Lear reports record fourth quarter, full year financials

SOUTHFIELD — Lear Corp. (NYSE: LEA), the Southfield-based manufacturer of automotive seating and electrical systems, today reported record results for the fourth quarter and full year 2017.

Net income for the fourth quarter was $400.5 million or $5.80 a share, up from $229.9 million or $3.24 a share in the fourth quarter of 2016. Revenue was $5.36 billion, up from $4.64 billion a year earlier.

For the full year, net income was $1.31 billion or $18.59 a share, up from $975.1 million or $13.33 a share in 2016. Revenue was $20.47 billion, up from $18.56 billion in 2016.

The company’s tax burden turned to a payout in the fourth quarter — $82.8 million in income taxes in 2016’s fourth quarter vs. a $42.7 million tax credit in the fourth quarter of 2017. For the full year, Lear’s income tax was $197.5 million, down from $370.2 million in 2016.

“In 2017, we continued to deliver superior results, as the investments that we have made in our business are paying off,” Lear President and CEO Matt Simoncini said in a press release. “We achieved record performance in all key financial metrics, and we further strengthened our product capabilities in both business segments. Today, we are in the strongest overall competitive position in our history. Our total return to shareholders last year was 35 percent. Over the last five years, we have delivered a total return to our shareholders of approximately 300 percent, almost three times the return of the S&P 500. “Going forward, our unique product capabilities and industry-leading cost structure will allow Lear to continue to deliver profitable sales growth and superior value to our customers and shareholders.”

Excluding the impact of foreign currency exchange, fourth quarter sales were up 11 percent and full-year sales were up 9 percent. This increase reflects the addition of new business in both product segments and the acquisition of Grupo Antolin’s seating business.

For the full year, net cash provided by operating activities was $1.78 billion, and free cash flow was $1.19 billion.

The company said it repurchased about 700,000 shares of its stock in the fourth quarter for $122 million. Since initiating a share repurchase program in 2011, the company said it had bought back 44.1 million shares of its stock, spending $3.5 billion. It has thus cut the number of shares outstanding 42 percent from 2011.

The company predicted 2018 revenue of $21.4 billion to $21.6 billion, and “adjusted” net income of $1.23 billion to $1.25 billion.

To listen to a replay of a conference call discussing these results, call (855) 859-2056 in the United States or $404) 537-3406 elsewhere, using conference ID 58073011.

Lear was founded in Detroit in 1917 as American Metal Products. Today, Lear is one of the world’s leading suppliers of automotive seating systems and electrical systems. Lear serves every major automaker in the world, and Lear content can be found on more than 400 vehicle nameplates. The company employs 165,000 people in 39 countries, and ranks No. 151 on the Fortune 500. More at www.lear.com.

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