Sales growth over market in the second quarter was six percentage points, driven primarily by the impact of new business in both segments. The company recorded net income of $69 million and adjusted net income of $107 million in the second quarter of fiscal 2022, compared to $175 million and $148 million, respectively, in the second quarter of 2021.
"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," said Ray Scott, Lear's president and chief executive officer. "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."
In the second quarter, global vehicle production increased by 1 per cent compared to a year ago, with North America up by 12 per cent, Europe down by 5 per cent, and China down by 3 per cent. Global production increased on a Lear sales-weighted basis by approximately 2 per cent, the company said in a press release.
Core operating earnings were $187 million, or 3.7 per cent of sales, compared to $233 million, or 4.9 per cent of sales, in 2021. The decrease in earnings resulted primarily from higher commodity costs and the impact of foreign exchange, which were partially offset by the addition of new business and higher production on key Lear platforms. In the seating segment, margins and adjusted margins were 5.5 per cent and 6.0 per cent of sales, respectively. In the e-systems segment, margins and adjusted margins were 0.2 per cent and 2.0 per cent of sales, respectively.
Fibre2Fashion News Desk (RR)