(Updates shares in the second paragraph.)
Oct. 28 (Bloomberg) -- Lear Corp. fell 4.2 percent after the maker of seats and other automobile parts reported a profit that was lower than analysts’ estimated as margins in its seating unit narrowed.
Lear slid to $47.60 at the close in New York. It declined as much as 10 percent, touching $44.52. Shares of the Southfield, Michigan-based company have fallen 3.6 percent this year.
Margins in Lear’s seating unit, which generated 79 percent of revenue last year, narrowed to 6.7 percent of sales from 7.5 percent. The company cited price cuts and higher commodity, product-introduction and development costs.
“Launch costs are historically an area that Lear has been very, very good at,” Chief Executive Officer Matt Simoncini said on a call with analysts. “We just need to get back to being good at it.”
Third-quarter profit rose 5.7 percent to $100.7 million, or 95 cents a share from $95.3 million or 88 cents. Excluding some items, profit was $1.08 a share, compared with $1.12, the average estimate of 14 analysts in a Bloomberg survey.
Sales rose 23 percent to $3.46 billion, compared with $3.23 billion, the average estimate of eight analysts in a Bloomberg survey.
Lear also boosted its forecasts for sales and profit for the year after raising its projections for vehicle production by 2 percent in North America and 1 percent in Europe.
The company said it’s forecasting 2011 sales of $13.8 billion to $14.1 billion and operating earnings of $760 million to $790 million, up from previous projections of $13.4 billion to $13.8 billion and $740 million to $780 million.
--Editors: Bill Koenig, Jamie Butters
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