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Harley-Davidson profit way above estimates as Trump weighs in

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Harley-Davidson profit way above estimates as Trump weighs in
FILE PHOTO: American motorcycle manufacturer Harley-Davidson's signboard is pictured at its branch in Tokyo, Japan August 13, 2018. REUTERS/Kim Kyung-Hoon/File Photo   -   Copyright  Kim Kyung Hoon(Reuters)
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(Reuters) – Harley-Davidson Inc on Tuesday surged past expectations for first-quarter profit and stuck to its full-year shipment forecasts in the face of concerns over falling U.S. sales and European import tariffs, sending its shares up 3 percent.

President Donald Trump, who has criticised Harley for its plans to shift some U.S. production overseas, weighed in after the results to say European Union tariffs on the manufacturer were “unfair” and vowed to reciprocate, without giving details.

Harley, while again weighed down by a continuing decline in its popularity both in the United States and globally, topped Wall Street’s profit forecasts by more than 30 cents per share.

Earlier this year, Harley said the retaliatory import duties imposed by the European Union on its bikes would cost the company between $100 million (£77 million) and $120 million in 2019.

European markets are a growing portion of the Harley’s total motorcycle sales. To avoid the additional import duty, it has boosted investment at its Thailand plant to serve that market.

It said U.S. retail motorcycle sales, or sales by dealers to customers, fell 4.2 percent in the first quarter ended March. 31. European sales were down 2.1 percent.

The company’s overall net income fell 26.7 percent to $127.9 million in the quarter, while revenue from motorcycles and related products fell 12.3 percent to $1.19 billion, roughly in line with forecasts.

That generated earnings per share excluding items of 98 cents, compared with the average analyst estimate of 65 cents per share, according to IBES data from Refinitiv.

(Reporting by Rachit Vats in Bengaluru and Rajesh Kumar Singh in Chicago; Editing by Anil D’Silva)

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