|
|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
Wisconsin
|
|
39-1382325
|
(State of organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
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3700 West Juneau Avenue
Milwaukee, Wisconsin
|
|
53208
|
(Address of principal executive offices)
|
|
(Zip code)
|
|
Large accelerated filer
|
|
x
|
Accelerated filer
|
|
¨
|
|
|
|
|
|
|
Non-accelerated filer
|
|
¨
|
Smaller reporting company
|
|
¨
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Part I
|
||
|
|
|
Item 1.
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
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|
|
Item 4.
|
||
|
|
|
Part II
|
||
|
|
|
Item 1.
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 6.
|
||
|
|
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
September 25,
2016 |
|
September 27,
2015 |
|
September 25,
2016 |
|
September 27,
2015 |
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Motorcycles and Related Products
|
$
|
1,091,630
|
|
|
$
|
1,140,321
|
|
|
$
|
4,338,353
|
|
|
$
|
4,301,674
|
|
Financial Services
|
183,183
|
|
|
177,109
|
|
|
547,505
|
|
|
513,093
|
|
||||
Total revenue
|
1,274,813
|
|
|
1,317,430
|
|
|
4,885,858
|
|
|
4,814,767
|
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Motorcycles and Related Products cost of goods sold
|
724,611
|
|
|
746,282
|
|
|
2,773,496
|
|
|
2,670,146
|
|
||||
Financial Services interest expense
|
42,573
|
|
|
41,214
|
|
|
131,387
|
|
|
120,938
|
|
||||
Financial Services provision for credit losses
|
36,543
|
|
|
27,233
|
|
|
97,127
|
|
|
68,655
|
|
||||
Selling, administrative and engineering expense
|
292,710
|
|
|
286,865
|
|
|
904,322
|
|
|
866,558
|
|
||||
Total costs and expenses
|
1,096,437
|
|
|
1,101,594
|
|
|
3,906,332
|
|
|
3,726,297
|
|
||||
Operating income
|
178,376
|
|
|
215,836
|
|
|
979,526
|
|
|
1,088,470
|
|
||||
Investment income
|
2,300
|
|
|
3,211
|
|
|
3,754
|
|
|
5,983
|
|
||||
Interest expense
|
7,706
|
|
|
4,879
|
|
|
21,968
|
|
|
4,897
|
|
||||
Income before provision for income taxes
|
172,970
|
|
|
214,168
|
|
|
961,312
|
|
|
1,089,556
|
|
||||
Provision for income taxes
|
58,905
|
|
|
73,821
|
|
|
316,327
|
|
|
379,545
|
|
||||
Net income
|
$
|
114,065
|
|
|
$
|
140,347
|
|
|
$
|
644,985
|
|
|
$
|
710,011
|
|
Earnings per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.64
|
|
|
$
|
0.69
|
|
|
$
|
3.57
|
|
|
$
|
3.43
|
|
Diluted
|
$
|
0.64
|
|
|
$
|
0.69
|
|
|
$
|
3.55
|
|
|
$
|
3.41
|
|
Cash dividends per common share
|
$
|
0.35
|
|
|
$
|
0.31
|
|
|
$
|
1.05
|
|
|
$
|
0.93
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
September 25,
2016 |
|
September 27,
2015 |
|
September 25,
2016 |
|
September 27,
2015 |
||||||||
Net income
|
$
|
114,065
|
|
|
$
|
140,347
|
|
|
$
|
644,985
|
|
|
$
|
710,011
|
|
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
3,853
|
|
|
(14,598
|
)
|
|
19,174
|
|
|
(37,368
|
)
|
||||
Derivative financial instruments
|
(2,031
|
)
|
|
(10,533
|
)
|
|
(7,374
|
)
|
|
(12,747
|
)
|
||||
Marketable securities
|
(11
|
)
|
|
(99
|
)
|
|
(88
|
)
|
|
(294
|
)
|
||||
Pension and postretirement benefit plans
|
7,572
|
|
|
8,799
|
|
|
22,715
|
|
|
26,395
|
|
||||
Total other comprehensive income (loss), net of tax
|
$
|
9,383
|
|
|
$
|
(16,431
|
)
|
|
$
|
34,427
|
|
|
$
|
(24,014
|
)
|
Comprehensive income
|
$
|
123,448
|
|
|
$
|
123,916
|
|
|
$
|
679,412
|
|
|
$
|
685,997
|
|
|
(Unaudited)
|
|
|
|
(Unaudited)
|
||||||
|
September 25,
2016 |
|
December 31,
2015 |
|
September 27,
2015 |
||||||
ASSETS
|
|
|
|
|
|
||||||
Current assets:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
790,284
|
|
|
$
|
722,209
|
|
|
$
|
1,368,554
|
|
Marketable securities
|
5,038
|
|
|
45,192
|
|
|
47,358
|
|
|||
Accounts receivable, net
|
346,176
|
|
|
247,405
|
|
|
294,054
|
|
|||
Finance receivables, net
|
2,205,644
|
|
|
2,053,582
|
|
|
2,068,873
|
|
|||
Inventories
|
426,547
|
|
|
585,907
|
|
|
466,657
|
|
|||
Restricted cash
|
65,088
|
|
|
88,267
|
|
|
113,499
|
|
|||
Deferred income taxes
|
123,609
|
|
|
102,769
|
|
|
100,558
|
|
|||
Other current assets
|
139,958
|
|
|
132,552
|
|
|
150,667
|
|
|||
Total current assets
|
4,102,344
|
|
|
3,977,883
|
|
|
4,610,220
|
|
|||
Finance receivables, net
|
4,944,322
|
|
|
4,814,571
|
|
|
5,009,473
|
|
|||
Property, plant and equipment, net
|
954,475
|
|
|
942,418
|
|
|
877,787
|
|
|||
Goodwill
|
54,663
|
|
|
54,182
|
|
|
54,267
|
|
|||
Deferred income taxes
|
80,831
|
|
|
99,614
|
|
|
71,952
|
|
|||
Other long-term assets
|
75,591
|
|
|
84,309
|
|
|
88,335
|
|
|||
|
$
|
10,212,226
|
|
|
$
|
9,972,977
|
|
|
$
|
10,712,034
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
||||||
Current liabilities:
|
|
|
|
|
|
||||||
Accounts payable
|
$
|
291,594
|
|
|
$
|
235,614
|
|
|
$
|
316,894
|
|
Accrued liabilities
|
506,533
|
|
|
471,964
|
|
|
464,352
|
|
|||
Short-term debt
|
1,055,428
|
|
|
1,201,380
|
|
|
990,049
|
|
|||
Current portion of long-term debt, net
|
700,152
|
|
|
838,349
|
|
|
885,889
|
|
|||
Total current liabilities
|
2,553,707
|
|
|
2,747,307
|
|
|
2,657,184
|
|
|||
Long-term debt, net
|
5,170,609
|
|
|
4,832,469
|
|
|
5,040,644
|
|
|||
Pension liability
|
120,494
|
|
|
164,888
|
|
|
61,458
|
|
|||
Postretirement healthcare liability
|
182,825
|
|
|
193,659
|
|
|
193,406
|
|
|||
Other long-term liabilities
|
192,223
|
|
|
195,000
|
|
|
199,669
|
|
|||
Commitments and contingencies (Note 18)
|
|
|
|
|
|
||||||
Shareholders’ equity:
|
|
|
|
|
|
||||||
Preferred stock, none issued
|
—
|
|
|
—
|
|
|
—
|
|
|||
Common stock
|
3,454
|
|
|
3,449
|
|
|
3,448
|
|
|||
Additional paid-in-capital
|
1,364,694
|
|
|
1,328,561
|
|
|
1,314,693
|
|
|||
Retained earnings
|
9,416,583
|
|
|
8,961,985
|
|
|
8,977,600
|
|
|||
Accumulated other comprehensive loss
|
(580,778
|
)
|
|
(615,205
|
)
|
|
(538,957
|
)
|
|||
Treasury stock, at cost
|
(8,211,585
|
)
|
|
(7,839,136
|
)
|
|
(7,197,111
|
)
|
|||
Total shareholders' equity
|
1,992,368
|
|
|
1,839,654
|
|
|
2,559,673
|
|
|||
|
$
|
10,212,226
|
|
|
$
|
9,972,977
|
|
|
$
|
10,712,034
|
|
|
(Unaudited)
|
|
|
|
(Unaudited)
|
||||||
|
September 25,
2016 |
|
December 31,
2015 |
|
September 27,
2015 |
||||||
Balances held by consolidated variable interest entities (Note 12)
|
|
|
|
|
|
||||||
Current finance receivables, net
|
$
|
236,561
|
|
|
$
|
322,768
|
|
|
$
|
357,713
|
|
Other assets
|
$
|
3,043
|
|
|
$
|
4,706
|
|
|
$
|
4,492
|
|
Non-current finance receivables, net
|
$
|
754,970
|
|
|
$
|
1,250,919
|
|
|
$
|
1,475,179
|
|
Restricted cash - current and non-current
|
$
|
69,364
|
|
|
$
|
100,151
|
|
|
$
|
125,561
|
|
Current portion of long-term debt, net
|
$
|
261,188
|
|
|
$
|
351,123
|
|
|
$
|
398,689
|
|
Long-term debt, net
|
$
|
664,431
|
|
|
$
|
1,108,254
|
|
|
$
|
1,303,043
|
|
|
Nine months ended
|
||||||
|
September 25,
2016 |
|
September 27,
2015 |
||||
Net cash provided by operating activities (Note 3)
|
$
|
927,809
|
|
|
$
|
1,020,957
|
|
Cash flows from investing activities:
|
|
|
|
||||
Capital expenditures
|
(162,726
|
)
|
|
(139,054
|
)
|
||
Origination of finance receivables
|
(3,009,479
|
)
|
|
(3,112,827
|
)
|
||
Collections on finance receivables
|
2,440,466
|
|
|
2,393,355
|
|
||
Proceeds from finance receivables sold
|
312,571
|
|
|
—
|
|
||
Sales and redemptions of marketable securities
|
40,014
|
|
|
9,500
|
|
||
Acquisition of business
|
—
|
|
|
(59,910
|
)
|
||
Other
|
251
|
|
|
5,172
|
|
||
Net cash used by investing activities
|
(378,903
|
)
|
|
(903,764
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from issuance of senior unsecured notes
|
—
|
|
|
740,949
|
|
||
Proceeds from issuance of medium-term notes
|
1,193,396
|
|
|
595,386
|
|
||
Repayments of medium-term notes
|
(451,336
|
)
|
|
(600,000
|
)
|
||
Proceeds from securitization debt
|
—
|
|
|
1,195,668
|
|
||
Repayments of securitization debt
|
(535,616
|
)
|
|
(764,909
|
)
|
||
Net (decrease) increase in credit facilities and unsecured commercial paper
|
(146,328
|
)
|
|
258,734
|
|
||
Borrowings of asset-backed commercial paper
|
33,428
|
|
|
69,191
|
|
||
Repayments of asset-backed commercial paper
|
(55,170
|
)
|
|
(55,124
|
)
|
||
Net change in restricted cash
|
30,981
|
|
|
(15,165
|
)
|
||
Dividends paid
|
(190,387
|
)
|
|
(191,451
|
)
|
||
Purchase of common stock for treasury
|
(374,234
|
)
|
|
(894,565
|
)
|
||
Excess tax benefits from share-based payments
|
1,291
|
|
|
2,878
|
|
||
Issuance of common stock under employee stock option plans
|
6,444
|
|
|
16,755
|
|
||
Net cash (used by) provided by financing activities
|
(487,531
|
)
|
|
358,347
|
|
||
Effect of exchange rate changes on cash and cash equivalents
|
6,700
|
|
|
(13,666
|
)
|
||
Net increase in cash and cash equivalents
|
$
|
68,075
|
|
|
$
|
461,874
|
|
Cash and cash equivalents:
|
|
|
|
||||
Cash and cash equivalents—beginning of period
|
$
|
722,209
|
|
|
$
|
906,680
|
|
Net increase in cash and cash equivalents
|
68,075
|
|
|
461,874
|
|
||
Cash and cash equivalents—end of period
|
$
|
790,284
|
|
|
$
|
1,368,554
|
|
|
September 25,
2016 |
|
December 31,
2015 |
|
September 27,
2015 |
||||||
Available-for-sale: Corporate bonds
|
$
|
5,038
|
|
|
$
|
45,192
|
|
|
$
|
47,358
|
|
Trading securities: Mutual funds
|
39,063
|
|
|
36,256
|
|
|
35,258
|
|
|||
|
$
|
44,101
|
|
|
$
|
81,448
|
|
|
$
|
82,616
|
|
|
September 25,
2016 |
|
December 31,
2015 |
|
September 27,
2015 |
||||||
Components at the lower of FIFO cost or market
|
|
|
|
|
|
||||||
Raw materials and work in process
|
$
|
159,209
|
|
|
$
|
161,704
|
|
|
$
|
153,779
|
|
Motorcycle finished goods
|
182,019
|
|
|
327,952
|
|
|
228,243
|
|
|||
Parts and accessories and general merchandise
|
134,587
|
|
|
145,519
|
|
|
134,537
|
|
|||
Inventory at lower of FIFO cost or market
|
475,815
|
|
|
635,175
|
|
|
516,559
|
|
|||
Excess of FIFO over LIFO cost
|
(49,268
|
)
|
|
(49,268
|
)
|
|
(49,902
|
)
|
|||
|
$
|
426,547
|
|
|
$
|
585,907
|
|
|
$
|
466,657
|
|
|
Nine months ended
|
||||||
|
September 25,
2016 |
|
September 27,
2015 |
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income
|
$
|
644,985
|
|
|
$
|
710,011
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization of intangibles
|
154,565
|
|
|
142,024
|
|
||
Amortization of deferred loan origination costs
|
65,445
|
|
|
71,012
|
|
||
Amortization of financing origination fees
|
7,212
|
|
|
7,331
|
|
||
Provision for long-term employee benefits
|
27,608
|
|
|
36,954
|
|
||
Employee benefit plan contributions and payments
|
(47,658
|
)
|
|
(19,358
|
)
|
||
Stock compensation expense
|
24,909
|
|
|
23,732
|
|
||
Net change in wholesale finance receivables related to sales
|
(169,599
|
)
|
|
(157,532
|
)
|
||
Provision for credit losses
|
97,127
|
|
|
68,655
|
|
||
Gain on off-balance sheet asset-backed securitization
|
(9,269
|
)
|
|
—
|
|
||
Loss on debt extinguishment
|
118
|
|
|
—
|
|
||
Pension plan settlement expense
|
900
|
|
|
—
|
|
||
Deferred income taxes
|
(11,261
|
)
|
|
(9,272
|
)
|
||
Foreign currency adjustments
|
(11,741
|
)
|
|
22,010
|
|
||
Other, net
|
(11,529
|
)
|
|
5,000
|
|
||
Changes in current assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
(86,796
|
)
|
|
(60,687
|
)
|
||
Finance receivables—accrued interest and other
|
364
|
|
|
(98
|
)
|
||
Inventories
|
173,975
|
|
|
(36,109
|
)
|
||
Accounts payable and accrued liabilities
|
97,190
|
|
|
211,045
|
|
||
Derivative instruments
|
(1,992
|
)
|
|
(6,734
|
)
|
||
Other
|
(16,744
|
)
|
|
12,973
|
|
||
Total adjustments
|
282,824
|
|
|
310,946
|
|
||
Net cash provided by operating activities
|
$
|
927,809
|
|
|
$
|
1,020,957
|
|
|
August 4, 2015
|
||
Current assets
|
$
|
11,088
|
|
Property, plant and equipment
|
144
|
|
|
Intangible assets
|
20,842
|
|
|
Goodwill
|
28,567
|
|
|
Total assets
|
60,641
|
|
|
Current liabilities
|
731
|
|
|
Net assets acquired
|
$
|
59,910
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||
|
September 25, 2016
|
|
September 27, 2015
|
|
September 25, 2016
|
|
September 27, 2015
|
||||||
Balance, beginning of period
|
54,542
|
|
|
26,105
|
|
|
$
|
54,182
|
|
|
$
|
27,752
|
|
Business acquisitions
|
—
|
|
|
28,567
|
|
|
—
|
|
|
28,567
|
|
||
Currency translations
|
121
|
|
|
(405
|
)
|
|
481
|
|
|
(2,052
|
)
|
||
Balance, end of period
|
54,663
|
|
|
54,267
|
|
|
$
|
54,663
|
|
|
$
|
54,267
|
|
|
September 25, 2016
|
|
|
||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net
|
|
Estimated useful life (years)
|
||||||
Other intangible assets
|
|
|
|
|
|
|
|
||||||
Reacquired distribution rights
|
$
|
13,357
|
|
|
$
|
(7,792
|
)
|
|
$
|
5,565
|
|
|
2
|
Customer relationships
|
7,535
|
|
|
(439
|
)
|
|
7,096
|
|
|
20
|
|||
Total other intangible assets
|
$
|
20,892
|
|
|
$
|
(8,231
|
)
|
|
$
|
12,661
|
|
|
|
|
December 31, 2015
|
|
|
||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net
|
|
Estimated useful life (years)
|
||||||
Other intangible assets
|
|
|
|
|
|
|
|
||||||
Reacquired distribution rights
|
$
|
12,614
|
|
|
$
|
(2,628
|
)
|
|
$
|
9,986
|
|
|
2
|
Customer relationships
|
7,116
|
|
|
(148
|
)
|
|
6,968
|
|
|
20
|
|||
Total other intangible assets
|
$
|
19,730
|
|
|
$
|
(2,776
|
)
|
|
$
|
16,954
|
|
|
|
|
September 27, 2015
|
|
|
||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net
|
|
Estimated useful life (years)
|
||||||
Other intangible assets
|
|
|
|
|
|
|
|
||||||
Reacquired distribution rights
|
$
|
13,117
|
|
|
$
|
(1,093
|
)
|
|
$
|
12,024
|
|
|
2
|
Customer relationships
|
7,399
|
|
|
(62
|
)
|
|
7,337
|
|
|
20
|
|||
Total other intangible assets
|
$
|
20,516
|
|
|
$
|
(1,155
|
)
|
|
$
|
19,361
|
|
|
|
|
|
Estimated Amortization
|
||
2016 (remaining 3 months)
|
|
$
|
1,767
|
|
2017
|
|
4,278
|
|
|
2018
|
|
372
|
|
|
2019
|
|
372
|
|
|
2020
|
|
372
|
|
|
2021
|
|
372
|
|
|
Thereafter
|
|
5,128
|
|
|
|
|
$
|
12,661
|
|
|
September 25,
2016 |
|
December 31,
2015 |
|
September 27,
2015 |
||||||
Retail
|
$
|
6,165,999
|
|
|
$
|
5,991,471
|
|
|
$
|
6,194,332
|
|
Wholesale
|
1,155,483
|
|
|
1,023,860
|
|
|
1,029,397
|
|
|||
Total finance receivables
|
7,321,482
|
|
|
7,015,331
|
|
|
7,223,729
|
|
|||
Allowance for credit losses
|
(171,516
|
)
|
|
(147,178
|
)
|
|
(145,383
|
)
|
|||
Finance receivables, net
|
$
|
7,149,966
|
|
|
$
|
6,868,153
|
|
|
$
|
7,078,346
|
|
|
Three months ended September 25, 2016
|
||||||||||
|
Retail
|
|
Wholesale
|
|
Total
|
||||||
Balance, beginning of period
|
$
|
152,998
|
|
|
$
|
8,355
|
|
|
$
|
161,353
|
|
Provision for credit losses
|
38,143
|
|
|
(1,600
|
)
|
|
36,543
|
|
|||
Charge-offs
|
(35,749
|
)
|
|
—
|
|
|
(35,749
|
)
|
|||
Recoveries
|
9,369
|
|
|
—
|
|
|
9,369
|
|
|||
Balance, end of period
|
$
|
164,761
|
|
|
$
|
6,755
|
|
|
$
|
171,516
|
|
|
|
|
|
|
|
||||||
|
Three months ended September 27, 2015
|
||||||||||
|
Retail
|
|
Wholesale
|
|
Total
|
||||||
Balance, beginning of period
|
$
|
131,903
|
|
|
$
|
7,328
|
|
|
$
|
139,231
|
|
Provision for credit losses
|
28,309
|
|
|
(1,076
|
)
|
|
27,233
|
|
|||
Charge-offs
|
(30,203
|
)
|
|
—
|
|
|
(30,203
|
)
|
|||
Recoveries
|
9,122
|
|
|
—
|
|
|
9,122
|
|
|||
Balance, end of period
|
$
|
139,131
|
|
|
$
|
6,252
|
|
|
$
|
145,383
|
|
|
|
|
|
|
|
||||||
|
Nine months ended September 25, 2016
|
||||||||||
|
Retail
|
|
Wholesale
|
|
Total
|
||||||
Balance, beginning of period
|
$
|
139,320
|
|
|
$
|
7,858
|
|
|
$
|
147,178
|
|
Provision for credit losses
|
98,230
|
|
|
(1,103
|
)
|
|
97,127
|
|
|||
Charge-offs
|
(101,853
|
)
|
|
—
|
|
|
(101,853
|
)
|
|||
Recoveries
|
32,355
|
|
|
—
|
|
|
32,355
|
|
|||
Other
(a)
|
(3,291
|
)
|
|
—
|
|
|
(3,291
|
)
|
|||
Balance, end of period
|
$
|
164,761
|
|
|
$
|
6,755
|
|
|
$
|
171,516
|
|
|
|
|
|
|
|
||||||
|
Nine months ended September 27, 2015
|
||||||||||
|
Retail
|
|
Wholesale
|
|
Total
|
||||||
Balance, beginning of period
|
$
|
122,025
|
|
|
$
|
5,339
|
|
|
$
|
127,364
|
|
Provision for credit losses
|
67,742
|
|
|
913
|
|
|
68,655
|
|
|||
Charge-offs
|
(83,939
|
)
|
|
—
|
|
|
(83,939
|
)
|
|||
Recoveries
|
33,303
|
|
|
—
|
|
|
33,303
|
|
|||
Balance, end of period
|
$
|
139,131
|
|
|
$
|
6,252
|
|
|
$
|
145,383
|
|
(a)
|
Related to the sale of finance receivables during the second quarter of 2016 with a principal balance of
$301.8 million
through an off-balance sheet asset-backed securitization transaction (see Note 12 for additional information).
|
|
September 25, 2016
|
||||||||||
|
Retail
|
|
Wholesale
|
|
Total
|
||||||
Allowance for credit losses, ending balance:
|
|
|
|
|
|
||||||
Individually evaluated for impairment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Collectively evaluated for impairment
|
164,761
|
|
|
6,755
|
|
|
171,516
|
|
|||
Total allowance for credit losses
|
$
|
164,761
|
|
|
$
|
6,755
|
|
|
$
|
171,516
|
|
Finance receivables, ending balance:
|
|
|
|
|
|
||||||
Individually evaluated for impairment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Collectively evaluated for impairment
|
6,165,999
|
|
|
1,155,483
|
|
|
7,321,482
|
|
|||
Total finance receivables
|
$
|
6,165,999
|
|
|
$
|
1,155,483
|
|
|
$
|
7,321,482
|
|
|
|
|
|
|
|
||||||
|
December 31, 2015
|
||||||||||
|
Retail
|
|
Wholesale
|
|
Total
|
||||||
Allowance for credit losses, ending balance:
|
|
|
|
|
|
||||||
Individually evaluated for impairment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Collectively evaluated for impairment
|
139,320
|
|
|
7,858
|
|
|
147,178
|
|
|||
Total allowance for credit losses
|
$
|
139,320
|
|
|
$
|
7,858
|
|
|
$
|
147,178
|
|
Finance receivables, ending balance:
|
|
|
|
|
|
||||||
Individually evaluated for impairment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Collectively evaluated for impairment
|
5,991,471
|
|
|
1,023,860
|
|
|
7,015,331
|
|
|||
Total finance receivables
|
$
|
5,991,471
|
|
|
$
|
1,023,860
|
|
|
$
|
7,015,331
|
|
|
|
|
|
|
|
||||||
|
September 27, 2015
|
||||||||||
|
Retail
|
|
Wholesale
|
|
Total
|
||||||
Allowance for credit losses, ending balance:
|
|
|
|
|
|
||||||
Individually evaluated for impairment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Collectively evaluated for impairment
|
139,131
|
|
|
6,252
|
|
|
145,383
|
|
|||
Total allowance for credit losses
|
$
|
139,131
|
|
|
$
|
6,252
|
|
|
$
|
145,383
|
|
Finance receivables, ending balance:
|
|
|
|
|
|
||||||
Individually evaluated for impairment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Collectively evaluated for impairment
|
6,194,332
|
|
|
1,029,397
|
|
|
7,223,729
|
|
|||
Total finance receivables
|
$
|
6,194,332
|
|
|
$
|
1,029,397
|
|
|
$
|
7,223,729
|
|
|
September 25, 2016
|
||||||||||||||||||||||
|
Current
|
|
31-60 Days
Past Due
|
|
61-90 Days
Past Due
|
|
Greater than
90 Days
Past Due
|
|
Total
Past Due
|
|
Total
Finance
Receivables
|
||||||||||||
Retail
|
$
|
5,973,108
|
|
|
$
|
119,709
|
|
|
$
|
41,866
|
|
|
$
|
31,316
|
|
|
$
|
192,891
|
|
|
$
|
6,165,999
|
|
Wholesale
|
1,154,617
|
|
|
366
|
|
|
114
|
|
|
386
|
|
|
866
|
|
|
1,155,483
|
|
||||||
Total
|
$
|
7,127,725
|
|
|
$
|
120,075
|
|
|
$
|
41,980
|
|
|
$
|
31,702
|
|
|
$
|
193,757
|
|
|
$
|
7,321,482
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
December 31, 2015
|
||||||||||||||||||||||
|
Current
|
|
31-60 Days
Past Due
|
|
61-90 Days
Past Due
|
|
Greater than
90 Days
Past Due
|
|
Total
Past Due
|
|
Total
Finance
Receivables
|
||||||||||||
Retail
|
$
|
5,796,003
|
|
|
$
|
118,996
|
|
|
$
|
43,680
|
|
|
$
|
32,792
|
|
|
$
|
195,468
|
|
|
$
|
5,991,471
|
|
Wholesale
|
1,022,365
|
|
|
888
|
|
|
530
|
|
|
77
|
|
|
1,495
|
|
|
1,023,860
|
|
||||||
Total
|
$
|
6,818,368
|
|
|
$
|
119,884
|
|
|
$
|
44,210
|
|
|
$
|
32,869
|
|
|
$
|
196,963
|
|
|
$
|
7,015,331
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
September 27, 2015
|
||||||||||||||||||||||
|
Current
|
|
31-60 Days
Past Due
|
|
61-90 Days
Past Due
|
|
Greater than
90 Days
Past Due
|
|
Total
Past Due
|
|
Total
Finance
Receivables
|
||||||||||||
Retail
|
$
|
6,024,620
|
|
|
$
|
111,393
|
|
|
$
|
34,511
|
|
|
$
|
23,808
|
|
|
$
|
169,712
|
|
|
$
|
6,194,332
|
|
Wholesale
|
1,028,981
|
|
|
106
|
|
|
162
|
|
|
148
|
|
|
416
|
|
|
1,029,397
|
|
||||||
Total
|
$
|
7,053,601
|
|
|
$
|
111,499
|
|
|
$
|
34,673
|
|
|
$
|
23,956
|
|
|
$
|
170,128
|
|
|
$
|
7,223,729
|
|
|
September 25, 2016
|
|
December 31, 2015
|
|
September 27, 2015
|
||||||
Prime
|
$
|
4,900,752
|
|
|
$
|
4,777,448
|
|
|
$
|
4,936,438
|
|
Sub-prime
|
1,265,247
|
|
|
1,214,023
|
|
|
1,257,894
|
|
|||
Total
|
$
|
6,165,999
|
|
|
$
|
5,991,471
|
|
|
$
|
6,194,332
|
|
|
September 25, 2016
|
|
December 31, 2015
|
|
September 27, 2015
|
||||||
Doubtful
|
$
|
—
|
|
|
$
|
5,169
|
|
|
$
|
—
|
|
Substandard
|
16,244
|
|
|
21,774
|
|
|
14,949
|
|
|||
Special Mention
|
—
|
|
|
6,271
|
|
|
3,706
|
|
|||
Medium Risk
|
7,667
|
|
|
11,494
|
|
|
6,496
|
|
|||
Low Risk
|
1,131,572
|
|
|
979,152
|
|
|
1,004,246
|
|
|||
Total
|
$
|
1,155,483
|
|
|
$
|
1,023,860
|
|
|
$
|
1,029,397
|
|
|
September 25, 2016
|
||||||||||||||
|
Balance
|
|
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
526,228
|
|
|
$
|
372,850
|
|
|
$
|
153,378
|
|
|
$
|
—
|
|
Marketable securities
|
44,101
|
|
|
39,063
|
|
|
5,038
|
|
|
—
|
|
||||
Derivatives
|
6,606
|
|
|
—
|
|
|
6,606
|
|
|
—
|
|
||||
|
$
|
576,935
|
|
|
$
|
411,913
|
|
|
$
|
165,022
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
$
|
1,388
|
|
|
$
|
—
|
|
|
$
|
1,388
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
|
December 31, 2015
|
||||||||||||||
|
Balance
|
|
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
555,910
|
|
|
$
|
390,706
|
|
|
$
|
165,204
|
|
|
$
|
—
|
|
Marketable securities
|
81,448
|
|
|
36,256
|
|
|
45,192
|
|
|
—
|
|
||||
Derivatives
|
16,235
|
|
|
—
|
|
|
16,235
|
|
|
—
|
|
||||
|
$
|
653,593
|
|
|
$
|
426,962
|
|
|
$
|
226,631
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
$
|
1,300
|
|
|
$
|
—
|
|
|
$
|
1,300
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
|
September 27, 2015
|
||||||||||||||
|
Balance
|
|
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
1,111,571
|
|
|
$
|
719,854
|
|
|
$
|
391,717
|
|
|
$
|
—
|
|
Marketable securities
|
82,616
|
|
|
35,258
|
|
|
47,358
|
|
|
—
|
|
||||
Derivatives
|
18,015
|
|
|
—
|
|
|
18,015
|
|
|
—
|
|
||||
|
$
|
1,212,202
|
|
|
$
|
755,112
|
|
|
$
|
457,090
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
$
|
1,309
|
|
|
$
|
—
|
|
|
$
|
1,309
|
|
|
$
|
—
|
|
|
September 25, 2016
|
|
December 31, 2015
|
|
September 27, 2015
|
||||||||||||||||||
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
$
|
790,284
|
|
|
$
|
790,284
|
|
|
$
|
722,209
|
|
|
$
|
722,209
|
|
|
$
|
1,368,554
|
|
|
$
|
1,368,554
|
|
Marketable securities
|
$
|
44,101
|
|
|
$
|
44,101
|
|
|
$
|
81,448
|
|
|
$
|
81,448
|
|
|
$
|
82,616
|
|
|
$
|
82,616
|
|
Derivatives
|
$
|
6,606
|
|
|
$
|
6,606
|
|
|
$
|
16,235
|
|
|
$
|
16,235
|
|
|
$
|
18,015
|
|
|
$
|
18,015
|
|
Finance receivables, net
|
$
|
7,233,923
|
|
|
$
|
7,149,966
|
|
|
$
|
6,937,053
|
|
|
$
|
6,868,153
|
|
|
$
|
7,170,873
|
|
|
$
|
7,078,346
|
|
Restricted cash
|
$
|
79,661
|
|
|
$
|
79,661
|
|
|
$
|
110,642
|
|
|
$
|
110,642
|
|
|
$
|
137,217
|
|
|
$
|
137,217
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivatives
|
$
|
1,388
|
|
|
$
|
1,388
|
|
|
$
|
1,300
|
|
|
$
|
1,300
|
|
|
$
|
1,309
|
|
|
$
|
1,309
|
|
Unsecured commercial paper
|
$
|
1,055,428
|
|
|
$
|
1,055,428
|
|
|
$
|
1,201,380
|
|
|
$
|
1,201,380
|
|
|
$
|
990,049
|
|
|
$
|
990,049
|
|
Asset-backed Canadian commercial paper conduit facility
|
$
|
140,488
|
|
|
$
|
140,488
|
|
|
$
|
153,839
|
|
|
$
|
153,839
|
|
|
$
|
158,712
|
|
|
$
|
158,712
|
|
Medium-term notes
|
$
|
4,199,753
|
|
|
$
|
4,063,510
|
|
|
$
|
3,410,966
|
|
|
$
|
3,316,949
|
|
|
$
|
3,468,459
|
|
|
$
|
3,325,032
|
|
Senior unsecured notes
|
$
|
800,818
|
|
|
$
|
741,144
|
|
|
$
|
737,435
|
|
|
$
|
740,653
|
|
|
$
|
752,494
|
|
|
$
|
741,057
|
|
Term asset-backed securitization debt
|
$
|
929,775
|
|
|
$
|
925,619
|
|
|
$
|
1,455,776
|
|
|
$
|
1,459,377
|
|
|
$
|
1,707,076
|
|
|
$
|
1,701,732
|
|
|
September 25, 2016
|
|
December 31, 2015
|
|
September 27, 2015
|
||||||||||||||||||||||||||||||
Derivatives Designated As Hedging
Instruments Under ASC
Topic 815
|
Notional
Value
|
|
Asset
Fair Value
(a)
|
|
Liability
Fair Value
(b)
|
|
Notional
Value
|
|
Asset
Fair Value
(a)
|
|
Liability
Fair Value
(b)
|
|
Notional
Value
|
|
Asset
Fair Value
(a)
|
|
Liability
Fair Value
(b)
|
||||||||||||||||||
Foreign currency contracts
(c)
|
$
|
615,251
|
|
|
$
|
6,337
|
|
|
$
|
1,193
|
|
|
$
|
436,352
|
|
|
$
|
16,167
|
|
|
$
|
181
|
|
|
$
|
460,323
|
|
|
$
|
18,015
|
|
|
$
|
19
|
|
Commodity
contracts
(c)
|
1,154
|
|
|
110
|
|
|
—
|
|
|
968
|
|
|
—
|
|
|
159
|
|
|
1,297
|
|
|
—
|
|
|
168
|
|
|||||||||
Total
|
$
|
616,405
|
|
|
$
|
6,447
|
|
|
$
|
1,193
|
|
|
$
|
437,320
|
|
|
$
|
16,167
|
|
|
$
|
340
|
|
|
$
|
461,620
|
|
|
$
|
18,015
|
|
|
$
|
187
|
|
|
September 25, 2016
|
|
December 31, 2015
|
|
September 27, 2015
|
||||||||||||||||||||||||||||||
Derivatives Not Designated As Hedging
Instruments Under ASC
Topic 815
|
Notional
Value
|
|
Asset
Fair Value
(a)
|
|
Liability
Fair Value
(b)
|
|
Notional
Value
|
|
Asset
Fair Value
(a)
|
|
Liability
Fair Value
(b)
|
|
Notional
Value
|
|
Asset
Fair Value
(a)
|
|
Liability
Fair Value
(b)
|
||||||||||||||||||
Commodity contracts
|
$
|
4,488
|
|
|
$
|
159
|
|
|
$
|
195
|
|
|
$
|
6,510
|
|
|
$
|
68
|
|
|
$
|
960
|
|
|
$
|
7,027
|
|
|
$
|
—
|
|
|
$
|
1,122
|
|
|
$
|
4,488
|
|
|
$
|
159
|
|
|
$
|
195
|
|
|
$
|
6,510
|
|
|
$
|
68
|
|
|
$
|
960
|
|
|
$
|
7,027
|
|
|
$
|
—
|
|
|
$
|
1,122
|
|
(a)
|
Included in other current assets
|
(b)
|
Included in accrued liabilities
|
(c)
|
Derivative designated as a cash flow hedge
|
|
Amount of Gain/(Loss) Recognized in OCI, before tax
|
||||||||||||||
|
Three months ended
|
|
Nine months ended
|
||||||||||||
Cash Flow Hedges
|
September 25,
2016 |
|
September 27,
2015 |
|
September 25,
2016 |
|
September 27,
2015 |
||||||||
Foreign currency contracts
|
$
|
(938
|
)
|
|
$
|
6,796
|
|
|
$
|
(5,445
|
)
|
|
$
|
35,004
|
|
Commodity contracts
|
43
|
|
|
(138
|
)
|
|
(30
|
)
|
|
(284
|
)
|
||||
Treasury rate locks
|
—
|
|
|
(10,746
|
)
|
|
—
|
|
|
(7,381
|
)
|
||||
Total
|
$
|
(895
|
)
|
|
$
|
(4,088
|
)
|
|
$
|
(5,475
|
)
|
|
$
|
27,339
|
|
|
Amount of Gain/(Loss) Reclassified from AOCL into Income
|
|
|
||||||||||||||||
|
Three months ended
|
|
Nine months ended
|
|
Expected to be Reclassified
|
||||||||||||||
Cash Flow Hedges
|
September 25,
2016 |
|
September 27,
2015 |
|
September 25,
2016 |
|
September 27,
2015 |
|
Over the Next Twelve Months
|
||||||||||
Foreign currency contracts
(a)
|
$
|
2,399
|
|
|
$
|
12,771
|
|
|
$
|
6,806
|
|
|
$
|
48,175
|
|
|
$
|
4,488
|
|
Commodity contracts
(a)
|
21
|
|
|
(68
|
)
|
|
(298
|
)
|
|
(530
|
)
|
|
110
|
|
|||||
Treasury rate locks
(b)
|
(90
|
)
|
|
(60
|
)
|
|
(271
|
)
|
|
(60
|
)
|
|
(362
|
)
|
|||||
Total
|
$
|
2,330
|
|
|
$
|
12,643
|
|
|
$
|
6,237
|
|
|
$
|
47,585
|
|
|
$
|
4,236
|
|
(a)
|
Gain/(loss) reclassified from accumulated other comprehensive loss (AOCL) to income is included in cost of goods sold
|
(b)
|
Gain/(loss) reclassified from accumulated other comprehensive loss (AOCL) to income is included in interest expense
|
|
Amount of Gain/(Loss) Recognized in Income on Derivative
|
||||||||||||||
|
Three months ended
|
|
Nine months ended
|
||||||||||||
Derivatives Not Designated As Hedges
|
September 25,
2016 |
|
September 27,
2015 |
|
September 25,
2016 |
|
September 27,
2015 |
||||||||
Commodity contracts
(a)
|
$
|
45
|
|
|
$
|
(731
|
)
|
|
$
|
(179
|
)
|
|
$
|
(1,257
|
)
|
Total
|
$
|
45
|
|
|
$
|
(731
|
)
|
|
$
|
(179
|
)
|
|
$
|
(1,257
|
)
|
(a)
|
Gain/(loss) recognized in income is included in cost of goods sold.
|
|
|
Three months ended September 25, 2016
|
||||||||||||||||||
|
|
Foreign currency translation adjustments
|
|
Marketable securities
|
|
Derivative financial instruments
|
|
Pension and postretirement benefit plans
|
|
Total
|
||||||||||
Balance, beginning of period
|
|
$
|
(43,523
|
)
|
|
$
|
(1,171
|
)
|
|
$
|
543
|
|
|
$
|
(546,010
|
)
|
|
$
|
(590,161
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
3,574
|
|
|
(18
|
)
|
|
(895
|
)
|
|
—
|
|
|
2,661
|
|
|||||
Income tax expense
|
|
279
|
|
|
7
|
|
|
332
|
|
|
—
|
|
|
618
|
|
|||||
Net other comprehensive income (loss) before reclassifications
|
|
3,853
|
|
|
(11
|
)
|
|
(563
|
)
|
|
—
|
|
|
3,279
|
|
|||||
Reclassifications:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Realized (gains) losses - foreign currency contracts
(a)
|
|
—
|
|
|
—
|
|
|
(2,399
|
)
|
|
—
|
|
|
(2,399
|
)
|
|||||
Realized (gains) losses - commodities contracts
(a)
|
|
—
|
|
|
—
|
|
|
(21
|
)
|
|
—
|
|
|
(21
|
)
|
|||||
Realized (gains) losses - treasury rate lock
(c)
|
|
—
|
|
|
—
|
|
|
90
|
|
|
—
|
|
|
90
|
|
|||||
Prior service credits
(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(446
|
)
|
|
(446
|
)
|
|||||
Actuarial losses
(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,472
|
|
|
12,472
|
|
|||||
Total reclassifications before tax
|
|
—
|
|
|
—
|
|
|
(2,330
|
)
|
|
12,026
|
|
|
9,696
|
|
|||||
Income tax expense (benefit)
|
|
—
|
|
|
—
|
|
|
862
|
|
|
(4,454
|
)
|
|
(3,592
|
)
|
|||||
Net reclassifications
|
|
—
|
|
|
—
|
|
|
(1,468
|
)
|
|
7,572
|
|
|
6,104
|
|
|||||
Other comprehensive income (loss)
|
|
3,853
|
|
|
(11
|
)
|
|
(2,031
|
)
|
|
7,572
|
|
|
9,383
|
|
|||||
Balance, end of period
|
|
$
|
(39,670
|
)
|
|
$
|
(1,182
|
)
|
|
$
|
(1,488
|
)
|
|
$
|
(538,438
|
)
|
|
$
|
(580,778
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended September 27, 2015
|
||||||||||||||||||
|
|
Foreign currency translation adjustments
|
|
Marketable securities
|
|
Derivative financial instruments
|
|
Pension and postretirement benefit plans
|
|
Total
|
||||||||||
Balance, beginning of period
|
|
$
|
(26,252
|
)
|
|
$
|
(895
|
)
|
|
$
|
16,828
|
|
|
$
|
(512,207
|
)
|
|
$
|
(522,526
|
)
|
Other comprehensive loss before reclassifications
|
|
(17,003
|
)
|
|
(157
|
)
|
|
(4,088
|
)
|
|
—
|
|
|
(21,248
|
)
|
|||||
Income tax expense
|
|
2,405
|
|
|
58
|
|
|
1,514
|
|
|
—
|
|
|
3,977
|
|
|||||
Net other comprehensive loss before reclassifications
|
|
(14,598
|
)
|
|
(99
|
)
|
|
(2,574
|
)
|
|
—
|
|
|
(17,271
|
)
|
|||||
Reclassifications:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Realized (gains) losses - foreign currency contracts
(a)
|
|
—
|
|
|
—
|
|
|
(12,771
|
)
|
|
—
|
|
|
(12,771
|
)
|
|||||
Realized (gains) losses - commodities contracts
(a)
|
|
—
|
|
|
—
|
|
|
68
|
|
|
—
|
|
|
68
|
|
|||||
Realized (gains) losses - treasury rate lock
(c)
|
|
—
|
|
|
—
|
|
|
60
|
|
|
—
|
|
|
60
|
|
|||||
Prior service credits
(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(695
|
)
|
|
(695
|
)
|
|||||
Actuarial losses
(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,671
|
|
|
14,671
|
|
|||||
Total reclassifications before tax
|
|
—
|
|
|
—
|
|
|
(12,643
|
)
|
|
13,976
|
|
|
1,333
|
|
|||||
Income tax expense (benefit)
|
|
—
|
|
|
—
|
|
|
4,684
|
|
|
(5,177
|
)
|
|
(493
|
)
|
|||||
Net reclassifications
|
|
—
|
|
|
—
|
|
|
(7,959
|
)
|
|
8,799
|
|
|
840
|
|
|||||
Other comprehensive (loss) income
|
|
(14,598
|
)
|
|
(99
|
)
|
|
(10,533
|
)
|
|
8,799
|
|
|
(16,431
|
)
|
|||||
Balance, end of period
|
|
$
|
(40,850
|
)
|
|
$
|
(994
|
)
|
|
$
|
6,295
|
|
|
$
|
(503,408
|
)
|
|
$
|
(538,957
|
)
|
|
|
Nine months ended September 25, 2016
|
||||||||||||||||||
|
|
Foreign currency translation adjustments
|
|
Marketable securities
|
|
Derivative financial instruments
|
|
Pension and postretirement benefit plans
|
|
Total
|
||||||||||
Balance, beginning of period
|
|
$
|
(58,844
|
)
|
|
$
|
(1,094
|
)
|
|
$
|
5,886
|
|
|
$
|
(561,153
|
)
|
|
$
|
(615,205
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
20,661
|
|
|
(140
|
)
|
|
(5,475
|
)
|
|
—
|
|
|
15,046
|
|
|||||
Income tax (benefit) expense
|
|
(1,487
|
)
|
|
52
|
|
|
2,028
|
|
|
—
|
|
|
593
|
|
|||||
Net other comprehensive income (loss) before reclassifications
|
|
19,174
|
|
|
(88
|
)
|
|
(3,447
|
)
|
|
—
|
|
|
15,639
|
|
|||||
Reclassifications:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Realized (gains) losses - foreign currency contracts
(a)
|
|
—
|
|
|
—
|
|
|
(6,806
|
)
|
|
—
|
|
|
(6,806
|
)
|
|||||
Realized (gains) losses - commodities contracts
(a)
|
|
—
|
|
|
—
|
|
|
298
|
|
|
—
|
|
|
298
|
|
|||||
Realized (gains) losses - treasury rate lock
(c)
|
|
—
|
|
|
—
|
|
|
271
|
|
|
—
|
|
|
271
|
|
|||||
Prior service credits
(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,338
|
)
|
|
(1,338
|
)
|
|||||
Actuarial losses
(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
37,416
|
|
|
37,416
|
|
|||||
Total reclassifications before tax
|
|
—
|
|
|
—
|
|
|
(6,237
|
)
|
|
36,078
|
|
|
29,841
|
|
|||||
Income tax expense (benefit)
|
|
—
|
|
|
—
|
|
|
2,310
|
|
|
(13,363
|
)
|
|
(11,053
|
)
|
|||||
Net reclassifications
|
|
—
|
|
|
—
|
|
|
(3,927
|
)
|
|
22,715
|
|
|
18,788
|
|
|||||
Other comprehensive income (loss)
|
|
19,174
|
|
|
(88
|
)
|
|
(7,374
|
)
|
|
22,715
|
|
|
34,427
|
|
|||||
Balance, end of period
|
|
$
|
(39,670
|
)
|
|
$
|
(1,182
|
)
|
|
$
|
(1,488
|
)
|
|
$
|
(538,438
|
)
|
|
$
|
(580,778
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended September 27, 2015
|
||||||||||||||||||
|
|
Foreign currency translation adjustments
|
|
Marketable securities
|
|
Derivative financial instruments
|
|
Pension and postretirement benefit plans
|
|
Total
|
||||||||||
Balance, beginning of period
|
|
$
|
(3,482
|
)
|
|
$
|
(700
|
)
|
|
$
|
19,042
|
|
|
$
|
(529,803
|
)
|
|
$
|
(514,943
|
)
|
Other comprehensive (loss) income before reclassifications
|
|
(41,954
|
)
|
|
(467
|
)
|
|
27,339
|
|
|
—
|
|
|
(15,082
|
)
|
|||||
Income tax expense (benefit)
|
|
4,586
|
|
|
173
|
|
|
(10,126
|
)
|
|
—
|
|
|
(5,367
|
)
|
|||||
Net other comprehensive (loss) income before reclassifications
|
|
(37,368
|
)
|
|
(294
|
)
|
|
17,213
|
|
|
—
|
|
|
(20,449
|
)
|
|||||
Reclassifications:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Realized (gains) losses - foreign currency contracts
(a)
|
|
—
|
|
|
—
|
|
|
(48,175
|
)
|
|
—
|
|
|
(48,175
|
)
|
|||||
Realized (gains) losses - commodities contracts
(a)
|
|
—
|
|
|
—
|
|
|
530
|
|
|
—
|
|
|
530
|
|
|||||
Realized (gains) losses - treasury rate lock
(c)
|
|
—
|
|
|
—
|
|
|
60
|
|
|
—
|
|
|
60
|
|
|||||
Prior service credits
(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,085
|
)
|
|
(2,085
|
)
|
|||||
Actuarial losses
(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,010
|
|
|
44,010
|
|
|||||
Total reclassifications before tax
|
|
—
|
|
|
—
|
|
|
(47,585
|
)
|
|
41,925
|
|
|
(5,660
|
)
|
|||||
Income tax expense (benefit)
|
|
—
|
|
|
—
|
|
|
17,625
|
|
|
(15,530
|
)
|
|
2,095
|
|
|||||
Net reclassifications
|
|
—
|
|
|
—
|
|
|
(29,960
|
)
|
|
26,395
|
|
|
(3,565
|
)
|
|||||
Other comprehensive (loss) income
|
|
(37,368
|
)
|
|
(294
|
)
|
|
(12,747
|
)
|
|
26,395
|
|
|
(24,014
|
)
|
|||||
Balance, end of period
|
|
$
|
(40,850
|
)
|
|
$
|
(994
|
)
|
|
$
|
6,295
|
|
|
$
|
(503,408
|
)
|
|
$
|
(538,957
|
)
|
(a)
|
Amounts reclassified to net income are included in Motorcycles and Related Products cost of goods sold.
|
(b)
|
Amounts reclassified are included in the computation of net periodic cost. See Note 16 for information related to pension and postretirement benefit plans.
|
(c)
|
Amounts reclassified to net income are included in interest expense.
|
|
|
September 25,
2016 |
|
December 31,
2015 |
|
September 27,
2015 |
||||||
Unsecured commercial paper
|
|
$
|
1,055,428
|
|
|
$
|
1,201,380
|
|
|
$
|
990,049
|
|
Total short-term debt
|
|
$
|
1,055,428
|
|
|
$
|
1,201,380
|
|
|
$
|
990,049
|
|
|
|
September 25,
2016 |
|
December 31,
2015 |
|
September 27,
2015 |
||||||
Secured debt
|
|
|
|
|
|
|
||||||
Asset-backed Canadian commercial paper conduit facility
|
|
$
|
140,488
|
|
|
$
|
153,839
|
|
|
$
|
158,712
|
|
Term asset-backed securitization debt
|
|
927,539
|
|
|
1,463,154
|
|
|
1,706,431
|
|
|||
Less: unamortized discount and debt issuance costs
|
|
(1,920
|
)
|
|
(3,777
|
)
|
|
(4,699
|
)
|
|||
Total secured debt
|
|
1,066,107
|
|
|
1,613,216
|
|
|
1,860,444
|
|
|||
|
|
|
|
|
|
|
||||||
Unsecured notes
|
|
|
|
|
|
|
||||||
3.88% Medium-term notes due in 2016 par value
|
|
—
|
|
|
450,000
|
|
|
450,000
|
|
|||
2.70% Medium-term notes due in 2017 par value
|
|
400,000
|
|
|
400,000
|
|
|
400,000
|
|
|||
1.55% Medium-term notes due in 2017 par value
|
|
400,000
|
|
|
400,000
|
|
|
400,000
|
|
|||
6.80% Medium-term notes due in 2018 par value
|
|
877,488
|
|
|
878,708
|
|
|
887,958
|
|
|||
2.40% Medium-term notes due in 2019 par value
|
|
600,000
|
|
|
600,000
|
|
|
600,000
|
|
|||
2.25% Medium-term notes due in 2019 par value
|
|
600,000
|
|
|
—
|
|
|
—
|
|
|||
2.15% Medium-term notes due in 2020 par value
|
|
600,000
|
|
|
600,000
|
|
|
600,000
|
|
|||
2.85% Medium-term notes due in 2021 par value
|
|
600,000
|
|
|
—
|
|
|
—
|
|
|||
3.50% Senior unsecured notes due in 2025 par value
|
|
450,000
|
|
|
450,000
|
|
|
450,000
|
|
|||
4.625% Senior unsecured notes due in 2045 par value
|
|
300,000
|
|
|
300,000
|
|
|
300,000
|
|
|||
Less: unamortized discount and debt issuance costs
|
|
(22,834
|
)
|
|
(21,106
|
)
|
|
(21,869
|
)
|
|||
Gross long-term debt
|
|
5,870,761
|
|
|
5,670,818
|
|
|
5,926,533
|
|
|||
Less: current portion of long-term debt, net of unamortized discount and issuance costs
|
|
(700,152
|
)
|
|
(838,349
|
)
|
|
(885,889
|
)
|
|||
Total long-term debt
|
|
$
|
5,170,609
|
|
|
$
|
4,832,469
|
|
|
$
|
5,040,644
|
|
|
September 25, 2016
|
||||||||||||||||||||||
|
Finance receivables
|
|
Allowance for credit losses
|
|
Restricted cash
|
|
Other assets
|
|
Total assets
|
|
Asset-backed debt
|
||||||||||||
On-balance sheet assets and liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Consolidated VIEs
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Term asset-backed securitizations
|
$
|
1,019,378
|
|
|
$
|
(27,847
|
)
|
|
$
|
69,364
|
|
|
$
|
2,893
|
|
|
$
|
1,063,788
|
|
|
$
|
925,619
|
|
Asset-backed U.S. commercial paper conduit facility
|
—
|
|
|
—
|
|
|
—
|
|
|
150
|
|
|
150
|
|
|
—
|
|
||||||
Unconsolidated VIEs
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset-backed Canadian commercial paper conduit facility
|
155,130
|
|
|
(3,244
|
)
|
|
10,297
|
|
|
351
|
|
|
162,534
|
|
|
140,488
|
|
||||||
Total on-balance sheet assets and liabilities
|
$
|
1,174,508
|
|
|
$
|
(31,091
|
)
|
|
$
|
79,661
|
|
|
$
|
3,394
|
|
|
$
|
1,226,472
|
|
|
$
|
1,066,107
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
December 31, 2015
|
||||||||||||||||||||||
|
Finance receivables
|
|
Allowance for credit losses
|
|
Restricted cash
|
|
Other assets
|
|
Total assets
|
|
Asset-backed debt
|
||||||||||||
On-balance sheet assets and liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Consolidated VIEs
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Term asset-backed securitizations
|
$
|
1,611,624
|
|
|
$
|
(37,937
|
)
|
|
$
|
100,151
|
|
|
$
|
4,383
|
|
|
$
|
1,678,221
|
|
|
$
|
1,459,377
|
|
Asset-backed U.S. commercial paper conduit facility
|
—
|
|
|
—
|
|
|
—
|
|
|
323
|
|
|
323
|
|
|
—
|
|
||||||
Unconsolidated VIEs
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset-backed Canadian commercial paper conduit facility
|
170,708
|
|
|
(3,061
|
)
|
|
10,491
|
|
|
393
|
|
|
178,531
|
|
|
153,839
|
|
||||||
Total on-balance sheet assets and liabilities
|
$
|
1,782,332
|
|
|
$
|
(40,998
|
)
|
|
$
|
110,642
|
|
|
$
|
5,099
|
|
|
$
|
1,857,075
|
|
|
$
|
1,613,216
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
September 27, 2015
|
||||||||||||||||||||||
|
Finance receivables
|
|
Allowance for credit losses
|
|
Restricted cash
|
|
Other assets
|
|
Total assets
|
|
Asset-backed debt
|
||||||||||||
On-balance sheet assets and liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Consolidated VIEs
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Term asset-backed securitizations
|
$
|
1,875,571
|
|
|
$
|
(42,679
|
)
|
|
$
|
125,561
|
|
|
$
|
4,383
|
|
|
$
|
1,962,836
|
|
|
$
|
1,701,732
|
|
Asset-backed U.S. commercial paper conduit facility
|
—
|
|
|
—
|
|
|
—
|
|
|
109
|
|
|
109
|
|
|
—
|
|
||||||
Unconsolidated VIEs
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset-backed Canadian commercial paper conduit facility
|
175,173
|
|
|
(3,090
|
)
|
|
11,656
|
|
|
473
|
|
|
184,212
|
|
|
158,712
|
|
||||||
Total on-balance sheet assets and liabilities
|
$
|
2,050,744
|
|
|
$
|
(45,769
|
)
|
|
$
|
137,217
|
|
|
$
|
4,965
|
|
|
$
|
2,147,157
|
|
|
$
|
1,860,444
|
|
|
2016
|
|
2015
|
||||||||||||
|
Transfers
|
|
Proceeds
|
|
Transfers
|
|
Proceeds
|
||||||||
First quarter
|
$
|
6,600
|
|
|
$
|
5,800
|
|
|
$
|
19,200
|
|
|
$
|
16,800
|
|
Second quarter
|
$
|
31,400
|
|
|
$
|
27,500
|
|
|
$
|
26,800
|
|
|
$
|
23,400
|
|
Third quarter
|
—
|
|
|
—
|
|
|
33,100
|
|
|
29,000
|
|
||||
|
$
|
38,000
|
|
|
$
|
33,300
|
|
|
$
|
79,100
|
|
|
$
|
69,200
|
|
|
September 25,
2016 |
|
December 31,
2015 |
|
September 27,
2015 |
||||||
On-balance sheet retail motorcycle finance receivables
|
$
|
6,017,065
|
|
|
$
|
5,843,352
|
|
|
$
|
6,039,011
|
|
Off-balance sheet retail motorcycle finance receivables
|
262,583
|
|
|
—
|
|
|
—
|
|
|||
Total serviced retail motorcycle finance receivables
|
$
|
6,279,648
|
|
|
$
|
5,843,352
|
|
|
$
|
6,039,011
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
September 25,
2016 |
|
September 27,
2015 |
|
September 25,
2016 |
|
September 27,
2015 |
||||||||
On-balance sheet retail motorcycle finance receivables
|
$
|
26,380
|
|
|
$
|
21,081
|
|
|
$
|
69,498
|
|
|
$
|
50,636
|
|
Off-balance sheet retail motorcycle finance receivables
|
270
|
|
|
—
|
|
|
285
|
|
|
—
|
|
||||
Total serviced retail motorcycle finance receivables
|
$
|
26,650
|
|
|
$
|
21,081
|
|
|
$
|
69,783
|
|
|
$
|
50,636
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
September 25,
2016 |
|
September 27,
2015 |
|
September 25,
2016 |
|
September 27,
2015 |
||||||||
Balance, beginning of period
|
$
|
82,480
|
|
|
$
|
83,416
|
|
|
$
|
74,217
|
|
|
$
|
69,250
|
|
Warranties issued during the period
|
11,107
|
|
|
9,714
|
|
|
49,321
|
|
|
46,668
|
|
||||
Settlements made during the period
|
(30,512
|
)
|
|
(31,492
|
)
|
|
(71,354
|
)
|
|
(68,611
|
)
|
||||
Recalls and changes to pre-existing warranty liabilities
|
22,448
|
|
|
18,170
|
|
|
33,339
|
|
|
32,501
|
|
||||
Balance, end of period
|
$
|
85,523
|
|
|
$
|
79,808
|
|
|
$
|
85,523
|
|
|
$
|
79,808
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
September 25,
2016 |
|
September 27,
2015 |
|
September 25,
2016 |
|
September 27,
2015 |
||||||||
Numerator
:
|
|
|
|
|
|
|
|
||||||||
Net income used in computing basic and diluted earnings per share
|
$
|
114,065
|
|
|
$
|
140,347
|
|
|
$
|
644,985
|
|
|
$
|
710,011
|
|
Denominator
:
|
|
|
|
|
|
|
|
||||||||
Denominator for basic earnings per share - weighted-average common shares
|
178,438
|
|
|
203,598
|
|
|
180,779
|
|
|
207,255
|
|
||||
Effect of dilutive securities - employee stock compensation plan
|
882
|
|
|
982
|
|
|
803
|
|
|
1,027
|
|
||||
Denominator for diluted earnings per share - adjusted weighted-average shares outstanding
|
179,320
|
|
|
204,580
|
|
|
181,582
|
|
|
208,282
|
|
||||
Earnings per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.64
|
|
|
$
|
0.69
|
|
|
$
|
3.57
|
|
|
$
|
3.43
|
|
Diluted
|
$
|
0.64
|
|
|
$
|
0.69
|
|
|
$
|
3.55
|
|
|
$
|
3.41
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
September 25,
2016 |
|
September 27,
2015 |
|
September 25,
2016 |
|
September 27,
2015 |
||||||||
Pension and SERPA Benefits
|
|
|
|
|
|
|
|
||||||||
Service cost
|
$
|
8,359
|
|
|
$
|
10,010
|
|
|
$
|
25,077
|
|
|
$
|
30,030
|
|
Interest cost
|
22,707
|
|
|
21,836
|
|
|
68,121
|
|
|
65,508
|
|
||||
Expected return on plan assets
|
(36,445
|
)
|
|
(36,232
|
)
|
|
(109,335
|
)
|
|
(108,696
|
)
|
||||
Amortization of unrecognized:
|
|
|
|
|
|
|
|
||||||||
Prior service cost
|
255
|
|
|
109
|
|
|
765
|
|
|
327
|
|
||||
Net loss
|
11,588
|
|
|
13,678
|
|
|
34,764
|
|
|
41,031
|
|
||||
Settlement loss
|
300
|
|
|
—
|
|
|
900
|
|
|
—
|
|
||||
Net periodic benefit cost
|
$
|
6,764
|
|
|
$
|
9,401
|
|
|
$
|
20,292
|
|
|
$
|
28,200
|
|
Postretirement Healthcare Benefits
|
|
|
|
|
|
|
|
||||||||
Service cost
|
$
|
1,870
|
|
|
$
|
2,065
|
|
|
$
|
5,610
|
|
|
$
|
6,195
|
|
Interest cost
|
3,704
|
|
|
3,541
|
|
|
11,112
|
|
|
10,623
|
|
||||
Expected return on plan assets
|
(3,017
|
)
|
|
(2,877
|
)
|
|
(9,051
|
)
|
|
(8,631
|
)
|
||||
Amortization of unrecognized:
|
|
|
|
|
|
|
|
||||||||
Prior service credit
|
(701
|
)
|
|
(804
|
)
|
|
(2,103
|
)
|
|
(2,412
|
)
|
||||
Net loss
|
884
|
|
|
993
|
|
|
2,652
|
|
|
2,979
|
|
||||
Net periodic benefit cost
|
$
|
2,740
|
|
|
$
|
2,918
|
|
|
$
|
8,220
|
|
|
$
|
8,754
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
September 25,
2016 |
|
September 27,
2015 |
|
September 25,
2016 |
|
September 27,
2015 |
||||||||
Motorcycles net revenue
|
$
|
1,091,630
|
|
|
$
|
1,140,321
|
|
|
$
|
4,338,353
|
|
|
$
|
4,301,674
|
|
Gross profit
|
367,019
|
|
|
394,039
|
|
|
1,564,857
|
|
|
1,631,528
|
|
||||
Selling, administrative and engineering expense
|
258,090
|
|
|
250,974
|
|
|
800,722
|
|
|
762,406
|
|
||||
Operating income from Motorcycles
|
108,929
|
|
|
143,065
|
|
|
764,135
|
|
|
869,122
|
|
||||
Financial Services revenue
|
183,183
|
|
|
177,109
|
|
|
547,505
|
|
|
513,093
|
|
||||
Financial Services expense
|
113,736
|
|
|
104,338
|
|
|
332,114
|
|
|
293,745
|
|
||||
Operating income from Financial Services
|
69,447
|
|
|
72,771
|
|
|
215,391
|
|
|
219,348
|
|
||||
Operating income
|
$
|
178,376
|
|
|
$
|
215,836
|
|
|
$
|
979,526
|
|
|
$
|
1,088,470
|
|
|
Three months ended September 25, 2016
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Motorcycles and Related Products
|
$
|
1,094,148
|
|
|
$
|
—
|
|
|
$
|
(2,518
|
)
|
|
$
|
1,091,630
|
|
Financial Services
|
—
|
|
|
183,706
|
|
|
(523
|
)
|
|
183,183
|
|
||||
Total revenue
|
1,094,148
|
|
|
183,706
|
|
|
(3,041
|
)
|
|
1,274,813
|
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Motorcycles and Related Products cost of goods sold
|
724,611
|
|
|
—
|
|
|
—
|
|
|
724,611
|
|
||||
Financial Services interest expense
|
—
|
|
|
42,573
|
|
|
—
|
|
|
42,573
|
|
||||
Financial Services provision for credit losses
|
—
|
|
|
36,543
|
|
|
—
|
|
|
36,543
|
|
||||
Selling, administrative and engineering expense
|
258,541
|
|
|
37,139
|
|
|
(2,970
|
)
|
|
292,710
|
|
||||
Total costs and expenses
|
983,152
|
|
|
116,255
|
|
|
(2,970
|
)
|
|
1,096,437
|
|
||||
Operating income
|
110,996
|
|
|
67,451
|
|
|
(71
|
)
|
|
178,376
|
|
||||
Investment income
|
2,300
|
|
|
—
|
|
|
—
|
|
|
2,300
|
|
||||
Interest expense
|
7,706
|
|
|
—
|
|
|
—
|
|
|
7,706
|
|
||||
Income before provision for income taxes
|
105,590
|
|
|
67,451
|
|
|
(71
|
)
|
|
172,970
|
|
||||
Provision for income taxes
|
33,895
|
|
|
25,010
|
|
|
—
|
|
|
58,905
|
|
||||
Net income
|
$
|
71,695
|
|
|
$
|
42,441
|
|
|
$
|
(71
|
)
|
|
$
|
114,065
|
|
|
Nine months ended September 25, 2016
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Motorcycles and Related Products
|
$
|
4,346,166
|
|
|
$
|
—
|
|
|
$
|
(7,813
|
)
|
|
$
|
4,338,353
|
|
Financial Services
|
—
|
|
|
549,162
|
|
|
(1,657
|
)
|
|
547,505
|
|
||||
Total revenue
|
4,346,166
|
|
|
549,162
|
|
|
(9,470
|
)
|
|
4,885,858
|
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Motorcycles and Related Products cost of goods sold
|
2,773,496
|
|
|
—
|
|
|
—
|
|
|
2,773,496
|
|
||||
Financial Services interest expense
|
—
|
|
|
131,387
|
|
|
—
|
|
|
131,387
|
|
||||
Financial Services provision for credit losses
|
—
|
|
|
97,127
|
|
|
—
|
|
|
97,127
|
|
||||
Selling, administrative and engineering expense
|
802,139
|
|
|
111,414
|
|
|
(9,231
|
)
|
|
904,322
|
|
||||
Total costs and expenses
|
3,575,635
|
|
|
339,928
|
|
|
(9,231
|
)
|
|
3,906,332
|
|
||||
Operating income
|
770,531
|
|
|
209,234
|
|
|
(239
|
)
|
|
979,526
|
|
||||
Investment income
|
186,754
|
|
|
—
|
|
|
(183,000
|
)
|
|
3,754
|
|
||||
Interest expense
|
21,968
|
|
|
—
|
|
|
—
|
|
|
21,968
|
|
||||
Income before provision for income taxes
|
935,317
|
|
|
209,234
|
|
|
(183,239
|
)
|
|
961,312
|
|
||||
Provision for income taxes
|
238,256
|
|
|
78,071
|
|
|
—
|
|
|
316,327
|
|
||||
Net income
|
$
|
697,061
|
|
|
$
|
131,163
|
|
|
$
|
(183,239
|
)
|
|
$
|
644,985
|
|
|
Three months ended September 27, 2015
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Motorcycles and Related Products
|
$
|
1,142,948
|
|
|
$
|
—
|
|
|
$
|
(2,627
|
)
|
|
$
|
1,140,321
|
|
Financial Services
|
—
|
|
|
177,487
|
|
|
(378
|
)
|
|
177,109
|
|
||||
Total revenue
|
1,142,948
|
|
|
177,487
|
|
|
(3,005
|
)
|
|
1,317,430
|
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Motorcycles and Related Products cost of goods sold
|
746,282
|
|
|
—
|
|
|
—
|
|
|
746,282
|
|
||||
Financial Services interest expense
|
—
|
|
|
41,214
|
|
|
—
|
|
|
41,214
|
|
||||
Financial Services provision for credit losses
|
—
|
|
|
27,233
|
|
|
—
|
|
|
27,233
|
|
||||
Selling, administrative and engineering expense
|
251,352
|
|
|
38,518
|
|
|
(3,005
|
)
|
|
286,865
|
|
||||
Total costs and expenses
|
997,634
|
|
|
106,965
|
|
|
(3,005
|
)
|
|
1,101,594
|
|
||||
Operating income
|
145,314
|
|
|
70,522
|
|
|
—
|
|
|
215,836
|
|
||||
Investment income
|
3,211
|
|
|
—
|
|
|
—
|
|
|
3,211
|
|
||||
Interest expense
|
4,879
|
|
|
—
|
|
|
—
|
|
|
4,879
|
|
||||
Income before provision for income taxes
|
143,646
|
|
|
70,522
|
|
|
—
|
|
|
214,168
|
|
||||
Provision for income taxes
|
47,703
|
|
|
26,118
|
|
|
—
|
|
|
73,821
|
|
||||
Net income
|
$
|
95,943
|
|
|
$
|
44,404
|
|
|
$
|
—
|
|
|
$
|
140,347
|
|
|
Nine months ended September 27, 2015
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Motorcycles and Related Products
|
$
|
4,309,589
|
|
|
$
|
—
|
|
|
$
|
(7,915
|
)
|
|
$
|
4,301,674
|
|
Financial Services
|
—
|
|
|
514,324
|
|
|
(1,231
|
)
|
|
513,093
|
|
||||
Total revenue
|
4,309,589
|
|
|
514,324
|
|
|
(9,146
|
)
|
|
4,814,767
|
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Motorcycles and Related Products cost of goods sold
|
2,670,146
|
|
|
—
|
|
|
—
|
|
|
2,670,146
|
|
||||
Financial Services interest expense
|
—
|
|
|
120,938
|
|
|
—
|
|
|
120,938
|
|
||||
Financial Services provision for credit losses
|
—
|
|
|
68,655
|
|
|
—
|
|
|
68,655
|
|
||||
Selling, administrative and engineering expense
|
763,637
|
|
|
112,067
|
|
|
(9,146
|
)
|
|
866,558
|
|
||||
Total costs and expenses
|
3,433,783
|
|
|
301,660
|
|
|
(9,146
|
)
|
|
3,726,297
|
|
||||
Operating income
|
875,806
|
|
|
212,664
|
|
|
—
|
|
|
1,088,470
|
|
||||
Investment income
|
105,983
|
|
|
—
|
|
|
(100,000
|
)
|
|
5,983
|
|
||||
Interest expense
|
4,897
|
|
|
—
|
|
|
—
|
|
|
4,897
|
|
||||
Income before provision for income taxes
|
976,892
|
|
|
212,664
|
|
|
(100,000
|
)
|
|
1,089,556
|
|
||||
Provision for income taxes
|
303,852
|
|
|
75,693
|
|
|
—
|
|
|
379,545
|
|
||||
Net income
|
$
|
673,040
|
|
|
$
|
136,971
|
|
|
$
|
(100,000
|
)
|
|
$
|
710,011
|
|
|
September 25, 2016
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
ASSETS
|
|
|
|
|
|
|
|
||||||||
Current assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
438,875
|
|
|
$
|
351,409
|
|
|
$
|
—
|
|
|
$
|
790,284
|
|
Marketable securities
|
5,038
|
|
|
—
|
|
|
—
|
|
|
5,038
|
|
||||
Accounts receivable, net
|
751,770
|
|
|
—
|
|
|
(405,594
|
)
|
|
346,176
|
|
||||
Finance receivables, net
|
—
|
|
|
2,205,644
|
|
|
—
|
|
|
2,205,644
|
|
||||
Inventories
|
426,547
|
|
|
—
|
|
|
—
|
|
|
426,547
|
|
||||
Restricted cash
|
—
|
|
|
65,088
|
|
|
—
|
|
|
65,088
|
|
||||
Deferred income taxes
|
61,611
|
|
|
61,998
|
|
|
—
|
|
|
123,609
|
|
||||
Other current assets
|
110,060
|
|
|
41,305
|
|
|
(11,407
|
)
|
|
139,958
|
|
||||
Total current assets
|
1,793,901
|
|
|
2,725,444
|
|
|
(417,001
|
)
|
|
4,102,344
|
|
||||
Finance receivables, net
|
—
|
|
|
4,944,322
|
|
|
—
|
|
|
4,944,322
|
|
||||
Property, plant and equipment, net
|
917,984
|
|
|
36,491
|
|
|
—
|
|
|
954,475
|
|
||||
Goodwill
|
54,663
|
|
|
—
|
|
|
—
|
|
|
54,663
|
|
||||
Deferred income taxes
|
73,639
|
|
|
9,066
|
|
|
(1,874
|
)
|
|
80,831
|
|
||||
Other long-term assets
|
133,441
|
|
|
24,605
|
|
|
(82,455
|
)
|
|
75,591
|
|
||||
|
$
|
2,973,628
|
|
|
$
|
7,739,928
|
|
|
$
|
(501,330
|
)
|
|
$
|
10,212,226
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
||||||||
Current liabilities:
|
|
|
|
|
|
|
|
||||||||
Accounts payable
|
$
|
268,945
|
|
|
$
|
428,243
|
|
|
$
|
(405,594
|
)
|
|
$
|
291,594
|
|
Accrued liabilities
|
419,675
|
|
|
98,268
|
|
|
(11,410
|
)
|
|
506,533
|
|
||||
Short-term debt
|
—
|
|
|
1,055,428
|
|
|
—
|
|
|
1,055,428
|
|
||||
Current portion of long-term debt, net
|
—
|
|
|
700,152
|
|
|
—
|
|
|
700,152
|
|
||||
Total current liabilities
|
688,620
|
|
|
2,282,091
|
|
|
(417,004
|
)
|
|
2,553,707
|
|
||||
Long-term debt, net
|
741,144
|
|
|
4,429,465
|
|
|
—
|
|
|
5,170,609
|
|
||||
Pension liability
|
120,494
|
|
|
—
|
|
|
—
|
|
|
120,494
|
|
||||
Postretirement healthcare benefits
|
182,825
|
|
|
—
|
|
|
—
|
|
|
182,825
|
|
||||
Other long-term liabilities
|
160,784
|
|
|
28,425
|
|
|
3,014
|
|
|
192,223
|
|
||||
Shareholders’ equity
|
1,079,761
|
|
|
999,947
|
|
|
(87,340
|
)
|
|
1,992,368
|
|
||||
|
$
|
2,973,628
|
|
|
$
|
7,739,928
|
|
|
$
|
(501,330
|
)
|
|
$
|
10,212,226
|
|
|
December 31, 2015
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
ASSETS
|
|
|
|
|
|
|
|
||||||||
Current assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
400,443
|
|
|
$
|
321,766
|
|
|
$
|
—
|
|
|
$
|
722,209
|
|
Marketable securities
|
45,192
|
|
|
—
|
|
|
—
|
|
|
45,192
|
|
||||
Accounts receivable, net
|
390,799
|
|
|
—
|
|
|
(143,394
|
)
|
|
247,405
|
|
||||
Finance receivables, net
|
—
|
|
|
2,053,582
|
|
|
—
|
|
|
2,053,582
|
|
||||
Inventories
|
585,907
|
|
|
—
|
|
|
—
|
|
|
585,907
|
|
||||
Restricted cash
|
—
|
|
|
88,267
|
|
|
—
|
|
|
88,267
|
|
||||
Deferred income taxes
|
56,319
|
|
|
46,450
|
|
|
—
|
|
|
102,769
|
|
||||
Other current assets
|
90,824
|
|
|
43,807
|
|
|
(2,079
|
)
|
|
132,552
|
|
||||
Total current assets
|
1,569,484
|
|
|
2,553,872
|
|
|
(145,473
|
)
|
|
3,977,883
|
|
||||
Finance receivables, net
|
—
|
|
|
4,814,571
|
|
|
—
|
|
|
4,814,571
|
|
||||
Property, plant and equipment, net
|
906,972
|
|
|
35,446
|
|
|
—
|
|
|
942,418
|
|
||||
Goodwill
|
54,182
|
|
|
—
|
|
|
—
|
|
|
54,182
|
|
||||
Deferred income taxes
|
86,075
|
|
|
15,681
|
|
|
(2,142
|
)
|
|
99,614
|
|
||||
Other long-term assets
|
133,753
|
|
|
31,158
|
|
|
(80,602
|
)
|
|
84,309
|
|
||||
|
$
|
2,750,466
|
|
|
$
|
7,450,728
|
|
|
$
|
(228,217
|
)
|
|
$
|
9,972,977
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
||||||||
Current liabilities:
|
|
|
|
|
|
|
|
||||||||
Accounts payable
|
$
|
220,050
|
|
|
$
|
158,958
|
|
|
$
|
(143,394
|
)
|
|
$
|
235,614
|
|
Accrued liabilities
|
387,137
|
|
|
89,048
|
|
|
(4,221
|
)
|
|
471,964
|
|
||||
Short-term debt
|
—
|
|
|
1,201,380
|
|
|
—
|
|
|
1,201,380
|
|
||||
Current portion of long-term debt, net
|
—
|
|
|
838,349
|
|
|
—
|
|
|
838,349
|
|
||||
Total current liabilities
|
607,187
|
|
|
2,287,735
|
|
|
(147,615
|
)
|
|
2,747,307
|
|
||||
Long-term debt, net
|
740,653
|
|
|
4,091,816
|
|
|
—
|
|
|
4,832,469
|
|
||||
Pension liability
|
164,888
|
|
|
—
|
|
|
—
|
|
|
164,888
|
|
||||
Postretirement healthcare benefits
|
193,659
|
|
|
—
|
|
|
—
|
|
|
193,659
|
|
||||
Other long-term liabilities
|
166,440
|
|
|
28,560
|
|
|
—
|
|
|
195,000
|
|
||||
Shareholders’ equity
|
877,639
|
|
|
1,042,617
|
|
|
(80,602
|
)
|
|
1,839,654
|
|
||||
|
$
|
2,750,466
|
|
|
$
|
7,450,728
|
|
|
$
|
(228,217
|
)
|
|
$
|
9,972,977
|
|
|
September 27, 2015
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
ASSETS
|
|
|
|
|
|
|
|
||||||||
Current assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
963,360
|
|
|
$
|
405,194
|
|
|
$
|
—
|
|
|
$
|
1,368,554
|
|
Marketable securities
|
47,358
|
|
|
—
|
|
|
—
|
|
|
47,358
|
|
||||
Accounts receivable, net
|
725,828
|
|
|
—
|
|
|
(431,774
|
)
|
|
294,054
|
|
||||
Finance receivables, net
|
—
|
|
|
2,068,873
|
|
|
—
|
|
|
2,068,873
|
|
||||
Inventories
|
466,657
|
|
|
—
|
|
|
—
|
|
|
466,657
|
|
||||
Restricted cash
|
—
|
|
|
113,499
|
|
|
—
|
|
|
113,499
|
|
||||
Deferred income taxes
|
53,218
|
|
|
47,340
|
|
|
—
|
|
|
100,558
|
|
||||
Other current assets
|
121,953
|
|
|
37,893
|
|
|
(9,179
|
)
|
|
150,667
|
|
||||
Total current assets
|
2,378,374
|
|
|
2,672,799
|
|
|
(440,953
|
)
|
|
4,610,220
|
|
||||
Finance receivables, net
|
—
|
|
|
5,009,473
|
|
|
—
|
|
|
5,009,473
|
|
||||
Property, plant and equipment, net
|
845,297
|
|
|
32,490
|
|
|
—
|
|
|
877,787
|
|
||||
Goodwill
|
54,267
|
|
|
—
|
|
|
—
|
|
|
54,267
|
|
||||
Deferred income taxes
|
59,649
|
|
|
14,232
|
|
|
(1,929
|
)
|
|
71,952
|
|
||||
Other long-term assets
|
135,766
|
|
|
32,522
|
|
|
(79,953
|
)
|
|
88,335
|
|
||||
|
$
|
3,473,353
|
|
|
$
|
7,761,516
|
|
|
$
|
(522,835
|
)
|
|
$
|
10,712,034
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
||||||||
Current liabilities:
|
|
|
|
|
|
|
|
||||||||
Accounts payable
|
$
|
290,154
|
|
|
$
|
458,514
|
|
|
$
|
(431,774
|
)
|
|
$
|
316,894
|
|
Accrued liabilities
|
382,292
|
|
|
93,168
|
|
|
(11,108
|
)
|
|
464,352
|
|
||||
Short-term debt
|
—
|
|
|
990,049
|
|
|
—
|
|
|
990,049
|
|
||||
Current portion of long-term debt, net
|
—
|
|
|
885,889
|
|
|
—
|
|
|
885,889
|
|
||||
Total current liabilities
|
672,446
|
|
|
2,427,620
|
|
|
(442,882
|
)
|
|
2,657,184
|
|
||||
Long-term debt, net
|
741,057
|
|
|
4,299,587
|
|
|
—
|
|
|
5,040,644
|
|
||||
Pension liability
|
61,458
|
|
|
—
|
|
|
—
|
|
|
61,458
|
|
||||
Postretirement healthcare benefits
|
193,406
|
|
|
—
|
|
|
—
|
|
|
193,406
|
|
||||
Other long-term liabilities
|
172,038
|
|
|
27,631
|
|
|
—
|
|
|
199,669
|
|
||||
Shareholders’ equity
|
1,632,948
|
|
|
1,006,678
|
|
|
(79,953
|
)
|
|
2,559,673
|
|
||||
|
$
|
3,473,353
|
|
|
$
|
7,761,516
|
|
|
$
|
(522,835
|
)
|
|
$
|
10,712,034
|
|
|
Nine months ended September 25, 2016
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
697,061
|
|
|
$
|
131,163
|
|
|
$
|
(183,239
|
)
|
|
$
|
644,985
|
|
Adjustments to reconcile net income to cash provided by operating activities:
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization of intangibles
|
148,851
|
|
|
5,714
|
|
|
—
|
|
|
154,565
|
|
||||
Amortization of deferred loan origination costs
|
—
|
|
|
65,445
|
|
|
—
|
|
|
65,445
|
|
||||
Amortization of financing origination fees
|
491
|
|
|
6,721
|
|
|
—
|
|
|
7,212
|
|
||||
Provision for employee long-term benefits
|
27,608
|
|
|
—
|
|
|
—
|
|
|
27,608
|
|
||||
Employee benefit plan contributions and payments
|
(47,658
|
)
|
|
—
|
|
|
—
|
|
|
(47,658
|
)
|
||||
Stock compensation expense
|
23,056
|
|
|
1,853
|
|
|
—
|
|
|
24,909
|
|
||||
Net change in wholesale finance receivables related to sales
|
—
|
|
|
—
|
|
|
(169,599
|
)
|
|
(169,599
|
)
|
||||
Provision for credit losses
|
—
|
|
|
97,127
|
|
|
—
|
|
|
97,127
|
|
||||
Gain on off-balance sheet securitization
|
—
|
|
|
(9,269
|
)
|
|
—
|
|
|
(9,269
|
)
|
||||
Loss on debt extinguishment
|
—
|
|
|
118
|
|
|
—
|
|
|
118
|
|
||||
Pension plan settlement expense
|
900
|
|
|
—
|
|
|
—
|
|
|
900
|
|
||||
Deferred income taxes
|
(574
|
)
|
|
(10,419
|
)
|
|
(268
|
)
|
|
(11,261
|
)
|
||||
Foreign currency adjustments
|
(11,741
|
)
|
|
—
|
|
|
—
|
|
|
(11,741
|
)
|
||||
Other, net
|
(12,416
|
)
|
|
648
|
|
|
239
|
|
|
(11,529
|
)
|
||||
Change in current assets and current liabilities:
|
|
|
|
|
|
|
|
||||||||
Accounts receivable, net
|
(348,996
|
)
|
|
—
|
|
|
262,200
|
|
|
(86,796
|
)
|
||||
Finance receivables—accrued interest and other
|
—
|
|
|
364
|
|
|
—
|
|
|
364
|
|
||||
Inventories
|
173,975
|
|
|
—
|
|
|
—
|
|
|
173,975
|
|
||||
Accounts payable and accrued liabilities
|
74,269
|
|
|
277,142
|
|
|
(254,221
|
)
|
|
97,190
|
|
||||
Derivative instruments
|
(1,992
|
)
|
|
—
|
|
|
—
|
|
|
(1,992
|
)
|
||||
Other
|
(18,924
|
)
|
|
2,180
|
|
|
—
|
|
|
(16,744
|
)
|
||||
Total adjustments
|
6,849
|
|
|
437,624
|
|
|
(161,649
|
)
|
|
282,824
|
|
||||
Net cash provided by operating activities
|
703,910
|
|
|
568,787
|
|
|
(344,888
|
)
|
|
927,809
|
|
||||
|
|
|
|
|
|
|
|
|
Nine months ended September 25, 2016
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||||||
Capital expenditures
|
(155,967
|
)
|
|
(6,759
|
)
|
|
—
|
|
|
(162,726
|
)
|
||||
Origination of finance receivables
|
—
|
|
|
(6,297,040
|
)
|
|
3,287,561
|
|
|
(3,009,479
|
)
|
||||
Collections of finance receivables
|
—
|
|
|
5,566,139
|
|
|
(3,125,673
|
)
|
|
2,440,466
|
|
||||
Proceeds from finance receivables sold
|
—
|
|
|
312,571
|
|
|
—
|
|
|
312,571
|
|
||||
Sales and redemptions of marketable securities
|
40,014
|
|
|
—
|
|
|
—
|
|
|
40,014
|
|
||||
Other
|
251
|
|
|
—
|
|
|
—
|
|
|
251
|
|
||||
Net cash used by investing activities
|
(115,702
|
)
|
|
(425,089
|
)
|
|
161,888
|
|
|
(378,903
|
)
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||||||
Proceeds from issuance of medium-term notes
|
—
|
|
|
1,193,396
|
|
|
—
|
|
|
1,193,396
|
|
||||
Repayments of medium-term notes
|
—
|
|
|
(451,336
|
)
|
|
—
|
|
|
(451,336
|
)
|
||||
Repayments of securitization debt
|
—
|
|
|
(535,616
|
)
|
|
—
|
|
|
(535,616
|
)
|
||||
Net decrease in credit facilities and unsecured commercial paper
|
—
|
|
|
(146,328
|
)
|
|
—
|
|
|
(146,328
|
)
|
||||
Borrowings of asset-backed commercial paper
|
—
|
|
|
33,428
|
|
|
—
|
|
|
33,428
|
|
||||
Repayments of asset-backed commercial paper
|
—
|
|
|
(55,170
|
)
|
|
—
|
|
|
(55,170
|
)
|
||||
Net change in restricted cash
|
—
|
|
|
30,981
|
|
|
—
|
|
|
30,981
|
|
||||
Dividends paid
|
(190,387
|
)
|
|
(183,000
|
)
|
|
183,000
|
|
|
(190,387
|
)
|
||||
Purchase of common stock for treasury
|
(374,234
|
)
|
|
—
|
|
|
—
|
|
|
(374,234
|
)
|
||||
Excess tax benefits from share-based payments
|
1,291
|
|
|
—
|
|
|
—
|
|
|
1,291
|
|
||||
Issuance of common stock under employee stock option plans
|
6,444
|
|
|
—
|
|
|
—
|
|
|
6,444
|
|
||||
Net cash used by financing activities
|
(556,886
|
)
|
|
(113,645
|
)
|
|
183,000
|
|
|
(487,531
|
)
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
7,110
|
|
|
(410
|
)
|
|
—
|
|
|
6,700
|
|
||||
Net increase in cash and cash equivalents
|
$
|
38,432
|
|
|
$
|
29,643
|
|
|
$
|
—
|
|
|
$
|
68,075
|
|
Cash and cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents—beginning of period
|
$
|
400,443
|
|
|
$
|
321,766
|
|
|
$
|
—
|
|
|
$
|
722,209
|
|
Net increase in cash and cash equivalents
|
38,432
|
|
|
29,643
|
|
|
—
|
|
|
68,075
|
|
||||
Cash and cash equivalents—end of period
|
$
|
438,875
|
|
|
$
|
351,409
|
|
|
$
|
—
|
|
|
$
|
790,284
|
|
|
Nine months ended September 27, 2015
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
673,040
|
|
|
$
|
136,971
|
|
|
$
|
(100,000
|
)
|
|
$
|
710,011
|
|
Adjustments to reconcile net income to cash provided by operating activities:
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization of intangibles
|
135,232
|
|
|
6,792
|
|
|
—
|
|
|
142,024
|
|
||||
Amortization of deferred loan origination costs
|
—
|
|
|
71,012
|
|
|
—
|
|
|
71,012
|
|
||||
Amortization of financing origination fees
|
107
|
|
|
7,224
|
|
|
—
|
|
|
7,331
|
|
||||
Provision for employee long-term benefits
|
36,954
|
|
|
—
|
|
|
—
|
|
|
36,954
|
|
||||
Employee benefit plan contributions and payments
|
(19,358
|
)
|
|
—
|
|
|
—
|
|
|
(19,358
|
)
|
||||
Stock compensation expense
|
21,723
|
|
|
2,009
|
|
|
—
|
|
|
23,732
|
|
||||
Net change in wholesale finance receivables related to sales
|
—
|
|
|
—
|
|
|
(157,532
|
)
|
|
(157,532
|
)
|
||||
Provision for credit losses
|
—
|
|
|
68,655
|
|
|
—
|
|
|
68,655
|
|
||||
Deferred income taxes
|
2,951
|
|
|
(12,223
|
)
|
|
—
|
|
|
(9,272
|
)
|
||||
Foreign currency adjustments
|
22,010
|
|
|
—
|
|
|
—
|
|
|
22,010
|
|
||||
Other, net
|
3,778
|
|
|
1,222
|
|
|
—
|
|
|
5,000
|
|
||||
Change in current assets and current liabilities:
|
|
|
|
|
|
|
|
||||||||
Accounts receivable, net
|
(331,347
|
)
|
|
—
|
|
|
270,660
|
|
|
(60,687
|
)
|
||||
Finance receivables—accrued interest and other
|
—
|
|
|
(98
|
)
|
|
—
|
|
|
(98
|
)
|
||||
Inventories
|
(36,109
|
)
|
|
—
|
|
|
—
|
|
|
(36,109
|
)
|
||||
Accounts payable and accrued liabilities
|
141,577
|
|
|
319,734
|
|
|
(250,266
|
)
|
|
211,045
|
|
||||
Derivative instruments
|
(6,734
|
)
|
|
—
|
|
|
—
|
|
|
(6,734
|
)
|
||||
Other
|
11,293
|
|
|
1,680
|
|
|
—
|
|
|
12,973
|
|
||||
Total adjustments
|
(17,923
|
)
|
|
466,007
|
|
|
(137,138
|
)
|
|
310,946
|
|
||||
Net cash provided by operating activities
|
655,117
|
|
|
602,978
|
|
|
(237,138
|
)
|
|
1,020,957
|
|
|
Nine months ended September 27, 2015
|
||||||||||||||
|
HDMC Entities
|
|
HDFS Entities
|
|
Eliminations
|
|
Consolidated
|
||||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||||||
Capital expenditures
|
(134,164
|
)
|
|
(4,890
|
)
|
|
—
|
|
|
(139,054
|
)
|
||||
Origination of finance receivables
|
—
|
|
|
(6,512,799
|
)
|
|
3,399,972
|
|
|
(3,112,827
|
)
|
||||
Collections of finance receivables
|
—
|
|
|
5,656,189
|
|
|
(3,262,834
|
)
|
|
2,393,355
|
|
||||
Sales and redemptions of marketable securities
|
9,500
|
|
|
—
|
|
|
—
|
|
|
9,500
|
|
||||
Acquisition of business
|
(59,910
|
)
|
|
—
|
|
|
—
|
|
|
(59,910
|
)
|
||||
Other
|
5,172
|
|
|
—
|
|
|
—
|
|
|
5,172
|
|
||||
Net cash used by investing activities
|
(179,402
|
)
|
|
(861,500
|
)
|
|
137,138
|
|
|
(903,764
|
)
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||||||
Proceeds from issuance of senior unsecured notes
|
740,949
|
|
|
—
|
|
|
—
|
|
|
740,949
|
|
||||
Proceeds from issuance of medium-term notes
|
—
|
|
|
595,386
|
|
|
—
|
|
|
595,386
|
|
||||
Repayments of medium-term notes
|
—
|
|
|
(600,000
|
)
|
|
—
|
|
|
(600,000
|
)
|
||||
Intercompany borrowing activity
|
250,000
|
|
|
(250,000
|
)
|
|
—
|
|
|
—
|
|
||||
Proceeds from securitization debt
|
—
|
|
|
1,195,668
|
|
|
—
|
|
|
1,195,668
|
|
||||
Repayments of securitization debt
|
—
|
|
|
(764,909
|
)
|
|
—
|
|
|
(764,909
|
)
|
||||
Net increase in credit facilities and unsecured commercial paper
|
—
|
|
|
258,734
|
|
|
—
|
|
|
258,734
|
|
||||
Borrowings of asset-backed commercial paper
|
—
|
|
|
69,191
|
|
|
—
|
|
|
69,191
|
|
||||
Repayments of asset-backed commercial paper
|
—
|
|
|
(55,124
|
)
|
|
—
|
|
|
(55,124
|
)
|
||||
Net change in restricted cash
|
—
|
|
|
(15,165
|
)
|
|
—
|
|
|
(15,165
|
)
|
||||
Dividends paid
|
(191,451
|
)
|
|
(100,000
|
)
|
|
100,000
|
|
|
(191,451
|
)
|
||||
Purchase of common stock for treasury
|
(894,565
|
)
|
|
—
|
|
|
—
|
|
|
(894,565
|
)
|
||||
Excess tax benefits from share-based payments
|
2,878
|
|
|
—
|
|
|
—
|
|
|
2,878
|
|
||||
Issuance of common stock under employee stock option plans
|
16,755
|
|
|
—
|
|
|
—
|
|
|
16,755
|
|
||||
Net cash (used by) provided by financing activities
|
(75,434
|
)
|
|
333,781
|
|
|
100,000
|
|
|
358,347
|
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
(10,816
|
)
|
|
(2,850
|
)
|
|
—
|
|
|
(13,666
|
)
|
||||
Net increase in cash and cash equivalents
|
$
|
389,465
|
|
|
$
|
72,409
|
|
|
$
|
—
|
|
|
$
|
461,874
|
|
Cash and cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents—beginning of period
|
$
|
573,895
|
|
|
$
|
332,785
|
|
|
$
|
—
|
|
|
$
|
906,680
|
|
Net increase in cash and cash equivalents
|
389,465
|
|
|
72,409
|
|
|
—
|
|
|
461,874
|
|
||||
Cash and cash equivalents—end of period
|
$
|
963,360
|
|
|
$
|
405,194
|
|
|
$
|
—
|
|
|
$
|
1,368,554
|
|
(1)
|
Note Regarding Forward-Looking Statements
|
|
Three months ended
|
|
|
|
|
|||||||||
(in thousands, except earnings per share)
|
September 25,
2016 |
|
September 27,
2015 |
|
(Decrease) Increase
|
|
% Change
|
|||||||
Operating income from Motorcycles & Related Products
|
$
|
108,929
|
|
|
$
|
143,065
|
|
|
$
|
(34,136
|
)
|
|
(23.9
|
)%
|
Operating income from Financial Services
|
69,447
|
|
|
72,771
|
|
|
(3,324
|
)
|
|
(4.6
|
)
|
|||
Operating income
|
178,376
|
|
|
215,836
|
|
|
(37,460
|
)
|
|
(17.4
|
)
|
|||
Investment income
|
2,300
|
|
|
3,211
|
|
|
(911
|
)
|
|
(28.4
|
)
|
|||
Interest expense
|
7,706
|
|
|
4,879
|
|
|
2,827
|
|
|
57.9
|
|
|||
Income before income taxes
|
172,970
|
|
|
214,168
|
|
|
(41,198
|
)
|
|
(19.2
|
)
|
|||
Provision for income taxes
|
58,905
|
|
|
73,821
|
|
|
(14,916
|
)
|
|
(20.2
|
)
|
|||
Net income
|
$
|
114,065
|
|
|
$
|
140,347
|
|
|
$
|
(26,282
|
)
|
|
(18.7
|
)%
|
Diluted earnings per share
|
$
|
0.64
|
|
|
$
|
0.69
|
|
|
$
|
(0.05
|
)
|
|
(7.2
|
)%
|
|
Three months ended
|
|
|
|
|
||||||
|
September 30,
2016 |
|
September 30,
2015 |
|
(Decrease)
Increase
|
|
%
Change
|
||||
Americas Region
|
|
|
|
|
|
|
|
||||
United States
|
45,469
|
|
|
48,918
|
|
|
(3,449
|
)
|
|
(7.1
|
)%
|
Canada
|
2,663
|
|
|
2,554
|
|
|
109
|
|
|
4.3
|
%
|
Latin America
|
2,605
|
|
|
2,818
|
|
|
(213
|
)
|
|
(7.6
|
)%
|
Total Americas Region
|
50,737
|
|
|
54,290
|
|
|
(3,553
|
)
|
|
(6.5
|
)%
|
Europe, Middle East and Africa Region (EMEA)
|
|
|
|
|
|
|
|
||||
Europe
(b)
|
8,807
|
|
|
8,441
|
|
|
366
|
|
|
4.3
|
%
|
Other
|
1,417
|
|
|
1,590
|
|
|
(173
|
)
|
|
(10.9
|
)%
|
Total EMEA Region
|
10,224
|
|
|
10,031
|
|
|
193
|
|
|
1.9
|
%
|
Asia Pacific Region
|
|
|
|
|
|
|
|
||||
Japan
|
2,762
|
|
|
2,642
|
|
|
120
|
|
|
4.5
|
%
|
Other
|
5,232
|
|
|
5,215
|
|
|
17
|
|
|
0.3
|
%
|
Total Asia Pacific Region
|
7,994
|
|
|
7,857
|
|
|
137
|
|
|
1.7
|
%
|
Total Worldwide Retail Sales
|
68,955
|
|
|
72,178
|
|
|
(3,223
|
)
|
|
(4.5
|
)%
|
Total International Retail Sales
|
23,486
|
|
|
23,260
|
|
|
226
|
|
|
1.0
|
%
|
(a)
|
Data source for retail sales figures shown above is new sales warranty and registration information provided by Harley-Davidson dealers and compiled by the Company. The Company must rely on information that its dealers supply concerning retail sales and this information is subject to revision.
|
(b)
|
Includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom.
|
|
Three months ended
|
|
|
|
|
||||||||||||
|
September 25, 2016
|
|
September 27, 2015
|
|
Unit
|
|
Unit
|
||||||||||
|
Units
|
|
Mix %
|
|
Units
|
|
Mix %
|
|
(Decrease) Increase
|
|
%
Change |
||||||
United States
|
26,269
|
|
|
54.0
|
%
|
|
30,092
|
|
|
56.3
|
%
|
|
(3,823
|
)
|
|
(12.7
|
)%
|
International
|
22,342
|
|
|
46.0
|
%
|
|
23,380
|
|
|
43.7
|
%
|
|
(1,038
|
)
|
|
(4.4
|
)
|
Harley-Davidson motorcycle units
|
48,611
|
|
|
100.0
|
%
|
|
53,472
|
|
|
100.0
|
%
|
|
(4,861
|
)
|
|
(9.1
|
)%
|
Touring motorcycle units
|
23,295
|
|
|
47.9
|
%
|
|
21,994
|
|
|
41.1
|
%
|
|
1,301
|
|
|
5.9
|
%
|
Cruiser motorcycle units
|
13,986
|
|
|
28.8
|
%
|
|
18,405
|
|
|
34.4
|
%
|
|
(4,419
|
)
|
|
(24.0
|
)
|
Sportster
®
/ Street motorcycle units
|
11,330
|
|
|
23.3
|
%
|
|
13,073
|
|
|
24.5
|
%
|
|
(1,743
|
)
|
|
(13.3
|
)
|
Harley-Davidson motorcycle units
|
48,611
|
|
|
100.0
|
%
|
|
53,472
|
|
|
100.0
|
%
|
|
(4,861
|
)
|
|
(9.1
|
)%
|
|
Three months ended
|
|
|
|
|
|||||||||
|
September 25, 2016
|
|
September 27, 2015
|
|
(Decrease)
Increase |
|
%
Change |
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Motorcycles
|
$
|
788,856
|
|
|
$
|
812,398
|
|
|
$
|
(23,542
|
)
|
|
(2.9
|
)%
|
Parts & Accessories
|
231,279
|
|
|
252,226
|
|
|
(20,947
|
)
|
|
(8.3
|
)
|
|||
General Merchandise
|
65,289
|
|
|
69,008
|
|
|
(3,719
|
)
|
|
(5.4
|
)
|
|||
Other
|
6,206
|
|
|
6,689
|
|
|
(483
|
)
|
|
(7.2
|
)
|
|||
Total revenue
|
1,091,630
|
|
|
1,140,321
|
|
|
(48,691
|
)
|
|
(4.3
|
)
|
|||
Cost of goods sold
|
724,611
|
|
|
746,282
|
|
|
(21,671
|
)
|
|
(2.9
|
)
|
|||
Gross profit
|
367,019
|
|
|
394,039
|
|
|
(27,020
|
)
|
|
(6.9
|
)
|
|||
Selling & administrative expense
|
217,946
|
|
|
212,278
|
|
|
5,668
|
|
|
2.7
|
|
|||
Engineering expense
|
40,144
|
|
|
38,696
|
|
|
1,448
|
|
|
3.7
|
|
|||
Operating expense
|
258,090
|
|
|
250,974
|
|
|
7,116
|
|
|
2.8
|
|
|||
Operating income from Motorcycles
|
$
|
108,929
|
|
|
$
|
143,065
|
|
|
$
|
(34,136
|
)
|
|
(23.9
|
)%
|
|
Net
Revenue
|
|
Cost of
Goods Sold
|
|
Gross
Profit
|
||||||
Three months ended September 27, 2015
|
$
|
1,140.3
|
|
|
$
|
746.3
|
|
|
$
|
394.0
|
|
Volume
|
(96.3
|
)
|
|
(61.1
|
)
|
|
(35.2
|
)
|
|||
Price, net of related cost
|
23.3
|
|
|
9.2
|
|
|
14.1
|
|
|||
Foreign currency exchange rates and hedging
|
8.5
|
|
|
7.7
|
|
|
0.8
|
|
|||
Shipment mix
|
15.8
|
|
|
6.2
|
|
|
9.6
|
|
|||
Raw material prices
|
—
|
|
|
(2.4
|
)
|
|
2.4
|
|
|||
Manufacturing and other costs
|
—
|
|
|
18.7
|
|
|
(18.7
|
)
|
|||
Total
|
(48.7
|
)
|
|
(21.7
|
)
|
|
(27.0
|
)
|
|||
Three months ended September 25, 2016
|
$
|
1,091.6
|
|
|
$
|
724.6
|
|
|
$
|
367.0
|
|
•
|
Volume decreases were driven by lower wholesale motorcycle shipments in the third quarter of 2016.
|
•
|
On average, wholesale prices for the Company’s model-year 2016 and 2017 motorcycles are higher than the prior model-years resulting in the favorable impact on revenue during the period. The impact of revenue favorability on gross profit was partially offset by increases in cost related to additional content. Wholesale and MSRP weighted average prices of the Company's model-year 2017 motorcycles increased by approximately 2.25%. After adjusting for the cost of new content and based on assumptions regarding mix, the Company expects pricing net of cost to be up approximately 1.25 percentage points expressed as a percent of revenue.
|
•
|
Gross profit was positively impacted by foreign currency due to higher revenues behind a slightly weaker U.S. dollar in the current quarter.
|
•
|
Shipment mix changes positively impacted gross profit. A stronger mix of model-year 2017 Touring motorcycles that feature the Milwaukee-Eight™ engine led to mix favorability during the quarter.
|
•
|
Raw material prices were lower in the third quarter of 2016 relative to the third quarter of 2015.
|
•
|
As the Company expected, manufacturing costs in the third quarter of 2016 were negatively impacted by costs related to the implementation of the ERP system at the Company's Kansas City manufacturing facility and the launch of the new Milwaukee-Eight™ engine. The Company's fixed cost absorption was also unfavorable as a result of lower production in the third quarter of 2016 compared to the third quarter of 2015.
|
|
Three months ended
|
||||||
|
September 25,
2016 |
|
September 27,
2015 |
||||
Balance, beginning of period
|
$
|
161,353
|
|
|
$
|
139,231
|
|
Provision for credit losses
|
36,543
|
|
|
27,233
|
|
||
Charge-offs
|
(35,749
|
)
|
|
(30,203
|
)
|
||
Recoveries
|
9,369
|
|
|
9,122
|
|
||
Balance, end of period
|
$
|
171,516
|
|
|
$
|
145,383
|
|
|
Nine months ended
|
|
|
|
|
|||||||||
(in thousands, except earnings per share)
|
September 25,
2016 |
|
September 27,
2015 |
|
(Decrease)
Increase |
|
%
Change |
|||||||
Operating income from Motorcycles & Related Products
|
$
|
764,135
|
|
|
$
|
869,122
|
|
|
$
|
(104,987
|
)
|
|
(12.1
|
)%
|
Operating income from Financial Services
|
215,391
|
|
|
219,348
|
|
|
(3,957
|
)
|
|
(1.8
|
)
|
|||
Operating income
|
979,526
|
|
|
1,088,470
|
|
|
(108,944
|
)
|
|
(10.0
|
)
|
|||
Investment income
|
3,754
|
|
|
5,983
|
|
|
(2,229
|
)
|
|
(37.3
|
)
|
|||
Interest expense
|
21,968
|
|
|
4,897
|
|
|
17,071
|
|
|
NM
|
|
|||
Income before income taxes
|
961,312
|
|
|
1,089,556
|
|
|
(128,244
|
)
|
|
(11.8
|
)
|
|||
Provision for income taxes
|
316,327
|
|
|
379,545
|
|
|
(63,218
|
)
|
|
(16.7
|
)
|
|||
Net income
|
$
|
644,985
|
|
|
$
|
710,011
|
|
|
$
|
(65,026
|
)
|
|
(9.2
|
)%
|
Diluted earnings per share
|
$
|
3.55
|
|
|
$
|
3.41
|
|
|
$
|
0.14
|
|
|
4.1
|
%
|
|
Nine months ended
|
|
|
|
|
||||||
|
September 30,
2016 |
|
September 30,
2015 |
|
(Decrease)
Increase
|
|
%
Change |
||||
Americas Region
|
|
|
|
|
|
|
|
||||
United States
|
135,581
|
|
|
142,196
|
|
|
(6,615
|
)
|
|
(4.7
|
)%
|
Canada
|
8,946
|
|
|
8,414
|
|
|
532
|
|
|
6.3
|
|
Latin America
|
7,064
|
|
|
8,091
|
|
|
(1,027
|
)
|
|
(12.7
|
)
|
Total Americas Region
|
151,591
|
|
|
158,701
|
|
|
(7,110
|
)
|
|
(4.5
|
)
|
Europe, Middle East and Africa Region (EMEA)
|
|
|
|
|
|
|
|
||||
Europe
(b)
|
32,590
|
|
|
30,720
|
|
|
1,870
|
|
|
6.1
|
|
Other
|
5,357
|
|
|
4,878
|
|
|
479
|
|
|
9.8
|
|
Total EMEA Region
|
37,947
|
|
|
35,598
|
|
|
2,349
|
|
|
6.6
|
|
Asia Pacific Region
|
|
|
|
|
|
|
|
||||
Japan
|
7,631
|
|
|
7,194
|
|
|
437
|
|
|
6.1
|
|
Other
|
16,510
|
|
|
16,277
|
|
|
233
|
|
|
1.4
|
|
Total Asia Pacific Region
|
24,141
|
|
|
23,471
|
|
|
670
|
|
|
2.9
|
|
Total Worldwide Retail Sales
|
213,679
|
|
|
217,770
|
|
|
(4,091
|
)
|
|
(1.9
|
)%
|
Total International Retail Sales
|
78,098
|
|
|
75,574
|
|
|
2,524
|
|
|
3.3
|
%
|
(a)
|
Data source for retail sales figures shown above is new sales warranty and registration information provided by Harley-Davidson dealers and compiled by the Company. The Company must rely on information that its dealers supply concerning retail sales and this information is subject to revision.
|
(b)
|
Includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom.
|
|
Nine months ended
|
|
|
|
|
||||||
|
September 30,
2016 |
|
September 30,
2015 |
|
(Decrease)Increase
|
|
%
Change |
||||
United States
(b)
|
263,479
|
|
|
279,013
|
|
|
(15,534
|
)
|
|
(5.6
|
)%
|
Europe
(c)
|
337,695
|
|
|
313,303
|
|
|
24,392
|
|
|
7.8
|
%
|
(a)
|
Data includes on-road 601+cc models. On-road 601+cc models include dual purpose models, three-wheeled motorcycles and autocycles. Registration data for Harley-Davidson Street 500
TM
motorcycles is not included in this table.
|
(b)
|
United States industry data is derived from information provided by Motorcycle Industry Council (MIC). This third party data is subject to revision and update.
|
(c)
|
Europe data includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and the United Kingdom. Industry retail motorcycle registration data includes 601+cc models derived from information provided by Association des Constructeurs Europeens de Motocycles (ACEM), an independent agency. This third-party data is subject to revision and update.
|
|
Nine months ended
|
|
|
|
|
||||||||||||
|
September 25, 2016
|
|
September 27, 2015
|
|
Unit
|
|
Unit
|
||||||||||
|
Units
|
|
Mix %
|
|
Units
|
|
Mix %
|
|
(Decrease) Increase
|
|
%
Change |
||||||
United States
|
141,708
|
|
|
64.5
|
%
|
|
141,884
|
|
|
65.0
|
%
|
|
(176
|
)
|
|
(0.1
|
)%
|
International
|
78,099
|
|
|
35.5
|
%
|
|
76,349
|
|
|
35.0
|
%
|
|
1,750
|
|
|
2.3
|
|
Harley-Davidson motorcycle units
|
219,807
|
|
|
100.0
|
%
|
|
218,233
|
|
|
100.0
|
%
|
|
1,574
|
|
|
0.7
|
%
|
Touring motorcycle units
|
89,467
|
|
|
40.7
|
%
|
|
95,354
|
|
|
43.7
|
%
|
|
(5,887
|
)
|
|
(6.2
|
)%
|
Cruiser motorcycle units
|
78,570
|
|
|
35.7
|
%
|
|
71,753
|
|
|
32.9
|
%
|
|
6,817
|
|
|
9.5
|
|
Sportster
®
/ Street motorcycle units
|
51,770
|
|
|
23.6
|
%
|
|
51,126
|
|
|
23.4
|
%
|
|
644
|
|
|
1.3
|
|
Harley-Davidson motorcycle units
|
219,807
|
|
|
100.0
|
%
|
|
218,233
|
|
|
100.0
|
%
|
|
1,574
|
|
|
0.7
|
%
|
|
Nine months ended
|
|
|
|
|
|||||||||
|
September 25, 2016
|
|
September 27, 2015
|
|
Increase
(Decrease) |
|
%
Change
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Motorcycles
|
$
|
3,437,066
|
|
|
$
|
3,376,356
|
|
|
$
|
60,710
|
|
|
1.8
|
%
|
Parts & Accessories
|
673,192
|
|
|
692,938
|
|
|
(19,746
|
)
|
|
(2.8
|
)
|
|||
General Merchandise
|
211,664
|
|
|
212,954
|
|
|
(1,290
|
)
|
|
(0.6
|
)
|
|||
Other
|
16,431
|
|
|
19,426
|
|
|
(2,995
|
)
|
|
(15.4
|
)
|
|||
Total revenue
|
4,338,353
|
|
|
4,301,674
|
|
|
36,679
|
|
|
0.9
|
|
|||
Cost of goods sold
|
2,773,496
|
|
|
2,670,146
|
|
|
103,350
|
|
|
3.9
|
|
|||
Gross profit
|
1,564,857
|
|
|
1,631,528
|
|
|
(66,671
|
)
|
|
(4.1
|
)
|
|||
Selling & administrative expense
|
670,086
|
|
|
645,933
|
|
|
24,153
|
|
|
3.7
|
|
|||
Engineering expense
|
130,636
|
|
|
116,473
|
|
|
14,163
|
|
|
12.2
|
|
|||
Operating expense
|
800,722
|
|
|
762,406
|
|
|
38,316
|
|
|
5.0
|
|
|||
Operating income from Motorcycles
|
$
|
764,135
|
|
|
$
|
869,122
|
|
|
$
|
(104,987
|
)
|
|
(12.1
|
)%
|
|
Net
Revenue |
|
Cost of
Goods Sold |
|
Gross
Profit |
||||||
Nine months ended September 27, 2015
|
$
|
4,301.7
|
|
|
$
|
2,670.2
|
|
|
$
|
1,631.5
|
|
Volume
|
0.5
|
|
|
0.1
|
|
|
0.4
|
|
|||
Price, net of related costs
|
74.4
|
|
|
32.5
|
|
|
41.9
|
|
|||
Foreign currency exchange rates and hedging
|
(8.4
|
)
|
|
24.8
|
|
|
(33.2
|
)
|
|||
Shipment mix
|
(29.8
|
)
|
|
(10.5
|
)
|
|
(19.3
|
)
|
|||
Raw material prices
|
—
|
|
|
(17.4
|
)
|
|
17.4
|
|
|||
Manufacturing and other costs
|
—
|
|
|
73.8
|
|
|
(73.8
|
)
|
|||
Total
|
36.7
|
|
|
103.3
|
|
|
(66.6
|
)
|
|||
Nine months ended September 25, 2016
|
$
|
4,338.4
|
|
|
$
|
2,773.5
|
|
|
$
|
1,564.9
|
|
•
|
Volume increases in 2016 were driven by the increase in wholesale motorcycle shipments offset by decreases in parts & accessories and general merchandise.
|
•
|
On average, wholesale prices for the Company’s model-year 2016 and 2017 motorcycles are higher than the prior model-years resulting in the favorable impact on revenue during the period. The impact of revenue favorability resulting from model-year price increases on gross profit was partially offset by increases in costs related to the additional content added to the model-year 2016 and 2017 motorcycles.
|
•
|
Gross profit was negatively impacted by foreign currency due to lower hedge gains, given the significant gains experienced in the prior year, and lower revenues behind a slightly stronger U.S. dollar.
|
•
|
Shipment mix changes negatively impacted gross profit primarily due to changes in motorcycle family mix.
|
•
|
Raw material prices were lower in the first
nine months
of
2016
relative to the first
nine months
of
2015
.
|
•
|
Manufacturing costs in the first nine months of 2016 were negatively impacted by higher year-over-year costs related to the implementation of the ERP system at the Company's Kansas City manufacturing facility, the launch of the new Milwaukee-Eight™ engine, other plant inefficiencies and lost absorption. The Company's fixed cost absorption was unfavorable as a result of lower production in the first nine months of 2016 compared to the first nine months of 2015.
|
|
Nine months ended
|
||||||
|
September 25,
2016 |
|
September 27,
2015 |
||||
Balance, beginning of period
|
$
|
147,178
|
|
|
$
|
127,364
|
|
Provision for credit losses
|
97,127
|
|
|
68,655
|
|
||
Charge-offs
|
(101,853
|
)
|
|
(83,939
|
)
|
||
Recoveries
|
32,355
|
|
|
33,303
|
|
||
Other
(a)
|
(3,291
|
)
|
|
—
|
|
||
Balance, end of period
|
$
|
171,516
|
|
|
$
|
145,383
|
|
(a)
|
Related to the sale of finance receivables during the second quarter of 2016 with a principal balance of $301.8 million through an off-balance sheet asset-backed securitization transaction.
|
|
2016
|
|
2017 - 2018
|
|
2019 - 2020
|
|
Thereafter
|
|
Total
|
||||||||||
Principal payments on debt
|
$
|
1,019,456
|
|
|
$
|
2,427,578
|
|
|
$
|
2,153,909
|
|
|
$
|
1,347,101
|
|
|
$
|
6,948,044
|
|
Interest payments on debt
|
38,599
|
|
|
300,523
|
|
|
133,563
|
|
|
428,237
|
|
|
900,922
|
|
|||||
|
$
|
1,058,055
|
|
|
$
|
2,728,101
|
|
|
$
|
2,287,472
|
|
|
$
|
1,775,338
|
|
|
$
|
7,848,966
|
|
|
September 25, 2016
|
||
Cash and cash equivalents
|
$
|
790,284
|
|
Current marketable securities
|
5,038
|
|
|
Total cash and cash equivalents and marketable securities
|
795,322
|
|
|
|
|
||
Credit facilities
|
409,572
|
|
|
Asset-backed U.S. commercial paper conduit facility
(a)
|
600,000
|
|
|
Asset-backed Canadian commercial paper conduit facility
(b)
|
42,817
|
|
|
Total availability under credit facilities
|
1,052,389
|
|
|
Total
|
$
|
1,847,711
|
|
(a)
|
The U.S. commercial paper conduit facility expires on December 14, 2016. The Company anticipates that it will renew this facility prior to expiration.
|
(b)
|
The Canadian commercial paper conduit facility, which is limited to Canadian denominated borrowings, was renewed June 30, 2016. The new facility expires June 30, 2017.
|
|
Nine months ended
|
||||||
|
September 25, 2016
|
|
September 27, 2015
|
||||
Net cash provided by operating activities
|
$
|
927,809
|
|
|
$
|
1,020,957
|
|
Net cash used by investing activities
|
(378,903
|
)
|
|
(903,764
|
)
|
||
Net cash (used by) provided by financing activities
|
(487,531
|
)
|
|
358,347
|
|
||
Effect of exchange rate changes on cash and cash equivalents
|
6,700
|
|
|
(13,666
|
)
|
||
Net increase in cash and cash equivalents
|
$
|
68,075
|
|
|
$
|
461,874
|
|
|
September 25,
2016 |
|
September 27,
2015 |
||||
Unsecured commercial paper
|
$
|
1,055,428
|
|
|
$
|
990,049
|
|
Asset-backed Canadian commercial paper conduit facility
|
140,488
|
|
|
158,712
|
|
||
Medium-term notes, net
|
4,063,510
|
|
|
3,325,032
|
|
||
Senior unsecured notes, net
|
741,144
|
|
|
741,057
|
|
||
Term asset-backed securitization debt, net
|
925,619
|
|
|
1,701,732
|
|
||
Total debt
|
$
|
6,926,189
|
|
|
$
|
6,916,582
|
|
Principal Amount
|
|
Rate
|
|
Issue Date
|
|
Maturity Date
|
$400,000
|
|
2.70%
|
|
January 2012
|
|
March 2017
|
$400,000
|
|
1.55%
|
|
November 2014
|
|
November 2017
|
$877,488
|
|
6.80%
|
|
May 2008
|
|
June 2018
|
$600,000
|
|
2.25%
|
|
January 2016
|
|
January 2019
|
$600,000
|
|
2.40%
|
|
September 2014
|
|
September 2019
|
$600,000
|
|
2.15%
|
|
February 2015
|
|
February 2020
|
$600,000
|
|
2.85%
|
|
January 2016
|
|
January 2021
|
|
2016
|
|
2015
|
||||||||||||
|
Transfers
|
|
Proceeds
|
|
Transfers
|
|
Proceeds
|
||||||||
First Quarter
|
$
|
6,600
|
|
|
$
|
5,800
|
|
|
$
|
19,200
|
|
|
$
|
16,800
|
|
Second Quarter
|
31,400
|
|
|
27,500
|
|
|
26,800
|
|
|
23,400
|
|
||||
Third Quarter
|
—
|
|
|
—
|
|
|
33,100
|
|
|
29,000
|
|
||||
|
$
|
38,000
|
|
|
$
|
33,300
|
|
|
$
|
79,100
|
|
|
$
|
69,200
|
|
•
|
assume or incur certain liens;
|
•
|
participate in certain mergers or consolidations; and
|
•
|
purchase or hold margin stock.
|
(i)
|
execute its business strategy,
|
(ii)
|
manage through changes in general economic conditions, including changing capital, credit and retail markets, and political events,
|
(iii)
|
prevent a cybersecurity breach involving consumer, employee, dealer, supplier, or Company data and respond to evolving regulatory requirements regarding data security,
|
(iv)
|
drive demand by executing its marketing strategy of appealing to and growing sales to multi-generational and multi-cultural customers worldwide in an increasingly competitive marketplace,
|
(v)
|
manage the impact that prices for and supply of used motorcycles may have on its business, including on retail sales of new motorcycles and collections,
|
(vi)
|
develop and introduce products, services and experiences that are successful in the marketplace,
|
(vii)
|
balance production volumes for its new motorcycles with consumer demand, including in circumstances where competitors may be supplying new motorcycles to the market in excess of demand at reduced prices,
|
(viii)
|
prevent and detect any issues with its motorcycles or any associated manufacturing processes to avoid delays in new model launches, recall campaigns, regulatory agency investigations, increased warranty costs or litigation and adverse effects on its reputation and brand strength,
|
(ix)
|
manage the credit quality, the loan servicing and collection activities, and the recovery rates of HDFS' loan portfolio,
|
(x)
|
accurately estimate and adjust to fluctuations in foreign currency exchange rates, interest rates and commodity prices,
|
(xi)
|
effectively execute reorganization actions within expected costs and realize the expected benefits of those actions,
|
(xii)
|
continue to develop the capabilities of its distributors and dealers and manage the risks that its independent dealers may have difficulty obtaining capital and managing through changing economic conditions and consumer demand,
|
(xiii)
|
manage risks that arise through expanding international manufacturing, operations and sales,
|
(xiv)
|
manage through the effects inconsistent and unpredictable weather and weather patterns may have on retail sales of motorcycles,
|
(xv)
|
manage supply chain issues, including quality issues and any unexpected interruptions or price increases caused by raw material shortages or natural disasters,
|
(xvi)
|
implement and manage enterprise-wide information technology systems, including systems at its manufacturing facilities,
|
(xvii)
|
manage changes and prepare for requirements in legislative and regulatory environments for its products, services and operations,
|
(xviii)
|
retain and attract talented employees,
|
(xix)
|
manage its exposure to product liability claims and commercial or contractual disputes,
|
(xx)
|
execute its flexible production strategy,
|
(xxi)
|
adjust to healthcare inflation and reform, pension reform and tax changes,
|
(xxii)
|
successfully access the capital and/or credit markets on terms (including interest rates) that are acceptable to the Company and within its expectations, and
|
(xxiii)
|
continue to manage the relationships and agreements that the Company has with its labor unions to help drive long-term competitiveness.
|
2016 Fiscal Month
|
Total Number of
Shares Purchased (a) |
|
Average Price
Paid per Share |
|
Total Number of Shares
Purchased as Part of Publicly Announced Plans or Programs |
|
Maximum Number of
Shares that May Yet Be Purchased Under the Plans or Programs |
|||||
June 27 to July 31
|
1,033,391
|
|
|
$
|
48
|
|
|
1,033,391
|
|
|
22,002,285
|
|
August 1 to August 28
|
432,723
|
|
|
$
|
53
|
|
|
432,723
|
|
|
21,568,310
|
|
August 29 to September 25
|
629,011
|
|
|
$
|
52
|
|
|
629,011
|
|
|
20,938,285
|
|
Total
|
2,095,125
|
|
|
$
|
50
|
|
|
2,095,125
|
|
|
|
(a)
|
Includes discretionary share repurchases and shares of common stock that employees surrendered to satisfy withholding taxes in connection with the vesting of restricted stock awards
|
|
HARLEY-DAVIDSON, INC.
|
|
|
Date: November 3, 2016
|
/s/ John A. Olin
|
|
John A. Olin
|
|
Senior Vice President and
|
|
Chief Financial Officer
|
|
(Principal financial officer)
|
Date: November 3, 2016
|
/s/ Mark R. Kornetzke
|
|
Mark R. Kornetzke
|
|
Chief Accounting Officer
|
|
(Principal accounting officer)
|
Exhibit No.
|
|
Description
|
10.1*
|
|
Harley-Davidson Management Deferred Compensation Plan as amended and restated effective January 1, 2017
|
31.1
|
|
Chief Executive Officer Certification pursuant to Rule 13a-14(a)
|
31.2
|
|
Chief Financial Officer Certification pursuant to Rule 13a-14(a)
|
32.1
|
|
Written Statement of the Chief Executive Officer and the Chief Financial Officer pursuant to 18 U.S.C. §1350
|
101
|
|
Financial statements from the quarterly report on Form 10-Q of Harley-Davidson, Inc. for the quarter ended September 25, 2016, filed on November 3, 2016, formatted in XBRL: (i) the Consolidated Statements of Income; (ii) the Consolidated Statements of Comprehensive Income; (iii) the Consolidated Balance Sheets; (iv) the Consolidated Statements of Cash Flows; and (v) the Notes to Consolidated Financial Statements.
|
*
|
Represents a management contract or compensatory plan, contract or arrangement in which a director or named executive officer of the Company participated.
|
|
|
Page
|
|
||
ARTICLE I.
DEFINITIONS AND CONSTRUCTION
|
|
2
|
|
||
|
Definitions.
|
|
2
|
|
|
|
Construction and Applicable Law.
|
|
8
|
|
|
|
|
|
|
|
|
ARTICLE II.
PARTICIPATION
|
|
9
|
|
||
|
Eligibility.
|
|
9
|
|
|
|
|
|
|
|
|
ARTICLE III.
EMPLOYEE DEFERRED COMPENSATION
|
|
10
|
|
||
|
Deferrals Of Base Compensation.
|
|
10
|
|
|
|
Deferrals of Annual Incentive (STIP) Awards.
|
|
12
|
|
|
|
Restricted Stock Deferrals.
|
|
13
|
|
|
|
Matching Contribution Credits.
|
|
16
|
|
|
|
Employer Retirement Contribution Restoration Credits.
|
|
17
|
|
|
|
Other Deferrals and Credits.
|
|
18
|
|
|
|
Effect of Unforeseeable Emergency or Hardship.
|
|
18
|
|
|
|
|
|
|
|
|
ARTICLE IV.
ACCOUNTING AND HYPOTHETICAL INVESTMENT ELECTIONS
|
|
19
|
|
||
|
Investment Options.
|
|
19
|
|
|
|
Participant Investment Elections.
|
|
19
|
|
|
|
Allocation of Deemed Investment Gain or Loss.
|
|
20
|
|
|
|
Accounts are For Record Keeping Purposes Only.
|
|
21
|
|
|
|
Pre-2000 Deferrals Under Program A.
|
|
21
|
|
|
|
|
|
|
|
|
ARTICLE V.
DISTRIBUTION OF ACCOUNTS
|
|
25
|
|
||
|
In General.
|
|
25
|
|
|
|
Initial Distribution Elections.
|
|
25
|
|
|
|
Modification of Distribution Election.
|
|
27
|
|
|
|
Distribution of Vested Account Balances.
|
|
27
|
|
|
|
Additional Distribution Rules.
|
|
28
|
|
|
|
Death Benefit Payments.
|
|
29
|
|
|
|
Hardship Withdrawals.
|
|
30
|
|
|
|
Automatic Single Sum Distribution.
|
|
31
|
|
|
|
Acceleration of Payments Upon a Change of Control.
|
|
31
|
|
|
|
|
|
|
|
|
ARTICLE VI.
GENERAL PROVISIONS
|
|
32
|
|
||
|
Administration.
|
|
32
|
|
|
|
Restrictions to Comply with Applicable Law.
|
|
32
|
|
|
|
Claims Procedures.
|
|
32
|
|
|
|
Participant Rights Unsecured.
|
|
34
|
|
|
|
Distributions for Tax Withholding and Payment.
|
|
34
|
|
|
|
Amendment or Termination of Plan.
|
|
35
|
|
|
|
Administrative Expenses.
|
|
37
|
|
|
|
Successors and Assigns.
|
|
37
|
|
|
|
Right of Offset.
|
|
37
|
|
|
|
Not a Contract of Employment.
|
|
38
|
|
|
|
Miscellaneous Distribution Rules.
|
|
38
|
|
(i)
|
Base Compensation Deferral: A Deferral of all or a portion of a Participant’s Base Compensation in accordance with Section 3.01.
|
(ii)
|
Annual Incentive (STIP) Deferral: A Deferral of all or a portion of a Participant’s annual cash incentive award in accordance with Section 3.02 (not including a Leadership STIP award).
|
(iii)
|
Restricted Stock Deferral: A Deferral of all or a portion of a Participant’s restricted stock or restricted stock unit award granted prior to January 1, 2017 under the Incentive Stock Plan, in accordance with Section 3.03.
|
(iv)
|
Employer Credits. An amount credited to the Participant’s Account in accordance with Sections 3.04, 3.05 or 3.06.
|
(i)
|
with respect to a Participant who is a Specified Employee on the date of the Participant’s Separation from Service, either (A) the month in which occurs the six (6) month anniversary of the Participant’s Separation from Service if such six (6) month anniversary occurs prior to the fifth (5
th
)
|
(ii)
|
with respect to a Participant who is
not
a Specified Employee on the date of the Participant’s Separation from Service, either (A) the first (1
st
) calendar month following the month in which occurs the Participant’s Separation from Service if there are at least thirty (30) calendar days between the date of the Participant’s Separation from Service and the fifth (5
th
) day of the following month, or (B) in any other case, the second (2
nd
) calendar month following the calendar month in which occurs the Participant’s Separation from Service. For purposes of the thirty (30) calendar day rule, the day on which the Participant’s Separation from Service occurs is not counted.
|
(i)
|
In the case of a Participant who has been designated for participation for the first time (and who has not previously been designated as being eligible for participation in another deferred compensation plan that is required to be aggregated with this Plan for purposes of Code Section 409A), the Participant may submit his or her initial Base Compensation Deferral election within thirty (30) days of being designated for participation in the Plan. If the Participant does so, the Participant’s validly executed Base Compensation Deferral election shall become effective with respect to Base Compensation attributable to services to be performed subsequent to the date on which the election is filed with the Administrator.
|
(ii)
|
In any other case, the Participant may elect to make Base Compensation Deferrals by submitting Base Compensation Deferral election, in such form and manner as the Administrator may prescribe, to the Administrator, but the election shall be treated as a Base Compensation Deferral election for the next following calendar year, and will become effective and shall apply only to Base Compensation attributable to services performed on or after January 1 of the calendar year following the calendar year during which the election is received by the Administrator.
|
(iii)
|
A Participant who was previously eligible for the Plan with respect to a prior period of employment but who ceased to be eligible to participate in the Plan (other than with respect to the accrual of deemed investment gain or loss) due to Separation from Service or transfer to an ineligible employment position, and who again is designated for participation following rehire or transfer back into an eligible employment position, may be treated as being eligible to participate for the “first time” if the Participant had not been eligible to participate in this Plan (or any other deferred compensation plan that is required to be aggregated with this Plan for purposes of Code Section 409A) at any time during the twenty-four (24) month period ending on the date the Participant again becomes eligible to again participate in the Plan.
|
(iv)
|
A Participant’s Base Compensation Deferral election is effective only for the calendar year to which the election relates, and shall not carry-over from year to year.
|
Age at
Deferral
|
Multiple of Program A Deferral Commitments Determined Separately
as to Each Deferral Commitment
|
|
|
Through 45
|
5.0
|
46
|
4.8
|
47
|
4.6
|
48
|
4.4
|
49
|
4.2
|
50
|
4.0
|
|
|
51
|
3.8
|
52
|
3.6
|
53
|
3.4
|
54
|
3.2
|
55
|
3.0
|
|
|
56
|
2.8
|
57
|
2.6
|
58
|
2.4
|
59
|
2.2
|
60
|
2.0
|
|
|
61
|
1.8
|
62
|
1.6
|
63
|
1.4
|
64
|
1.2
|
65 and over
|
1.0
|
(i)
|
Retirement Distribution Election
. In the Retirement Distribution election, the Participant elects the distribution period of from one (1) to fifteen (15) annual installments. The Participant’s Retirement Distribution Election is given effect only if the Participant’s Separation from Service occurs on or after the Participant’s attainment of age fifty-five (55). If the Participant fails to timely make an election with respect to any Deferrals, the Participant is deemed to have elected distribution in a single sum payment, i.e., one (1) annual installment.
|
(ii)
|
Fixed Date Election
. A Participant may (but need not) make a Fixed Date Election, other than with respect to Restricted Stock Deferrals. In the Fixed Date Election, the Participant elects distribution, in from one (1) to fifteen (15) annual installments, to be made (or commence) at a fixed date (month and year), e.g., June, 2021. The Participant’s Fixed Date Election is given effect only if the Participant has not incurred a Separation from Service prior to the first day of the month in which distribution pursuant to the Participant’s Fixed Date election is to be made or commence. The Fixed Date Election is an optional election, and there is no deemed distribution election for a Participant who does not timely make an election with respect to any Deferral.
|
(i)
|
The Plan is terminated within twelve (12) months of a corporate dissolution taxed under Code Section 331, or with the approval of a bankruptcy court pursuant to 11 U.S.C. §503(b)(1)(A), and the amounts accrued under the Plan but not yet paid are distributed to the Participants or Beneficiaries, as applicable, by the latest of: (A) the last day of the calendar year in which the Plan termination and liquidation occurs, (B) the last day of the calendar year in which the amount is no longer subject to a substantial risk of forfeiture, or (C) the last day of the first calendar year in which payment is administratively practicable.
|
(ii)
|
The Plan is terminated at any time during the period that begins thirty (30) days prior and ends twelve (12) months following a change of control event (within the meaning of Code Section 409A), provided that all arrangements required to be aggregated with the Plan (within the meaning of Code Section 409A) sponsored by the Company or an Affiliate are terminated and liquidated with respect to each Participant that experienced the change of
|
(iii)
|
The Plan is terminated at any other time, provided that such termination does not occur proximate to a downturn in the financial health of the Company or an Affiliate. In such event, all amounts accrued under the Plan but not yet paid will be distributed to all Participants or Beneficiaries, as applicable, no earlier than twelve (12) months (and no later than twenty-four (24) months) after the date of termination. This provision shall not be effective unless all other plans required to be aggregated with this Plan under Code Section 409A are also terminated and liquidated. Notwithstanding the foregoing, any payment that would otherwise be paid during the twelve (12)-month period beginning on the Plan termination date pursuant to the terms of the Plan shall be paid in accordance with such terms. In addition, the Company or any Affiliate shall be prohibited from adopting a similar arrangement within three (3) years following the date of the Plan’s termination, unless any individual who was a Participant under this Plan is excluded from participating thereunder for such three (3) year period.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Harley-Davidson, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors:
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: November 3, 2016
|
/s/ Matthew S. Levatich
|
|
Matthew S. Levatich
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Harley-Davidson, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors:
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: November 3, 2016
|
/s/ John A. Olin
|
|
John A. Olin
|
|
Senior Vice President and
|
|
Chief Financial Officer
|
Date: November 3, 2016
|
/s/ Matthew S. Levatich
|
|
Matthew S. Levatich
|
|
President and Chief Executive Officer
|
|
|
|
/s/ John A. Olin
|
|
John A. Olin
|
|
Senior Vice President and
|
|
Chief Financial Officer
|