Segment Reporting

9 Months Ended

Sep. 28, 2019

The Company has two reportable operating segments: Seating, which includes complete seat systems and all major seat components, including seat covers and surface materials such as leather and fabric, seat structures and mechanisms, seat foam and headrests, and E-Systems, which includes complete electrical distribution systems, as well as sophisticated electronic control modules, electrification products, connectivity products and software solutions for the cloud, cars and mobile devices.

The other category includes unallocated costs related to corporate headquarters, regional headquarters and the elimination of intercompany activities, none of which meets the requirements for being classified as an operating segment. Corporate and regional headquarters costs include various support functions, such as information technology, corporate finance, legal, executive administration and human resources, as well as advanced engineering expenses.

The Company evaluates the performance of its operating segments based primarily on (i) revenues from external customers, (ii) pretax income before equity in net income of affiliates, interest expense and other expense, net, ("segment earnings") and (iii) cash flows, being defined as segment earnings less capital expenditures plus depreciation and amortization.

A summary of revenues from external customers and other financial information by reportable operating segment is shown below (in millions):



	Three Months Ended September 28, 2019
	Seating		E-Systems		Other			Consolidated
Revenues from external customers	$	3,715.0	$	1,110.0	$	—		$	4,825.0
Segment earnings ⁽¹⁾	281.5		74.3		(55.1		)	300.7
Depreciation and amortization	82.1		42.5		3.9			128.5
Capital expenditures	86.0		59.8		5.0			150.8
Total assets	7,575.3		3,078.8		2,099.2			12,753.3



	Three Months Ended September 29, 2018
	Seating		E-Systems		Other			Consolidated
Revenues from external customers	$	3,683.0	$	1,208.6	$	—		$	4,891.6
Segment earnings ⁽¹⁾	294.0		138.4		(69.1		)	363.3
Depreciation and amortization	80.1		36.1		3.6			119.8
Capital expenditures	109.2		49.8		1.5			160.5
Total assets	7,311.2		2,578.8		2,119.4			12,009.4



	Nine Months Ended September 28, 2019
	Seating		E-Systems		Other			Consolidated
Revenues from external customers	$	11,468.1	$	3,524.6	$	—		$	14,992.7
Segment earnings ⁽¹⁾	817.0		287.3		(186.2		)	918.1
Depreciation and amortization	248.4		120.2		11.8			380.4
Capital expenditures	246.2		151.4		12.5			410.1



	Nine Months Ended September 29, 2018
	Seating		E-Systems		Other			Consolidated
Revenues from external customers	$	12,287.6	$	3,918.5	$	—		$	16,206.1
Segment earnings ⁽¹⁾	981.8		504.3		(191.7		)	1,294.4
Depreciation and amortization	241.5		109.6		10.7			361.8
Capital expenditures	335.2		150.4		7.1			492.7

⁽¹⁾See definition above

For the three months ended September 28, 2019, segment earnings include restructuring charges of $18.2 million, $9.0 million and $0.7 million in the Seating and E-Systems segments and in the other category, respectively. For the nine months ended September 28, 2019, segment earnings include restructuring charges of $91.7 million, $26.2 million and $1.0 million in the Seating and E-Systems segments and in the other category, respectively. The Company expects to incur approximately $44 million and approximately $23 million of additional restructuring costs in the Seating and E-Systems segments, respectively, related to activities initiated as of September 28, 2019, and expects that the components of such costs will be consistent with its historical experience.

For the three months ended September 29, 2018, segment earnings include restructuring charges of $17.3 million, $2.4 million and $0.1 million in the Seating and E-Systems segments and in the other category, respectively. For the nine months ended September 29, 2018, segment earnings include restructuring charges of $37.6 million, $7.9 million and $2.7 million in the Seating and E-Systems segments and in the other category, respectively.

For further information, see Note 3, "Restructuring."

A reconciliation of segment earnings to consolidated income before provision for income taxes and equity in net income of affiliates is shown below (in millions):



	Three Months Ended				Nine Months Ended
	September 28, 2019		September 29, 2018		September 28, 2019		September 29, 2018
Segment earnings	$	300.7	$	363.3	$	918.1	$	1,294.4
Interest expense	24.0		21.2		69.4		62.8
Other expense, net	9.7		13.2		27.9		11.3
Consolidated income before provision for income taxes and equity in net income of affiliates	$	267.0	$	328.9	$	820.8	$	1,220.3