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To: ~digs who wrote (2389)	10/16/2006 1:52:47 AM
From: ~digs	Respond to of 7944

Harley 3rd-qtr net jumps on strong new bike sales biz.yahoo.com Thursday October 12 ; By James B. Kelleher CHICAGO (Reuters) - Harley-Davidson Inc. (NYSE:HOG - News) on Thursday posted a better-than-expected 18 percent jump in quarterly earnings on strong sales of its new line of motorcycles. Harley has avoided the wall that other U.S. recreational vehicle makers, including Winnebago Industries Inc. (NYSE:WGO - News) and Polaris Industries Inc. (NYSE:PII - News), have hit as interest rates and gas prices have risen. "Domestically, they're stronger than bear breath," said Bob Simonson, an analyst at William Blair & Co. In July, the company unveiled four new bikes, including two liquid-cooled power-cruisers in its VRSC, as well as powerful new engines for its Dyna, Softail and Touring bikes. Jim Ziemer, Harley's chief executive, said the new models had been a "big hit" with customers. Third-quarter net profit increased to $312.7 million, or $1.20 a share, from $265 million, or 96 cents share, during the period last year. Revenue was up 14.3 percent to $1.64 billion. Analysts, on average, expected the Milwaukee-based company to report earnings of $1.10 a share on sales of $1.58 billion, according to Reuters Estimates. "These results are fabulous," said Tim Conder, an analyst A.G. Edwards & Sons. "Most of it's coming from the richer mix of products." The higher profits were largely driven by strong worldwide sales of the company's iconic motorbikes. But an improved performance at its financial services unit and share repurchases, expected by many analysts, also contributed, analysts said. International retail sales of Harley-Davidson motorcycles grew 18.7 percent, the company said, with especially strong sales in Canada and Japan. Harley's results were equally impressive in its own backyard, where it gained market share. U.S. retail sales of its motorcycles rose 6.7 percent during the quarter, while the overall heavyweight motorcycle market grew just 0.2 percent. Going forward, Harley said it would no longer provide annual shipment guidance. Instead, the company will provide shipment guidance on a quarter-by-quarter basis only. But it reiterated it expects to generate earnings-per-share growth of between 11 percent and 17 percent through 2009. Analyst Simonson said the question hanging over Harley is whether the enthusiastic response to its new products will carry through into the next few quarters, typically the off-season for bike sales. "How deep is that well of demand?" he said. "Is it going to continue into the first half of next year, or are we going to see some slippage once all the Harley devotees who just have to have the new thing are satisfied?"