CHICAGO (Reuters) -- Auto parts supplier Lear Corp. on Thursday forecast 2005 earnings per share below the consensus estimate as it works to offset rising raw materials costs and North American light vehicle production cuts.
Lear said last year that it expected North American light vehicle production cuts by Ford Motor Co. and General Motors, rising raw materials costs and price cutting demands for automakers to remain challenges in 2005.
Lear, which makes seats, interior trim and electrical systems, said it expects 2005 net income per share of $5 to $6 with net sales rising to a range of $17.6 billion to $18 billion, mainly on new business. It also raised its quarterly dividend 25 percent to 25 cents a share.
Analysts on average expect Lear to earn $6.20 per share in 2005 with revenue of about $17.96 billion, according to Reuters Estimates.
Lear expects capital spending of $425 million to $475 million in 2005 to support new sales growth. The Southfield, Mich.-based company said its three-year sales backlog increased $750 million to $3.8 billion.
The 2005 forecast is based on North American light vehicle production of 15.7 million to 16 million units and Europe production of 18.3 million to 18.6 million units, both roughly in line with 2004, Lear said.