Driven by strong retail sales and product line redesigns, Harley Davidson ( HDI) beat the Street with strong second-quarter earnings.

In a press release Tuesday, the company reported earnings of 83 cents a share, a 25.8% increase from 66 cents in the same period last year and beating the consensus estimate of 75 cents a share.

Sales rose 8.9% to $1.33 billion from $1.22 billion in the previous year. The company cited U.S. retail sales and overall unit shipment increases as the force behind their numbers, noting that "floor traffic is brisk, driven by keen interest in the entire Harley-Davidson experience." It cited the redesign of its Sportster model, which it said was succeeding in broadening the line's appeal.

The motorcycle maker indicated that certain efficiencies related to gross margin "are not expected to be maintained in the second half of the year due to new model year startup." Nonetheless, the company did indicate that it was on target to ship 317,000 Harley-Davidson motorcycles in 2004.

The third quarter consensus estimate is 75 cents a share.

Shares of Harley-Davidson closed yesterday at $59.60 and are up recently in pre-market trading $1.55 or 2.6% to $61.15.

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