Celestica Announces Second Quarter 2024 Financial Results

TORONTO (GLOBE NEWSWIRE) — Celestica Inc. (TSX: CLS) (NYSE: CLS), a leader in design, manufacturing, hardware platform and supply chain solutions for the world’s most innovative companies, today announced financial results for the quarter ended June 30, 2024 (Q2 2024)^†.

“We are pleased to deliver another quarter of very strong performance in Q2 2024, with revenue up 23% year-to-year and non-IFRS adjusted EPS* up 65% year-to-year”. said Rob Mionis, President and CEO, Celestica.

“With our strong performance in the first half of the year and favorable demand dynamics continuing, we are pleased to raise our full year 2024 outlook. We anticipate achieving revenue of $9.45 billion and non-IFRS adjusted EPS* of $3.62 in 2024, which, if achieved, would represent 19% and 49% growth, respectively, compared to 2023. We continue to stay focused on solid execution for our customers, and delivering on our strategic priorities and financial targets.”

Q2 2024 Highlights

• Key measures:
  • Revenue: $2.39 billion, increased 23% compared to $1.94 billion for the second quarter of 2023 (Q2 2023).
  • Non-IFRS operating margin*: 6.3%, compared to 5.5% for Q2 2023.
  • ATS segment revenue decreased 11% compared to Q2 2023; ATS segment margin was 4.6% compared to 4.8% for Q2 2023.
  • CCS segment revenue increased 51% compared to Q2 2023; CCS segment margin was 7.2% compared to 6.0% for Q2 2023.
  • Adjusted earnings per share (EPS) (non-IFRS)*: $0.91, compared to $0.55 for Q2 2023.
  • Adjusted return on invested capital (adjusted ROIC) (non-IFRS)*: 26.7%, compared to 20.0% for Q2 2023.
  • Adjusted free cash flow (non-IFRS)*: $63.3 million, compared to $66.8 million for Q2 2023.
• Most directly comparable IFRS financial measures to non-IFRS measures above:
  • Earnings from operations as a percentage of revenue: 5.7% compared to 4.5% for Q2 2023.
  • EPS: $0.83 compared to $0.46 for Q2 2023.
  • Return on invested capital (IFRS ROIC): 23.9% compared to 16.5% for Q2 2023.
  • Cash provided by operations: $123.1 million compared to $130.2 million for Q2 2023.
• Repurchased 0.2 million common shares for cancellation for $10.0 million.

† Celestica has two operating and reportable segments: Advanced Technology Solutions (ATS) and Connectivity & Cloud Solutions (CCS). Our ATS segment consists of our ATS end market and is comprised of our Aerospace and Defense (A&D), Industrial, HealthTech and Capital Equipment businesses. Our CCS segment consists of our Communications and Enterprise (servers and storage) end markets. Segment performance is evaluated based on segment revenue, segment income and segment margin (segment income as a percentage of segment revenue). See note 3 to our June 30, 2024 unaudited interim condensed consolidated financial statements (Q2 2024 Interim Financial Statements) for further detail.

2024 Annual Outlook Update

Building on our strong performance in Q2 2024, we are updating our 2024 outlook to the following:

• revenue of $9.45 billion (our previous outlook was $9.1 billion);
• non-IFRS operating margin* of 6.3% (our previous outlook was 6.1%); and
• non-IFRS adjusted EPS* of $3.62 (our previous outlook was $3.30).

Our previous non-IFRS adjusted free cash flow* outlook of $250 million for 2024 remains unchanged. The above outlook assumes an annual non-IFRS adjusted effective tax rate* of approximately 19% (which does not account for foreign exchange impacts or unanticipated tax settlements).