According to Harley-Davidson's Second Quarter results, the company showed “continued improvement in key areas,” despite a decrease in worldwide retail sales of 5.5 percent compared to the second quarter a year ago, and US sales which were down 8.4 percent. The report shows income up 28.9 percent over the same quarter a year ago. Despite the motorcycle sales slump, the rate of decline in sales also shows a sequential moderation from the prior four quarters.
The improvement is attributed to the company's restructuring efforts, plus continued improvement in the performance of Harley’s financing arm, HDFS, which showed operating income of $87.5 million in the first half of 2010, compared to an operating loss of $79.3 million in the first half of 2009.
Harley is counting on closing cost gaps in it’s manufacturing operations with the beginning of union negotiations starting this week for the company’s Milwaukee and Tomahawk facilities, the contracts for which expire in April 2012. The company says that if negotiations fail it will move those Wisconsin operations to another US location. The company did state that it’s corporate headquarters; product development and the Harley-Davidson Museum will remain in Milwaukee, regardless of the outcome of its decision on production operations.
The company reiterated its expectation to ship 201,000 to 212,000 Harley-Davidson motorcycles to dealers and distributors worldwide in 2010, a reduction of five to ten percent from 2009.
For a transcript of the Q2 2010 Earnings call go here
For a transcript of the Q2 2010 Earnings call go here
Posts
