|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
13-3386776
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
||
21557 Telegraph Road, Southfield, MI
|
|
48033
|
(Address of principal executive offices)
|
|
(Zip code)
|
Large accelerated filer
|
x
|
|
|
Accelerated filer
|
¨
|
Non-accelerated filer
|
¨
|
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
|
¨
|
Emerging growth company
|
¨
|
|
|
|
|
|
|
Page No.
|
|
|
|
|
Item 3 – Quantitative and Qualitative Disclosures about Market Risk (included in Item 2)
|
|
|
|
(1)
|
Unaudited.
|
|
Three Months Ended
|
||||||
|
April 1,
2017 |
|
April 2,
2016 |
||||
Net sales
|
$
|
4,998.5
|
|
|
$
|
4,662.9
|
|
|
|
|
|
||||
Cost of sales
|
4,416.0
|
|
|
4,127.2
|
|
||
Selling, general and administrative expenses
|
155.7
|
|
|
149.0
|
|
||
Amortization of intangible assets
|
10.1
|
|
|
13.2
|
|
||
Interest expense
|
20.8
|
|
|
21.1
|
|
||
Other expense, net
|
3.7
|
|
|
8.5
|
|
||
Consolidated income before provision for income taxes and equity in net income of affiliates
|
392.2
|
|
|
343.9
|
|
||
Provision for income taxes
|
89.1
|
|
|
98.2
|
|
||
Equity in net income of affiliates
|
(15.4
|
)
|
|
(16.8
|
)
|
||
Consolidated net income
|
318.5
|
|
|
262.5
|
|
||
Less: Net income attributable to noncontrolling interests
|
12.7
|
|
|
14.1
|
|
||
Net income attributable to Lear
|
$
|
305.8
|
|
|
$
|
248.4
|
|
|
|
|
|
||||
Basic net income per share attributable to Lear
|
$
|
4.39
|
|
|
$
|
3.33
|
|
|
|
|
|
||||
Diluted net income per share attributable to Lear
|
$
|
4.35
|
|
|
$
|
3.29
|
|
|
|
|
|
||||
Cash dividends declared per share
|
$
|
0.50
|
|
|
$
|
0.30
|
|
|
|
|
|
||||
Average common shares outstanding
|
69,658,368
|
|
|
74,689,475
|
|
||
|
|
|
|
||||
Average diluted shares outstanding
|
70,327,348
|
|
|
75,474,339
|
|
||
|
|
|
|
||||
|
|
|
|
||||
Consolidated comprehensive income (Note 13)
|
$
|
422.1
|
|
|
$
|
332.2
|
|
Less: Comprehensive income attributable to noncontrolling interests
|
13.8
|
|
|
14.3
|
|
||
Comprehensive income attributable to Lear
|
$
|
408.3
|
|
|
$
|
317.9
|
|
|
Three Months Ended
|
||||||
|
April 1,
2017 |
|
April 2,
2016 |
||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Consolidated net income
|
$
|
318.5
|
|
|
$
|
262.5
|
|
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
96.9
|
|
|
90.2
|
|
||
Net change in recoverable customer engineering, development and tooling
|
7.4
|
|
|
5.2
|
|
||
Net change in working capital items (see below)
|
(145.3
|
)
|
|
(77.5
|
)
|
||
Other, net
|
1.4
|
|
|
8.2
|
|
||
Net cash provided by operating activities
|
278.9
|
|
|
288.6
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Additions to property, plant and equipment
|
(120.8
|
)
|
|
(88.1
|
)
|
||
Other, net
|
(7.9
|
)
|
|
(1.8
|
)
|
||
Net cash used in investing activities
|
(128.7
|
)
|
|
(89.9
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Credit agreement repayments
|
(6.2
|
)
|
|
(3.1
|
)
|
||
Short-term borrowings, net
|
1.4
|
|
|
2.6
|
|
||
Repurchase of common stock
|
(115.6
|
)
|
|
(154.7
|
)
|
||
Dividends paid to Lear Corporation stockholders
|
(36.7
|
)
|
|
(25.3
|
)
|
||
Dividends paid to noncontrolling interests
|
(26.5
|
)
|
|
—
|
|
||
Other, net
|
(41.7
|
)
|
|
(51.0
|
)
|
||
Net cash used in financing activities
|
(225.3
|
)
|
|
(231.5
|
)
|
||
Effect of foreign currency translation
|
13.2
|
|
|
10.3
|
|
||
Net Change in Cash and Cash Equivalents
|
(61.9
|
)
|
|
(22.5
|
)
|
||
Cash and Cash Equivalents as of Beginning of Period
|
1,271.6
|
|
|
1,196.6
|
|
||
Cash and Cash Equivalents as of End of Period
|
$
|
1,209.7
|
|
|
$
|
1,174.1
|
|
|
|
|
|
||||
Changes in Working Capital Items:
|
|
|
|
||||
Accounts receivable
|
$
|
(526.6
|
)
|
|
$
|
(410.5
|
)
|
Inventories
|
(35.4
|
)
|
|
(41.8
|
)
|
||
Accounts payable
|
374.7
|
|
|
240.8
|
|
||
Accrued liabilities and other
|
42.0
|
|
|
134.0
|
|
||
Net change in working capital items
|
$
|
(145.3
|
)
|
|
$
|
(77.5
|
)
|
|
|
|
|
||||
Supplementary Disclosure:
|
|
|
|
||||
Cash paid for interest
|
$
|
42.6
|
|
|
$
|
40.9
|
|
Cash paid for income taxes, net of refunds received
|
$
|
65.1
|
|
|
$
|
41.4
|
|
|
|
|
|
Purchase price paid, net of cash acquired
|
|
$
|
148.5
|
|
|
|
|
||
Property, plant and equipment
|
|
$
|
12.7
|
|
Other assets purchased and liabilities assumed, net
|
|
9.9
|
|
|
Goodwill
|
|
72.9
|
|
|
Intangible assets
|
|
53.0
|
|
|
Preliminary purchase price allocation
|
|
$
|
148.5
|
|
|
Accrual as of
|
|
2017
|
|
Utilization
|
|
Accrual as of
|
||||||||||||
|
January 1, 2017
|
|
Charges
|
|
Cash
|
|
Non-cash
|
|
April 1, 2017
|
||||||||||
Employee termination benefits
|
$
|
69.4
|
|
|
$
|
6.1
|
|
|
$
|
(6.2
|
)
|
|
$
|
—
|
|
|
$
|
69.3
|
|
Asset impairment charges
|
—
|
|
|
0.1
|
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|||||
Contract termination costs
|
4.6
|
|
|
0.3
|
|
|
(0.3
|
)
|
|
—
|
|
|
4.6
|
|
|||||
Other related costs
|
—
|
|
|
1.2
|
|
|
(1.2
|
)
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
74.0
|
|
|
$
|
7.7
|
|
|
$
|
(7.7
|
)
|
|
$
|
(0.1
|
)
|
|
$
|
73.9
|
|
|
April 1,
2017 |
|
December 31, 2016
|
||||
Raw materials
|
$
|
768.5
|
|
|
$
|
746.3
|
|
Work-in-process
|
118.3
|
|
|
106.4
|
|
||
Finished goods
|
181.0
|
|
|
167.9
|
|
||
Inventories
|
$
|
1,067.8
|
|
|
$
|
1,020.6
|
|
|
April 1,
2017 |
|
December 31, 2016
|
||||
Current
|
$
|
182.8
|
|
|
$
|
185.9
|
|
Long-term
|
41.6
|
|
|
43.4
|
|
||
Recoverable customer E&D and tooling
|
$
|
224.4
|
|
|
$
|
229.3
|
|
|
April 1,
2017 |
|
December 31, 2016
|
||||
Land
|
$
|
102.7
|
|
|
$
|
101.7
|
|
Buildings and improvements
|
681.4
|
|
|
648.1
|
|
||
Machinery and equipment
|
2,554.0
|
|
|
2,459.6
|
|
||
Construction in progress
|
299.8
|
|
|
296.4
|
|
||
Total property, plant and equipment
|
3,637.9
|
|
|
3,505.8
|
|
||
Less – accumulated depreciation
|
(1,567.2
|
)
|
|
(1,486.5
|
)
|
||
Property, plant and equipment, net
|
$
|
2,070.7
|
|
|
$
|
2,019.3
|
|
|
Seating
|
|
E-Systems
|
|
Total
|
||||||
Balance at January 1, 2017
|
$
|
1,091.2
|
|
|
$
|
30.1
|
|
|
$
|
1,121.3
|
|
Foreign currency translation and other
|
8.1
|
|
|
—
|
|
|
8.1
|
|
|||
Balance at April 1, 2017
|
$
|
1,099.3
|
|
|
$
|
30.1
|
|
|
$
|
1,129.4
|
|
|
April 1, 2017
|
|
December 31, 2016
|
||||||||||||||||||||||||
Debt Instrument
|
Long-Term Debt
|
|
Debt Issuance Costs
(1)
|
|
Long-Term
Debt, Net
|
|
Weighted
Average
Interest
Rate
|
|
Long-Term Debt
|
|
Debt Issuance Costs
(1)
|
|
Long-Term
Debt, Net
|
|
Weighted
Average
Interest
Rate
|
||||||||||||
Credit Agreement — Term Loan Facility
|
$
|
462.5
|
|
|
$
|
(1.5
|
)
|
|
$
|
461.0
|
|
|
2.325%
|
|
$
|
468.7
|
|
|
$
|
(1.6
|
)
|
|
$
|
467.1
|
|
|
2.105%
|
4.75% Senior Notes due 2023 ("2023 Notes")
|
500.0
|
|
|
(4.6
|
)
|
|
495.4
|
|
|
4.75%
|
|
500.0
|
|
|
(4.8
|
)
|
|
495.2
|
|
|
4.75%
|
||||||
5.375% Senior Notes due 2024 ("2024 Notes")
|
325.0
|
|
|
(2.7
|
)
|
|
322.3
|
|
|
5.375%
|
|
325.0
|
|
|
(2.8
|
)
|
|
322.2
|
|
|
5.375%
|
||||||
5.25% Senior Notes due 2025 ("2025 Notes")
|
650.0
|
|
|
(6.4
|
)
|
|
643.6
|
|
|
5.25%
|
|
650.0
|
|
|
(6.6
|
)
|
|
643.4
|
|
|
5.25%
|
||||||
Other
|
5.5
|
|
|
—
|
|
|
5.5
|
|
|
N/A
|
|
5.7
|
|
|
—
|
|
|
5.7
|
|
|
N/A
|
||||||
|
$
|
1,943.0
|
|
|
$
|
(15.2
|
)
|
|
1,927.8
|
|
|
|
|
$
|
1,949.4
|
|
|
$
|
(15.8
|
)
|
|
1,933.6
|
|
|
|
||
Less — Current portion
|
|
|
|
|
(38.8
|
)
|
|
|
|
|
|
|
|
(35.6
|
)
|
|
|
||||||||||
Long-term debt
|
|
|
|
|
$
|
1,889.0
|
|
|
|
|
|
|
|
|
$
|
1,898.0
|
|
|
|
Note
|
Issuance Date
|
|
Maturity Date
|
|
Interest Payable Dates
|
2023 Notes
|
January 2013
|
|
January 15, 2023
|
|
January 15 and July 15
|
2024 Notes
|
March 2014
|
|
March 15, 2024
|
|
March 15 and September 15
|
2025 Notes
|
November 2014
|
|
January 15, 2025
|
|
January 15 and July 15
|
|
Three Months Ended
|
||||||||||||||
|
April 1, 2017
|
|
April 2, 2016
|
||||||||||||
|
U.S.
|
|
Foreign
|
|
U.S.
|
|
Foreign
|
||||||||
Service cost
|
$
|
1.3
|
|
|
$
|
1.7
|
|
|
$
|
1.4
|
|
|
$
|
1.5
|
|
Interest cost
|
5.4
|
|
|
3.8
|
|
|
7.4
|
|
|
3.9
|
|
||||
Expected return on plan assets
|
(7.2
|
)
|
|
(5.6
|
)
|
|
(9.5
|
)
|
|
(5.6
|
)
|
||||
Amortization of actuarial loss
|
0.6
|
|
|
1.2
|
|
|
0.7
|
|
|
0.7
|
|
||||
Settlement loss
|
0.2
|
|
|
0.8
|
|
|
0.2
|
|
|
—
|
|
||||
Net periodic benefit cost
|
$
|
0.3
|
|
|
$
|
1.9
|
|
|
$
|
0.2
|
|
|
$
|
0.5
|
|
|
Three Months Ended
|
||||||||||||||
|
April 1, 2017
|
|
April 2, 2016
|
||||||||||||
|
U.S.
|
|
Foreign
|
|
U.S.
|
|
Foreign
|
||||||||
Service cost
|
$
|
—
|
|
|
$
|
0.1
|
|
|
$
|
—
|
|
|
$
|
0.1
|
|
Interest cost
|
0.6
|
|
|
0.4
|
|
|
0.8
|
|
|
0.4
|
|
||||
Amortization of actuarial (gain) loss
|
(0.6
|
)
|
|
0.1
|
|
|
(0.3
|
)
|
|
0.1
|
|
||||
Amortization of prior service credit
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
(0.1
|
)
|
||||
Net periodic benefit cost
|
$
|
—
|
|
|
$
|
0.5
|
|
|
$
|
0.5
|
|
|
$
|
0.5
|
|
|
Three Months Ended
|
||||||
|
April 1,
2017 |
|
April 2,
2016 |
||||
Provision for income taxes
|
$
|
89.1
|
|
|
$
|
98.2
|
|
Pretax income before equity in net income of affiliates
|
$
|
392.2
|
|
|
$
|
343.9
|
|
Effective tax rate
|
22.7
|
%
|
|
28.6
|
%
|
|
Three Months Ended
|
||||||
|
April 1,
2017 |
|
April 2,
2016 |
||||
Net income attributable to Lear
|
$
|
305.8
|
|
|
$
|
248.4
|
|
|
|
|
|
||||
Average common shares outstanding
|
69,658,368
|
|
|
74,689,475
|
|
||
Dilutive effect of common stock equivalents
|
668,980
|
|
|
784,864
|
|
||
Average diluted shares outstanding
|
70,327,348
|
|
|
75,474,339
|
|
||
|
|
|
|
||||
Basic net income per share attributable to Lear
|
$
|
4.39
|
|
|
$
|
3.33
|
|
|
|
|
|
||||
Diluted net income per share attributable to Lear
|
$
|
4.35
|
|
|
$
|
3.29
|
|
|
Three Months Ended April 1, 2017
|
||||||||||
|
Equity
|
|
Lear
Corporation
Stockholders'
Equity
|
|
Non-
controlling
Interests
|
||||||
Beginning equity balance
|
$
|
3,192.9
|
|
|
$
|
3,057.2
|
|
|
$
|
135.7
|
|
Stock-based compensation transactions
|
(25.8
|
)
|
|
(25.8
|
)
|
|
—
|
|
|||
Repurchase of common stock
|
(127.5
|
)
|
|
(127.5
|
)
|
|
—
|
|
|||
Dividends declared to Lear Corporation stockholders
|
(35.7
|
)
|
|
(35.7
|
)
|
|
—
|
|
|||
Dividends declared to noncontrolling interest holders
|
(17.0
|
)
|
|
—
|
|
|
(17.0
|
)
|
|||
Adoption of ASU 2016-09 (Note 11, "Taxes")
|
54.5
|
|
|
54.5
|
|
|
—
|
|
|||
Comprehensive income:
|
|
|
|
|
|
|
|||||
Net income
|
318.5
|
|
|
305.8
|
|
|
12.7
|
|
|||
Other comprehensive income, net of tax:
|
|
|
|
|
|
|
|||||
Defined benefit plan adjustments
|
0.7
|
|
|
0.7
|
|
|
—
|
|
|||
Derivative instruments and hedging activities
|
52.1
|
|
|
52.1
|
|
|
—
|
|
|||
Foreign currency translation adjustments
|
50.8
|
|
|
49.7
|
|
|
1.1
|
|
|||
Other comprehensive income
|
103.6
|
|
|
102.5
|
|
|
1.1
|
|
|||
Comprehensive income
|
422.1
|
|
|
408.3
|
|
|
13.8
|
|
|||
Ending equity balance
|
$
|
3,463.5
|
|
|
$
|
3,331.0
|
|
|
$
|
132.5
|
|
|
Three Months Ended
April 1, 2017 |
||
Defined benefit plans:
|
|
||
Balance at beginning of period
|
$
|
(192.8
|
)
|
Reclassification adjustments (net of tax expense of $0.5 million)
|
1.7
|
|
|
Other comprehensive loss recognized during the period (net of tax impact of $— million)
|
(1.0
|
)
|
|
Balance at end of period
|
$
|
(192.1
|
)
|
|
|
||
Derivative instruments and hedging:
|
|
||
Balance at beginning of period
|
$
|
(45.1
|
)
|
Reclassification adjustments (net of tax expense of $3.0 million)
|
8.8
|
|
|
Other comprehensive income recognized during the period (net of tax expense of $14.7 million)
|
43.3
|
|
|
Balance at end of period
|
$
|
7.0
|
|
|
|
||
Foreign currency translation:
|
|
||
Balance at beginning of period
|
$
|
(597.7
|
)
|
Other comprehensive income recognized during the period (net of tax impact of $— million)
|
49.7
|
|
|
Balance at end of period
|
$
|
(548.0
|
)
|
|
Three Months Ended April 2, 2016
|
||||||||||
|
Equity
|
|
Lear
Corporation
Stockholders'
Equity
|
|
Non-
controlling
Interests
|
||||||
Beginning equity balance
|
$
|
3,017.7
|
|
|
$
|
2,927.4
|
|
|
$
|
90.3
|
|
Stock-based compensation transactions
|
(27.7
|
)
|
|
(27.7
|
)
|
|
—
|
|
|||
Repurchase of common stock
|
(154.7
|
)
|
|
(154.7
|
)
|
|
—
|
|
|||
Dividends declared to Lear Corporation stockholders
|
(23.1
|
)
|
|
(23.1
|
)
|
|
—
|
|
|||
Non-controlling interests — other
|
—
|
|
|
(2.2
|
)
|
|
2.2
|
|
|||
Comprehensive income:
|
|
|
|
|
|
||||||
Net income
|
262.5
|
|
|
248.4
|
|
|
14.1
|
|
|||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Defined benefit plan adjustments
|
(2.8
|
)
|
|
(2.8
|
)
|
|
—
|
|
|||
Derivative instruments and hedging activities
|
2.0
|
|
|
2.0
|
|
|
—
|
|
|||
Foreign currency translation adjustments
|
70.5
|
|
|
70.3
|
|
|
0.2
|
|
|||
Other comprehensive income
|
69.7
|
|
|
69.5
|
|
|
0.2
|
|
|||
Comprehensive income
|
332.2
|
|
|
317.9
|
|
|
14.3
|
|
|||
Ending equity balance
|
$
|
3,144.4
|
|
|
$
|
3,037.6
|
|
|
$
|
106.8
|
|
|
Three Months Ended
April 2, 2016 |
||
Defined benefit plans:
|
|
||
Balance at beginning of period
|
$
|
(194.6
|
)
|
Reclassification adjustments (net of tax expense of $0.2 million)
|
1.1
|
|
|
Other comprehensive loss recognized during the period (net of tax impact of $— million)
|
(3.9
|
)
|
|
Balance at end of period
|
$
|
(197.4
|
)
|
|
|
||
Derivative instruments and hedging:
|
|
||
Balance at beginning of period
|
$
|
(38.7
|
)
|
Reclassification adjustments (net of tax expense of $4.9 million)
|
13.6
|
|
|
Other comprehensive loss recognized during the period (net of tax benefit of $4.2 million)
|
(11.6
|
)
|
|
Balance at end of period
|
$
|
(36.7
|
)
|
|
|
||
Foreign currency translation:
|
|
||
Balance at beginning of period
|
$
|
(496.8
|
)
|
Other comprehensive income recognized during the period (net of tax impact of $— million)
|
70.3
|
|
|
Balance at end of period
|
$
|
(426.5
|
)
|
Balance at January 1, 2017
|
$
|
49.1
|
|
Expense, net (including changes in estimates)
|
7.8
|
|
|
Settlements
|
(2.9
|
)
|
|
Foreign currency translation and other
|
0.7
|
|
|
Balance at April 1, 2017
|
$
|
54.7
|
|
|
Three Months Ended April 1, 2017
|
||||||||||||||
|
Seating
|
|
E-Systems
|
|
Other
|
|
Consolidated
|
||||||||
Revenues from external customers
|
$
|
3,868.0
|
|
|
$
|
1,130.5
|
|
|
$
|
—
|
|
|
$
|
4,998.5
|
|
Segment earnings
(1)
|
320.3
|
|
|
164.9
|
|
|
(68.5
|
)
|
|
416.7
|
|
||||
Depreciation and amortization
|
65.0
|
|
|
28.3
|
|
|
3.6
|
|
|
96.9
|
|
||||
Capital expenditures
|
82.7
|
|
|
29.5
|
|
|
8.6
|
|
|
120.8
|
|
||||
Total assets
|
6,824.5
|
|
|
1,835.7
|
|
|
1,940.3
|
|
|
10,600.5
|
|
|
Three Months Ended April 2, 2016
|
||||||||||||||
|
Seating
|
|
E-Systems
|
|
Other
|
|
Consolidated
|
||||||||
Revenues from external customers
|
$
|
3,602.0
|
|
|
$
|
1,060.9
|
|
|
$
|
—
|
|
|
$
|
4,662.9
|
|
Segment earnings
(1)
|
291.6
|
|
|
149.8
|
|
|
(67.9
|
)
|
|
373.5
|
|
||||
Depreciation and amortization
|
61.3
|
|
|
26.1
|
|
|
2.8
|
|
|
90.2
|
|
||||
Capital expenditures
|
62.4
|
|
|
20.2
|
|
|
5.5
|
|
|
88.1
|
|
||||
Total assets
|
6,241.5
|
|
|
1,745.9
|
|
|
1,972.1
|
|
|
9,959.5
|
|
(1)
|
See definition above.
|
|
Three Months Ended
|
||||||
|
April 1,
2017 |
|
April 2,
2016 |
||||
Segment earnings
|
$
|
416.7
|
|
|
$
|
373.5
|
|
Interest expense
|
20.8
|
|
|
21.1
|
|
||
Other expense, net
|
3.7
|
|
|
8.5
|
|
||
Consolidated income before provision for income taxes and equity in net income of affiliates
|
$
|
392.2
|
|
|
$
|
343.9
|
|
|
April 1,
2017 |
|
December 31, 2016
|
||||
Estimated aggregate fair value
|
$
|
2,007.0
|
|
|
$
|
2,004.8
|
|
Aggregate carrying value
(1)
|
1,937.5
|
|
|
1,943.7
|
|
|
April 1,
2017 |
|
December 31,
2016 |
||||
Fair value of contracts designated as cash flow hedges:
|
|
|
|
||||
Other current assets
|
$
|
20.0
|
|
|
$
|
11.2
|
|
Other long-term assets
|
9.2
|
|
|
0.5
|
|
||
Other current liabilities
|
(15.2
|
)
|
|
(58.3
|
)
|
||
Other long-term liabilities
|
(0.6
|
)
|
|
(9.9
|
)
|
||
|
13.4
|
|
|
(56.5
|
)
|
||
|
|
|
|
||||
Notional amount
|
$
|
1,152.4
|
|
|
$
|
1,275.0
|
|
Outstanding maturities in months, not to exceed
|
24
|
|
|
24
|
|
||
Fair value of contracts not designated as hedging instruments:
|
|
|
|
||||
Other current assets
|
13.0
|
|
|
5.9
|
|
||
Other current liabilities
|
(7.6
|
)
|
|
(3.8
|
)
|
||
|
5.4
|
|
|
2.1
|
|
||
|
|
|
|
||||
Notional amount
|
$
|
1,452.4
|
|
|
$
|
681.2
|
|
Outstanding maturities in months, not to exceed
|
9
|
|
|
12
|
|
||
|
|
|
|
||||
Total fair value
|
$
|
18.8
|
|
|
$
|
(54.4
|
)
|
Total notional amount
|
$
|
2,604.8
|
|
|
$
|
1,956.2
|
|
|
Three Months Ended
|
||||||
|
April 1,
2017 |
|
April 2,
2016 |
||||
Gains (losses) recognized in accumulated other comprehensive loss
|
$
|
58.1
|
|
|
$
|
(15.7
|
)
|
|
|
|
|
||||
Losses reclassified from accumulated other comprehensive loss to:
|
|
|
|
||||
Net sales
|
0.1
|
|
|
0.3
|
|
||
Cost of sales
|
11.7
|
|
|
18.2
|
|
||
|
11.8
|
|
|
18.5
|
|
||
Comprehensive income
|
$
|
69.9
|
|
|
$
|
2.8
|
|
Market:
|
|
This approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.
|
|
|
|
Income
:
|
|
This approach uses valuation techniques to convert future amounts to a single present value amount based on current market expectations.
|
|
|
|
Cost:
|
|
This approach is based on the amount that would be required to replace the service capacity of an asset (replacement cost).
|
Level 1:
|
|
Observable inputs, such as quoted market prices in active markets for identical assets or liabilities that are accessible at the measurement date.
|
|
|
|
Level 2:
|
|
Inputs, other than quoted market prices included in Level 1, that are observable either directly or indirectly for the asset or liability.
|
|
|
|
Level 3:
|
|
Unobservable inputs that reflect the entity’s own assumptions about the exit price of the asset or liability. Unobservable inputs may be used if there is little or no market data for the asset or liability at the measurement date.
|
Standards Pending Adoption
|
|
Description
|
|
Effective Date
|
|
Anticipated Impact
|
ASU 2014-09, Revenue from Contracts with Customers
(1)
|
|
The standard replaces existing revenue recognition guidance and requires additional financial statement disclosures. The provisions of these updates may be applied through either a full retrospective or a modified retrospective approach.
|
|
January 1, 2018
|
|
The Company is continuing to assess the potential effects of the standard. The Company’s current analysis indicates that the new standard may impact the Company's accounting for contractually guaranteed reimbursement of pre-production engineering and development and tooling costs related to products produced for its customers under long-term supply agreements. Under current guidance, such reimbursement is recorded as a cost offset. Under the new standard, the Company may recognize such reimbursements as revenues. While the Company continues to assess the potential effects of the standard, the Company does not currently expect the adoption of the new standard to have a material impact on consolidated net income or the consolidated balance sheet. The Company has not yet selected a transition method and plans to adopt the new standard effective January 1, 2018.
|
ASU 2016-02, Leases
|
|
The standard requires that a lessee recognize on its balance sheet right-of-use assets and corresponding liabilities resulting from leasing transactions, as well as additional financial statement disclosures. Currently, GAAP only requires balance sheet recognition for leases classified as capital leases. The provisions of this update apply to substantially all leased assets, with certain permitted exceptions, and must be adopted using a modified retrospective approach.
|
|
January 1, 2019
|
|
The Company is currently evaluating the impact of this update. For additional information on the Company’s operating lease commitments, see Note 11, "Commitments and Contingencies," to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016.
|
ASU 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost
|
|
The standard was issued to address the net presentation of the components of net benefit cost. It requires the classification of service cost in the same line item as other current employee compensation costs. It also requires the presentation of the remaining components of net benefit cost in a separate line item outside any subtotal for income from operations.
|
|
January 1, 2018
|
|
The update will result in the retrospective reclassification of the non-service cost components of net benefit cost from cost of sales and selling, general and administrative expenses to other expense, net. There will be no impact on consolidated net income.
|
Standard
|
|
Description
|
|
Effective Date
|
ASU 2015-11, Simplifying the Measurement of Inventory
|
|
The standard requires the measurement of inventory at the lower of cost or net realizable value rather than at the lower of cost or market.
|
|
January 1, 2017
|
ASU 2016-05, Effects of Derivative Contract Novations on Existing Hedge Accounting Relationships and ASU 2016-06, Contingent Put and Call Options in Debt Instruments.
|
|
The standards provide clarification when there is a change in a counterparty to a derivative hedging instrument and the steps required when assessing the economic characteristics of embedded put or call options.
|
|
January 1, 2017
|
ASU 2016-07, Simplifying the Transition to Equity Method of Accounting
|
|
The standard eliminates the requirement to retroactively apply the equity method of accounting as a result of an increase in the level of ownership or degree of influence.
|
|
January 1, 2017
|
ASU 2016-17, Interests Held through Related Parties that Are under Common Control
|
|
The standard changes the evaluation of whether a reporting entity is the primary beneficiary of a variable interest entity in certain instances involving entities under common control.
|
|
January 1, 2017
|
Standard
|
|
Description
|
|
Effective Date
|
ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities
|
|
The standard requires equity investments and other ownership interests in unconsolidated entities (other than those accounted for using the equity method of accounting) to be measured at fair value through earnings. A practicability exception exists for equity investments without readily determinable fair values.
|
|
January 1, 2018
|
ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments
|
|
The standard addresses the classification of cash flows related to various transactions, including debt prepayment and extinguishment costs, contingent consideration and proceeds from insurance claims.
|
|
January 1, 2018
|
ASU 2016-16, Income Taxes - Intra-Entity Transfers of Assets Other than Inventory
|
|
The standard requires the recognition of the income tax effects of intercompany sales and transfers (other than inventory) when the sales and transfers occur.
|
|
January 1, 2018
|
ASU 2016-18, Restricted Cash
|
|
The standard provides guidance on the presentation of restricted cash on the statement of cash flows.
|
|
January 1, 2018
|
ASU 2017-01, Clarifying the Definition of a Business
|
|
The standard provides a new framework to use when determining if a set of assets and activities is a business.
|
|
January 1, 2018
|
ASU 2017-05, Gains and Losses from the Derecognition of Nonfinancial Assets
|
|
The standard provides guidance for recognizing gains and losses on nonfinancial assets (including land, buildings and intangible assets) to noncustomers. Adoption must coincide with ASU 2014-09.
|
|
January 1, 2018
|
ASU 2016-13, Measurement of Credit Losses on Financial Instruments
|
|
The standard changes the impairment model for most financial instruments to an "expected loss" model. The new model will generally result in earlier recognition of credit losses.
|
|
January 1, 2020
|
ASU 2017-04, Simplifying the Test for Goodwill Impairment
|
|
The standard simplifies the accounting for goodwill impairments and allows a goodwill impairment charge to be based on the amount of a reporting unit's carrying value in excess of its fair value. This eliminates the requirement to calculate the implied fair value of goodwill or what is known as "Step 2" under the current guidance.
|
|
January 1, 2020
|
|
April 1, 2017
|
||||||||||||||||||
|
Lear
|
|
Guarantors
|
|
Non-
guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(Unaudited; in millions)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
250.4
|
|
|
$
|
0.3
|
|
|
$
|
959.0
|
|
|
$
|
—
|
|
|
$
|
1,209.7
|
|
|
Accounts receivable
|
423.2
|
|
|
292.2
|
|
|
2,593.4
|
|
|
—
|
|
|
3,308.8
|
|
|||||
Inventories
|
66.3
|
|
|
385.4
|
|
|
616.1
|
|
|
—
|
|
|
1,067.8
|
|
|||||
Intercompany accounts
|
76.5
|
|
|
156.5
|
|
|
—
|
|
|
(233.0
|
)
|
|
—
|
|
|||||
Other
|
134.1
|
|
|
12.7
|
|
|
495.8
|
|
|
—
|
|
|
642.6
|
|
|||||
Total current assets
|
950.5
|
|
|
847.1
|
|
|
4,664.3
|
|
|
(233.0
|
)
|
|
6,228.9
|
|
|||||
LONG-TERM ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Property, plant and equipment, net
|
313.0
|
|
|
329.4
|
|
|
1,428.3
|
|
|
—
|
|
|
2,070.7
|
|
|||||
Goodwill
|
172.1
|
|
|
519.9
|
|
|
437.4
|
|
|
—
|
|
|
1,129.4
|
|
|||||
Investments in subsidiaries
|
4,269.9
|
|
|
1,546.3
|
|
|
—
|
|
|
(5,816.2
|
)
|
|
—
|
|
|||||
Intercompany loans receivable
|
1,068.3
|
|
|
1,167.7
|
|
|
118.2
|
|
|
(2,354.2
|
)
|
|
—
|
|
|||||
Other
|
513.4
|
|
|
134.7
|
|
|
542.8
|
|
|
(19.4
|
)
|
|
1,171.5
|
|
|||||
Total long-term assets
|
6,336.7
|
|
|
3,698.0
|
|
|
2,526.7
|
|
|
(8,189.8
|
)
|
|
4,371.6
|
|
|||||
Total assets
|
$
|
7,287.2
|
|
|
$
|
4,545.1
|
|
|
$
|
7,191.0
|
|
|
$
|
(8,422.8
|
)
|
|
$
|
10,600.5
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term borrowings
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10.2
|
|
|
$
|
—
|
|
|
$
|
10.2
|
|
Accounts payable and drafts
|
392.6
|
|
|
559.6
|
|
|
2,090.8
|
|
|
—
|
|
|
3,043.0
|
|
|||||
Accrued liabilities
|
251.3
|
|
|
157.2
|
|
|
1,130.2
|
|
|
—
|
|
|
1,538.7
|
|
|||||
Intercompany accounts
|
—
|
|
|
—
|
|
|
233.0
|
|
|
(233.0
|
)
|
|
—
|
|
|||||
Current portion of long-term debt
|
37.5
|
|
|
—
|
|
|
1.3
|
|
|
—
|
|
|
38.8
|
|
|||||
Total current liabilities
|
681.4
|
|
|
716.8
|
|
|
3,465.5
|
|
|
(233.0
|
)
|
|
4,630.7
|
|
|||||
LONG-TERM LIABILITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt
|
1,884.8
|
|
|
—
|
|
|
4.2
|
|
|
—
|
|
|
1,889.0
|
|
|||||
Intercompany loans payable
|
1,124.9
|
|
|
54.5
|
|
|
1,174.8
|
|
|
(2,354.2
|
)
|
|
—
|
|
|||||
Other
|
265.1
|
|
|
5.8
|
|
|
365.8
|
|
|
(19.4
|
)
|
|
617.3
|
|
|||||
Total long-term liabilities
|
3,274.8
|
|
|
60.3
|
|
|
1,544.8
|
|
|
(2,373.6
|
)
|
|
2,506.3
|
|
|||||
EQUITY:
|
|
|
|
|
|
|
|
|
|
||||||||||
Lear Corporation stockholders’ equity
|
3,331.0
|
|
|
3,768.0
|
|
|
2,048.2
|
|
|
(5,816.2
|
)
|
|
3,331.0
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
132.5
|
|
|
—
|
|
|
132.5
|
|
|||||
Equity
|
3,331.0
|
|
|
3,768.0
|
|
|
2,180.7
|
|
|
(5,816.2
|
)
|
|
3,463.5
|
|
|||||
Total liabilities and equity
|
$
|
7,287.2
|
|
|
$
|
4,545.1
|
|
|
$
|
7,191.0
|
|
|
$
|
(8,422.8
|
)
|
|
$
|
10,600.5
|
|
|
December 31, 2016
|
||||||||||||||||||
|
Lear
|
|
Guarantors
|
|
Non-
guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(In millions)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
480.4
|
|
|
$
|
0.3
|
|
|
$
|
790.9
|
|
|
$
|
—
|
|
|
$
|
1,271.6
|
|
Accounts receivable
|
314.0
|
|
|
238.7
|
|
|
2,193.8
|
|
|
—
|
|
|
2,746.5
|
|
|||||
Inventories
|
67.9
|
|
|
364.7
|
|
|
588.0
|
|
|
—
|
|
|
1,020.6
|
|
|||||
Intercompany accounts
|
87.0
|
|
|
94.3
|
|
|
—
|
|
|
(181.3
|
)
|
|
—
|
|
|||||
Other
|
119.4
|
|
|
15.3
|
|
|
475.9
|
|
|
—
|
|
|
610.6
|
|
|||||
Total current assets
|
1,068.7
|
|
|
713.3
|
|
|
4,048.6
|
|
|
(181.3
|
)
|
|
5,649.3
|
|
|||||
LONG-TERM ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Property, plant and equipment, net
|
309.4
|
|
|
313.4
|
|
|
1,396.5
|
|
|
—
|
|
|
2,019.3
|
|
|||||
Goodwill
|
172.1
|
|
|
519.9
|
|
|
429.3
|
|
|
—
|
|
|
1,121.3
|
|
|||||
Investments in subsidiaries
|
4,002.3
|
|
|
917.5
|
|
|
—
|
|
|
(4,919.8
|
)
|
|
—
|
|
|||||
Intercompany loans receivable
|
308.9
|
|
|
1,206.9
|
|
|
91.1
|
|
|
(1,606.9
|
)
|
|
—
|
|
|||||
Other
|
456.6
|
|
|
146.8
|
|
|
525.1
|
|
|
(17.8
|
)
|
|
1,110.7
|
|
|||||
Total long-term assets
|
5,249.3
|
|
|
3,104.5
|
|
|
2,442.0
|
|
|
(6,544.5
|
)
|
|
4,251.3
|
|
|||||
Total assets
|
$
|
6,318.0
|
|
|
$
|
3,817.8
|
|
|
$
|
6,490.6
|
|
|
$
|
(6,725.8
|
)
|
|
$
|
9,900.6
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term borrowings
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8.6
|
|
|
$
|
—
|
|
|
$
|
8.6
|
|
Accounts payable and drafts
|
328.8
|
|
|
460.1
|
|
|
1,851.6
|
|
|
—
|
|
|
2,640.5
|
|
|||||
Accrued liabilities
|
228.6
|
|
|
197.5
|
|
|
1,071.5
|
|
|
—
|
|
|
1,497.6
|
|
|||||
Intercompany accounts
|
—
|
|
|
—
|
|
|
181.3
|
|
|
(181.3
|
)
|
|
—
|
|
|||||
Current portion of long-term debt
|
34.4
|
|
|
—
|
|
|
1.2
|
|
|
—
|
|
|
35.6
|
|
|||||
Total current liabilities
|
591.8
|
|
|
657.6
|
|
|
3,114.2
|
|
|
(181.3
|
)
|
|
4,182.3
|
|
|||||
LONG-TERM LIABILITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt
|
1,893.5
|
|
|
—
|
|
|
4.5
|
|
|
—
|
|
|
1,898.0
|
|
|||||
Intercompany loans payable
|
504.9
|
|
|
48.7
|
|
|
1,053.3
|
|
|
(1,606.9
|
)
|
|
—
|
|
|||||
Other
|
270.6
|
|
|
13.2
|
|
|
361.4
|
|
|
(17.8
|
)
|
|
627.4
|
|
|||||
Total long-term liabilities
|
2,669.0
|
|
|
61.9
|
|
|
1,419.2
|
|
|
(1,624.7
|
)
|
|
2,525.4
|
|
|||||
EQUITY:
|
|
|
|
|
|
|
|
|
|
||||||||||
Lear Corporation stockholders’ equity
|
3,057.2
|
|
|
3,098.3
|
|
|
1,821.5
|
|
|
(4,919.8
|
)
|
|
3,057.2
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
135.7
|
|
|
—
|
|
|
135.7
|
|
|||||
Equity
|
3,057.2
|
|
|
3,098.3
|
|
|
1,957.2
|
|
|
(4,919.8
|
)
|
|
3,192.9
|
|
|||||
Total liabilities and equity
|
$
|
6,318.0
|
|
|
$
|
3,817.8
|
|
|
$
|
6,490.6
|
|
|
$
|
(6,725.8
|
)
|
|
$
|
9,900.6
|
|
|
Three Months Ended April 1, 2017
|
||||||||||||||||||
|
Lear
|
|
Guarantors
|
|
Non-
guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(Unaudited; in millions)
|
||||||||||||||||||
Net sales
|
$
|
912.3
|
|
|
$
|
1,279.8
|
|
|
$
|
4,254.9
|
|
|
$
|
(1,448.5
|
)
|
|
$
|
4,998.5
|
|
Cost of sales
|
914.5
|
|
|
1,082.2
|
|
|
3,867.8
|
|
|
(1,448.5
|
)
|
|
4,416.0
|
|
|||||
Selling, general and administrative expenses
|
73.4
|
|
|
7.9
|
|
|
74.4
|
|
|
—
|
|
|
155.7
|
|
|||||
Intercompany operating (income) expense, net
|
(114.6
|
)
|
|
71.4
|
|
|
43.2
|
|
|
—
|
|
|
—
|
|
|||||
Amortization of intangible assets
|
1.9
|
|
|
4.0
|
|
|
4.2
|
|
|
—
|
|
|
10.1
|
|
|||||
Interest expense
|
23.5
|
|
|
(1.2
|
)
|
|
(1.5
|
)
|
|
—
|
|
|
20.8
|
|
|||||
Other expense, net
|
(6.2
|
)
|
|
(2.8
|
)
|
|
12.7
|
|
|
—
|
|
|
3.7
|
|
|||||
Consolidated income before income taxes and equity in net income of affiliates and subsidiaries
|
19.8
|
|
|
118.3
|
|
|
254.1
|
|
|
—
|
|
|
392.2
|
|
|||||
Provision for income taxes
|
(6.3
|
)
|
|
38.4
|
|
|
57.0
|
|
|
—
|
|
|
89.1
|
|
|||||
Equity in net income of affiliates
|
(0.6
|
)
|
|
—
|
|
|
(14.8
|
)
|
|
—
|
|
|
(15.4
|
)
|
|||||
Equity in net income of subsidiaries
|
(279.1
|
)
|
|
(148.6
|
)
|
|
—
|
|
|
427.7
|
|
|
—
|
|
|||||
Consolidated net income
|
305.8
|
|
|
228.5
|
|
|
211.9
|
|
|
(427.7
|
)
|
|
318.5
|
|
|||||
Less: Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
12.7
|
|
|
—
|
|
|
12.7
|
|
|||||
Net income attributable to Lear
|
$
|
305.8
|
|
|
$
|
228.5
|
|
|
$
|
199.2
|
|
|
$
|
(427.7
|
)
|
|
$
|
305.8
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated comprehensive income
|
$
|
408.3
|
|
|
$
|
276.2
|
|
|
$
|
267.6
|
|
|
$
|
(530.0
|
)
|
|
$
|
422.1
|
|
Less: Comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
13.8
|
|
|
—
|
|
|
13.8
|
|
|||||
Comprehensive income attributable to Lear
|
$
|
408.3
|
|
|
$
|
276.2
|
|
|
$
|
253.8
|
|
|
$
|
(530.0
|
)
|
|
$
|
408.3
|
|
|
Three Months Ended April 2, 2016
|
||||||||||||||||||
|
Lear
|
|
Guarantors
|
|
Non-
guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(Unaudited; in millions)
|
||||||||||||||||||
Net sales
|
$
|
926.6
|
|
|
$
|
1,217.4
|
|
|
$
|
3,841.2
|
|
|
$
|
(1,322.3
|
)
|
|
$
|
4,662.9
|
|
Cost of sales
|
922.5
|
|
|
1,033.5
|
|
|
3,493.5
|
|
|
(1,322.3
|
)
|
|
4,127.2
|
|
|||||
Selling, general and administrative expenses
|
76.4
|
|
|
2.4
|
|
|
70.2
|
|
|
—
|
|
|
149.0
|
|
|||||
Intercompany operating (income) expense, net
|
(115.8
|
)
|
|
60.4
|
|
|
55.4
|
|
|
—
|
|
|
—
|
|
|||||
Amortization of intangible assets
|
1.9
|
|
|
4.0
|
|
|
7.3
|
|
|
—
|
|
|
13.2
|
|
|||||
Interest expense
|
23.0
|
|
|
(0.8
|
)
|
|
(1.1
|
)
|
|
—
|
|
|
21.1
|
|
|||||
Other expense, net
|
10.5
|
|
|
(0.6
|
)
|
|
(1.4
|
)
|
|
—
|
|
|
8.5
|
|
|||||
Consolidated income before income taxes and equity in net income of affiliates and subsidiaries
|
8.1
|
|
|
118.5
|
|
|
217.3
|
|
|
—
|
|
|
343.9
|
|
|||||
Provision for income taxes
|
3.5
|
|
|
47.7
|
|
|
47.0
|
|
|
—
|
|
|
98.2
|
|
|||||
Equity in net income of affiliates
|
(0.4
|
)
|
|
—
|
|
|
(16.4
|
)
|
|
—
|
|
|
(16.8
|
)
|
|||||
Equity in net income of subsidiaries
|
(243.4
|
)
|
|
(136.7
|
)
|
|
—
|
|
|
380.1
|
|
|
—
|
|
|||||
Consolidated net income
|
248.4
|
|
|
207.5
|
|
|
186.7
|
|
|
(380.1
|
)
|
|
262.5
|
|
|||||
Less: Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
14.1
|
|
|
—
|
|
|
14.1
|
|
|||||
Net income attributable to Lear
|
$
|
248.4
|
|
|
$
|
207.5
|
|
|
$
|
172.6
|
|
|
$
|
(380.1
|
)
|
|
$
|
248.4
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated comprehensive income
|
$
|
317.9
|
|
|
$
|
215.2
|
|
|
$
|
250.0
|
|
|
$
|
(450.9
|
)
|
|
$
|
332.2
|
|
Less: Comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
14.3
|
|
|
—
|
|
|
14.3
|
|
|||||
Comprehensive income attributable to Lear
|
$
|
317.9
|
|
|
$
|
215.2
|
|
|
$
|
235.7
|
|
|
$
|
(450.9
|
)
|
|
$
|
317.9
|
|
|
Three Months Ended April 1, 2017
|
||||||||||||||||||
|
Lear
|
|
Guarantors
|
|
Non-
guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(Unaudited; in millions)
|
||||||||||||||||||
Net Cash Provided by Operating Activities
|
$
|
56.0
|
|
|
$
|
73.4
|
|
|
$
|
190.2
|
|
|
$
|
(40.7
|
)
|
|
$
|
278.9
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Additions to property, plant and equipment
|
(16.8
|
)
|
|
(34.0
|
)
|
|
(70.0
|
)
|
|
—
|
|
|
(120.8
|
)
|
|||||
Intercompany transactions
|
(759.4
|
)
|
|
39.2
|
|
|
(27.1
|
)
|
|
747.3
|
|
|
—
|
|
|||||
Other, net
|
(3.9
|
)
|
|
0.2
|
|
|
(4.2
|
)
|
|
|
|
|
(7.9
|
)
|
|||||
Net cash provided by (used in) investing activities
|
(780.1
|
)
|
|
5.4
|
|
|
(101.3
|
)
|
|
747.3
|
|
|
(128.7
|
)
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Credit agreement repayments
|
(6.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6.2
|
)
|
|||||
Short-term borrowings, net
|
—
|
|
|
—
|
|
|
1.4
|
|
|
—
|
|
|
1.4
|
|
|||||
Repurchase of common stock
|
(115.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(115.6
|
)
|
|||||
Dividends paid to Lear Corporation stockholders
|
(36.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(36.7
|
)
|
|||||
Dividends paid to noncontrolling interests
|
—
|
|
|
—
|
|
|
(26.5
|
)
|
|
—
|
|
|
(26.5
|
)
|
|||||
Intercompany transactions
|
694.4
|
|
|
(78.8
|
)
|
|
91.0
|
|
|
(706.6
|
)
|
|
—
|
|
|||||
Other, net
|
(41.8
|
)
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
(41.7
|
)
|
|||||
Net cash provided by (used in) financing activities
|
494.1
|
|
|
(78.8
|
)
|
|
66.0
|
|
|
(706.6
|
)
|
|
(225.3
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Effect of foreign currency translation
|
—
|
|
|
—
|
|
|
13.2
|
|
|
—
|
|
|
13.2
|
|
|||||
Net Change in Cash and Cash Equivalents
|
(230.0
|
)
|
|
—
|
|
|
168.1
|
|
|
—
|
|
|
(61.9
|
)
|
|||||
Cash and Cash Equivalents as of Beginning of Period
|
480.4
|
|
|
0.3
|
|
|
790.9
|
|
|
—
|
|
|
1,271.6
|
|
|||||
Cash and Cash Equivalents as of End of Period
|
$
|
250.4
|
|
|
$
|
0.3
|
|
|
$
|
959.0
|
|
|
$
|
—
|
|
|
$
|
1,209.7
|
|
|
Three Months Ended April 2, 2016
|
||||||||||||||||||
|
Lear
|
|
Guarantors
|
|
Non-
guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(Unaudited; in millions)
|
||||||||||||||||||
Net Cash Provided by Operating Activities
|
$
|
(7.4
|
)
|
|
$
|
100.5
|
|
|
$
|
195.5
|
|
|
$
|
—
|
|
|
$
|
288.6
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Additions to property, plant and equipment
|
(14.5
|
)
|
|
(21.2
|
)
|
|
(52.4
|
)
|
|
—
|
|
|
(88.1
|
)
|
|||||
Intercompany transactions
|
(24.4
|
)
|
|
14.9
|
|
|
0.4
|
|
|
9.1
|
|
|
—
|
|
|||||
Other, net
|
(3.2
|
)
|
|
0.1
|
|
|
1.3
|
|
|
—
|
|
|
(1.8
|
)
|
|||||
Net cash used in investing activities
|
(42.1
|
)
|
|
(6.2
|
)
|
|
(50.7
|
)
|
|
9.1
|
|
|
(89.9
|
)
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Credit agreement repayments
|
(3.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3.1
|
)
|
|||||
Short-term borrowings, net
|
—
|
|
|
—
|
|
|
2.6
|
|
|
—
|
|
|
2.6
|
|
|||||
Repurchase of common stock
|
(154.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(154.7
|
)
|
|||||
Dividends paid to Lear Corporation stockholders
|
(25.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25.3
|
)
|
|||||
Intercompany transactions
|
253.2
|
|
|
(94.6
|
)
|
|
(149.5
|
)
|
|
(9.1
|
)
|
|
—
|
|
|||||
Other, net
|
(50.6
|
)
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
|
(51.0
|
)
|
|||||
Net cash provided by (used in) financing activities
|
19.5
|
|
|
(94.6
|
)
|
|
(147.3
|
)
|
|
(9.1
|
)
|
|
(231.5
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Effect of foreign currency translation
|
—
|
|
|
—
|
|
|
10.3
|
|
|
—
|
|
|
10.3
|
|
|||||
Net Change in Cash and Cash Equivalents
|
(30.0
|
)
|
|
(0.3
|
)
|
|
7.8
|
|
|
—
|
|
|
(22.5
|
)
|
|||||
Cash and Cash Equivalents as of Beginning of Period
|
526.4
|
|
|
0.3
|
|
|
669.9
|
|
|
—
|
|
|
1,196.6
|
|
|||||
Cash and Cash Equivalents as of End of Period
|
$
|
496.4
|
|
|
$
|
—
|
|
|
$
|
677.7
|
|
|
$
|
—
|
|
|
$
|
1,174.1
|
|
|
April 1,
2017 |
|
December 31,
2016 |
||||
Credit agreement
|
$
|
461.0
|
|
|
$
|
467.1
|
|
Senior notes
|
1,461.3
|
|
|
1,460.8
|
|
||
|
1,922.3
|
|
|
1,927.9
|
|
||
Less — Current portion
|
(37.5
|
)
|
|
(34.4
|
)
|
||
Long-term debt
|
$
|
1,884.8
|
|
|
$
|
1,893.5
|
|
|
First Quarter
|
|
|
|||
|
2017
|
|
2016
|
|
% Change
|
|
North America
|
4.6
|
|
4.5
|
|
3
|
%
|
Europe and Africa
|
6.1
|
|
5.7
|
|
6
|
%
|
Asia
|
12.2
|
|
11.5
|
|
6
|
%
|
South America
|
0.7
|
|
0.6
|
|
19
|
%
|
Other
|
0.3
|
|
0.4
|
|
(16
|
)%
|
Global light vehicle production
|
23.9
|
|
22.6
|
|
6
|
%
|
|
2017
|
|
2016
|
||
North America
|
40
|
%
|
|
41
|
%
|
Europe and Africa
|
38
|
%
|
|
39
|
%
|
Asia
|
19
|
%
|
|
18
|
%
|
South America
|
3
|
%
|
|
2
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
|
Three Months Ended
|
||||||
|
April 1,
2017 |
|
April 2,
2016 |
||||
Costs related to restructuring actions, including manufacturing inefficiencies of $2 million for the three months ended April 2, 2016
|
$
|
9
|
|
|
$
|
12
|
|
Acquisition and other related costs
|
2
|
|
|
—
|
|
||
Acquisition-related inventory fair value adjustment
|
2
|
|
|
—
|
|
||
Tax benefits, net
|
19
|
|
|
5
|
|
|
Three Months Ended
|
||||||||||||
|
April 1, 2017
|
|
April 2, 2016
|
||||||||||
Net sales
|
|
|
|
|
|
|
|
||||||
Seating
|
$
|
3,868.0
|
|
|
77.4
|
%
|
|
$
|
3,602.0
|
|
|
77.2
|
%
|
E-Systems
|
1,130.5
|
|
|
22.6
|
|
|
1,060.9
|
|
|
22.8
|
|
||
Net sales
|
4,998.5
|
|
|
100.0
|
|
|
4,662.9
|
|
|
100.0
|
|||
Cost of sales
|
4,416.0
|
|
|
88.3
|
|
|
4,127.2
|
|
|
88.5
|
|
||
Gross profit
|
582.5
|
|
|
11.7
|
|
|
535.7
|
|
|
11.5
|
|
||
Selling, general and administrative expenses
|
155.7
|
|
|
3.1
|
|
|
149.0
|
|
|
3.2
|
|
||
Amortization of intangible assets
|
10.1
|
|
|
0.2
|
|
|
13.2
|
|
|
0.3
|
|
||
Interest expense
|
20.8
|
|
|
0.4
|
|
|
21.1
|
|
|
0.5
|
|
||
Other expense, net
|
3.7
|
|
|
0.1
|
|
|
8.5
|
|
|
0.2
|
|
||
Provision for income taxes
|
89.1
|
|
|
1.8
|
|
|
98.2
|
|
|
2.1
|
|
||
Equity in net income of affiliates
|
(15.4
|
)
|
|
(0.3
|
)
|
|
(16.8
|
)
|
|
(0.4
|
)
|
||
Net income attributable to noncontrolling interests
|
12.7
|
|
|
0.3
|
|
|
14.1
|
|
|
0.3
|
|
||
Net income attributable to Lear
|
$
|
305.8
|
|
|
6.1
|
%
|
|
$
|
248.4
|
|
|
5.3
|
%
|
(in millions)
|
|
Cost of Sales
|
||
First quarter 2016
|
|
$
|
4,127
|
|
Material cost
|
|
205
|
|
|
Labor and other
|
|
76
|
|
|
Depreciation
|
|
8
|
|
|
First quarter 2017
|
|
$
|
4,416
|
|
|
Three Months Ended
|
||||||
|
April 1, 2017
|
|
April 2, 2016
|
||||
Net sales
|
$
|
3,868.0
|
|
|
$
|
3,602.0
|
|
Segment earnings
(1)
|
320.3
|
|
|
291.6
|
|
||
Margin
|
8.3
|
%
|
|
8.1
|
%
|
(1)
|
See definition above.
|
|
Three Months Ended
|
||||||
|
April 1, 2017
|
|
April 2, 2016
|
||||
Net sales
|
$
|
1,130.5
|
|
|
$
|
1,060.9
|
|
Segment earnings
(1)
|
164.9
|
|
|
149.8
|
|
||
Margin
|
14.6
|
%
|
|
14.1
|
%
|
(1)
|
See definition above.
|
|
Three Months Ended
|
||||||
|
April 1, 2017
|
|
April 2, 2016
|
||||
Net sales
|
$
|
—
|
|
|
$
|
—
|
|
Segment earnings
(1)
|
(68.5
|
)
|
|
(67.9
|
)
|
||
Margin
|
N/A
|
|
|
N/A
|
|
(1)
|
See definition above.
|
|
Three Months Ended
|
||||||||||
|
April 1, 2017
|
|
April 2, 2016
|
|
Incremental Increase (Decrease) in Operating
Cash Flow
|
||||||
Consolidated net income and depreciation and amortization
|
$
|
415
|
|
|
$
|
353
|
|
|
$
|
62
|
|
Net change in working capital items:
|
|
|
|
|
|
||||||
Accounts receivable
|
(527
|
)
|
|
(411
|
)
|
|
(116
|
)
|
|||
Inventory
|
(35
|
)
|
|
(42
|
)
|
|
7
|
|
|||
Accounts payable
|
375
|
|
|
241
|
|
|
134
|
|
|||
Accrued liabilities and other
|
42
|
|
|
134
|
|
|
(92
|
)
|
|||
Net change in working capital items
|
(145
|
)
|
|
(78
|
)
|
|
(67
|
)
|
|||
Other
|
9
|
|
|
13
|
|
|
(4
|
)
|
|||
Net cash provided by operating activities
|
$
|
279
|
|
|
$
|
289
|
|
|
$
|
(10
|
)
|
Note
|
|
Aggregate Principal Amount
|
|
Stated Coupon Rate
|
|||
Senior unsecured notes due 2023
|
|
$
|
500
|
|
|
4.75
|
%
|
Senior unsecured notes due 2024
|
|
325
|
|
|
5.375
|
%
|
|
Senior unsecured notes due 2025
|
|
650
|
|
|
5.25
|
%
|
|
|
|
$
|
1,475
|
|
|
|
Payment Date
|
|
Dividend Per Share
|
|
Declaration Date
|
|
Record Date
|
||
March 23, 2017
|
|
$
|
0.50
|
|
|
February 10, 2017
|
|
March 3, 2017
|
|
April 1,
2017 |
|
December 31,
2016 |
||||
Notional amount (contract maturities < 24 months)
|
$
|
2,605
|
|
|
$
|
1,956
|
|
Fair value
|
19
|
|
|
(54
|
)
|
|
|
|
Potential Earnings Benefit (Adverse Earnings Impact)
|
||||||
|
Hypothetical Strengthening %
(1)
|
|
April 1, 2017
|
|
December 31, 2016
|
||||
U.S. dollar
|
10%
|
|
$
|
(23
|
)
|
|
$
|
(19
|
)
|
Euro
|
10%
|
|
14
|
|
|
16
|
|
|
|
|
Estimated Change in Fair Value
|
||||||
|
Hypothetical Change %
(2)
|
|
April 1, 2017
|
|
December 31, 2016
|
||||
U.S. dollar
|
10%
|
|
$
|
34
|
|
|
$
|
50
|
|
Euro
|
10%
|
|
59
|
|
|
35
|
|
•
|
general economic conditions in the markets in which we operate, including changes in interest rates or currency exchange rates;
|
•
|
currency controls and the ability to economically hedge currencies;
|
•
|
the financial condition and restructuring actions of our customers and suppliers;
|
•
|
changes in actual industry vehicle production levels from our current estimates;
|
•
|
fluctuations in the production of vehicles or the loss of business with respect to, or the lack of commercial success of, a vehicle model for which we are a significant supplier;
|
•
|
disruptions in the relationships with our suppliers;
|
•
|
labor disputes involving us or our significant customers or suppliers or that otherwise affect us;
|
•
|
the outcome of customer negotiations and the impact of customer-imposed price reductions;
|
•
|
the impact and timing of program launch costs and our management of new program launches;
|
•
|
the costs, timing and success of restructuring actions;
|
•
|
increases in our warranty, product liability or recall costs;
|
•
|
risks associated with conducting business in foreign countries;
|
•
|
the impact of regulations on our foreign operations;
|
•
|
the operational and financial success of our joint ventures;
|
•
|
competitive conditions impacting us and our key customers and suppliers;
|
•
|
disruptions to our information technology systems, including those related to cybersecurity;
|
•
|
the cost and availability of raw materials, energy, commodities and product components and our ability to mitigate such costs;
|
•
|
the outcome of legal or regulatory proceedings to which we are or may become a party;
|
•
|
the impact of pending legislation and regulations or changes in existing federal, state, local or foreign laws or regulations;
|
•
|
unanticipated changes in cash flow, including our ability to align our vendor payment terms with those of our customers;
|
•
|
limitations imposed by our existing indebtedness and our ability to access capital markets on commercially reasonable terms;
|
•
|
impairment charges initiated by adverse industry or market developments;
|
•
|
our ability to execute our strategic objectives;
|
•
|
changes in discount rates and the actual return on pension assets;
|
•
|
costs associated with compliance with environmental laws and regulations;
|
•
|
developments or assertions by or against us relating to intellectual property rights;
|
•
|
our ability to utilize our net operating loss, capital loss and tax credit carryforwards;
|
•
|
global sovereign fiscal matters and creditworthiness, including potential defaults and the related impacts on economic activity, including the possible effects on credit markets, currency values, monetary unions, international treaties and fiscal policies;
|
•
|
the impact of potential changes in tax and trade policies in the United States and related actions by countries in which we do business;
|
•
|
the anticipated changes in economic and other relationships between the United Kingdom and the European Union; and
|
•
|
other risks described in Item 1A, "Risk Factors," in our Annual Report on Form 10-K for the year ended
December 31, 2016
, and our other Securities and Exchange Commission ("SEC") filings.
|
(a)
|
Disclosure Controls and Procedures
|
(b)
|
Changes in Internal Control over Financial Reporting
|
Period
|
|
Total Number
of Shares
Purchased
|
|
Average
Price Paid
per Share
|
|
Total Number of
Shares Purchased
as Part of
Publicly Announced
Plans or Programs
|
|
Approximate Dollar
Value of Shares that
May Yet be
Purchased Under
the Program
(in millions)
|
|
||||
January 1, 2017 through January 28, 2017
|
|
—
|
|
|
N/A
|
|
N/A
|
|
|
$
|
341.2
|
|
|
January 29, 2017 through February 25, 2017
|
|
108,000
|
|
|
$142.30
|
|
108,000
|
|
|
984.6
|
|
(1)
|
|
February 26, 2017 through April 1, 2017
|
|
788,965
|
|
|
$142.08
|
|
788,965
|
|
|
872.5
|
|
|
|
Total
|
|
896,965
|
|
|
$142.10
|
|
896,965
|
|
|
$
|
872.5
|
|
|
(1)
|
As of February 2017, our Board of Directors authorized a
$658.8 million
increase to our existing common stock repurchase program to provide for a remaining aggregate repurchase authorization of $1 billion.
|
LEAR CORPORATION
|
|
|
|
|
|
|
|
Dated:
|
April 26, 2017
|
By:
|
/s/ Matthew J. Simoncini
|
|
|
|
Matthew J. Simoncini
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
|
By:
|
/s/ Jeffrey H. Vanneste
|
|
|
|
Jeffrey H. Vanneste
|
|
|
|
Senior Vice President and Chief Financial Officer
|
|
Exhibit
Number
|
|
Exhibit
|
*
|
10.1
|
|
First Amendment to the Lear Corporation 2009 Long-Term Stock Incentive Plan (amended and restated as of January 1, 2014), effective as of January 1, 2017.
|
*
|
10.2
|
|
First Amendment to the Lear Corporation Annual Incentive Plan (amended and restated as of January 1, 2014), effective February 9, 2017.
|
*
|
31.1
|
|
Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer.
|
*
|
31.2
|
|
Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer.
|
*
|
32.1
|
|
Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
*
|
32.2
|
|
Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
**
|
101.INS
|
|
XBRL Instance Document.
|
**
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
**
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
**
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
**
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
**
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
*
|
Filed herewith.
|
**
|
Submitted electronically with the Report.
|
1.
|
The final sentence of Section 6.7 of the Plan is hereby deleted and replaced with the following:
|
2.
|
Section 16.2 of the Plan is hereby deleted in its entirety and replaced with the following:
|
3.
|
Except to the extent hereby amended, the Plan shall remain in full force and effect.
|
1.
|
The phrase “the senior Human Resources executive” is hereby replaced with the phrase “the Company’s Chief Executive Officer” wherever the former phrase appears in Article 3 (Participation), Section 4.4 (Bonus), Section 4.6 (Eligibility for Payments), Section 5.1 (General Administration), and Section 7.3 (Participant’s Rights).
|
2.
|
The phrase “the senior Human Resources executive’s” is hereby replaced with the phrase “the Company’s Chief Executive Officer’s (or his or her designee’s)” where the former phrase appears in Section 4.5(a).
|
3.
|
The phrase “(or his or her designee”) shall be inserted immediately following the phrase “the Company’s Chief Executive Officer” wherever the former phrase does not already appear in Section 4.4 (Bonus) and Section 7.3 (Participant’s Rights), as amended in Part 1 above.
|
4.
|
The phrase “or his or her designee” shall be inserted immediately following the phrase “the Company’s Chief Executive Officer” wherever the former phrase does not already appear in Section 4.6 (Eligibility for Payments), as amended in Part 1 above.
|
5.
|
The first sentence of Section 4.1 is hereby deleted in its entirety and replaced with the following:
|
6.
|
The phrase “or the Company’s Chief Executive Officer or his or her designee, as applicable,” shall be inserted immediately following the phrase “The Committee” wherever the former phrase appears in Section 4.2.
|
7.
|
Section 4.3 is hereby deleted in its entirety and replaced with the following:
|
“(a)
|
Within a reasonable time after the close of a Performance Period, the Committee shall determine whether the objective performance goals established for that Performance Period have been met, with respect to the respective Corporate Officers. If the objective performance goals and any other material terms established by the Committee have been met by a Corporate Officer, the Committee shall so certify such determination in writing with respect to such Corporate Officer before the applicable Bonus is paid pursuant to Section 4.5.
|
(b)
|
Within a reasonable time after the close of a Performance Period, the Company’s Chief Executive Officer or his or her designee shall determine whether the objective performance goals established for the Performance Period have been met, or are reasonably likely to be met, with respect to the respective Participants who are not Corporate Officers. If the objective performance goals and any other material terms established by the Chief Executive Officer or his or her designee have been met or are reasonably likely to be met by a Participant who is not a Corporate Officer, the Company’s Chief Executive Officer or his or her designee shall so certify such determination in writing with respect to such Participant before the applicable Bonus is paid pursuant to Section 4.5.”
|
8.
|
The third sentence of Section 4.4 is hereby deleted in its entirety and replaced with the following:
|
9.
|
Except to the extent hereby amended, the Plan shall remain in full force and effect.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Lear Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
April 26, 2017
|
By:
|
/s/ Matthew J. Simoncini
|
|
|
|
Matthew J. Simoncini
|
|
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Lear Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
April 26, 2017
|
By:
|
/s/ Jeffrey H. Vanneste
|
|
|
|
Jeffrey H. Vanneste
|
|
|
|
Senior Vice President and Chief Financial Officer
|
|
1. The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and
|
|
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
April 26, 2017
|
Signed:
|
/s/ Matthew J. Simoncini
|
|
|
|
Matthew J. Simoncini
|
|
|
|
Chief Executive Officer
|
|
1. The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and
|
|
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
April 26, 2017
|
Signed:
|
/s/ Jeffrey H. Vanneste
|
|
|
|
Jeffrey H. Vanneste
|
|
|
|
Chief Financial Officer
|