Seating and electrical equipment specialist Lear Corporation on Thursday said first quarter 2010 sales rose 36% year on year to US$2.9bn.
Income before interest, other expense, income taxes, restructuring costs and other special items – core operating earnings – was $138.2m compared with a loss of $66.7m in Q1 2009.
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Seating segment net sales rose 32% to $2.3bn as global vehicle production rose helped by favourable foreign exchange, Lear said in a statement. In the electrical power management segment, net sales rose 50% to $625m for the same reasons.
“Operating margins in both segments improved significantly, reflecting the increase in sales, favourable operating performance and the benefit of operational restructuring actions,” Lear added.
The company said the “production environment” improved from year-ago levels, with mature markets moving higher from distressed levels and growth in emerging markets continuing.
In North America, vehicle production was up 72% year on year and rose 32% in Europe. Production volumes continued to grow in the first quarter in major emerging markets, with increases ranging from 20% in Brazil to 65% in China.
“Business conditions in the first quarter reflected an improved economic climate and increased industry vehicle production from a year ago. In this early stage of economic recovery, we achieved positive operating earnings and free cash flow. In addition, we completed a major refinancing of our capital structure,” said chairman, CEO and president Bob Rossiter.
Lear expects total industry vehicle production in 2010 of approximately 11m units in North America, 15.8m in Europe and 13.1m in China and is assuming an exchange rate of $1.35/euro.
It forecast global net sales of about $11bn and full year core operating earnings of $375m to $425m. Operational restructuring costs in 2010 are estimated at about $110m.
