Harley-Davidson 2Q income jumps, sales drop eases
Harley-Davidson 2nd-qtr income climbs as sales decline eases, financial unit posts profit
On Tuesday July 20, 2010, 8:03 am
MILWAUKEE (AP) -- Harley-Davidson Inc. said Tuesday its net income in the second quarter more than tripled, as its financial services business reversed a year-ago loss and the decline in sales of its motorcycles eased.
The Milwaukee company said this year will be challenging and it will closely monitor production to make sure supply and demand are in balance.
Harley has been restructuring its business for more than a year to cope with a shrinking market and an economic downturn that has undercut demand for its pricey, chrome-laden motorcycles.
Last year Harley shut down its Buell sport-bike line and it is trying to sell its premium motorcycle unit, MV Agusta. In December, the company and its union agreed to a new contract at its main motorcycle plant in York, Pa., that will cost half of the 1,950 union workers their jobs.
The company said worldwide retail sales of its motorcycles fell 5.5 percent from last year, yet that was a more moderate decline than in previous quarters. Sales in the U.S. fell 8.4 percent, while sales in foreign markets were flat.
Company shares slid 30 cents to $23.31 in premarket trading.
A bright spot was Harley-Davidson Financial Services, which makes loans to Harley customers and dealers. The business posted operating income of $60.8 million, reversing a money-losing quarter last year.
Net income in the three months ended June 27 totaled $71.2 million, or 30 cents per share. That compares with net income of $19.8 million, or 8 cents per share, in the same period last year.
Excluding discontinued operations, income was 59 cents per share. Revenue from motorcycles and related products was flat at $1.14 billion.
Analysts surveyed by Thomson Reuters expected 41 cents per share on $1.13 billion in revenue
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