(Source: Canada Newswire)
(All amounts in U.S. dollars.
Per share information based on diluted
shares outstanding unless noted otherwise).
First Quarter Summary
---------------------
- Revenue of $1,469 million, compared to $1,836 million for the same
period last year
- GAAP earnings of $19.2 million or $0.08 per share, compared to GAAP
earnings of $29.8 million or $0.13 per share last year
- Adjusted net earnings of $0.13 per share compared to $0.15 per share
for the same period last year
- Return on invested capital, including intangibles, of 16.9% compared
to 10.5% last year
- Operating margin of 2.9% compared to 2.7% last year
- Gross margin of 7.6% compared to 6.3% last year
- Repurchased $150 million in debt; Company cash position at
$1.1 billion
- Second quarter of 2009 revenue guidance of $1.3 billion -
$1.45 billion, adjusted net earnings per share of $0.07 - $0.13
TORONTO, April 23 /CNW/ - Celestica Inc. (NYSE, TSX: CLS), a global leader in the delivery of end-to-end product lifecycle solutions, today announced financial results for the first quarter ended March 31, 2009.
Revenue for the quarter was $1,469 million, compared to $1,836 million in the first quarter of 2008. GAAP net earnings were $19.2 million or $0.08 per share, compared to GAAP net earnings of $29.8 million or $0.13 per share for the same period last year. The year- over-year change reflected the impact of weaker end-market demand.
Adjusted net earnings for the quarter were $29.3 million, or $0.13 per share, compared to adjusted net earnings of $35.4 million, or $0.15 per share, for the same period last year. Adjusted net earnings is defined as net earnings before other charges, amortization of intangible assets (excluding amortization of computer software), option expense, gains or losses related to the repurchase of shares and debt, net of tax and significant deferred tax write-offs or recovery. Detailed GAAP financial statements and supplementary information related to adjusted net earnings appear at the end of this press release.
The company's revenue and adjusted net earnings for the first quarter of 2009 were within the company's published guidance, announced on January 28, 2009, of revenue of $1.40 billion to $1.60 billion and adjusted net earnings per share of $0.07 to $0.13.
"Celestica continues to deliver profitability and on-going operational improvements in support of our customers, in a very tough economic environment," said Craig Muhlhauser, President and Chief Executive Officer, Celestica. "Our track record and relentless drive to achieve world class operational excellence and a laser- like focus on creating value for our customers, will serve as an excellent platform for our future growth and profitability, as the market environment begins to improve."
Second Quarter Outlook
----------------------
For the second quarter ending June 30, 2009, the company anticipates revenue to be in the range of $1.3 billion to $1.45 billion, and adjusted net earnings per share to range from $0.07 to $0.13.
First Quarter and Annual Shareholders Meeting Webcasts
------------------------------------------------------
Management will host its quarterly results conference call today at 8:00 a.m. Eastern Time. The webcast can be accessed at www.celestica.com.
The company's Annual Meeting of Shareholders will be held today at 10:00 a.m. at the Glenn Gould Studio, CBC Building, 250 Front Street West, Toronto, Ontario. A live webcast of management's presentation can also be heard at www.celestica.com beginning at approximately 10:10 a.m. Eastern Time.
Supplementary Information
-------------------------
In addition to disclosing detailed results in accordance with Canadian generally accepted accounting principles (GAAP), Celestica also provides supplementary non-GAAP measures as a method to evaluate the company's operating performance.
Management uses adjusted net earnings as a measure of enterprise- wide performance. As a result of restructuring activities, acquisitions made by the company, fair value accounting for stock options and securities repurchases, management believes adjusted net earnings are a useful measure for the company as well as its investors to facilitate period-to-period operating comparisons and allow the comparison of operating results with its competitors in the U.S. and Asia. Excluded from adjusted net earnings are the effects of other charges, most significantly the write-down of goodwill and long-lived assets, gains or losses on the repurchase of shares or debt and the related income tax effect of these adjustments, and any significant deferred tax write-offs or recovery. The company also excludes some recurring charges such as restructuring costs, option expense, the amortization of intangible assets (except amortization of computer software), and the related income tax effect of these adjustments. The term adjusted net earnings does not have any standardized meaning prescribed by GAAP and is not necessarily comparable to similar measures presented by other companies. Adjusted net earnings are not a measure of performance under Canadian or U.S. GAAP and should not be considered in isolation or as a substitute for net earnings prepared in accordance with Canadian or U.S. GAAP. The company has provided a reconciliation of adjusted net earnings to Canadian GAAP net earnings below.
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 any challenge.
For further information on Celestica, visit its website at http:/ /www.celestica.com.
The company's security filings can also be accessed at http:// www.sedar.com and http://www.sec.gov.
To access Q1 2009 Information Sheet click here:
http://files.newswire.ca/106/Q1Information.pdf
To access the Q1 2009 Webcast slides click here:
http://files.newswire.ca/106/Q1Webcast.pdf
Safe Harbour and Fair Disclosure Statement
------------------------------------------
This news release contains forward-looking statements related to our future growth, trends in our industry, our financial and/or operational results, and our financial or operational performance. Such forward-looking statements are predictive in nature and may be based on current expectations, forecasts or assumptions involving risks and uncertainties that could cause actual outcomes and results to differ materially from the forward-looking statements themselves. Such forward-looking statements may, without limitation, be preceded by, followed by, or include words such as "believes", "expects", "anticipates", "estimates", "intends", "plans", or similar expressions, or may employ such future or conditional verbs as "may", "will", "should" or "would", or may otherwise be indicated as forward-looking statements by grammatical construction, phrasing or context. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the U.S. Private Securities Litigation Reform Act of 1995, and in any applicable Canadian securities legislation. Forward-looking statements are not guarantees of future performance. You should understand that the following important factors could affect our future results and could cause those results to differ materially from those expressed in such forward-looking statements: the challenges of effectively managing our operations during uncertain economic conditions, including significant changes in demand from our customers as a result of the impact of the global economic crisis and capital markets weakness; the risk of potential non-performance by counterparties, including but not limited to financial institutions, customers and suppliers, during uncertain economic conditions; the effects of price competition and other business and competitive factors generally affecting the EMS industry, including changes in the trend for outsourcing; our dependence on a limited number of customers; variability of operating results among periods; the challenge of managing our financial exposures to foreign currency fluctuations; the challenge of responding to lower-than-expected customer demand; our inability to retain or grow our business due to execution problems resulting from significant headcount reductions, plant closures and product transfers associated with major restructuring activities; our dependence on industries affected by rapid technological change; our ability to successfully manage our international operations; and the delays in the delivery and/or general availability of various components used in our manufacturing process. These and other risks and uncertainties, as well as other information related to the company, are discussed in the Company's various public filings at www.sedar.com and www.sec.gov, including our Annual Report on Form 20-F and subsequent reports on Form 6-K filed with the Securities and Exchange Commission and our Annual Information Form filed with the Canadian Securities Commissions. Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that such information may not be appropriate for other purposes.
As of its date, this press release contains any material information associated with the company's financial results for the first quarter ended March 31, 2009 and revenue and adjusted net earnings guidance for the second quarter ending June 30, 2009. Revenue and earnings guidance is reviewed by the company's board of directors. Our revenue and earnings guidance is based on various assumptions which management believes are reasonable under the current circumstances, but may prove to be inaccurate, and many of which involve factors that are beyond the control of the Company. The material assumptions may include assumptions regarding the following: forecasts from our customers, which range from 30 to 90 days; timing and investments associated with ramping new business; general economic and market conditions; currency exchange rates; pricing and competition; anticipated customer demand; supplier performance and pricing; commodity, labor, energy and transportation costs; operational and financial matters; technological developments; and the timing and execution of our restructuring plan. These assumptions are based on management's current views with respect to current plans and events, and are and will be subject to the risks and uncertainties referred to above. It is Celestica's policy that revenue and earnings guidance is effective on the date given, and will only be updated through a public announcement.
RECONCILIATION OF GAAP TO
ADJUSTED NET EARNINGS
(in millions of
U.S. dollars)
2008 2009
Three months ----------------------------- --------------------- --------
ended Adjust- Adjust-
March 31 GAAP ments Adjusted GAAP ments Adjusted
--------- --------- --------- --------- --------- ---------
Revenue $1,835.7 $ - $1,835.7 $1,469.4 $ - $1,469.4
Cost of
sales(1) 1,720.7 (1.0) 1,719.7 1,358.2 (0.7) 1,357.5
--------- --------- --------- --------- --------- ---------
Gross profit 115.0 1.0 116.0 111.2 0.7 111.9
SG&A(1)(2) 63.3 (0.7) 62.6 67.4 (1.0) 66.4
Amortization
of
intangible
assets(2) 7.2 (4.2) 3.0 5.8 (3.1) 2.7
Other
charges 3.3 (3.3) - 12.5 (12.5) -
--------- --------- --------- --------- --------- ---------
Operating
earnings -
EBIAT 41.2 9.2 50.4 25.5 17.3 42.8
Interest
expense,
net 8.7 - 8.7 10.2 - 10.2
--------- --------- --------- --------- --------- ---------
Net earnings
before tax 32.5 9.2 41.7 15.3 17.3 32.6
Income tax
expense
(recovery) 2.7 3.6 6.3 (3.9) 7.2 3.3
--------- --------- --------- --------- --------- ---------
Net
earnings $ 29.8 $ 5.6 $ 35.4 $ 19.2 $ 10.1 $ 29.3
--------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- ---------
W.A. No.
of shares
(in
millions)
- diluted 229.2 229.2 229.4 229.4
Earnings
per share
- diluted $ 0.13 $ 0.15 $ 0.08 $ 0.13
(1) Non-cash option expense included in cost of sales and SG&A is added
back for adjusted net earnings.
(2) Certain 2008 GAAP numbers have been restated to reflect the change in
accounting for computer software effective January 1, 2009 as
required under Canadian GAAP. For the first quarter of 2008,
$3.0 million in amortization of computer software has been
reclassified from SG&A expenses to amortization of intangible assets.
Amortization of computer software is not added back for EBIAT and
adjusted net earnings. There is no impact to our current or
previously reported EBIAT, adjusted net earnings or net earnings.
GUIDANCE SUMMARY
1Q 09 Guidance 1Q 09 Actual 2Q 09 Guidance(3)
-------------- ------------ -----------------
Revenue $1.4B - $1.6B $1.5B $1.3B - $1.45B
Adjusted net EPS $0.07 - $0.13 $0.13 $0.07 - $0.13
(3) Guidance for the second quarter is provided only on an adjusted net
earnings basis. This is due to the difficulty in forecasting the
various items impacting GAAP net earnings, such as the amount and
timing of our restructuring activities.
CELESTICA INC.
CONSOLIDATED BALANCE SHEETS
(in millions of U.S. dollars)
December 31 March 31
2008 2009
------------ ------------
Assets (unaudited)
Current assets:
Cash and cash equivalents (note 6).......... $ 1,201.0 $ 1,081.3
Accounts receivable (note 10(c))............ 1,074.0 731.4
Inventories (note 2)........................ 787.4 695.1
Prepaid and other assets (note 7(i))........ 87.1 64.6
Income taxes recoverable.................... 14.1 17.1
Deferred income taxes....................... 8.2 7.0
------------ ------------
3,171.8 2,596.5
Property, plant and equipment (note 1(i))..... 433.5 432.7
Intangible assets (note 1(i))................. 54.1 49.0
Other long-term assets (note 7(ii))........... 126.8 107.4
------------ ------------
$ 3,786.2 $ 3,185.6
------------ ------------
------------ ------------
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable............................ $ 1,090.6 $ 781.4
Accrued liabilities (notes 4 and 7(i))...... 463.1 304.6
Income taxes payable........................ 13.5 12.2
Deferred income taxes....................... 0.2 0.2
Current portion of long-term debt
(note 3)................................... 1.0 0.4
------------ ------------
1,568.4 1,098.8
Long-term debt (note 3)....................... 732.1 584.3
Accrued pension and post-employment
benefits..................................... 63.2 62.4
Deferred income taxes......................... 47.2 38.3
Other long-term liabilities................... 9.8 8.8
------------ ------------
2,420.7 1,792.6
Shareholders' equity (note 8):
Capital stock............................... 3,588.5 3,588.5
Contributed surplus......................... 204.4 211.3
Deficit..................................... (2,436.8) (2,417.6)
Accumulated other comprehensive income...... 9.4 10.8
------------ ------------
1,365.5 1,393.0
------------ ------------
$ 3,786.2 $ 3,185.6
------------ ------------
------------ ------------
Guarantees and contingencies (note 9)
Subsequent event (note 3(a))
See accompanying notes to unaudited consolidated
financial statements.
These unaudited interim consolidated financial statements should
be read in conjunction with the 2008 annual
consolidated financial statements.
CELESTICA INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions of U.S. dollars, except per share amounts)
Three months ended
March 31
2008 2009
------------ ------------
(unaudited) (unaudited)
Revenue....................................... $ 1,835.7 $ 1,469.4
Cost of sales................................. 1,720.7 1,358.2
------------ ------------
Gross profit.................................. 115.0 111.2
Selling, general and administrative
expenses (note 1(i))......................... 63.3 67.4
Amortization of intangible assets
(note 1(i)).................................. 7.2 5.8
Other charges (note 4)........................ 3.3 12.5
Interest on long-term debt.................... 14.5 10.4
Interest income, net of interest expense...... (5.8) (0.2)
------------ ------------
Earnings before income taxes.................. 32.5 15.3
Income tax expense (recovery):
Current..................................... 5.2 2.7
Deferred.................................... (2.5) (6.6)
------------ ------------
2.7 (3.9)
------------ ------------
Net earnings for the period................... $ 29.8 $ 19.2
------------ ------------
------------ ------------
Basic earnings per share...................... $ 0.13 $ 0.08
Diluted earnings per share.................... $ 0.13 $ 0.08
Shares used in computing per share amounts:
Basic (in millions)......................... 229.1 229.4
Diluted (in millions)....................... 229.2 229.4
See accompanying notes to unaudited consolidated
financial statements.
These unaudited interim consolidated financial statements
should be read in conjunction with the
2008 annual consolidated financial statements.
CELESTICA INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in millions of U.S. dollars)
Three months ended
March 31
2008 2009
------------ ------------
(unaudited) (unaudited)
Net earnings for the period................... $ 29.8 $ 19.2
Other comprehensive income, net of tax:
Foreign currency translation gain (loss).... 9.8 (9.1)
Net gain (loss) on derivatives designated
as cash flow hedges........................ 0.4 (12.7)
Reclass net loss (gain) on derivatives
designated as cash flow hedges to
operations................................. (10.7) 23.2
------------ ------------
Comprehensive income..........................
