Harley-Davidson Inc. on Wednesday reported a 30% increase in second quarter profit but expressed caution about its sales prospects for the rest of the year.
Harley reported net income of $247.3 million, or $1.07 per share, for the three months ended July 1. That's up from $190.6 million, or 81 cents per share, a year earlier.
Analysts polled by FactSet expected earnings of $1.05 per share.
Revenue increased 17% to $1.57 billion. That was below average Wall Street expectations of $1.64 billion.
By volume, retail sales of new bikes rose 2.8% worldwide, while U.S. unit sales increased 4% in the quarter.
"We believe June growth in particular was below consensus expectations," said UBS analyst Robin Farley, noting that unseasonably warm weather in the first quarter had pulled sales forward out of the second quarter.
There's some uncertainty about prospects for the remainder of the year, especially in Europe.
"We have seen a drop-off in Europe, more so in some countries than others. The whole sovereign debt issue is a black cloud hanging over the horizon, and I am not sure any of us really knows exactly where that's going to go," said CEO Keith Wandell.
Through the first half of the year, dealers sold 145,391 new Harley-Davidson motorcycles worldwide, a 9.3% increase from the year-ago period. Sales were up 12% in the U.S., 16.5% in the Asia Pacific region and 58% percent in Latin America. They were down 4.5% in the Europe-Middle East-Africa region.
"If you look at the first two quarters, the results were pretty good," said analyst Robin Diedrich with Edward Jones Co.
Harley says it still plans to ship 245,000 to 250,000 bikes to dealers in fiscal 2012, which would amount to an increase of 5% to 7% over year-ago levels.
"The big part of the story we have been looking for is an improvement in sales and cost-cutting efforts kicking in at the same time. And that is what we are seeing," Diedrich said.
