Additional Balance Sheet and Cash Flow Information

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Additional Balance Sheet and Cash Flow Information

Investments in Marketable Securities – The Company’s investments in marketable securities consisted of the following (in thousands):


	September 30, 2024		December 31, 2023		September 30, 2023

Mutual funds	$	33,816	$	34,079	$	32,664

Mutual funds, included in Other long-term assets on the Consolidated balance sheets, are carried at fair value with gains and losses recorded in income. Mutual funds are held to support certain deferred compensation obligations.

Inventories, net – Substantially all inventories located in the U.S. are valued using the last-in, first-out (LIFO) method. Other inventories are valued at the lower of cost or net realizable value using the first-in, first-out (FIFO) method. Motorcycle finished goods inventories include motorcycles that are ready for sale and motorcycles that are substantially complete but awaiting installation of certain components. Inventories, net consisted of the following (in thousands):


	September 30, 2024		December 31, 2023		September 30, 2023
Raw materials and work in process	$	299,296	$	389,221	$	333,107
Motorcycle finished goods	399,699		514,964		405,714
Parts and accessories and apparel	119,260		150,844		154,640
Inventory at lower of FIFO cost or net realizable value	818,255		1,055,029		893,461
Excess of FIFO over LIFO cost	(136,391)		(125,078)		(124,696)
	$	681,864	$	929,951	$	768,765

Deposits – HDFS offers brokered certificates of deposit to customers indirectly through contractual arrangements with third-party banks and/or securities brokerage firms through its bank subsidiary. The Company had $549.0 million, $447.8 million, and $478.9 million, net of fees, of interest-bearing brokered certificates of deposit outstanding as of September 30, 2024, December 31, 2023, and September 30, 2023, respectively. The liabilities for deposits are included in Short-term deposits, net or Long-term deposits, net on the Consolidated balance sheets based upon the term of each brokered certificate of deposit issued. Each separate brokered certificate of deposit is issued under a master certificate, and as such, all outstanding brokered certificates of deposit are considered below the Federal Deposit Insurance Corporation insurance coverage limits.

Future maturities of the Company's certificates of deposit as of September 30, 2024 were as follows (in thousands):


2024	$	33,551
2025	145,737
2026	236,489
2027	119,281
Thereafter	15,200
Future maturities	550,258
Unamortized fees	(1,248)
	$	549,010

Operating Cash Flow – The reconciliation of Net income to Net cash provided by operating activities was as follows (in thousands):


	Nine months ended
	September 30, 2024		September 30, 2023
Cash flows from operating activities:
Net income	$	563,605	$	671,762
Adjustments to reconcile Net income to Net cash provided by operating activities:
Depreciation and amortization	119,568		112,592
Amortization of deferred loan origination costs	54,461		65,996
Amortization of financing origination fees	10,363		9,734
Income related to long-term employee benefits	(40,076)		(50,373)
Employee benefit plan contributions and payments	(3,781)		(2,668)
Stock compensation expense	39,820		64,538
Net change in wholesale finance receivables related to sales	(211,800)		(392,817)
Provision for credit losses	175,017		170,496



Deferred income taxes	(1,815)		(8,455)

Other, net	19,557		(19,738)
Changes in current assets and liabilities:
Accounts receivable, net	(36,529)		(72,084)
Finance receivables – accrued interest and other	2,325		2,366
Inventories, net	253,373		160,742
Accounts payable and accrued liabilities	(12,903)		14,453

Other current assets	(530)		(19,777)
	367,050		35,005
Net cash provided by operating activities	$	930,655	$	706,767