Celestica Inc. · TSX:CLS
Celestica — Q2 2021 Earnings Presentation
22 slides from Celestica's earnings presentation, Jul 27, 2021
Slide 1: Second Quarter 2021 Financial Results
Second Quarter 2021 Financial Results July 27, 2021 1
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward- Looking Statements This presentation contains forward-looking statements, including, without limitation, those related to our future growth; trends in the electronics manufacturing services (EMS) industry and our segments (and/or their constituent businesses), and
Slide 3: CEO Remarks
CEO Remarks ‘Celestica”
Slide 4: Higher Lifecycle Solutions revenue concentration is enabling long term profitable growth
Higher Lifecycle Solutions revenue concentration is enabling long term profitable growth Lifecycle Solutions Lifecycle Solutions Revenue as % of Total 60% 51% 47% ATS HPS 39% 41% • Long program lifecycles • Extensive patent portfolio FY2017 FY2018 FY2019 FY2020 1H21 • Highly regulated • Product road
Slide 5: Q2 2021 Highlights
Q2 2021 Highlights $US Q2 2021 Comments Aggregate 5% YTY Decrease; (Aggregate 6% YTY Increase in non-Cisco revenues1) Revenue $1.42B 12% YTY Increase in ATS 14% YTY Decrease in CCS IFRS Net Earnings $26.3M Up $13.0M YTY IFRS Earnings per Share - diluted $0.21 Up 11 cents YTY Non-IFRS Operating Margi
Slide 6: ATS and CCS Segment Revenue and Profitability
ATS1 and CCS2 Segment Revenue and Profitability Q2 2020 Revenue 6 Q2 2021 Revenue 7 Year over 2Q21 Revenue $ Sequential Year ATS Up 6% Up 12% ATS ATS CCS Up 22% Down 14% 34% CCS 40% CCS Non-Cisco CCS3 Up 22% Up 2% 60% 66% Communications4 Up 20% Down 7% Enterprise5 Up 26% Down 25% Segment 2Q20 2Q21 I
Slide 7: Q2 2021 Highlights
Q2 2021 Highlights¹ B/(W) QTQ B/(W) YTY $US Millions (Except for per share amounts and %) Q2 2021 (vs. Q1 2021) (vs. Q2 2020) Revenue $1,420 $185 ($72) Non-Cisco2 $184 $77 IFRS Net Earnings $26.3 $15.8 $13.0 IFRS Earnings per Share - diluted $0.21 $0.13 $0.11 Non-IFRS Adjusted Gross Margin 8.4% (0.2
Slide 8: Working Capital / Capex / Non-IFRS Free Cash Flow
Working Capital / Capex / Non-IFRS Free Cash Flow1 Q2 2021 ($US) Inventory turns increased by 0.4x sequentially 4.4 inventory turns2 (Inventory up $71M sequentially and up $19M YTY) $10M Capex ~1% of Revenue $31.2M Free Cash Flow1 Achieved positive free cash flow for the 10th consecutive quarter Cas
Slide 9: Balance Sheet: Net Cash $27M
Balance Sheet $US At June 30, 2021 Cash and cash equivalents $467M Revolver (excluding L/Cs) - Term Loans $440M Net Cash: $27M As of June 30, 2021, Celestica’s non-IFRS debt leverage ratio was 1.4x. See the Appendix for a reconciliation of non-IFRS debt leverage ratio to the most directly comparable
Slide 10: Q3 2021 Outlook
Q3 2021 Outlook1 $US Revenue $1.40B - $1.55B 4.0% Non-IFRS Operating Margin at the mid-point of revenue and non-IFRS adjusted EPS guidance ranges Non-IFRS Adjusted EPS – diluted $0.30 - $0.36 Non-IFRS Adjusted SG&A $56M - $58M Q3 2021 Non-IFRS Tax Rate Estimate Non-IFRS Adjusted Effective Tax Rate o
Slide 11: Q3 2021 End Market Revenue Outlook
Q3 2021 End Market Revenue Outlook Year over Year Revenue % Change ATS1 Increase low double-digit Communications Decrease high single-digit Enterprise2 Decrease low twenties 1 ATS consists of A&D, Industrial, Energy, HealthTech, and Capital Equipment. 2 Enterprise consists of Servers and Storage. 11
Slide 12: Concluding Remarks
Concluding Remarks ‘Celestica”
Slide 13: ee . Celestica”
ee . Celestica” a on
Slide 14: YTY Non-IFRS Operating Margin Progression
YTY Non-IFRS Operating Margin Progression Non-IFRS Operating Margin1 vs Prior Year Quarter 3.9% 3.9% 3.6% 3.5% 3.4% 3.4% 2.9% 2.9% 2.9% 2.8% 2.5% 2.4% Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Prior Year Quarter Non-IFRS Operating Margin Non-IFRS Operating Margin Q2 2021 was the sixth consecut
Slide 15: Second Quarter 2021 Financial Results
Second Quarter 2021 Financial Results July 27, 2021
Slide 16: Appendix
Appendix oy ‘Celestica”
Slide 17: Segment Income and Margin
Segment Income and Margin1 * * *Refers to notes to our Q2 2021 unaudited interim condensed consolidated financial statements (Q2 2021 Interim Financial Statements) 1 Segment income is defined as a segment’s net revenue less its cost of sales and its allocable portion of selling, general and administ
Slide 18: IFRS to non-IFRS Reconciliation
IFRS to non-IFRS Reconciliation* 1Q 2020 2Q 2020 3Q 2020 4Q 2020 1Q2021 2Q2021 YTD 2021 FY 2020 IFRS Revenue $ 1,318.6 $ 1,492.4 $ 1,550.5 $ 1,386.6 $ 1,234.9 $ 1,420.3 $ 2,655.2 $ 5,748.1 Net earnings (loss) (3.2) 13.3 30.4 20.1 10.5 26.3 36.8 60.6 Earnings (loss) per share - diluted $ (0.02) $ 0.1
Slide 19: IFRS to non-IFRS Reconciliation…continued
IFRS to non-IFRS Reconciliation…continued* 1Q2020 2Q2020 3Q 2020 4Q 2020 1Q2021 2Q2021 YTD 2021 FY 2020 IFRS Net earnings (loss) $ (3.2) $ 13.3 $ 30.4 $ 20.1 $ 10.5 $ 26.3 $ 36.8 $ 60.6 As a percentage of revenue (0.2%) 0.9% 2.0% 1.4% 0.9% 1.9% 1.4% 1.1% Non-IFRS adjusted net Employee stock-based co
Slide 20: IFRS to non-IFRS Reconciliation…continued
IFRS to non-IFRS Reconciliation…continued* Non-IFRS operating margin (non-IFRS operating earnings as a percentage of revenue) reconciliation to IFRS earnings (loss) before income taxes as a percentage of revenue 1Q 2019 2Q 2019 3Q 2019 4Q 2019 1Q 2020 2Q 2020 3Q 2020 4Q 2020 1Q2021 2Q2021 IFRS Reven
Slide 21: IFRS to non-IFRS Reconciliation…continued
IFRS to non-IFRS Reconciliation…continued* (1) IFRS earnings (loss) per diluted share is calculated by dividing IFRS net earnings (loss) by the number of diluted weighted average shares outstanding (DWAS). In order to calculate IFRS loss per diluted share for Q1 2020, we used a DWAS of 129.0 million
Slide 22: Second Quarter 2021 Financial Results
Second Quarter 2021 Financial Results July 27, 2021