Growth returns for Lear in second quarter

Worldwide
Published:  03 August, 2022
Credit: Lear Corporation

Automotive technology company Lear Corporation has reported its second quarter 2022 financial results, showing a return to sales growth after a weak first quarter.

After sales fell by 3% year-on-year in the first quarter of the year, the company has reported growth of 7% in the second quarter to US$5.1 billion.

Lear, which owns international automotive leather maker Eagle Ottawa, achieved net income of US$69 million and adjusted net income of US$107 income in the period, compared with US$175 million and US$148 million in the same period in 2021.

Notably, during the quarter, Lear acquired Thagora Technology, a company specialising in material utilisation hardware and software technologies.

Also, in May, the company announced that it had entered into a definitive agreement to acquire German company IGB for €140 million, which is a supplier of automotive seat heating, ventilation, active cooling, steering wheel heating, seat sensors, and electronic control modules.

Global vehicle production increased by 1% year-on-year during the second quarter of the year, with North America up 12%, Europe down 5% and China down 3%.

Looking forward to the full 2022 year, the company is forecasting net sales in the range of US$20.55-21.05 billion, with an adjusted EBITDA between US$1.4-1.5 billion.

Ray Scott, Lear’s President and Chief Executive Officer, said: “In a quarter marked with continued industry supply chain disruptions, including significant Covid-related production shutdowns in China, and increased commodity costs, Lear recorded solid financial results in the second quarter.

We are proactively taking steps to reduce costs and improve our manufacturing flexibility to position the company to succeed in multiple industry volume scenarios. The IGB acquisition we announced in the quarter will further strengthen Lear’s position as the leading supplier of automotive seating.

“Our increased emphasis on thermal comfort will create value for our customers through innovative and efficient products that improve quality, performance, weight and cost. The strategic actions we are taking are designed to increase earnings and cash flow, and support increased cash returns to shareholders.”