Milwaukee-based Harley-Davidson Inc. reported third quarter net income of $134.0 million, or 59 cents per share, down from $183.6 million, or 78 cents per share, as the company restructured its production process at its largest plant in York, Pa.
The company previously announced a plan for lower third-quarter motorcycle shipments during the launch of an ERP production system at the York plant.
For the full year 2012, Harley-Davidson continues to forecast a five-to seven-percent increase in motorcycle shipments compared with 2011.
“The third quarter marked a pivotal milestone in Harley-Davidson’s transformation. With the launch of the ERP production system at York, a major piece of our restructuring work is behind us. We are now focused on optimizing the system and look forward to the start of seasonal surge production early next year,” said Keith Wandell, chairman, president and chief executive officer. “From our market leadership in U.S. outreach segments to our global expansion to the effective launch of ERP at York, we continued to see the evidence of the successful execution of our strategic plan. We believe Harley-Davidson is on track to deliver growth through our strategy, with investments in new markets, new products, and improved manufacturing and retail capabilities. Our entire team of employees, dealers and suppliers has done a great job of delivering on the many changes throughout the business that are important to Harley-Davidson’s long-term success.”
Through nine months, retail sales of new Harley-Davidson motorcycles grew 6.0 percent overall. Harley-Davidson continues to expect to ship 245,000 to 250,000 motorcycles to dealers and distributors worldwide in 2012, a five-to seven-percent increase from 2011.
In the third quarter, the company incurred restructuring charges of $9.2 million. The company now expects to incur full-year 2012 restructuring costs of $35 million to $45 million, a reduction of $5 million from the range previously provided.
“We believe our U.S. dealers’ third-quarter new motorcycle sales were adversely affected by a limited availability of new motorcycles in July, August and early September resulting from the ERP implementation at York combined with the move of Harley-Davidson’s annual new model launch to late August from late July. As U.S. dealer inventory returned to more appropriate levels and the new 2013 motorcycles became more available, retail sales responded positively and gained momentum as we exited the quarter,” Wandell said. “Harley-Davidson had a lot of exciting news for customers in the third quarter, with the launch of the 110th Anniversary year and Anniversary Edition motorcycles, and the rollout of our exciting full line of 2013 bikes. While we see great untapped opportunity at retail, we continue to temper our expectations in light of continued softness in the global economy.”
