Slide 1: First Quarter 2022 Financial Results
First Quarter 2022 Financial Results May 3, 2022 Ray Scott, President and CEO Jason Cardew, Senior Vice President and CFO
Slide 2: Safe Harbor Statement
Safe Harbor Statement Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding anticipated financial results and liquidity. The words “will,” “may,” “designed to,” “outl
Slide 3: Agenda
Agenda 01 02 03 BUSINESS UPDATE FINANCIAL REVIEW CONCLUDING REMARKS Ray Scott, President and CEO Jason Cardew, Senior Vice President and CFO Ray Scott, President and CEO Lear Proprietary: The information contained herein is the property of Lear Corporation. 3
Slide 4: Business Update
Business Update Ray Scott, President and CEO
Slide 5: Financial Overview First Quarter 2022
Financial Overview First Quarter 2022 $221M $5.2B $184M $1.80 OPERATING CASH FLOW SALES CORE OPERATING ADJUSTED EARNINGS EARNINGS PER SHARE Q1 2021 $248M $90M Q1 2021 $5.4B Q1 2021 $336M Q1 2021 $3.73 FREE CASH FLOW Q1 2021 $135M Lear Proprietary: The information contained herein is the property of
Slide 6: Q1 2022 Business Highlights
Q1 2022 Business Highlights Sales outperformed global industry production by 4 percentage points with above market growth in both Seating and E-Systems Total business wins of more than $1.2 billion in both business segments including another significant conquest award in Seating and a major new elec
Slide 7: Lear Actions to Mitigate Impact from Macro Headwinds
Lear Actions to Mitigate Impact from Macro Headwinds VOLUME HEADWINDS LEAR ACTIONS Ukraine war reduced Q1 European production by Aggressive cash management focused on improving ≈180,000 units (see Appendix for Lear direct exposure) inventory levels and working capital Semiconductor disruptions reduc
Slide 8: Seating Update
Seating Update • Strong momentum driving recent business wins ▪ Significant new conquest award in North America ▪ Multiple China EV program awards • Key launches on track ▪ Mercedes-Benz EQE in Europe & China; EQS SUV in U.S. ▪ Range Rover Sport in U.K. ▪ BMW X5 in China and 7-Series in Europe • Nam
Slide 9: Kongsberg Business Update
Kongsberg Business Update • Acquisition completed on February 28th • Integration on track to protect and expand JIT market share and drive profitable growth ▪ New thermal comfort awards with global EV OEM in U.S. and China ▪ Tracking above 2022 commercial sales estimate of $200 million • Combining m
Slide 10: E-Systems Update
E-Systems Update • Scaling volume of battery disconnect unit for GM • M&N acquisition integration ahead of plan • Lear/Hu Lane JV accelerating connection systems strategy ▪ Multiple vertical integration sourcing awards ▪ High-speed data wire harness subassembly award with Geely in China • Key launch
Slide 11: E-Systems – Electrification Key Products and Launches
E-Systems – Electrification Key Products and Launches HIGH VOLTAGE KEY 2022 LAUNCHES HIGH VOLTAGE WIRING CONNECTION SYSTEMS GMC Global Battery Module Connector Hummer Pickup EV OEM Battery Plug Board Typical CPV $200 - $400 Battery Disconnect Unit High and Low Voltage Wiring POWER ELECTRONICS Volvo
Slide 12: Financial Review
Financial Review Jason Cardew, Senior Vice President and CFO
Slide 13: E-Systems – Electrification Update
E-Systems – Electrification Update NEW BUSINESS AWARDS QUOTE PIPELINE ($ in millions) ($ in millions) $500 ≈$2,000 $324 ≈$1,000 $218 ≈$600 2020 2021 2022 2020 2021 2022 (Target) REVENUE OUTLOOK ($ in millions) $1,300 37% CAGR $1,000 $850 Awarded $550 Awarded $1,000 $800 Awarded $405 $725 $270 2020 2
Slide 14: Global Vehicle Production and Currency
First Quarter 2022 Global Vehicle Production and Currency INDUSTRY PRODUCTION (units in millions) GLOBAL NORTH AMERICA EUROPE AND AFRICA CHINA Q1 2021 20.1 Q1 2021 3.6 Q1 2021 4.9 Q1 2021 5.4 Q1 2022 19.3 Q1 2022 3.6 Q1 2022 4.0 Q1 2022 5.8 DOWN 4% YOY DOWN 2% YOY DOWN 18% YOY UP 8% YOY KEY CURRENCI
Slide 15: Growth Over Market
Growth Over Market First Quarter 2022 7% EUROPE 4% Q1 2022 Global GoM • Seating: Backlog and favorable platform mix • E-Systems: Favorable 7% NORTH AMERICA platform mix and backlog (12)% CHINA 5% Q1 2022 • Seating: Backlog and • Seating: Unfavorable favorable platform mix platform mix Seating GoM •
Slide 16: Key Financials
Key Financials First Quarter 2022 ($ in millions, except per share amounts) 2021 2022 YEAR-OVER-YEAR DRIVERS Lower volume and foreign exchange, partially offset by backlog Net Sales $5,354 $5,208 and commodity passthrough Core Operating Earnings $336 $184 Lower volume and higher commodity costs, par
Slide 17: Seating Sales and Margin Drivers
Seating Sales and Margin Drivers First Quarter 2022 SALES ADJUSTED EARNINGS AND MARGIN ($ in millions) ($ in millions) 7.7% $3,996 $307 10 bps $62 $153 $24 $3,913 (95) bps 75 bps 5.6% $(87) $218 $(235) (200) bps Q1 2021 Volume / Backlog Commodities FX Kongsberg Q1 2022 Q1 2021 Volume / Backlog Commo
Slide 18: E-Systems Sales and Margin Drivers
E-Systems Sales and Margin Drivers First Quarter 2022 SALES ADJUSTED EARNINGS AND MARGIN ($ in millions) ($ in millions) $1,358 $72 7.0% $1,296 $95 $55 $(44) 5 bps (235) bps 20 bps 3.2% $(145) (165) bps (5) bps $42 Q1 2021 Volume / Backlog Commodities FX Q1 2022 Q1 2021 Volume / Backlog Commodities
Slide 19: 2022 Outlook – Global Vehicle Production and Currency
2022 Outlook – Global Vehicle Production and Currency INDUSTRY PRODUCTION (units in millions) GLOBAL NORTH AMERICA EUROPE AND AFRICA CHINA FY 2021 75.3 FY 2021 13.0 FY 2021 16.3 FY 2021 23.0 FY 2022 77.5 FY 2022 14.7 FY 2022 16.7 FY 2022 22.2 High End 78.9 vs Prior Year vs Prior Year vs Prior Year v
Slide 20: February Outlook to May Outlook – at Mid-Point
February Outlook to May Outlook – at Mid-Point SALES ADJUSTED EARNINGS AND MARGIN ($ in millions) ($ in millions) $21,550 4.9% $115 $20,800 $1,050 $(620) 10 bps $(245) 4.2% (65) bps (10) bps (5) bps $865 February Volume / Mix Commodities FX May February Volume / Mix Commodities FX Net May Outlook /
Slide 21: 2022 Full Year Outlook
2022 Full Year Outlook Net Sales Interest Expense Operating Cash Flow $20,400 - $21,200 million ≈$105 million $875 - $1,125 million February Outlook $20,800 - $22,300 million Effective Tax Rate February Outlook $950 - $1,300 million ≈21% Core Operating Earnings Adjusted Net Income Capital Spending $
Slide 22: Concluding Remarks
Concluding Remarks Ray Scott, President and CEO
Slide 23: Operational Excellence, Cash Flow, Strategic Initiatives, Profitable Growth
Operational Excellence Aggressively manage cash flow Execute key strategic initiatives Profitable growth Lear Proprietary: The information contained herein is the property of Lear Corporation. 23
Slide 24: Appendix
Appendix
Slide 25: Ukraine / Russia Exposure
Ukraine / Russia Exposure • No facilities in Ukraine • Two JIT seating facilities in Russia ▪ Kaluga ▪ Nizhny Novgorod ▪ ≈650 employees • 2021 sales of $139 million (less than 1% of Lear’s consolidated net sales) ▪ Largest customers – Volkswagen, Mitsubishi and PSA • $21 million in net assets • $25
Slide 26: Non-GAAP
Non-GAAP In addition to the results reported in accordance with GAAP included throughout this presentation, the Company has provided information regarding “pretax income before equity income, interest, other expense, restructuring costs and other special items” (core operating earnings or adjusted s
Slide 27: Non-GAAP
Non-GAAP Lear Proprietary: The information contained herein is the property of Lear Corporation. 27
Slide 28: Non-GAAP
Non-GAAP Lear Proprietary: The information contained herein is the property of Lear Corporation. 28
Slide 29: Non-GAAP
Non-GAAP Lear Proprietary: The information contained herein is the property of Lear Corporation. 29
Slide 30: Non-GAAP
Non-GAAP Lear Proprietary: The information contained herein is the property of Lear Corporation. 30