Harley Davidson shares up on earnings beat

July 24 01:58 2015

Shares of iconic U.S. motorcycle maker Harley Davidson rallied more than 2% in pre-market trading after it topped second-quarter earnings expectations by 5 cents, despite currency headwinds from a strong dollar. The company reported second-quarter earnings per share of $1.44, which was better than the $1.39 Wall Street analysts were expecting. Revenues, while a tad light, were virtually in line with forecasts, as sales totalled $1.65 billion vs. expectations of $1.67 billion. In the year-ago quarter, Harley Davidson posted EPS of $1.62 on revenue of $1.83 billion.

At 7:40 a.m. ET, Harley Davidson (HOG) shares were up $1.26, or 2.3%, to $54.94 in pre-market trading. The company, in a press release, said the quarterly results were in line with what they were expecting following a decision in April to slash 2015 motorcycle shipments from initial projections due to “currency-driven competitive pressures in the U.S.” and the company’s commitment to better manage supply and demand.

Dealer new motorcycle sales were down 1.4% worldwide for the second quarter compared to the year-ago period, but gained momentum as the quarter progressed, the company said. “In the face of a tough competitive environment, driven mostly by currency and greater competitive activity, we are leveraging our many strengths and meeting the challenge head on,” said Matt Levatich, president and chief executive officer. “Our actions during the quarter have had a positive impact. We are encouraged by the momentum at retail as the quarter progressed, both in the U.S. and internationally.”

Harley Davidson sells motorcycles such as the Sportster SuperLow, Dyna Low Rider and Softail Fat Boy. Sales in the quarter fell short in the U.S. and most parts of the world, although sales increased in the Asian Pacific region. Dealers worldwide sold 88,931 new Harley motorcycles in the second quarter compared to 90,218 motorcycles in the year-ago quarter. In the U.S., dealers sold 57,790 new Harley-Davidson motorcycles in the quarter compared to sales of 58,225 motorcycles in the year-ago period.