Lear Corp. has reported record financial results for the second quarter of 2016. Highlights include:

• Record sales of $4.7 billion, reflecting continued growth in both segments
• Net income of $282 million versus $182 million in the prior year
• Record core operating earnings of $399 million, an increase of 18 percent from prior year, with a record margin of 8.4 percent, up from 7.3 percent a year ago
• Earnings per share of $3.82, with adjusted earnings per share of $3.66, up 30 percent from prior year
• Repurchased 2.3 million shares, approximately 3 percent of shares outstanding
• Increasing full year outlook for earnings and free cash flow

“The company’s operating fundamentals are the strongest in our history, and we are very well-positioned for future growth in both of our business segments,” said Matt Simoncini, Lear’s president and CEO. “In Seating, we have received outstanding customer response to our craftsmanship initiative and our new ‘Intelligent Seat.’ In Electrical, our electrical distribution capabilities, connected gateway modules, wireless technology and software expertise are allowing Lear to capitalize on the rapidly growing vehicle communication and connectivity mega-trend. In addition, we offer hybrid and high-power electrical systems, including 48-volt architectures, as well as the most efficient vehicle battery charging capabilities. These unique capabilities in both product segments, combined with our low-cost footprint and strong capital structure, provide Lear with a competitive advantage and will continue to drive profitable growth.”

In the Seating segment, sales were up 2 percent to $3.6 billion. Excluding the impact of foreign exchange and commodity prices, sales increased 4 percent, reflecting the addition of new business and improved production volumes on key platforms. Segment earnings were $288 million or 7.9 percent of sales. Adjusted segment earnings were $302 million or 8.3 percent of sales. Adjusted margins improved 120 basis points from a year ago, reflecting the increase in sales and strong operating performance.

In the Electrical segment, sales were up 3 percent to $1.1 billion. Excluding the impact of foreign exchange and commodity prices, sales increased 5 percent, reflecting the addition of new business. Segment earnings were $151 million or 14 percent of sales. Adjusted segment earnings were $161 million or 14.8 percent of sales. Adjusted margins improved 90 basis points from a year ago, reflecting the increase in sales and favorable operating performance.

Share Repurchase Program

During the second quarter of 2016, Lear repurchased approximately 2.3 million shares of its common stock for a total of $250 million. As of the end of the second quarter, Lear had a remaining share repurchase authorization of $595 million, which expires on Dec. 31, 2017, and reflects approximately 7 percent of Lear’s total market capitalization at current market prices.

Since initiating the share repurchase program in early 2011, Lear has repurchased 38.9 million shares of its common stock for a total of $2.8 billion at an average price of $72.06 per share.  This represents a reduction of approximately 37 percent of our shares outstanding at the time the company began the program.

Full Year 2016 Financial Outlook

Lear is increasing its full year 2016 financial guidance for earnings and free cash flow based on its strong first half performance and outlook for the full year.

The company said its 2016 financial outlook is based on industry vehicle production assumptions of 18 million units in North America, up 3 percent from the prior year, 22.3 million units in Europe and Africa, up 3 percent from the prior year, and 24 million units in China, up 6 percent from the prior year. Lear’s financial outlook is based on an average full year exchange rate of $1.10/Euro.

Sales in 2016 are expected to be in the range of $18.5 billion to $18.8 billion. Core operating earnings are expected to be in the range of $1.45 billion to $1.50 billion, an increase of $50 million from the prior guidance.