Harley Davidson 2007 Annual Report Download - page 8

10-YEAR CAGR 18.3%
1,100
300
400
200
100
0
700
600
500
1,000
900
800
1,043
960
890
580
267
214
934
174
348
438
761
HARLEY-DAVI DSO N, I NC.
N ET INCOM E
Dollars in millions
06050402999897 00 01 03 07
HARLEY-DAVI DSO N, I NC.
N ET REV E NU E
Dollars in millions
5,801
5,342
5,015
4,091
2,453
2,064
1,763
2,943
3,407
4,624
10-YEAR CAGR 12.5%CAGR: COMPOUND ANNUAL GROWTH RATE
6,000
2,000
2,500
1,500
500
1
,000
0
4,000
3,500
3,000
5,500
5,000
4,500
5,727
06050402999897 00 01 03 07
In 2007, the Company’s net revenue and net
income decreased 1.3% and 10.5%, respectively.
Net revenue of $5.7 billion was $74 million
lower than in 2006, while 2007 net income
of $934 million was $109 million lower than
last year.
Revenue from sales of Harley-Davidson
motorcycles decreased to $4.4 billion in 2007,
a decline of 2.3% from 2006. Buell motorcycle
revenue of $101 million was down 1.7%. Rev-
enue from Genuine Parts and Accessories in
2007 totaled $868 million, a 0.7% increase over
the previous year, and General Merchandise
revenue was $305 million, an increase of 10.1%
compared to 2006.
Harley-Davidson continues to effectively
manage its balance sheet and realized a return
on invested capital (ROIC) at the end of 2007 of
26.3%. The Company has maintained an ROIC
over 20% every year since 2000.
The Company’s share price declined 33.7%
during 2007. For the ten-year period ending on
December 31, 2007, compound annual total
return on Harley-Davidson stock was 13.9%.
The Company increased its dividend twice during
2007 and has increased the annual dividend
for 15 consecutive years. The dividend paid per
share in 2007 was up 30.9% compared to 2006.
Since the end of 1986, the year Harley-Davidson,
Inc. became a public company, shareholders
have enjoyed a compound annual total return
growth rate of 27.2%, which includes fi ve 2-for-1
stock splits during that time period.
HARLEY-DAVIDSON MOTORCYCLES Worldwide
retail sales of Harley-Davidson motorcycles
declined 1.8% in 2007.
In the United States, 2007 retail sales of
Harley-Davidson motorcycles decreased 6.2%
compared to 2006 and the overall U.S. heavy-
weight market declined 5.0%.
For the full year 2007, retail sales of
Harley-Davidson motorcycles in our international
markets increased 13.7%. In Europe, sales of
Harley-Davidson motorcycles increased 15.0%,
and in Japan, retail sales of Harley-Davidson
motorcycles increased 3.6% compared to 2006.
Annual retail sales increased 9.4% in Canada,
and increased 23.7% in the remaining interna-
tional markets combined.
In 2007, Harley-Davidson motorcycle ship-
ments were 330,619 units, down 5.3% from 2006.
HARLEY-DAVIDSON FINANCIAL SERVICES
Harley-Davidson Financial Services (HDFS)
continued a 14 -year run of earnings growth.
Operating income increased from $211 mil-
lion in 2006 to $212 million in 2007 as HDFS
benefi ted from increased wholesale and retail
lending activity.
2007 FINANCIAL PERFORMANCE SUMMARY
30,000
0
20,000
10,000
06
23
,
191
930
981
07
15
,
687
93
242
1
,
686
95
337
2
,
224
96
414
3
,
650
97
553
4
,
257
98
710
7
,
434
99
860
10
,
084
00
782
12
,
544
01
689
17
,
169
02
537
14
,
645
03
690
15
,
133
04
766
19
,
476
05
803
16
,
709
94
245
2
,
152
20 -YEAR COMPARISON OF YE AR -END VALUE OF $100 INVESTED DEC. 31, 1987. ASSUMES FOR BOTH HARLEY-DAVIDSON AND S&P THAT ALL DIVIDENDS ARE REINVESTED.
HARLEY-DAVIDSON, INC. VS. STANDARD & POOR’S 500 COMPOSITE INDEX
In dollars
S&P 500 H-D
88
123
242
89
161
374
90
156
367
91
204
852
220
1
,
433
92
400
50
0
200
150
100
350
300
250
349.2
06
329.0
05
317.3
04
263.7
02
177.2
99
150.8
98
132.3
97
204.6
00
234.5
01
291.1
03
HARLEY-DAVIDSON MOTORCYCLE
W O R L DW I DE S H I P MENTS
Units in thousands
330.6
07
DOM EST IC INTERNAT IONAL
HARLEY-DAVI DSO N, I NC.
DILUTED EARNINGS PER SHARE
In dollars
3.93
3.41
3.00
1.90
0.86
0.69
0.57
1.13
1.43
2.50
4.00
0
3.00
2.00
1.00
3.74
10-YEAR CAGR 20.7%
06050402999897 00 01 03 07
HARLEY-DAVI DSO N, I NC.
C AP I TAL E X PENDI TURES
Dollars in millions
219.6
198.4
213.6
323.9
165.8
182.8
186.2
203.6
290.4
227.2
350
0
150
100
50
300
250
200
242.1
06050402999897 00 01 03 07
HARLEY-DAVI DSO N, I NC.
DIV I DENDS P E R S HARE
In dollars, adjusted for splits
1.200
0
1.000
0.800
0.600
0.400
0.200
0.810
0.625
0.405
0.135
0.088
0.078
0.068
0.098
0.115
0.195
1.060
10-YEAR CAGR 31.6%
06050402999897 00 01 03 07
2007 HARLEY-DAVIDSON
LEADERSHIP
CORPORATE OFFICERS
THOMAS E. BERGMANN
Executive Vice President and
Chief Financial Offi cer
PERRY A. GLASSGOW
Vice President and Treasurer
GAIL A. LIONE
Executive Vice President, General Counsel,
Secretary and Chief Compliance Offi cer
JAMES L. ZIEMER
President and Chief Executive Offi cer
HARLEY
-DAVID S ON M OTOR
COMPANY LEADERSHIP
JOANNE M. BISCHMANN
Vice President, Licensing and Special Events
DAVID P. BOZEMAN
Vice President, Advanced Manufacturing
RODNEY J. COPES
Vice President, Asia Pacifi c
WILLIAM B. DANNEHL
Executive Vice President,
Chief Organizational Transformation Offi cer
WILLIAM G. DAVIDSON
Senior Vice President and
Chief Styling Offi cer
WILLIAM J. DAVIDSON
Vice President, Core Customer Marketing
KARL M. EBERLE
Senior Vice President, Manufacturing
ROBERT S. FARCHIONE
Vice President, Engineering Platform Teams
FRED C. GATES
Vice President and General Manager,
York Vehicle Operations
JAMES E. HANEY
Vice President and Chief Information Offi cer
MICHAEL P. HEERHOLD
Vice President and General Manager,
Powertrain Operations, Pilgrim Road
TIMOTHY K. HOELTER
Vice President, Government Affairs
RONALD M. HUTCHINSON
Senior Vice President, Product Development
M ICHAEL D. KEEFE
Vice President, Harley Owners Group
PATRICK D. KELLER
Vice President,
Engineering Centers of Expertise
KATHLEEN A. LAWLER
Vice President, Communication
MATTHEW S. LEVATICH
Vice President, Parts and Accessories
JAMES A. MCCASLIN
President and Chief Operating Offi cer
JEFFREY A. MERTEN
Vice President, North American Sales
LOUIS N. NETZ
Vice President and Director, Styling
JOHN A. OLIN
Vice President and Controller
STEVEN R. PHILLIPS
Vice President, Quality, Operational Excellence
and Technical Service
MARK-HANS RICHER
Senior Vice President and
Chief Marketing Offi cer
HAROLD A. SCOTT
Vice President, Human Resources
PATRICK SMITH
Vice President, General Merchandise
MICHAEL VAN DER SANDE
Vice President and Managing Director,
Harley-Davidson Europe
JERRY G. WILKE
Vice President
2007 HARLEY-DAVIDSON
FINANCIAL SERVICES LEADERSHIP
SAIYID T. NAQVI
President, Harley-Davidson Financial Services
2007 BUELL MOTORCYCLE
COMPANY LEADERSHIP
ERIK F. BUELL
Chairman and Chief Technical Offi cer,
Buell Motorcycle Company
JON R. FLICKINGER
President and Chief Operating Offi cer,
Buell Motorcycle Company
2007 BOARD OF D I R ECTOR S,
HARLEY-DAVIDSON, I NC.
BARRY K. ALLEN
Senior Advisor, Providence Equity Partners
President, Allen Enterprises, LLC
RICHARD I. BEATTIE
Chairman,
Simpson Thacher & Bartlett LLP
JEFFREY L. BLEUSTEIN
Chairman of the Board,
Harley-Davidson, Inc.
GEORGE H. CONRADES
Executive Chairman,
Akamai Technologies, Inc.
JUDSON C. GREEN
President and Chief Executive Offi cer,
NAVTEQ Corporation
DONALD A. JAMES
Chairman and Chief Executive Offi cer,
Deeley Harley-Davidson/Canada
Fred Deeley Imports Ltd.
SARA L. LEVINSON
Chairperson, ClubMom, Inc.
GEORGE L. MILES, JR.
President and Chief Executive Offi cer,
WQED Multimedia
JAMES A. NORLING
Chairman of the Board,
Chartered Semiconductor Manufacturing Ltd.
JOCHEN ZEITZ
Chairman and
Chief Executive Offi cer, Puma AG
JAMES L. ZIEMER
President and Chief Executive Offi cer,
Harley-Davidson, Inc.
COMPANY INFORMATION
HARLEY-DAVIDSON, INC.
3700 West Juneau Avenue
P.O. Box 653
Milwaukee, WI 53201-0653
Internet Addresses:
www.harley-davidson.com
www.buell.com
PLANT TOUR INFORMATION:
877-883-1450
York, Pa. motorcycles
Kansas City, Mo. motorcycles
Milwaukee, Wis. engines
The following is a representative sample of trademarks
of H-D Michigan, Inc.: Harley-Davidson, Harley,
the Bar & Shield Logo, MotorClothes, Harley Owners
Group, H.O.G., Nightster, V-Rod, Harley-Davidson
Museum and Buell.
SHAREHOLDER INFORMATION
ANNUAL SHAREHOLDER MEETING
The Annual Meeting of Shareholders will convene
at 10:30 a.m., CT, on Saturday, April 26, 2008, at
the Pfi ster Hotel, 424 East Wisconsin, Milwaukee,
Wisconsin, 53202.
SEC FORM 10-K
A copy of the Annual Report to the Securities and
Exchange Commission on Form 10-K may be
obtained from the Company without charge to
shareholders or via the Company’s website
on or about February 22, 2008.
D IV I D E N D R E I NV E S T M E N T A N D
STOCK PURCHASE PLAN
To obtain information on our Dividend Reinvestment
and Direct Stock Purchase plans, please contact
ComputerShare.
ComputerShare Trust Company
2 North LaSalle Street
Chicago, IL 60602
866-360-5339 toll-free
REGISTRAR AND TRANSFER AGENT
COMPUTERSHARE INVESTOR SERVICES, LLC
P.O. Box A3504
Chicago, IL 60690-3504
866-360-5339 toll-free
or 312-360-5339
CONTACT INVESTOR RELATIONS AT:
877- HDSTOCK toll-free
414-343-4782, or try our e-mail:
investor[email protected]
Corporate Governance materials may be obtained via
our website at www.harley-davidson.com
Communication with the Board
c/o the Secretary of Harley-Davidson, Inc.
3700 West Juneau Avenue
P.O. Box 653
Milwaukee, WI 53201-0653
© 2008 Harley-Davidson, Inc.
Design: VSA Partners, Inc., Chicago
Printing: Anderson Lithograph
Paper: Sappi Opus Matte Text
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CORPORATE SUMMARY
10-YEAR CAGR 13.1%
70.47
06
51.49
05
60.75
04
46.20
02
32.03
99
23.69
98
13.63
97
39.75
00
54.31
01
47.53
03
HARLEY-DAVI DSO N, I NC.
YEA R -END STOCK PRICES
In dollars, adjusted for splits
46.71
07
0
80
10
40
30
20
70
60
50
HARLEY-DAVI DSO N, I NC.
COMMON SH A R ES OU TSTANDING
Shares outstanding, in millions
258.1
06
274.0
05
294.3
04
350
0
150
100
50
300
250
200
238.5
07
301.5
03
%
48.048.647.848.248.146.443.944.647.248.2
Data includes U.S. and Canada.
U.S. Source: Motorcycle Industry Council (MIC). Canada Source: Moped & Motorcycle Industry of Canada.
The Company must rely on data compiled by independent agencies to obtain retail registrations data necessary for calculating market share. The retail
registrations data for Harley-Davidson motorcycles included in these tables may differ slightly from the Harley-Davidson retail sales data presented elsewhere
by the Company. The differences are not significant and generally relate to the timing of data submissions to the independent sources.
206.1
97
246.2
98
116.1
297.9
99
142.0
365.4
00
163.1
422.8
01
185.6
475.0
02
220.1
495.4
03
238.2
530.8
04
255.8
553.6
05
264.7
578.8
06
281.6
555.0
07
266.3
MARKET SHARE
NORTH AMERICA
651 + CC M O TOR C Y L E R E G I S T RATIONS H - D VS. INDUST R Y *
Units in thousands
0
650
250
300
200
100
50
150
450
400
350
600
550
500
*
99.3
48.0% HARLEY-DAVIDSON
14.3% HONDA
12.7% SUZUKI
9.2% YAMAHA
7.5% K AWA SAKI
8.3% OTHER
47.7
H-D MOTORCYCLES INDUSTRY
450
50
100
0
250
200
150
400
350
300
403.0
268.7
292.8
335.4
322.6
321.3
333.2
323.9
337.1
350.7
376.8
38.7
17.2
18.1
20.5
23.2
22.8
23.5
26.3
25.9
29.7
34.3
EUROPE
651 + CC M O TOR C Y L E R E G I S T RATIONS H - D VS. INDUST R Y *
Units in thousands
H-D MOTORCYCLES
% 9.69.18.57.78.17.17.15.95.96.1
Data includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and the United Kingdom.
The Company derives its market registration data and market share calculations from information provided by Giral S.A.
The Company must rely on data compiled by independent agencies to obtain retail registrations data necessary for calculating market share. The retail
registrations data for Harley-Davidson motorcycles included in these tables may differ slightly from the Harley-Davidson retail sales data presented elsewhere
by the Company. The differences are not significant and generally relate to the timing of data submissions to the independent sources.
MARKET SHARE
INDUSTRY
*
97 98 99 00 01 02 03 04 05 06 07
16.5% SUZUKI
15.1% BMW
13.6% YAMAHA
12.3% HONDA
11.3% KAWASAKI
9.6% HARLEY-DAV IDSON
6.5% TR IUMPH
5.9% DUCATI
9.2% OTHER
6.9