Performance Summary In 2010, Harley-Davidson’s revenue from motorcycles and related products on a continuing basis decreased 23.1 percent to $4.29 billion compared to 2009 and income from continuing operations decreased 89.7 percent from the prior year to $70.6 million. These results reflect the performance of the Company’s motorcycle business, operating losses at Harley-Davidson Financial Services and the impact of restructuring charges. Revenue from sales of HarleyDavidson motorcycles decreased to $3.17 billion in 2010, a decline of 25.2 percent from 2009, on a 26.5 percent reduction in shipments of HarleyDavidson motorcycles. Revenue from Genuine Parts and Accessories in 2010 totaled $767.3 million, a 10.7 percent decrease from the previous year, and General Merchandise revenue was $282.2 million, a decrease of 10.1 percent compared to 2009. During 2010, Harley-Davidson took actions to lower its cost structure through eliminating excess capacity, reducing administrative costs and
exiting non-core business operations. Consequently, 2010 results were significantly affected by non-recurring charges. Harley-Davidson expects restructuring activities announced in 2010 to deliver between $240 million and $260 million in annual ongoing savings upon completion of those restructuring activities.
Our share price increased 48.5 percent during 2010 and the Company paid out dividends of $0.40 per share in 2010. Harley-Davidson has paid a dividend every year since 1993. MOTORCYCLES Worldwide retail sales of HarleyDavidson motorcycles declined 22.7 percent in 2010 compared to 2009. In the United States, 2010 retail sales of 162,385 Harley-Davidson motorcycles decreased 25.8 percent from 2009 and overall U.S. heavyweight market registrations declined 36.6 percent. For the full year
2010, retail sales of Harley-Davidson motorcycles in our international markets decreased 15.4 percent compared to 2009. For the same period, retail sales of Harley-Davidson motorcycles decreased 11.2 percent in the Europe Region, 27.2 percent in the Latin America Region, 30.9 percent in Canada and 9.0 percent in the Asia Pacific Region. In 2010, the Company shipped 223,023 Harley-Davidson motorcycles worldwide, compared to 303,479 in 2009. In 2010, 35 percent of the Harley-Davidson motorcycles shipped went to international markets compared to 32 percent in 2009. FINANCIAL SERVICES Financial Services incurred an operating loss of $118 million in 2010 compared to operating income of $82.8 million in 2009, largely due to a $72.7 million credit loss provision for a one time reclassification of Held for Sale receivables to Held for Investment and a $28.4 million goodwill impairment charge.
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