Second-quarter results are in line with company expectations following Harley-Davidson’s decision in April to lower motorcycle shipments from initial projections for 2015 in light of currency-driven competitive pressures in the U.S. and the company’s commitment to manage supply in line with demand.
Dealer new motorcycle sales were down 1.4 percent worldwide for the second quarter compared to the year-ago period, but gained momentum as the quarter progressed.
“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, Harley-Davidson, Inc. “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.”
“We are confident in the strength of our business and the strategies we have in place to maintain our industry leadership and grow our business over the long term,” said Levatich. “Our singular focus on the customer through unrivaled products, unique experiences and our expanding dealer network is the bedrock we are building on to continue to grow our reach and impact with customers across the globe.”
Retail Harley-Davidson Motorcycle Sales
Dealers worldwide sold 88,931 new Harley-Davidson motorcycles in the second quarter of 2015 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.
In international markets, dealers sold 31,141 new Harley-Davidson motorcycles during the second quarter compared to 31,993 motorcycles in the year-ago period, with sales up 16.6 percent in the Asia Pacific region and down 8.9 percent in the EMEA region, 2.6 percent in the Latin America region and 9.9 percent in Canada.
Guidance
Harley-Davidson continues to expect to ship 276,000 to 281,000 motorcycles to dealers and distributors worldwide in 2015, an approximate 2 percent to 4 percent increase from 2014. In the third quarter, the company expects to ship 54,000 to 59,000 motorcycles compared to 50,670 motorcycles shipped in the year-ago period. The company continues to expect full-year 2015 operating margin of approximately 18 percent to 19 percent for the motorcycles segment. The company also continues to expect 2015 capital expenditures for Harley-Davidson, Inc. of $240 million to $260 million.
As previously announced, the company anticipates closing on its transaction with its Canadian distributor on or about August 4, 2015, at which time the company will obtain the exclusive right to distribute the company’s products in Canada. The above guidance does not include the impact of the anticipated transaction, but as previously indicated, the company expects the financial impact of the pending transition to be dilutive to 2015 earnings per share due to upfront transition costs.
