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WEAK BUT POSITIVE YEAR FOR HARLEY

Despite only modest motorcycle sales volume growth in 2014, Harley-Davidson’s full-year financial results include a double-digit profit improvement.

Consolidated revenue over the 12 months increased by 5.6 per cent to £4.12bn. But global retail motorcycle sales only rose by 2.7 per cent to 267,999 units, accounting for £2.9bn of that. With parts, accessories, apparel and other merchandise rolled in, the tally from products sold reached £3.69bn, climbing by 5.9 per cent.

Overall operating profit was up by 11 per cent to £848m. However, the contribution from Harley-Davidson Financial Services fell by 1.9 per cent to £184m, due to higher credit losses. Net profit stacked on 15 per cent to £559m.

Retail sales grew by 1.3 per cent in the USA, 11.8 per cent in Asia Pacific countries, 6.4 per cent in Europe (plus the Middle East and Africa) and 2.1 per cent in Latin America. Canada declined by 10.8 per cent. Harley’s wholesale shipments into its worldwide dealer network increased by 3.9 per cent to 270,726 bikes.

The fourth quarter was less impressive. Although global retail motorcycle sales were up by 2.8 per cent to 47,149 units, key US volume dropped by 1.6 per cent (26,957 units) while international markets increased by 9.2 per cent (20,192 units). So the strengthening US dollar undermined quarterly revenue growth through negative foreign exchange translation, with a fractional 0.1 per cent fall in turnover to £682m from motorcycles and related products. Consequently, operating profit in the final three months plummeted by 19.4 per cent to £65.1m and net profit was down by 1.2 per cent to £49.3m.

The company says it expects to ship between 282,000 to 287,000 motorcycles to dealers worldwide in 2015, an approximate four to six per cent expansion. Some 79,000 to 84,000 of these will arrive in the first quarter, against an actual figure of 80,682 in the same period last year.

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