Slide 1: Third Quarter 2022 Financial Results
Third Quarter 2022 Financial Results November 1, 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 Third Quarter 2022
Financial Overview Third Quarter 2022 $5.2B $235M $2.33 $252M SALES CORE OPERATING ADJUSTED OPERATING EARNINGS EARNINGS PER SHARE CASH FLOW Q3 2021 $4.3B Q3 2021 $98M Q3 2021 $0.53 Q3 2021 $(4)M Lear Proprietary: The information contained herein is the property of Lear Corporation. Please see append
Slide 6: Third Quarter and Year-to-Date 2022 Business Highlights
Third Quarter and Year-to-Date 2022 Business Highlights Year-to-date sales have outperformed global industry production by 4 percentage points with above market growth in both Seating and E-Systems Selected by General Motors to exclusively supply the Battery Disconnect Unit (BDU) on all full-size SU
Slide 7: Seating Update
Seating Update • Launched production at new just-in-time seating plant in Detroit to support electric vehicle production at GM Factory Zero • Developed alternative materials to drive sustainability - Awarded two development contracts with separate OEMs for Lear’s proprietary foam alternative - Annou
Slide 8: Lear Developed Electrification Products Driving Growth
Lear Developed Electrification Products Driving Growth BATTERY DISCONNECT UNITS (BDU) INTERCELL CONNECT BOARDS (ICB) • The primary interface between an electric • Electrical and mechanical frames connect vehicle’s battery pack and the electrical system multiple battery cells to form an integrated ba
Slide 9: Financial Review
Financial Review Jason Cardew Senior Vice President and CFO
Slide 10: Global Vehicle Production and Currency
Third Quarter 2022 Global Vehicle Production and Currency INDUSTRY PRODUCTION (units in millions) GLOBAL NORTH AMERICA EUROPE AND AFRICA CHINA Q3 2021 16.2 Q3 2021 3.0 Q3 2021 3.1 Q3 2021 5.1 Q3 2022 20.8 Q3 2022 3.7 Q3 2022 3.7 Q3 2022 6.9 UP 29% YOY UP 24% YOY UP 20% YOY UP 35% YOY KEY CURRENCIES
Slide 11: Growth Over Market
Growth Over Market Third Quarter 2022 1% Q3 2022 4% YTD 2022 12% EUROPE Global GoM • Seating: Backlog partially offset by unfavorable platform mix • E-Systems: Backlog and (2)% NORTH AMERICA favorable platform mix (5)% CHINA FLAT Q3 2022 • Seating: Unfavorable 4% YTD 2022 platform mix partially • Se
Slide 12: Key Financials Third Quarter 2022
Key Financials Third Quarter 2022 ($ in millions, except per share amounts) 2021 2022 YEAR-OVER-YEAR DRIVERS Increased volume, strong backlog and commodity pass- Net Sales $4,268 $5,241 through, partially offset by the impact from foreign exchange Core Operating Earnings $98 $235 Increased sales and
Slide 13: Seating Sales and Margin Drivers
Seating Sales and Margin Drivers Third Quarter 2022 SALES ADJUSTED EARNINGS AND MARGIN ($ in millions) ($ in millions) $86 $211 35 bps $59 $3,888 45 bps $603 210 bps 6.6% (10) bps (25) bps $(237) (45) bps $255 4.5% $3,166 $144 Q3 2021 Volume / Backlog Commodities FX Acquisitions Q3 2022 Q3 2021 Volu
Slide 14: E-Systems Sales and Margin Drivers
E-Systems Sales and Margin Drivers Third Quarter 2022 SALES ADJUSTED EARNINGS AND MARGIN ($ in millions) ($ in millions) 120 bps $62 $110 230 bps 75 bps 3.9% $1,353 $203 $(124) (210) bps $53 (35) bps $1,102 2.1% $23 Q3 2021 Volume / Backlog Commodities FX Q3 2022 Q3 2021 Volume / Backlog Commodities
Slide 15: 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 79.9 FY 2022 14.4 FY 2022 15.9 FY 2022 25.0 vs Prior Year vs Prior Year vs Prior Year vs Prior Year U
Slide 16: 2022 Full Year Outlook
2022 Full Year Outlook Unchanged from prior outlook Net Sales Interest Expense Operating Cash Flow $20,550 - $21,050 million ≈$105 million $950 - $1,075 million Effective Tax Rate ≈21% Core Operating Earnings Capital Spending $815 - $915 million $675 - $700 million Adjusted Net Income $465 - $545 mi
Slide 17: Operating Cash Flow and Capital Allocation
Operating Cash Flow and Capital Allocation CAPITAL ALLOCATION STRATEGY DEBT MATURITIES Strong Balance Sheet ($ in millions) $2,000 • No outstanding debt maturities until 2027 • Low cost of debt averaging less than 4% with a weighted average life of 14.6 years Available Revolver Bonds • Total availab
Slide 18: Company Specific Drivers Improving Operating Performance
Company Specific Drivers Improving Operating Performance PRODUCT AND COMMERCIAL STRATEGY LEAR FORWARD PLAN • Growing Connection Systems and BDU opportunities • Improve capacity utilization and flexibility in manufacturing plants • Thermal Comfort execution and cost synergies • Realize overhead and S
Slide 19: Concluding Remarks
Concluding Remarks Ray Scott President and CEO
Slide 20: Lear Strategically Positioned to Drive Value for Shareholders
Lear Strategically Positioned to Drive Value for Shareholders Global Leader in Seating Growing E-Systems Business • Growing 25% global market share with 45% share in luxury • Diverse product portfolio aligned with electrification, safety and autonomy trends • Most vertically integrated seat manufact
Slide 21: Appendix
Appendix
Slide 22: 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
Slide 23: Non-GAAP
Non-GAAP Lear Proprietary: The information contained herein is the property of Lear Corporation. 23
Slide 24: Non-GAAP
Non-GAAP Lear Proprietary: The information contained herein is the property of Lear Corporation. 24
Slide 25: Non-GAAP
Non-GAAP Lear Proprietary: The information contained herein is the property of Lear Corporation. 25
Slide 26: Non-GAAP
Non-GAAP Lear Proprietary: The information contained herein is the property of Lear Corporation. 26