Harley-Davidson Sales Plunge
Harley-Davidson Inc. said Thursday its third-quarter profit fell sharply, as the slowing economy took its toll on sales of its iconic motorcycles.
The Milwaukee-based company also cut its earnings outlook and estimate for motorcycle shipments for the remainder of the year, in a sign that the credit crunch and the global economic slowdown will continue to weigh on earnings.
“Going forward, we expect the global economy and consumer concerns to continue to create challenges for Harley-Davidson through the end of the year and in 2009,” Chief Executive Jim Ziemer said in a statement.
Harley said its earnings for the quarter ended Sept. 28 dropped 37 per cent to $166.5-million (U.S.), or 71 cents per share, from $265-million, or $1.07 per share, in the same quarter last year.
Revenue fell 8 per cent to $1.42-billion from $1.54-billion in the third quarter of 2007.
The company’s earnings results fell short of Wall Street’s expectations, though revenue met estimates. Analysts expected a profit of 79 cents per share on revenue of $1.42-billion, according to a survey by Thomson Reuters.
Harley reported lower shipments of its widely recognizable bikes. They fell 14 per cent to 75,704, though international shipments crept higher, in a sign the company continues to make inroads into overseas markets. Retail sales fell 10 per cent.
The company, whose performance is closely tied to consumer confidence, also narrowed its expectations for both motorcycle shipments and earnings. It now expects to earn between $3.00 and $3.10 per share for the year. It previously expected $3.00 to $3.18 per share.
Analysts expect $3.14 per share.
The company lowered shipment estimates to 303,500 to 306,000. Previously, it expected between 303,500 and 307,500 units.
Shares of Harley closed Wednesday at $24.53. The stock is down 47 per cent for the year.
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