Slide 1: Fourth-Quarter and Full-Year 2007 Results/2008 Financial Outlook
Exhibit 99.2 advance relentlessly® Fourth-Quarter and Full-Year 2007 Results/2008 Financial Outlook January 31, 2008
Slide 2: Agenda
Agenda Fourth-Quarter and Full-Year 2007 Results/ 2008 Financial Outlook Matt Simoncini, SVP and Chief Financial Officer Strategic Objectives / Electrical and Electronic Business Review Dan Ninivaggi, Executive Vice President Business Assessment and Outlook Jim Vandenberghe, Vice Chairman Q and A Se
Slide 3: Fourth-Quarter and Full-Year 2007 Results/2008 Financial Outlook
Fourth-Quarter and Full-Year 2007 Results/ 2008 Financial Outlook 3
Slide 4: 2007 Results – Core Businesses Financial Highlights
2007 Results – Core Businesses Financial Highlights* Fourth-Quarter 2007 Net sales of $3.9 billion, up 6% Core operating earnings of $179 million, up 11% Free cash flow of $171 million Full-Year 2007 Net sales of $15.3 billion, up 5% Core operating earnings of $749 million, up 34% Free cash flow of
Slide 5: 2007 Results Fourth Quarter Industry Environment
2007 Results Fourth Quarter Industry Environment Fourth Quarter Fourth Quarter 2007 2007 vs. 2006 North American Production Industry 3.6 mil up 1% Domestic Three 2.3 mil down 2% Lear’s Top 15 Platforms 1.0 mil down 7% European Production Industry 5.0 mil up 5% Lear's Top 5 Customers 2.6 mil up 4% Ke
Slide 6: 2007 Results Fourth Quarter Reported Financials
2007 Results Fourth Quarter Reported Financials Fourth Fourth 4Q '07 [in millions, except net income (loss) per share] Quarter 2007 Quarter 2006 B/(W) 4Q '06 Net Sales $3,859.0 $4,280.5 ($421.5) Income Before Interest, Other (Income) Expense and Income Taxes* $86.6 $84.8 $1.8 Pretax Income (Loss) $4
Slide 7: Fourth Quarter Restructuring/Special Items
2007 Results Fourth Quarter Restructuring/Special Items* Fourth Quarter Income Before Interest, (in millions) Other (Income) Expense and Income Taxes Reported Results 2007 Total Company $ 86.6 Income Statement Category Reported Results Include the Following Items: COGS SG&A Costs related to restruct
Slide 8: Fourth Quarter Net Sales Changes and Margin Impact
2007 Results Fourth Quarter Net Sales Changes and Margin Impact Net Sales Margin Performance Factor Change Impact Comments (in millions) Industry Production / $ (178) Negative Unfavorable platform mix, primarily in Platform Mix / Net Pricing North America Global New Business 156 Positive Primarily o
Slide 9: 2007 Results – Seating Systems Fourth Quarter and Full Year Performance
2007 Results – Seating Systems Fourth Quarter and Full Year Performance* Adjusted Seating Segment Margins Fourth Quarter Full Year 7.0% 6.7% 6.7% 5.6% Q4 2006 Q4 2007 2006 2007 (in millions) (in millions) Sales $2,903.2 $3,066.0 Sales $11,624.8 $12,206.1 Earnings** $ 181.0 $ 141.6 Earnings** $ 604.0
Slide 10: 2007 Results – Electrical and Electronic Fourth Quarter and Full Year Performance
2007 Results – Electrical and Electronic Fourth Quarter and Full Year Performance* Adjusted Electrical and Electronic Segment Margins Fourth Quarter Full Year 4.9% 3.6% 2.7% 2.4% Q4 2006 Q4 2007 2006 2007 (in millions) (in millions) Sales $ 739.3 $ 793.0 Sales $2,996.9 $3,100.0 Earnings** $ (5.1) $
Slide 11: 2007 Results Fourth Quarter and Full Year Free Cash Flow
2007 Results Fourth Quarter and Full Year Free Cash Flow* (in millions) Fourth Full Year Quarter 2007 2007 Net Income $ 27.0 $ 241.5 Depreciation / Amortization 76.0 296.9 Working Capital / Other 156.0 97.4 Cash from Operations $ 259.0 $ 635.8 Capital Expenditures (88.1) (202.2) Free Cash Flow $ 170
Slide 12: 2008 Outlook Full-Year Production Assumptions
2008 Outlook Full-Year Production Assumptions* Full-Year Change from 2008 Outlook Prior Year North American Production Total Industry ~14.4 mil down 4% Domestic Three ~ ~8.6 mil down 9% Lear’s Top 15 Platforms ~ ~3.6 mil down 12% European Production Total Industry ~ ~20.1 mil flat Lear’s Top 5 Custo
Slide 13: 2008 Outlook Full-Year Financial Forecast
2008 Outlook Full-Year Financial Forecast* 2008 Full-Year Financial Forecast Net Sales ˜˜ $15 billion Core Operating Earnings $660 to $700 million Income before interest, other expense, income taxes, restructuring costs and other special items Interest Expense $185 to $195 million Pretax Income $430
Slide 14: Sales Backlog Update
Sales Backlog Update* 2008 – 2010 Sales Backlog** Composition of Sales Backlog** (in millions) By Product: Seating -- $205M Electrical and Electronic -- $435M ~ ~ $640 By Region: North America -- $(290)M Europe -- $550M ~ ~ $330 ~ Asia -- $280M ~ $250 South America -- $100M ~ $60 ~ By Customer Type:
Slide 15: Strategic Objectives / Electrical and Electronic Business Review
Strategic Objectives / Electrical and Electronic Business Review 15
Slide 16: Strategic Objectives
Strategic Objectives* Leadership Position in Seating #1 market position in North America, Europe, China and India Well-diversified sales mix – balanced customer, market and platform representation Selectively increased vertical integration in key components Technology/technical solution leader in al
Slide 17: Electrical and Electronic History and Business Profile
Electrical and Electronic History and Business Profile Electrical Distribution $2.2 billion Acquired from United Technologies in 1999 Present global sales of $3.1 billion Electronics $0.9 billion Business Profile Electrical Distribution Systems Electronic Products Among leaders in wire harnesses: Le
Slide 18: Electrical and Electronic Market Environment – Electrical Distribution
Electrical and Electronic Market Environment – Electrical Distribution Highly competitive segment, presently Top-Five Wire Harness undergoing major restructuring and Suppliers consolidation Global scale and low-cost footprint are critical success factors 1. Yazaki Market share and margin pressure as
Slide 19: Electrical and Electronic Market Opportunity
Electrical and Electronic Market Opportunity* External Factors Power and signal distribution is a critical system in improving vehicle functionality Consumer demand for electronic content in vehicles is continuing to increase Business Assessment Emerging powertrain technologies (e.g., hybrid, fuel c
Slide 20: Electrical and Electronic Lear's Improvement Plan
Electrical and Electronic Lear’s Improvement Business Assessment Plan* Lear has Increase implemented Global Scale a number of significant actions to reposition its business Sales backlog for future of $435 million success through and improved 2010; significant opportunity shareholder value for sales
Slide 21: Electrical and Electronic Business Assessment: Since 2005, Lear Has...
Electrical Since and 2005, Electronic Lear Has . . . * Business Improved Assessment Net Sales AndbyCore Region Operating Earnings** Net Sales* Core Operating Earnings* North America [return to positive] (in billions) (in millions) Presently underperforming, reflecting several lost programs and $749
Slide 22: Restored Cash Flow and Strengthened Balance Sheet
Restored Electrical Free Cash Flow and and Electronic Strengthened * Our Balance Outlook for Business Sheet* Free Cash Flow** $434 Cash Balance (in millions) (in millions) $601 $503 Significant $116 new business coming on-line $197 Competitive low-cost footprint globally ($419) Improved 2005 custome
Slide 23: Continuing To Diversify Our Sales Mix
Continuing To Diversify Our Sales Mix 2006 2007 Europe Geographic Europe 36% 43% Rest of World North America Rest of World North America 9% 55% 12% 45% Customer Classic Ford & GM Saab, Volvo, Jaguar and Land Rover Classic Ford & GM 42% 7% 47% Chrysler 6% BMW Fiat All Other All Other Porsche PSA VW 5
Slide 24: Summary and Outlook
Summary and Outlook* 2007 represents second consecutive year of financial improvement: Net sales in core business of $15.3 billion, up 5% Core operating earnings of $749 million, up 34% Free cash flow of $434 million – best since 2003 No significant near-term debt maturities Business structure impro
Slide 25: Advance Relentlessly
R ADVANCE RELENTLESSLY™ LEA Listed NYSE www.lear.com 29
Slide 26: 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 (income) expense and incom
Slide 27: Non-GAAP Financial Information Core Operating Earnings
Non-GAAP Financial Information Core Operating Earnings Three Months Ended Full Year (in millions) Q4 2007 Q4 2006 2007 2006 2005 Pretax income (loss) $ 45.1 $ (635.9) $ 331.4 $ (655.5) $ (1,187.2) Divestiture of Interior business 2.9 607.3 10.7 636.0 - Interest expense 48.9 52.3 199.2 209.8 183.2 Ot
Slide 28: Non-GAAP Financial Information Segment Earnings Reconciliation
Non-GAAP Financial Information Segment Earnings Reconciliation Three Months Full Year (in millions) Q4 2007 Q4 2006 2007 2006 Seating $ 141.6 $ 181.0 $ 758.7 $ 604.0 Electrical and electronic (4.2) (5.1) 40.8 102.5 Interior - (34.2) 8.2 (183.8) Segment earnings 137.4 141.7 807.7 522.7 Corporate and
Slide 29: Non-GAAP Financial Information Adjusted Segment Earnings
Non-GAAP Financial Information Adjusted Segment Earnings Three Months Q4 2007 Three Months Q4 2006 Electrical and Electrical and (in millions) Seating Electronic Seating Electronic Sales $ 3,066.0 $ 793.0 $ 2,903.2 $ 739.3 Segment earnings $ 141.6 $ (4.2) $ 181.0 $ (5.1) Costs related to restructuri
Slide 30: 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) Q4 2007 Full Year 2007 Full Year 2006 Full Year 2005 Net cash provided by operating activities $ 157.4 $ 466.9 $ 285.3 $ 560.8 Net change in sold accounts receivable 101.6 168.9 178.0 (411.1) Net cash p
Slide 31: Non-GAAP Financial Information Net Debt
Non-GAAP Financial Information Net Debt December 31, (in millions) 2007 2006 2005 Short-term borrowings $ 13.9 $ 39.3 $ 23.4 Current portion of long-term debt 96.1 25.6 9.4 Long-term debt 2,344.6 2,434.5 2,243.1 Total debt 2,454.6 2,499.4 2,275.9 Utilization under ABS and A/R factoring facilities 10
Slide 32: 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