Harley-Davidson posted it Q2 2019 results and lets just say they are interesting.  The MoCo reported that it had made progress towards its plan to build more riders through its More Roads to Harley-Davidson accelerated plan for growth.  They also claimed that they expect to substantially mitigate incremental EU and China tariffs early in the second quarter of 2020.

Harley’s President and CEO Matt Levatich was quoted as saying:

“In the second quarter we achieved significant advancements under our More Roads plan and we continued to lay a solid foundation for future growth.  The decisions and investments we’re making, within a highly dynamic and competitive global marketplace, demonstrate our intense focus to build the next generation of riders and maximize shareholder value.”

Good results?

So everything’s good then?  Well not so fast.  Recognizing that the MoCo has to make investments to grow its market share is understandable.  Clearly, Harley under Levatich’s guidance is looking to the future and that makes sense.

Harley-Davidson numbers

But how long can Harley continue to invest and not show good quarterly results?  2019’s Q2 numbers do not look good and did not even equal last years Q2 numbers.  Harley reported the following results:

  • Q2 2019 GAAP diluted EPS was $1.23 vs. 2018’s diluted EPS was $1.45.
    • Result: down from last year.
  • Excluding restructuring plan costs and the impact of incremental tariffs, second-quarter 2019 diluted EPS was $1.46 compared to $1.52 in the second quarter of 2018.
    • Result: still down from last year.
  • Second-quarter 2019 net income was $195.6 million on consolidated revenue of $1.63 billion, versus net income of $242.3 million on consolidated revenue of $1.71 billion in 2018.
    • Result: Both net income and revenue are down.
  • Worldwide retail sales were down 8.4% in Q2.
  • US retail sales were down 8%.
  • International retail sales were down by 8.9%.

Is time running out?

I don’t know about you, but those numbers don’t look like a path to success.  Certainly, Harley has been spending on creating new markets and developing new products.  That costs time and money.  I’d like to think that this is the last of the down results, but I’m afraid that any upward results are quite a way off.

I’m cheering for you Harley, but time is winding down in the 3rd period and you may have to look at pulling the goalie.


Featured image: Harley-Davidson

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