Supplemental Consolidating Data (Tables)

6 Months Ended

Jul. 01, 2012

Operations

All supplemental data is presented in thousands.

	Three months ended July 1, 2012
	Motorcycles & Related		Financial
	Products Operations		Services Operations			Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	1,572,003	$	—		$	(2,956	)	$	1,569,047
Financial services		—		160,843			(230	)		160,613
Total revenue		1,572,003		160,843			(3,186	)		1,729,660
Costs and expenses:
Motorcycles and related products cost of goods sold		1,005,230		—			—			1,005,230
Financial services interest expense		—		48,712			—			48,712
Financial services provision for credit losses		—		(5,259	)		—			(5,259	)
Selling, administrative and engineering expense		248,268		38,162			(3,186	)		283,244
Restructuring expense		6,220		—			—			6,220
Total costs and expenses		1,259,718		81,615			(3,186	)		1,338,147
Operating income		312,285		79,228			—			391,513
Investment income		2,231		—			—			2,231
Interest expense		11,595		—			—			11,595
Income before provision for income taxes		302,921		79,228			—			382,149
Provision for income taxes		106,377		28,522			—			134,899
Income from continuing operations		196,544		50,706			—			247,250
Loss from discontinued operations, net of tax		—		—			—			—
Net income	$	196,544	$	50,706		$	—		$	247,250
	Six months ended July 1, 2012
	Motorcycles & Related		Financial
	Products Operations		Services Operations			Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	2,847,786	$	—		$	(5,370	)	$	2,842,416
Financial services		—		316,749			186			316,935
Total revenue		2,847,786		316,749			(5,184	)		3,159,351
Costs and expenses:
Motorcycles and related products cost of goods sold		1,822,089		—			—			1,822,089
Financial services interest expense		—		99,968			—			99,968
Financial services provision for credit losses		—		3,754			—			3,754
Selling, administrative and engineering expense		484,847		69,235			(5,184	)		548,898
Restructuring expense		17,671		—			—			17,671
Total costs and expenses		2,324,607		172,957			(5,184	)		2,492,380
Operating income		523,179		143,792			—			666,971
Investment income		229,164		—			(225,000	)		4,164
Interest expense		23,090		—			—			23,090
Income before provision for income taxes		729,253		143,792			(225,000	)		648,045
Provision for income taxes		176,995		51,765			—			228,760
Income from continuing operations		552,258		92,027			(225,000	)		419,285
Loss from discontinued operations, net of tax		—		—			—			—
Net income	$	552,258	$	92,027		$	(225,000	)	$	419,285

	Three months ended June 26, 2011
	Motorcycles & Related		Financial
	Products Operations		Services Operations			Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	1,342,803	$	—		$	(3,059	)	$	1,339,744
Financial services		—		166,518			(665	)		165,853
Total revenue		1,342,803		166,518			(3,724	)		1,505,597
Costs and expenses:
Motorcycles and related products cost of goods sold		871,476		—			—			871,476
Financial services interest expense		—		56,991			—			56,991
Financial services provision for credit losses		—		(6,790	)		—			(6,790	)
Selling, administrative and engineering expense		235,492		36,656			(3,724	)		268,424
Restructuring expense		13,594		—			—			13,594
Total costs and expenses		1,120,562		86,857			(3,724	)		1,203,695
Operating income		222,241		79,661			—			301,902
Investment income		1,748		—			—			1,748
Interest expense		11,350		—			—			11,350
Income before provision for income taxes		212,639		79,661			—			292,300
Provision for income taxes		73,042		28,678			—			101,720
Income from continuing operations		139,597		50,983			—			190,580
Loss from discontinued operations, net of tax		—		—			—			—
Net income	$	139,597	$	50,983		$	—		$	190,580
	Six months ended June 26, 2011
	Motorcycles & Related		Financial
	Products Operations		Services Operations			Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	2,408,293	$	—		$	(5,505	)	$	2,402,788
Financial services		—		328,270			(531	)		327,739
Total revenue		2,408,293		328,270			(6,036	)		2,730,527
Costs and expenses:
Motorcycles and related products cost of goods sold		1,582,654		—			—			1,582,654
Financial services interest expense		—		115,026			—			115,026
Financial services provision for credit losses		—		(1,184	)		—			(1,184	)
Selling, administrative and engineering expense		439,163		69,412			(6,036	)		502,539
Restructuring expense		36,593		—			—			36,593
Total costs and expenses		2,058,410		183,254			(6,036	)		2,235,628
Operating income		349,883		145,016			—			494,899
Investment income		128,146		—			(125,000	)		3,146
Interest expense		22,831		—			—			22,831
Income before provision for income taxes		455,198		145,016			(125,000	)		475,214
Provision for income taxes		113,168		52,206			—			165,374
Income from continuing operations		342,030		92,810			(125,000	)		309,840
Loss from discontinued operations, net of tax		—		—			—			—
Net income	$	342,030	$	92,810		$	(125,000	)	$	309,840

Balance Sheet

	July 1, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	725,909	$	345,587	$	—		$	1,071,496
Marketable securities		135,848		—		—			135,848
Accounts receivable, net		885,797		—		(635,529	)		250,268
Finance receivables, net		—		1,398,553		—			1,398,553
Restricted finance receivables held by variable interest entities, net		—		456,285		—			456,285
Inventories		323,046		—		—			323,046
Restricted cash held by variable interest entities		—		188,564		—			188,564
Other current assets		182,464		63,343		—			245,807
Total current assets		2,253,064		2,452,332		(635,529	)		4,069,867
Finance receivables, net		—		2,569,187		—			2,569,187
Restricted finance receivables held by variable interest entities, net		—		1,592,544		—			1,592,544
Property, plant and equipment, net		747,133		29,660		—			776,793
Goodwill		28,604		—		—			28,604
Other long-term assets		335,811		17,956		(73,978	)		279,789
	$	3,364,612	$	6,661,679	$	(709,507	)	$	9,316,784
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	197,891	$	689,877	$	(635,529	)	$	252,239
Accrued liabilities		466,808		71,756		(3,467	)		535,097
Short-term debt		—		845,868		—			845,868
Current portion of long-term debt		—		399,962					399,962
Current portion of long-term debt held by variable interest entities		—		507,427		—			507,427
Total current liabilities		664,699		2,514,890		(638,996	)		2,540,593
Long-term debt		303,000		2,442,189		—			2,745,189
Long-term debt held by variable interest entities		—		831,805		—			831,805
Pension liability		122,496		—		—			122,496
Postretirement healthcare benefits		263,295		—		—			263,295
Other long-term liabilities		131,754		15,265		—			147,019
Commitments and contingencies (Note 17)
Total shareholders’ equity		1,879,368		857,530		(70,511	)		2,666,387
	$	3,364,612	$	6,661,679	$	(709,507	)	$	9,316,784

	December 31, 2011
	Motorcycles & Related		Financial
	Products Operations		Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	943,330	$	583,620	$	—		$	1,526,950
Marketable securities		153,380		—		—			153,380
Accounts receivable, net		393,615		—		(174,576	)		219,039
Finance receivables, net		—		1,168,603		—			1,168,603
Restricted finance receivables held by variable interest entities, net		—		591,864		—			591,864
Inventories		418,006		—		—			418,006
Restricted cash held by variable interest entities		—		229,655		—			229,655
Other current assets		167,423		67,286		—			234,709
Total current assets		2,075,754		2,641,028		(174,576	)		4,542,206
Finance receivables, net		—		1,754,441		—			1,754,441
Restricted finance receivables held by variable interest entities, net		—		2,271,773		—			2,271,773
Property, plant and equipment, net		779,330		30,129		—			809,459
Goodwill		29,081		—		—			29,081
Other long-term assets		322,379		17,460		(72,635	)		267,204
	$	3,206,544	$	6,714,831	$	(247,211	)	$	9,674,164
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	220,957	$	209,332	$	(174,576	)	$	255,713
Accrued liabilities		482,838		85,038		(3,704	)		564,172
Short-term debt		—		838,486		—			838,486
Current portion of long-term debt		—		399,916					399,916
Current portion of long-term debt held by variable interest entities		—		640,331		—			640,331
Total current liabilities		703,795		2,173,103		(178,280	)		2,698,618
Long-term debt		303,000		2,093,871		—			2,396,871
Long-term debt held by variable interest entities		—		1,447,015		—			1,447,015
Pension liability		302,483		—		—			302,483
Postretirement healthcare benefits		268,582		—		—			268,582
Other long-term liabilities		126,036		14,303		—			140,339
Commitments and contingencies (Note 17)
Total shareholders’ equity		1,502,648		986,539		(68,931	)		2,420,256
	$	3,206,544	$	6,714,831	$	(247,211	)	$	9,674,164

	June 26, 2011
	Motorcycles & Related		Financial
	Products Operations		Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	681,804	$	291,674	$	—		$	973,478
Marketable securities		244,555		—		—			244,555
Accounts receivable, net		710,791		—		(445,128	)		265,663
Finance receivables, net		—		1,144,886		—			1,144,886
Restricted finance receivables held by variable interest entities, net		—		573,208		—			573,208
Inventories		337,472		—		—			337,472
Restricted cash held by variable interest entities		—		244,060		—			244,060
Other current assets		160,059		57,597		—			217,656
Total current assets		2,134,681		2,311,425		(445,128	)		4,000,978
Finance receivables, net		—		2,306,165		—			2,306,165
Restricted finance receivables held by variable interest entities, net		—		1,939,181		—			1,939,181
Property, plant and equipment, net		758,828		30,115		—			788,943
Goodwill		31,156		—		—			31,156
Other long-term assets		339,666		26,711		(70,821	)		295,556
	$	3,264,331	$	6,613,597	$	(515,949	)	$	9,361,979
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	243,954	$	478,569	$	(445,128	)	$	277,395
Accrued liabilities		522,533		70,880		(3,317	)		590,096
Short-term debt		—		694,137		—			694,137
Current portion of long-term debt held by variable interest entities		—		635,604		—			635,604
Total current liabilities		766,487		1,879,190		(448,445	)		2,197,232
Long-term debt		303,000		2,590,462		—			2,893,462
Long-term debt held by variable interest entities		—		1,217,778		—			1,217,778
Pension liability		103,511		—		—			103,511
Postretirement healthcare liability		258,881		—		—			258,881
Other long-term liabilities		146,286		13,433		—			159,719
Commitments and contingencies (Note 17)
Total shareholders’ equity		1,686,166		912,734		(67,504	)		2,531,396
	$	3,264,331	$	6,613,597	$	(515,949	)	$	9,361,979

Cash Flows

	Six months ended July 1, 2012
	Motorcycles & Related			Financial			Eliminations &
	Products Operations			Services Operations			Adjustments			Consolidated
Cash flows from operating activities:
Income from continuing operations	$	552,258			92,027		$	(225,000	)	$	419,285
Adjustments to reconcile income from continuing operations to cash provided by operating activities:
Depreciation		82,954			3,043			—			85,997
Amortization of deferred loan origination costs		—			38,075			—			38,075
Amortization of financing origination fees		237			4,784			—			5,021
Provision for employee long-term benefits		33,236			1,027			—			34,263
Contributions to pension and postretirement plans		(213,648	)		—			—			(213,648	)
Stock compensation expense		20,539			1,580			—			22,119
Net change in wholesale finance receivables		—			—			(124,919	)		(124,919	)
Provision for credit losses		—			3,754			—			3,754
Pension and postretirement healthcare plan curtailment and settlement expense		—			—			—			—
Foreign currency adjustments		8,143			—			—			8,143
Other, net		1,275			4,292			—			5,567
Change in current assets and current liabilities:
Accounts receivable		(295,930	)		—			260,953			(34,977	)
Finance receivables—accrued interest and other		—			2,912			—			2,912
Inventories		89,162			—			—			89,162
Accounts payable and accrued liabilities		(22,227	)		270,894			(260,953	)		(12,286	)
Restructuring reserves		(9,915	)		—			—			(9,915	)
Derivative instruments		(1,293	)		(127	)		—			(1,420	)
Other		(25,286	)		(3,605	)		—			(28,891	)
Total adjustments		(332,753	)		326,629			(124,919	)		(131,043	)
Net cash provided by operating activities of continuing operations		219,505			418,656			(349,919	)		288,242
Cash flows from investing activities of continuing operations:
Capital expenditures		(57,504	)		(2,574	)		—			(60,078	)
Origination of finance receivables		—			(3,766,621	)		2,183,049			(1,583,572	)
Collections of finance receivables		—			3,493,920			(2,058,130	)		1,435,790
Sales and redemptions of marketable securities		18,053			—			—			18,053
Net cash (used by) provided by investing activities of continuing operations		(39,451	)		(275,275	)		124,919			(189,807	)
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes		—			397,373			—			397,373
Loan to HDFS		(200,000	)		200,000			—			—
Proceeds from securitization of debt		—			91,030			—			91,030
Repayments of securitization debt		—			(839,401	)		—			(839,401	)
Net decrease in credit facilities and unsecured commercial paper		—			(46,629	)		—			(46,629	)
Net change in restricted cash		—			41,091			—			41,091
Dividends paid		(71,645	)		(225,000	)		225,000			(71,645	)
Purchase of common stock for treasury		(172,742	)		—			—			(172,742	)
Excess tax benefits from share based payments		15,730			—			—			15,730
Issuance of common stock under employee stock option plans		35,337			—			—			35,337
Net cash used by financing activities of continuing operations		(393,320	)		(381,536	)		225,000			(549,856	)
Effect of exchange rate changes on cash and cash equivalents of continuing operations		(4,155	)		122			—			(4,033	)
Net (decrease) increase in cash and cash equivalents of continuing operations		(217,421	)		(238,033	)		—			(455,454	)
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations		—			—			—			—
Cash flows from investing activities of discontinued operations		—			—			—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations		—			—			—			—
		—			—			—			—
Net (decrease) increase in cash and cash equivalents	$	(217,421	)	$	(238,033	)	$	—		$	(455,454	)
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	943,330		$	583,620		$	—		$	1,526,950
Cash and cash equivalents of discontinued operations—beginning of period		—			—			—			—
Net (decrease) increase in cash and cash equivalents		(217,421	)		(238,033	)		—			(455,454	)
Less: Cash and cash equivalents of discontinued operations—end of period		—			—			—			—
Cash and cash equivalents—end of period	$	725,909		$	345,587		$	—		$	1,071,496

	Six months ended June 26, 2011
	Motorcycles & Related			Financial			Eliminations &
	Products Operations			Services Operations			Adjustments			Consolidated
Cash flows from operating activities:
Net income	$	342,030		$	92,810		$	(125,000	)	$	309,840
Loss from discontinued operations		—			—			—			—
Income from continuing operations		342,030			92,810			(125,000	)		309,840
Adjustments to reconcile income from continuing operations to cash provided by operating activities:
Depreciation		86,375			3,168			—			89,543
Amortization of deferred loan origination costs		—			39,054			—			39,054
Amortization of financing origination fees		237			5,596			—			5,833
Provision for employee long-term benefits		33,018			1,438			—			34,456
Contributions to pension and postretirement plans		(205,498	)		—			—			(205,498	)
Stock compensation expense		19,176			1,361			—			20,537
Net change in wholesale finance receivables		—			—			11,909			11,909
Provision for credit losses		—			(1,184	)		—			(1,184	)
Pension and postretirement healthcare plan curtailment and settlement expense		236			—			—			236
Foreign currency adjustments		(2,813	)		—			—			(2,813	)
Other, net		5,337			21,889			—			27,226
Change in current assets and current liabilities:
Accounts receivable		(44,899	)		—			53,200			8,301
Finance receivables—accrued interest and other		—			5,553			—			5,553
Inventories		(530	)		—			—			(530	)
Accounts payable and accrued liabilities		79,110			60,426			(5,698	)		133,838
Restructuring reserves		3,195			—			—			3,195
Derivative instruments		1,188			7			—			1,195
Other		(4,729	)		44,575			(47,575	)		(7,729	)
Total adjustments		(30,597	)		181,883			11,836			163,122
Net cash provided by (used by) operating activities of continuing operations		311,433			274,693			(113,164	)		472,962
Cash flows from investing activities of continuing operations:
Capital expenditures		(65,956	)		(3,311	)		—			(69,267	)
Origination of finance receivables		—			(3,264,370	)		1,829,763			(1,434,607	)
Collections of finance receivables		—			3,258,282			(1,841,672	)		1,416,610
Purchases of marketable securities		(142,653	)		—			—			(142,653	)
Sales and redemptions of marketable securities		39,966			—			—			39,966
Net cash (used by) provided by investing activities of continuing operations		(168,643	)		(9,399	)		(11,909	)		(189,951	)
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes		—			447,076			—			447,076
Loan to HDFS		(200,000	)		200,000			—			—
Repayments of securitization debt		—			(901,851	)		—			(901,851	)
Net decrease in credit facilities and unsecured commercial paper		—			131,039			—			131,039
Net change in restricted cash		—			44,827			—			44,827
Dividends paid		(53,152	)		(125,000	)		125,000			(53,152	)
Purchase of common stock for treasury		(5,678	)		—			—			(5,678	)
Excess tax benefits from share based payments		3,476			—			—			3,476
Issuance of common stock under employee stock option plans		4,534			—			—			4,534
Net cash (used by) provided by financing activities of continuing operations		(250,820	)		(203,909	)		125,000			(329,729	)
Effect of exchange rate changes on cash and cash equivalents of continuing operations		(1,922	)		147			73			(1,702	)
Net (decrease) increase in cash and cash equivalents of continuing operations		(109,952	)		61,532			—			(48,420	)
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations		(35	)		—			—			(35	)
Cash flows from investing activities of discontinued operations		—			—			—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations		—			—			—			—
		(35	)		—			—			(35	)
Net (decrease) increase in cash and cash equivalents	$	(109,987	)	$	61,532		$	—		$	(48,455	)
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	791,791		$	230,142		$	—		$	1,021,933
Cash and cash equivalents of discontinued operations—beginning of period		—			—			—			—
Net (decrease) increase in cash and cash equivalents		(109,987	)		61,532			—			(48,455	)
Less: Cash and cash equivalents of discontinued operations—end of period		—			—			—			—
Cash and cash equivalents—end of period	$	681,804		$	291,674		$	—		$	973,478