Celestica Announces Q2 2024 Financial Results

Estimated reading time: 2 minutes

Celestica Inc., a leader in design, manufacturing, hardware platform and supply chain solutions for the world's most innovative companies, 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.

Third Quarter of 2024 (Q3 2024) Guidance             

For Q3 2024, we expect a negative $0.16 to $0.22 per share (pre-tax) aggregate impact on net earnings on an IFRS basis for employee stock-based compensation (SBC) expense, amortization of intangible assets (excluding computer software), and restructuring charges. For Q3 2024, we also expect a non-IFRS adjusted effective tax rate* of approximately 20%, without accounting for foreign exchange impacts or unanticipated tax settlements.

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).