849	$	7,980,044	$	(205,734)	$	10,528,159
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	266,710	$	138,053	$	(110,383)	$	294,380
Accrued liabilities	463,491		119,186		(389)		582,288
Short-term debt	—		571,995		—		571,995
Current portion of long-term debt, net	—		1,748,109		—		1,748,109
	730,201		2,577,343		(110,772)		3,196,772
Long-term debt, net	743,296		4,381,530		—		5,124,826
Lease liabilities	38,783		5,664		—		44,447
Pension liabilities	56,138		—		—		56,138
Postretirement healthcare liabilities	72,513		—		—		72,513
Other long-term liabilities	186,252		40,609		2,603		229,464
Commitments and contingencies (Note 17)
Shareholders’ equity	926,666		974,898		(97,565)		1,803,999
	$	2,753,849	$	7,980,044	$	(205,734)	$	10,528,159

	September 29, 2019
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	482,106	$	380,275	$	—	$	862,381
Accounts receivable, net	635,997		—		(328,381)		307,616
Finance receivables, net	—		2,210,001		—		2,210,001
Inventories, net	489,098		—		—		489,098
Restricted cash	—		79,115		—		79,115
Other current assets	109,724		46,013		(14,951)		140,786
	1,716,925		2,715,404		(343,332)		4,088,997
Finance receivables, net	—		5,305,579		—		5,305,579
Property, plant and equipment, net	791,107		53,339		—		844,446
Goodwill	63,727		—		—		63,727
Deferred income taxes	92,921		40,411		(1,313)		132,019
Lease assets	49,706		6,199		—		55,905
Other long-term assets	157,341		20,401		(92,185)		85,557
	$	2,871,727	$	8,141,333	$	(436,830)	$	10,576,230
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	314,843	$	362,489	$	(328,381)	$	348,951
Accrued liabilities	462,644		108,719		(14,373)		556,990
Short-term debt	—		1,013,137		—		1,013,137
Current portion of long-term debt, net	—		1,779,673		—		1,779,673
	777,487		3,264,018		(342,754)		3,698,751
Long-term debt, net	743,127		3,863,914		—		4,607,041
Lease liabilities	33,296		6,112		—		39,408
Pension liabilities	82,561		—		—		82,561
Postretirement healthcare liabilities	89,032		—		—		89,032
Other long-term liabilities	180,103		40,261		2,854		223,218
Commitments and contingencies (Note 17)
Shareholders’ equity	966,121		967,028		(96,930)		1,836,219
	$	2,871,727	$	8,141,333	$	(436,830)	$	10,576,230

	Nine months ended September 27, 2020
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
Cash flows from operating activities:
Net income	$	106,047	$	91,542	$	(99,893)	$	97,696
Adjustments to reconcile Net income to Net cash provided by operating activities:
Depreciation and amortization	133,679		6,378		—		140,057
Amortization of deferred loan origination costs	—		52,374		—		52,374
Amortization of financing origination fees	510		10,118		—		10,628
Provision for long-term employee benefits	23,557		—		—		23,557
Employee benefit plan contributions and payments	(5,456)		—		—		(5,456)
Stock compensation expense	10,959		1,117		—		12,076
Net change in wholesale finance receivables related to sales	—		—		330,793		330,793
Provision for credit losses	—		178,433		—		178,433
Deferred income taxes	6,171		(24,737)		(412)		(18,978)
Other, net	(13,628)		4,416		(108)		(9,320)
Changes in current assets and liabilities:
Accounts receivable, net	(100,672)		—		130,302		29,630
Finance receivables - accrued interest and other	—		5,097		—		5,097
Inventories, net	273,668		—		—		273,668
Accounts payable and accrued liabilities	(38,815)		154,121		(132,228)		(16,922)
Derivative financial instruments	(1,584)		41		—		(1,543)
Other	26,704		2,634		3,940		33,278
	315,093		389,992		332,287		1,037,372
Net cash provided by operating activities	421,140		481,534		232,394		1,135,068
Cash flows from investing activities:
Capital expenditures	(90,592)		(1,703)		—		(92,295)
Origination of finance receivables	—		(4,697,675)		1,824,416		(2,873,259)
Collections on finance receivables	—		4,886,976		(2,156,810)		2,730,166
Other investing activities	334		—		—		334
Net cash (used) provided by investing activities	(90,258)		187,598		(332,394)		(235,054)

	Nine months ended September 27, 2020
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
Cash flows from financing activities:
Proceeds from issuance of medium-term notes	—		1,396,602		—		1,396,602
Repayments of medium-term notes	—		(1,400,000)		—		(1,400,000)
Proceeds from securitization debt	—		2,064,450		—		2,064,450
Repayments of securitization debt	—		(735,885)		—		(735,885)
Borrowings of asset-backed commercial paper	—		225,187		—		225,187
Repayments of asset-backed commercial paper	—		(236,846)		—		(236,846)
Net increase in unsecured commercial paper	—		509,978		—		509,978
Net increase in credit facilities	—		150,000		—		150,000
Deposits	—		29,992		—		29,992
Dividends paid	(65,002)		(100,000)		100,000		(65,002)
Repurchase of common stock	(7,895)		—		—		(7,895)
Issuance of common stock under share-based plans	96		—		—		96
Net cash (used) provided by financing activities	(72,801)		1,903,478		100,000		1,930,677
Effect of exchange rate changes on cash, cash equivalents and restricted cash	4,974		1,097		—		6,071
Net increase in cash, cash equivalents and restricted cash	$	263,055	$	2,573,707	$	—	$	2,836,762
Cash, cash equivalents and restricted cash:
Cash, cash equivalents and restricted cash, beginning of period	$	470,649	$	434,717	$	—	$	905,366
Net increase in cash, cash equivalents and restricted cash	263,055		2,573,707		—		2,836,762
Cash, cash equivalents and restricted cash, end of period	$	733,704	$	3,008,424	$	—	$	3,742,128

	Nine months ended September 29, 2019
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
Cash flows from operating activities:
Net income	$	396,320	$	153,905	$	(140,086)	$	410,139
Adjustments to reconcile Net income to Net cash provided by operating activities:
Depreciation and amortization	168,013		6,596		—		174,609
Amortization of deferred loan origination costs	—		57,303		—		57,303
Amortization of financing origination fees	503		6,529		—		7,032
Provision for long-term employee benefits	10,888		—		—		10,888
Employee benefit plan contributions and payments	(11,166)		—		—		(11,166)
Stock compensation expense	22,869		2,454		—		25,323
Net change in wholesale finance receivables related to sales	—		—		683		683
Provision for credit losses	—		94,621		—		94,621
Deferred income taxes	5,514		(1,765)		(214)		3,535
Other, net	9,126		(1,372)		85		7,839
Changes in current assets and liabilities:
Accounts receivable, net	(216,961)		—		209,128		(7,833)
Finance receivables - accrued interest and other	—		(4,574)		—		(4,574)
Inventories, net	62,870		—		—		62,870
Accounts payable and accrued liabilities	8,729		207,971		(203,562)		13,138
Derivative financial instruments	2,443		94		—		2,537
Other	(19,516)		12,144		9,077		1,705
	43,312		380,001		15,197		438,510
Net cash provided by operating activities	439,632		533,906		(124,889)		848,649
Cash flows from investing activities:
Capital expenditures	(118,182)		(2,979)		—		(121,161)
Origination of finance receivables	—		(5,757,384)		2,615,758		(3,141,626)
Collections on finance receivables	—		5,326,787		(2,630,869)		2,695,918
Sales and redemptions of marketable securities	10,007		—		—		10,007
Acquisition of business	(7,000)		—		—		(7,000)
Other investing activities	12,388		—		—		12,388
Net cash used by investing activities	(102,787)		(433,576)		(15,111)		(551,474)

	Nine months ended September 29, 2019
	HDMC Entities		HDFS Entities		Consolidating Adjustments		Consolidated
Cash flows from financing activities:
Proceeds from issuance of medium-term notes	—		546,655		—		546,655
Repayments of medium-term notes	—		(1,350,000)		—		(1,350,000)
Proceeds from securitization debt	—		1,021,353		—		1,021,353
Repayments of securitization debt	—		(244,250)		—		(244,250)
Borrowings of asset-backed commercial paper	—		177,950		—		177,950
Repayments of asset-backed commercial paper	—		(240,008)		—		(240,008)
Net decrease in unsecured commercial paper	—		(120,707)		—		(120,707)
Dividends paid	(179,409)		(140,000)		140,000		(179,409)
Repurchase of common stock	(217,454)		—		—		(217,454)
Issuance of common stock under share-based plans	2,180		—		—		2,180
Net cash used by financing activities	(394,683)		(349,007)		140,000		(603,690)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(4,604)		494		—		(4,110)
Net decrease in cash, cash equivalents and restricted cash	$	(62,442)	$	(248,183)	$	—	$	(310,625)
Cash, cash equivalents and restricted cash:
Cash, cash equivalents and restricted cash, beginning of period	$	544,548	$	715,200	$	—	$	1,259,748
Net decrease in cash, cash equivalents and restricted cash	(62,442)		(248,183)		—		(310,625)
Cash, cash equivalents and restricted cash, end of period	$	482,106	$	467,017	$	—	$	949,123