Harley-Davidson Inc Tops Earnings Estimates

Harley-Davidson Inc (NYSE:HOG) released the earnings results from its most recently completed quarter before opening bell this morning, posting diluted earnings per share of 69 cents and consolidated revenue of $1.3 billion. Analysts had been expecting earnings of 60 cents per share on $1.14 billion in revenue.

Harley-Davidson’s key earnings metrics

In the same quarter last year, the motorcycle dealer reported diluted earnings of 73 cents per share and $1.34 billion in revenue.

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For the first nine months of this year, Harley-Davidson reported a 6.8% growth rate in revenue, a 16.9% growth rate in net income and a 20.1% growth rate in diluted earnings per share. In last year’s first nine months, the company’s earnings per share were $3.52.

Motorcycles revenue was $815.4 million, compared to $857 million in the same quarter a year ago. The decline was in line with guidance. Motorcycle parts and accessories revenue fell 4.2% to $239.7 million. The company’s gross margin for the quarter was 34.9%, compared to last year’s 35.3%.

Harley-Davidson sees lower shipments

According to this morning’s press release, Harley-Davidson shipped fewer motorcycles in the third quarter, just as it had planned to do. However, sales topped last year’s third quarter, as the company reported that it sold 73,217 new motorcycles in this year’s September quarter.

In the same quarter a year ago, Harley-Davidson sold 70,517 motorcycles. Management credited a rebound in sales of the Sportster motorcycle and wider availability of the Street 750 and Street 500 motorcycles, as well as strong dealer results for the increase in sales. They added that last year’s third quarter was one of their strongest retail increases in recent years due to the launch of the Project Rushmore line.

In the U.S. this year, Harley-Davidson dealers sold 50,167 new motorcycles, with the remaining sales coming in international markets.

Harley-Davidson provides guidance

The motorcycle company reiterated its previously provided guidance of between 270,000 and 275,000 motorcycle shipments for this year. That’s about a 3.5% to 5.5% increase year over year. Harley-Davidson also still expects to see an operating margin of 17.5% for the full year, compared to 18.5% in the Motorcycles segment.

The company expects capital expenditures of between $215 million and $235 million.