Harley-Davidson (HOG) - Get Report posted stronger-than-expected third quarter earnings and confirmed its full-year shipping and profit margin guidance as the iconic motorcycle maker continues to move away from its trade war spat with President Donald Trump.
Harley-Davidson said earnings for the three months ending in September, excluding manufacturing optimization costs, came in at 78 cents a share, well ahead of the 53 cent estimate, on sales of $1.32 billion which rose 14.7% from the same period last year. The group also confirmed its full-year motorcycle shipment guidance of between 231,000 to 236,000 vehicles, but noted that worldwide sales fell 7.8% over the third quarter period.
"As we manage our business with resilience in a challenging time in our history, we are leveraging our strengths for a more promising road ahead. We are investing to build the next generation of Harley-Davidson riders and we are optimizing our business to drive profitability and cash flow," said CEO Matt Levatich. "Through September, cash flow was very strong and revenue was up over 3 percent despite lower motorcycle shipments."
Harley-Davidson shares were seen 4.6% higher at $40.50 each following the earnings release, a pre-market move that would trim the stock's year-to-date decline to around 20% and value the Milwaukee, Wis.-based group at around $6.7 billion.
Harley-Davidson was targeted by the European Union in June with fresh import tariffs after President Trump imposed 25% levies on non-American steel and aluminium products earlier in the year.
Levatich cautioned at the time that any import tariffs would have a "significant" impact on overseas sales and increased the cost of each bike by $2,200. It also said it will ramp-up production in Asia and South America as part of a new business strategy focused on accelerating overseas sales.
Trump, in fact, appeared to back a boycott of the iconic motorcycle maker shortly after when it said it had plans to move some of its production facilities overseas.
The nature of the boycott that Trump referenced was unclear, although the President visited a "Bikers from Trump" rally at his Bedminster, N.J. golf course in June that the White House said included 180 riders that included military veterans and law enforcement officials.