Harley profit tops Street, cautious on 2012

(Reuters) - Harley-Davidson Inc (HOG.N) reported a better-than-expected fourth-quarter profit on a 12 percent rise in product sales, citing success in boosting sales of its motorcycles beyond its core market of baby boomers.

Net income was $105.7 million, or 46 cents per share, compared with a net loss of $46.8 million, or 20 cents per share, a year ago.

Profit from continuing operations was 24 cents per share, 1 cent above analysts' average forecast, according to Thomson Reuters I/B/E/S.

Revenue from motorcycles and related products -- which excludes the company's finance arm -- rose to $1.03 billion from $917.1 million a year ago, topping the $1.01 billion analysts had expected.

The company said it plans to ship 240,000 to 245,000 motorcycles in 2012, up 3 to 5 percent from 2011. It expects a gross margin of 34.75 percent to 35.75 percent, up from 33.4 percent in 2011, as it cuts costs.

The 2012 shipment target was "a little to the light end" of expectations, UBS Investment Research analyst Robin Farley wrote in a note to clients.

The motorcycle maker said macroeconomic uncertainties and expected uneven production rates at its York, Pennsylvania, factory as it phases in a new computer system prompted it to offer a cautious sales forecast.

"We remain cautious on the U.S. recovery and concerned on the continuing debt crisis in Europe," Chief Financial Officer John Olin said in a conference call with investors.

Harley shares were up 3 cents at $41.90 in early trading on the New York Stock Exchange.

The weak U.S. economy has hit demand for the Milwaukee, Wisconsin-based company's motorcycles, and Harley has responded by restructuring its manufacturing base and introducing less costly bikes aimed at younger riders.

Harley shares have risen about 17 percent over the past year, sharply outpacing the 3 percent rise of the Standard & Poor's 500 index. .SPX

(Reporting By Scott Malone; Editing by Derek Caney and John Wallace)