[YesAuto Industry] Recently, Lear, a global supplier of seat and electrical and electronic system technology, released its first quarter financial report for 2019. Its first quarter revenue was US$5.2 billion (approximately RMB 35.5 billion), a year-on-year decrease of 10% ($5.7 billion in 2018). In the first quarter, net income was US$229 million (approximately RMB 1.56 billion) and adjusted net income was US$253 million (approximately RMB 1.73 billion), compared with US$354 million and US$345 million in the same period last year.
Lear Company stated in its financial report that the decline in operating income in the first quarter was mainly due to the sluggish market environment in the entire automotive industry and the macroeconomic situation is not optimistic. Lear also experienced a planned downtime, production has also declined, and some Revenue was offset by new business. Ray Scott, CEO of Lear Corporation, said, “The recently completed acquisition of Xevo proves that we are committed to developing capabilities and technologies that will reshape key trends in the automotive industry.” Xevo is an automotive software developer that provides cloud and in-vehicle applications. And mobile device solutions.
The decline in operating income has also led to lower profit margins. The profit margin of the seat business unit is 6.4%, which is 7.6% after adjustment; the profit margin of the electronic system business unit is 10.3%, which is 11.3% after adjustment. In the first quarter, Lear's free cash flow was $71 million. Except for the increase in additional expenses related to the acquisition of Xevo, Lear's financial outlook for the full year of 2019 is the same as previously predicted.