Harley-Davidson Q1 Profit Up 19%, Results Beat View

(RTTNews) - Motorcycle manufacturer Harley-Davidson, Inc. (HOG) on Tuesday reported a 19 percent increase in profit for the first quarter from last year, reflecting strong operating results in the motorcycles segment amid higher shipments.

Both revenue and earnings per share for the quarter beat analysts' expectations. Looking ahead, the company affirmed its shipment forecast for fiscal 2014.

Keith Wandell, Chairman, President and Chief Executive Officer of Harley-Davidson said, "Harley-Davidson delivered gains on many fronts in the first quarter, with shipments up 7.3%, strong margin improvement and solid growth in dealer new motorcycle sales."

The Milwaukee, Wisconsin-based maker of heavyweight and sport motorcycles as well as accessories reported net income for the first quarter of $265.92 million or $1.21 per share, up from $224.13 million or $0.99 per share in the prior-year quarter.

On average, fifteen analysts polled by Thomson Reuters expected the company to report earnings of $1.08 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenue for the quarter grew 11 percent to $1.57 billion from $1.41 billion in the same period last year and beat analysts' consensus estimate of $1.53 billion.

Dealers worldwide sold 57,415 new Harley-Davidson motorcycles in the first quarter, up 5.8 percent from 54,254 motorcycles in the year-ago quarter.

Sales grew 20.5 percent in the Asia Pacific region, rose 8.2 percent in the EMEA region and increased 8.9 percent in the Latin America region, but declined 2.4 percent in Canada. Sales in the U.S. rose 3 percent from the year-ago period to 35,730 units, despite the cold winter weather.

Revenue from motorcycles for the quarter grew 13 percent to $1.31 billion, with a 7 percent increase in motorcycle shipments to dealers and distributors worldwide to 80,862 motorcycles. Motorcycle shipments in the U.S. also increased 7 percent to 54,291 units.

Revenue from motorcycle parts and accessories increased 8 percent from last year to $198.14 million. Revenue from general merchandise, which includes MotorClothes apparel and accessories, declined 11 percent to $64.11 million.

The company's gross margin for the quarter improved 100 basis points to 37.7 percent from last year's 36.7 percent.

Looking ahead to the second quarter, Harley-Davidson expects to ship 92,000 to 97,000 motorcycles to dealers and distributors worldwide, up from shipments of 84,606 motorcycles in the year-ago period.

For fiscal 2014, Harley-Davidson continues to expect to ship 279,000 to 284,000 motorcycles to dealers and distributors worldwide in 2014, an increase of about 7 to 9 percent from 2013.

HOG is currently trading at $72.09, up $4.55 or 6.74 percent on a volume of 794,330 shares.