Lear Corp. in Southfield, a global automotive technology supplier of seating and E-systems, today reported that sales in the third quarter increased 10 percent to $5.8 billion, compared to $5.2 billion in the third quarter 2022.
The company also reported that net income in the third quarter reached $133 million and an adjusted net income of $170 million, compared to $92 million and $140 million, respectively, in the third quarter of 2022.
Core operating earnings increased 14 percent to $267 million, compared to $235 million in the third quarter of 2022. Additionally, earnings per share of $2.25 and adjusted earnings per share of $2.87, compared to $1.54 and $2.33, respectively, in the third quarter of 2022.
Other highlights include:
- Net cash provided by operating activities of $404 million and free cash flow of $251 million, compared to $252 million and $112 million, respectively, in the third quarter of 2022.
- Fifth consecutive quarter of year-over-year margin improvement in E-systems.
- Received more than twice as many J.D. Power 2023 U.S. Seat Quality and Satisfaction Study awards as any other seat supplier, with four best in segment and nine total awards.
- Awarded first General Motors seat ventilation program, using the company’s customer relationships to accelerate growth in thermal comfort systems.
- Launched complete seats for Stellantis conquest business for the Wagoneer and Grand Wagoneer premium SUVs.
- Named a 2023 PACE award finalist for ReNewKnit, Lear’s premium and fully recyclable sueded seating surface material.
- Cash and cash equivalents at quarter end of $980 million and total liquidity of $3 billion.
- Accelerated share repurchases, returning $120 million of cash to shareholders through share repurchases and dividends.
“Lear’s positive momentum continued in the third quarter with our fifth consecutive quarter of improved year-over-year results,” says Ray Scott, president and CEO at Lear. “Our strategy to streamline our product portfolio and improve our financial performance in E-systems is on track, as the division reported its highest operating margins in more than two years.”
In the third quarter, global vehicle production increased by 4 percent compared to a year ago, with North America up 9 percent, Europe up 6 percent and China down 1 percent. Global vehicle production increased 8 percent on a Lear sales-weighted basis.
Core operating earnings were $267 million, or 4.6 percent of sales, compared to $235 million, or 4.5 percent of sales, in 2022.
The increase in earnings resulted primarily from higher production on key Lear platforms and the addition of new business. In the seating segment, margins and adjusted margins were 5.7 percent and 6.4 percent of sales, respectively. In the E-systems segment, margins and adjusted margins were 4 percent and 5.3 percent of sales, respectively.
Earnings per share were $2.25. Adjusted earnings per share were $2.87, up 23 percent compared to a year ago, primarily reflecting higher operating earnings. In the third quarter of 2023, net cash provided by operating activities was $404 million, and free cash flow was $251 million.
