Lear Corporation Business Report FY ended Dec. 2015
Business Highlights
Financial Overview |
(in million USD) |
| FY ended Dec. 31, 2015 | FY ended Dec. 31, 2014 | Rate of change (%) | Factors | |
| Overall | ||||
| Net Sales | 18,211.4 | 17,727.3 | 2.7 | 1) |
| Consolidated Net Income | 795.8 | 702.3 | 13.3 | - |
| Seating Segment | ||||
| Sales | 14,098.5 | 13,310.6 | 5.9 | 2) |
| Electrical Segment | ||||
| Sales | 4,112.9 | 4,416.7 | (6.9) | 3) |
Factors
1) Net Sales
-The Company's sales for the fiscal year ended December 31, 2015 increased by 2.7% over the previous year to USD 18,211.4 million. Positive impacts to the Company's sales included the acquisition of Eagle Ottawa, which increased sales by USD 820 million; new business in Europe, North America and Asia, which increased sales by USD 769 million; and increased production volumes in North America and Europe, which contributed an increase of USD 426 million. These gains were offset by negative foreign currency exchange effects, which decreased sales by approximately USD 1.5 billion.
2) Seating
-The Company's seating segment had sales of USD 14,098.5 million for the fiscal year ended December 31, 2015, an increase of 5.9% over the previous year. The acquisition of Eagle Ottawa, new business, and higher production volumes increased net sales by USD 820 million, 617 million, and 362 million, respectively. Negative currency exchange effects decreased sales by approximately USD 1.0 billion.
3) Electrical
-The Company's electrical segment's sales for the fiscal year ended December 31, 2015 were USD 4,112.9 million, a decrease of 6.9% from the previous year. New business and higher production volumes increased sales by USD 152 million and 64 million, respectively. However, these gains were offset by negative currency exchange effects, which decreased sales by USD 452 million.
Acquisitions
-The Company announced that it has acquired Arada Systems, a Troy, Michigan-based automotive technology company that specializes in Vehicle-to-Vehicle and Vehicle-to-Infrastructure (V2X) communications. Arada Systems has developed V2X software and hardware solutions utilizing its expertise in 5.9 GHz dedicated short range communications and other wireless communications protocols, notably GPS. Arada's V2X products include its LocoMate series of roadside units for infrastructure and on-board units for vehicles. (From a press release on November 30, 2015)
-The Company announced that it has acquired intellectual property and technology from Autonet Mobile, a Santa Rosa, California-based developer of software and devices for automotive applications. Autonet Mobile's technology directly connects on-board vehicle systems with cloud-based applications using proprietary data exchange capabilities via cellular networks. The acquired intellectual property and technology will complement the Company's wireless capabilities and provide growth opportunities for the Electrical segment. (From a press release on August 17, 2015)
-The Company announced the completion of its acquisition of Eagle Ottawa, a U.S.-based supplier of premium automotive leather. The transaction is valued at USD 850 million. (From a press release on January 5, 2015)
Outlook
-For the fiscal year ending December 31, 2016, the Company forecasts its net sales to be between USD 18.5 billion and USD 19.0 billion. The adjusted net income attributable to the Company is projected to be between USD 855 million and 895 million.
R&D Expenditure |
(in million USD) |
| FY ended Dec. 31, 2015 | FY ended Dec. 31, 2014 | FY ended Dec. 31, 2013 | |
| Overall | 127 | 102 | 108 |
R&D Structure
-The Company's electrical segment has over 2,000 engineers working in research and development.
-Advanced technology development is conducted worldwide at six advanced technology centers and at the Company's product engineering centers. The global innovation and technology center in Southfield, Michigan, U.S., is the Company's central facility for research and development.
R&D Facilities
-The Company announced the company has purchased a building in Detroit, Michigan to create an innovation and design center. The six-story, 35,000-square-foot building will be converted into a hub for art, creativity, advanced concept development, and hands-on learning for Detroit college students. The Company will work with the College for Creative Studies (CCS) to capitalize on its unique fabric, leather and sewing expertise to produce innovative car seating systems and vehicle interiors. It will also work with the Wayne State University College of Engineering to expand its electrical distribution systems and capabilities including connected car and alternative energy vehicle applications. The project is expected to complete in 2016. (From a press release on September 28, 2015)
Patents
-As of December 31, 2015, the Company has approximately 2,000 patents and patent applications pending.
Capital Expenditure |
(in million USD) |
| FY ended Dec. 31, 2015 | FY ended Dec. 31, 2014 | FY ended Dec. 31, 2013 | |
| Seating | 317.2 | 268.9 | 288.5 |
| Electrical | 134.4 | 138.4 | 163.4 |
| Other | 34.2 | 17.4 | 8.7 |
| Total | 485.8 | 424.7 | 460.6 |
-The Company expects to invest USD 525 million in capital expenditures for the fiscal year ending December 31, 2016.
Investments outside U.S.
<Macedonia>
-The Company announced its plans to open a new automotive plant to produce seat covers in Gostivar, Macedonia, in summer 2015. Serving all major European automotive manufacturers, the new facility will initially employ approximately 300 people and focus on leather and fabric cutting and sewing capabilities. The plant is expected to expand in the future. (From a press release on May 19, 2015)