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Lear profit beats on strong automobile demand in China – Metro US

Lear profit beats on strong automobile demand in China

U.S. auto part maker Lear Corp. plant safety measures to
U.S. auto part maker Lear Corp. plant safety measures to resume operations during COVID-19, in Ciudad Juarez

(Reuters) -U.S. auto parts maker Lear on Friday reported a better-than-expected first-quarter profit and raised its full-year outlook, helped by robust demand in key markets such as China, which is leading the sector’s recovery from the COVID-19 crisis.

Lear’s results come a day after rival Magna International Inc also beat estimates for quarterly results, driven by strong China demand.

Even as the health crisis has boosted demand for personal transport, a severe chip shortage has led car companies to cut production, capping sales growth at auto parts makers.

Lear said it now expects full-year sales between $20.35 billion and $21.15 billion, up from its prior forecast of $19.8 billion to $20.8 billion.

Lear, which counts General Motors Co and Ford among its top customers, makes automotive seating and electrical distribution systems that manage electrical power within a vehicle.

The company also raised its 2021 adjusted earnings before interest, taxes, depreciation, and amortization forecast to a range of $1.70 billion to $1.87 billion, from prior range of $1.69 billion to $1.86 billion.

On an adjusted basis, Lear earned $3.73 per share in the quarter ended April 3, beating analysts’ average estimate of $2.95 per share, according to IBES data from Refinitiv.

Net sales rose 20% to $5.4 billion, topping the Wall Street estimate of $4.89 billion.

(Reporting by Ankit Ajmera in Bengaluru; Editing by Shailesh Kuber)