Celestica's Q2 Revenue of $1.42B within Guidance

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Celestica Inc., a global leader in the delivery of end-to-end product lifecycle solutions, today announced financial results for the second quarter ended June 30, 2015.

Second Quarter 2015 Highlights

  • Revenue: $1.42 billion, within our guidance range of $1.35 billion to $1.45 billion (announced April 21, 2015), increased 9% sequentially and decreased 4% compared to the second quarter of 2014
  • Revenue from our diversified end market represented 28% of total revenue, consistent with the second quarter of 2014
  • Operating margin (non-IFRS): 3.4%,  compared to 3.5% for the second quarter of 2014
  • Adjusted EPS (non-IFRS): $0.25 per share, within our guidance range of $0.20 to $0.26 per share (announced April 21, 2015), consistent with the second quarter of 2014
  • IFRS EPS: $0.14 per share, compared to $0.22 per share for the second quarter of 2014
  • ROIC (non-IFRS): 19.6%, compared to 19.0% for the second quarter of 2014
  • Repurchased and cancelled 26.3 million subordinate voting shares for $350.0 million under a substantial issuer bid, representing approximately 15.5% of the total multiple voting shares and subordinate voting shares issued and outstanding prior to its completion
  • Free cash flow (non-IFRS): $2.4 million, compared to $40.9 million for the second quarter of 2014

“Celestica delivered a solid second quarter with revenue and adjusted earnings per share above the midpoint of our guidance range, driven primarily by strength in our communications, storage and semiconductor markets as compared to last quarter,” said Craig Muhlhauser, Celestica’s President and Chief Executive Officer. “Through our continued focus on profitable revenue growth, operational excellence and continuous improvement, we also achieved sequential improvements in operating margin and return on invested capital.”
“As we look ahead to the second half of the year, we remain focused on diversification and accelerating our growth, strong operational execution, disciplined cost management and increasing our asset velocity to drive customer and shareholder value.”

Substantial Issuer Bid (SIB)

During the second quarter of 2015, we launched and completed a $350 million SIB, pursuant to which we repurchased and cancelled approximately 26.3 million subordinate voting shares at a price of $13.30 per share, representing approximately 15.5% of the total multiple voting shares and subordinate voting shares issued and outstanding prior to completion of the SIB. We funded the SIB using a combination of the net proceeds of a new $250 million non-revolving term loan (the Term Loan), $25.0 million drawn on our revolving credit facility, and available cash on hand.

Sale Agreement with respect to Real Property in Toronto

We also announced today that we have entered into an agreement to sell our real property located in Toronto, Ontario, which includes the site of Celestica's corporate headquarters and its Toronto manufacturing operations, to an entity to be formed by a consortium of three real estate developers. Subject to completion of the transaction, the agreed purchase price is approximately $137 million Canadian dollars ($110.7 million at period-end exchange rates), exclusive of taxes and subject to adjustment. The completion of the transaction is subject to various conditions, including municipal approvals and is anticipated to occur within approximately two years.

Third Quarter 2015 Outlook

For the third quarter ending September 30, 2015, we anticipate revenue to be in the range of $1.4 billion to $1.5 billion, and non-IFRS adjusted net earnings per share to be in the range of $0.28 to $0.34. We expect a negative $0.10 to $0.16 per share (pre-tax) aggregate impact on net earnings on an IFRS basis for employee stock-based compensation expense, amortization of intangible assets (excluding computer software) and restructuring charges.

About Celestica 

Celestica is dedicated to delivering end-to-end product lifecycle solutions to drive our customers’ success. Through our simplified global operations network and information technology platform, we are solid partners who deliver informed, flexible solutions that enable our customers to succeed in the markets they serve. Committed to providing a truly differentiated customer experience, our agile and adaptive employees share a proud history of demonstrated expertise and creativity that provides our customers with the ability to overcome complex challenges. For further information about Celestica, visit our website at www.celestica.com. Our securities filings can also be accessed at www.sedar.com and www.sec.gov.



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