Seating and electrical power management systems (EPMS) supplier Lear Corporation reported adjusted earnings per share up 19% to US$1.29 on sales up 2% to US$3.5bn in the third quarter of 2012.
Lear noted its EPMS sales of $877m set a quarterly record with adjusted margin of 7.5% up from 5.4% last year.
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It also rasied full year net income guidance $15m.
The supplier said third quarter global industry production increased 2% year on year with rises in all major automotive markets except Europe. Production in North America and China was up 14% and 7%, respectively. Business conditions in Europe remained depressed, with production down 7% and the euro weaker by 12%.
“Lear performed well in the third quarter, with year-over-year improvements in sales, earnings and free cash flow,” said president and CEO Matt Simoncini.
“Despite a challenging operating environment in Europe, we remained solidly profitable in that region and increased earnings per share significantly from the prior year. We continue to win new business globally and strengthen our capabilities in emerging markets.”
The third quarter’s $3.5bn sales tally, operating proft of $179m, net income of $121m and earnings per share of $1.23 compared with $3.5bn, $178m, $101m and $0.95 respectively in Q3 2011.
Seating sales were down 1% to $2.7bn, due to negative foreign exchange and lower industry production in Europe. Adjusted segment earnings were $161m or 6.1%. Earnings in this segment fell from last year due to increased product and facility launch costs, plus development costs for new business, primarily in South America.
EPMS sales grew 14% to a quarterly record of $877m, thanks mainly to new business but were partially offset by negative foreign exchange. Adjusted segment earnings were $66m or 7.5%. Earnings increased year on yeardue to higher sales and productivity improvements, though there were increased product and facility launch costs and programme development costs.
Lear’s latest 2012 outlook is based on industry vehicle production of 15.2m units in North America, up 2%, and 16.6m units in Europe, down 1%, and an average full year exchange rate of $1.28/EUR, up 2% from August guidance.
The supplier expects 2012 sales of approximately $14.3bn, compared with previous guidance of $13.9 to $14.4bn. Core operating earnings are expected to be in the range of $745 to $785m ($740 to $790m).
