DOW JONES NEWSWIRES 
 

Harley Davidson Inc. (HOG) posted a 37% decline in first-quarter net income on tax and restructuring charges as the iconic motorcycle maker reported slumping sales and announced more job cuts.

Weak consumer spending and weak credit markets have pinched demand for big-ticket items, prompting a dividend cut and more layoffs at Harley Davidson, which has been curtailing production for about a year and faces liquidity problems at its financial unit. The company has been working to increase sales by diversifying its customer base to include women and young riders.

The company said Thursday it would cut another 300 to 400 hourly production jobs in addition to the 1,100 jobs it announced in January, producing some $120 million to $150 million in charges through 2010. The company expects to save up to $25 million this year and as much as $55 million in 2010.

Meanwhile, Harley Davidson reported first-quarter net income of $117.3 million, or 50 cents a share, down from $187.6 million, or 79 cents, a year earlier. The latest results included $57.4 million in charges.

Revenue slipped 1.2% to $1.3 billion as global retail motorcycle sales dropped 12%.

Analysts expected earnings, excluding items, of 51 cents a share on revenue of $1.3 billion, according to Thomson Reuters. Excluding the charge, earnings were above expectations and shares were up 5% in pre market trading to $18.00

Despite the retail-sales drop, motorcycle shipments rose 3.9%. U. s. sales dropped 9%, a lesser decline than the prior two quarters.

Meanwhile, the financial services segment, roiled by the credit-market owes, dropped 68% on a $25.7 million write downs related to secularization interests and receivables for sales due to higher credit losses.

-By Katherine E. Wegert, Dow Jones Newswires; 201-938-5294; katherine.wegert@dowjones.com