Interiors specialist Lear Corporation has posted a net loss for the third quarter of 2006 of $US74.0m, or $1.10 per share. This compares with a net loss of $750.1m, or $11.17 per share, a year ago. Net sales were up to $4.1 bn from $4.0bn.
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Last year, Lear booked $777.7m for impairments and restructuring in the third quarter.
“In response to very challenging industry conditions, we are continuing to aggressively implement cost reduction and restructuring actions to improve future profitability,” said chairman and chief executive officer Bob Rossiter.
Net sales slightly up from the prior year primarily reflected the addition of new business globally, offset in large part by lower production in North America and Europe. Operating performance was slightly below the year-earlier results, reflecting the adverse impact of lower production and higher raw material costs, largely offset by the benefit of new business and cost reductions in core businesses.
Lear, which has now completed the contribution of substantially all of its European interior business to International Automotive Components Group, expects worldwide net sales of about $17.7bn, reflecting recently announced production cuts in North America and the divestiture of the European business.
It expects full-year income before interest, other expense, income taxes, impairments, restructuring costs and other special items (core operating earnings) to be in the range of $345 to $375m. Restructuring costs for the full year are estimated to be in the range of $105 to $115m.
Pretax income before impairments, restructuring costs and other special items is estimated to be in the range of $65 to $95m. Income tax expense is estimated to be approximately $40m in the fourth quarter, subject to the actual mix of financial results by country.
Fourth quarter industry production assumptions underlying Lear’s financial outlook include 3.7m units in North America, down 5% from a year ago, and 4.7m units in Europe, down 1% from a year ago. Lear’s major platforms in North America are expected to be down significantly more than the industry average.
