Slide 1: Second Quarter Results and 2008 Financial Outlook
Exhibit 99.2 Second Quarter Results and 2008 Financial Outlook July 29, 2008
Slide 2: Agenda
Agenda Company Overview Bob Rossiter, Chairman, CEO and President Second Quarter Results and 2008 Financial Outlook Matt Simoncini, SVP and CFO Q and A Session 2
Slide 3: Company Overview
Company Overview 3
Slide 4: Business Conditions Very Challenging
Business Conditions Very Challenging* North American industry production down sharply: Second quarter down 15% from a year ago Full-year outlook lowest since the early 1990s Dramatic shift away from full-size pickups and large SUVs in North America: Second quarter down 37% from a year ago Full-year
Slide 5: Lear is Proactively Addressing the Challenges
Lear is Proactively Addressing the Challenges* Maintained solid operating fundamentals globally Accelerating progress on global restructuring initiative Winning significant new business globally Continuing to diversify our sales mix Investing in our electrical and electronic business Proactively man
Slide 6: Sales Growth and Diversification
Sales Growth and Diversification* Net new business wins since January total about $600 million: ˜ $60 million in 2009 ˜ $300 million in 2010 ˜ $240 million beyond 2010 Composition of net new business further diversifies sales: Primarily outside of North America 55% in electrical and electronics 25%
Slide 7: Leadership in Seat Quality
Leadership in Seat Quality Lear’s Highlights from Things Gone Wrong (TGW) 2008 J.D. Power Survey per 100 vehicles 19% Year-Over-Year Improvement in TGW 39% Improvement since 2000 in TGW Lear leads the industry in key segments: Best Compact Premium Seat Quality–Porsche Cayman Best Midsize Premium Spo
Slide 8: Operating Priorities
Operating Priorities Business conditions in North America have deteriorated rapidly this year and are likely to remain challenging into 2009 In response, the Lear team is focused on: Maintaining operational excellence Further diversifying our sales outside of North America Implementing structural co
Slide 9: Second Quarter Results and 2008 Financial Outlook
Second Quarter Results and 2008 Financial Outlook 9
Slide 10: Second Quarter 2008 Financial Summary
Second Quarter 2008 Financial Summary* Major Factors Impacting Second-Quarter 2008 Results Difficult North American production environment, with industry down 15% and Domestic Three down 21% from a year ago Raw material and energy prices remained high Continued benefits of restructuring actions Seco
Slide 11: Second Quarter 2008 Industry Environment
Second Quarter 2008 Industry Environment Second Quarter Second Quarter 2008 2008 vs. 2007 North American Production Industry 3.4 mil down 15% Domestic Three 2.1 mil down 21% Lear's Top 15 Platforms 0.8 mil down 30% European Production Industry 5.5 mil up 4% Lear's Top 5 Customers 2.8 mil up 3% Key C
Slide 12: Second Quarter 2008 Reported Financials
Second Quarter 2008 Reported Financials Second Second 2Q '08 (in millions, except net income per share) Quarter 2008 Quarter 2007 B/(W) 2Q '07 Net Sales $3,979.0 $4,155.3 ($176.3) Income Before Interest, Other Expense and Income Taxes* $105.5 $194.8 ($89.3) Pretax Income $55.8 $143.9 ($88.1) Net Inc
Slide 13: Second Quarter 2008 Restructuring Impact
Second Quarter 2008 Restructuring Impact* Second Quarter Income Before Interest, (in millions) Other Expense and Income Taxes Reported Results 2008 Total Company $ 105.5 Income Statement Category Reported Results Include the Following Items: COGS SG&A Costs related to restructuring actions $ 58.3 $
Slide 14: Second Quarter 2008 Net Sales Changes and Margin Impact
Second Quarter 2008 Net Sales Changes and Margin Impact Net Sales Margin Performance Factor Change Impact Comments (in millions) Industry Production / $ (554) Negative Lower production and unfavorable platform Platform Mix / Net Pricing mix in North America, including impact of American Axle strike
Slide 15: Second Quarter 2008 Seating Performance
Second Quarter 2008 Seating Performance* Explanation of Adjusted Seating Segment Margins Year-to-Year Change Q2 Second Quarter First Half Sales Factors Decreased, driven by lower industry production and unfavorable platform mix in North America, partially offset by favorable foreign exchange Margin
Slide 16: Second Quarter 2008 Electrical and Electronic Performance
Second Quarter 2008 Electrical and Electronic Performance* Explanation of Adjusted Electrical and Electronic Segment Margins Year-to-Year Change Q2 Second Quarter First Half Sales Factors Increased, driven by favorable foreign exchange and the addition of new business, partially offset by lower indu
Slide 17: Second Quarter 2008 Free Cash Flow
Second Quarter 2008 Free Cash Flow* (in millions) Second Quarter 2008 Net Income $ 18.3 Depreciation / Amortization 77.4 Working Capital / Other (30.0) Cash from Operations $ 65.7 Capital Expenditures (50.0) Free Cash Flow $ 15.7 * Free cash flow represents net cash provided by operating activities
Slide 18: 2008 Outlook Global Industry Production
2008 Outlook Global Industry Production* 2008 Industry Production Forecast (in millions of vehicles) Major Market 2008 B/(W) 2007 North America 13.5 (10)% Europe 20.3 1% China 7.9 14% Brazil 3.0 15% India 2.4 27% Russia 1.7 11% Global ˜ 70.0 up 2% 17.2 North American Production (in millions) 13.8 13
Slide 19: 2008 Outlook Full-Year Financial Forecast
2008 Outlook Full-Year Financial Forecast* 2008 Full-Year Financial Forecast Net Sales ˜ $15.0 billion Core Operating Earnings $550 to $600 million Income before interest, other expense, income taxes, restructuring costs and other special items Interest Expense $190 to $200 million Pretax Income $32
Slide 20: Committed Liquidity Until 2012
Committed Liquidity Until 2012* Debt Maturities Following July 2008 Bank Amendment ($ in millions) 1 1 2 4 3 1 Revolving line of credit of $1.3 billion, $468 million of which matures on March 23, 2010 and $822 million of which matures on January 31, 2012. 2 $1.0 billion term loan amortizes at $6.0m
Slide 21: Summary and Outlook
Summary and Outlook* Business structure improvements being aggressively implemented to improve long-term competitiveness: Aggressive actions to improve cost structure Continued sales diversification Further low-cost footprint expansion Selective vertical integration Adopted global operating structur
Slide 22: Advance Relentlessly
R ADVANCE RELENTLESSLY™ LEA Listed NYSE www.lear.com 22
Slide 23: Non-GAAP Financial Information
Non-GAAP Financial Information In addition to the results reported in accordance with accounting principles generally accepted in the United States (“GAAP”) included throughout this presentation, the Company has provided information regarding “income before interest, other expense and income taxes,”
Slide 24: Non-GAAP Financial Information: Core Operating Earnings
Non-GAAP Financial Information Core Operating Earnings Three Months (in millions) Q2 2008 Q2 2007 Pretax income $ 55.8 $ 143.9 Divestiture of Interior business - (0.7) Interest expense 45.6 51.3 Other expense, net * 4.1 0.3 Income before interest, other expense and income taxes $ 105.5 $ 194.8 Restr
Slide 25: Non-GAAP Financial Information: Segment Earnings Reconciliation
Non-GAAP Financial Information Segment Earnings Reconciliation Three Months Six Months (in millions) Q2 2008 Q2 2007 Q2 2008 Q2 2007 Seating $ 130.0 $ 238.8 $ 313.3 $ 435.9 Electrical and electronic 31.2 23.5 66.5 41.0 Interior - (0.6) - 8.2 Segment earnings 161.2 261.7 379.8 485.1 Corporate and geo
Slide 26: Non-GAAP Financial Information: Adjusted Segment Earnings
Non-GAAP Financial Information Adjusted Segment Earnings Three Months Q2 2008 Three Months Q2 2007 Electrical and Electrical and (in millions) Seating Electronic Seating Electronic Sales $ 3,141.2 $ 837.8 $ 3,264.5 $ 825.1 Segment earnings $ 130.0 $ 31.2 $ 238.8 $ 23.5 Costs related to restructuring
Slide 27: Non-GAAP Financial Information: Cash from Operations and Free Cash Flow
Non-GAAP Financial Information Cash from Operations and Free Cash Flow Three Months (in millions) Q2 2008 Net cash provided by operating activities $ 68.4 Net change in sold accounts receivable (2.7) Net cash provided by operating activities before net change in sold accounts receivable (cash from o
Slide 28: Forward-Looking Statements
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. Actual results may differ materially from anticipated results as a