I’ll get right to the point. Motorcycle sales down. Revenues down. Earnings down. Currency issues. Tough competition.
The company’s Q2 earnings were hard to sugar coat for Matt Levatich, President and CEO. But he sure tried.
“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.”
Dealers worldwide sold 88,931 new motorcycles in Q2 2015 compared to 90,218 motorcycles in the year-ago quarter. In the U.S., dealers sold 57,790 new motorcycles in the quarter compared to sales of 58,225 motorcycles in the year-ago period. In international markets, dealers sold 31,141 new motorcycles during the 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.
Second-quarter revenue from motorcycles decreased 11.6 percent to $1.31 billion compared to revenue of $1.48 billion in the year-ago period. Following the company’s decision in April to lower motorcycle shipments, the motor company shipped 85,172 motorcycles to dealers and distributors worldwide during the quarter compared to shipments of 92,217 motorcycles in the year-ago period.
Revenue from motorcycle parts and accessories was $256.8 million during the quarter, down 5.4 percent, and revenue from general merchandise, which includes MotorClothes apparel and accessories, was $77.5 million, up 1.5 percent compared to the year-ago period.
As the new CEO, this is Mr. Levatich’s first solo “ride” on an earnings report after Keith Wandell retired. You have to give the company cred for its integrity of not over producing its motorcycles, but employees and shareholders can’t be happy with these sales.
Full disclosure: I have no positions in HOG stocks and no plans to initiate any position within the next 72 hours. I wrote this article from publically accessible information and expresses my own opinion. I am not receiving compensation for it and have no business relationship with the company. I currently own a Harley-Davidson Road Glide.
Photo courtesy of H-D.
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