Celestica Announces Fourth Quarter 2022 Financial Results

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Celestica Inc., 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 December 31, 2022 (Q4 2022).

“Celestica finished with a strong fourth quarter and had an outstanding 2022, resulting in 46% year-over-year non-IFRS adjusted EPS* growth. Our ability to successfully execute on our long-term strategy has allowed us to win in markets where we see opportunity for long-term, profitable growth,” said Rob Mionis, President and CEO, Celestica. “For the full year, we achieved $7.25 billion in revenue, a 29% increase over 2021 and our highest annual non-IFRS operating margin* and non-IFRS adjusted EPS* in our company’s history.”

“We are very pleased with the strength and consistency of our financial results. This performance is made possible by the exceptional efforts of the global Celestica team, in the context of a challenging environment. As we look ahead to 2023, we expect to build on the successes of this past year, and continue to advance our long-term goals of generating revenue growth and improving our profitability."

Q4 2022 Highlights

• Key measures:
  • Revenue: $2.04 billion, increased 35% compared to $1.51 billion for the fourth quarter of 2021 (Q4 2021).
  • Non-IFRS operating margin*: 5.3%, compared to 4.9% for Q4 2021.
  • ATS segment revenue: increased 30% compared to Q4 2021; ATS segment margin was 4.4%, compared to 5.6% for Q4 2021.
  • CCS segment revenue: increased 39% compared to Q4 2021; CCS segment margin was 5.9%, compared to 4.4% for Q4 2021.
  • Adjusted earnings per share (EPS) (non-IFRS)*: $0.56, compared to $0.44 for Q4 2021.
  • Adjusted return on invested capital (ROIC) (non-IFRS)*: 20.7%, compared to 16.6% for Q4 2021.
  • Adjusted free cash flow (non-IFRS)*: $42.6 million, compared to $35.6 million for Q4 2021.
• IFRS financial measures (directly comparable to non-IFRS measures above):
  • Earnings from operations as a percentage of revenue: 4.0%, compared to 3.3% for Q4 2021.
  • EPS: $0.35, compared to $0.26 for Q4 2021.
  • Return on invested capital (IFRS ROIC): 15.7%, compared to 11.1% for Q4 2021.
  • Cash provided by operations: $101.3 million, compared to $65.8 million for Q4 2021.
• Repurchased 1.2 million subordinate voting shares (SVS) for cancellation for $12.0 million.

2023 Outlook

Following our solid performance in 2022, we are pleased to reaffirm our 2023 outlook of:

• revenue of at least $7.5 billion;
• non-IFRS operating margin* of between 4.5% and 5.5%; and
• target non-IFRS adjusted EPS* of between $1.95 and $2.05.

Achievement of the midpoint of our 2023 non-IFRS adjusted EPS* range would represent a two-year non-IFRS adjusted EPS* average annual growth rate of 24% for 2022 and 2023(1). Looking beyond 2023, our average annual non-IFRS adjusted EPS* growth objective continues be 10%+ for 2024 and 2025.

Although we have incorporated the anticipated impact of supply chain constraints into the foregoing financial guidance and outlook to the best of our ability, their adverse impact (in terms of duration and severity) cannot be estimated with certainty, and may be materially in excess of our expectations.