MILWAUKEE -- Harley-Davidson, Inc today announced its results for the second quarter ended June 29, 2008. Revenue for the quarter was $1.57 billion compared to $1.62 billion in the year ago quarter, a 2.9 percent decrease. Net income was $222.8 million compared to $290.5 million in the year ago quarter, a decrease of 23.3 percent. Second quarter diluted earnings per share (EPS) were $0.95, a 16.7 percent decrease compared to last year's $1.14.

"During the second quarter we shipped 80,326 Harley-Davidson motorcycles to our dealers and distributors around the world. While this  result exceeds our guidance range of 76,000 to 80,000 units for thequarter, it is a decrease of 15.6 percent from the year-ago period. This decrease reflects the impact of the shipment reduction we announced April 17th in response to ongoing weakness in the U.S. economy," said Jim Ziemer, Chief Executive Officer of Harley-Davidson, Inc.

"We expect U.S. economic conditions and ongoing consumer concerns to continue to create challenges at least through the end of the year," said Ziemer. "We believe the actions we took to reduce shipments to our U.S. dealers and our related workforce reduction position us appropriately for the current economic environment. I am confident about our future as we continue to manage and reinvest in the business for the long-term."

"Last week, we announced our planned acquisition of the MV Agusta Group and celebrated the grand opening of the Harley-Davidson Museum. Next Tuesday, we introduce our exciting new 2009 motorcycles. A month from today, we kick off our 105th Anniversary Celebration with the launch of the first of 105 motorcycle rides to Milwaukee from around the U.S. These are just some of the ways we are positioning the Company for the future, strengthening bonds with current customers and reaching out to new customers," Ziemer said.

The Company expects to ship between 74,000 and 78,000 Harley-Davidson motorcycles during the third quarter of 2008. For the full year of 2008, Harley-Davidson still plans to ship between 303,500 and 307,500 units. The Company continues to expect full-year EPS of $3.00 to $3.18, a decrease of 15 to 20 percent compared to 2007.

Motorcycles and Related Products Segment - Second Quarter Results
Revenue from Harley-Davidson motorcycles was $1.19 billion, a decrease of $67.0 million or 5.3 percent versus the same period last year. Shipments of Harley-Davidson motorcycles totaled 80,326 units, a decrease of 14,791 units or 15.6 percent compared to last year's second quarter.

Revenue from Parts and Accessories (P&A), which consists of Genuine Motor Parts and Genuine Motor Accessories, totaled $265.7 million, an increase of $2.3 million or 0.9 percent over the year-ago quarter. Revenue from General Merchandise, which consists of MotorClothes apparel and collectibles, totaled $76.8 million, an increase of $4.1 million or 5.6 percent over the year-ago quarter.

Gross margin for the second quarter of 2008 was 35.7 percent of revenue compared to 37.4 percent for the second quarter last year. Second quarter operating margin decreased to 20.1 percent from 23.9 percent in the second quarter of 2007. The Company's gross and operating margins were adversely impacted this quarter by the shipment volume reduction.

Motorcycle Retail Sales Data
During the second quarter, worldwide retail sales of Harley-Davidson motorcycles decreased 3.6 percent compared to the prior year second quarter. In the U.S., retail sales of Harley-Davidson motorcycles decreased 8.7 percent for the quarter. The heavyweight motorcycle market in the U.S. increased 0.8 percent for the same period.

Retail sales of Harley-Davidson motorcycles grew 11.2 percent in international markets during the second quarter of 2008 compared to the second quarter of 2007. Second quarter retail sales increased 8.7 percent in Canada; the Europe Region was up 9.0 percent; the Asia Pacific Region was up 7.3 percent; and the Latin America Region was up 67.1 percent.

Six Month Results
For the first six months of 2008, revenue totaled $2.88 billion, a 2.9 percent increase over the year-ago period. Earnings per share were $1.74, a decrease of 7.9 percent compared to the same period last year.

Through the first six months of this year, shipments of Harley-Davidson motorcycles were 152,194 units, a 6.6 percent decrease compared to last year's 162,878 units. Harley-Davidson motorcycle revenue was $2.20 billion, up 2.7 percent compared to last year's $2.15 billion. P&A revenue totaled $447.6 million, a 0.9 percent decrease from last year's $451.6 million. General Merchandise revenue totaled $160.8 million, an 8.0 percent increase compared to $148.8 million during the same period in 2007.

HDFS operating income was $72.1 million, a 42.0 percent decrease from last year's $124.1 million.

Courtesy: Harley-Davidson Inc, USA

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Posted by Naresh Koshti on 21 July, 2008 10:38:26 AM IST #