October 22, 2009 / 8:37 PM / 9 years ago

UPDATE 2-Celestica posts loss on weak demand, restructuring

* Adjusted EPS $0.17 vs $0.24 a year ago

* Revenue $1.56 billion

* Net loss $600,000, or nil per share

* Demand appears to be stabilizing - CEO (Adds details, CEO comments. In U.S. dollars unless noted)

By Wojtek Dabrowski

TORONTO, Oct 22 (Reuters) - Contract electronics maker Celestica Inc (CLS.TO) (CLS.N) posted a marginal quarterly loss on Thursday, blaming restructuring charges and soft demand in a in what it said was a challenging and volatile environment.

Still, its revenue and adjusted profit, which is net earnings before charges and other items, hit the top end of forecasts Celestica issued in July and the company said its operating performance is continuing to improve.

Celestica, whose customers have included computer giant IBM (IBM.N) and handset maker Motorola MOT.N, said it lost $600,000, or nil per share, in the three months ended Sept. 30. That was down from a profit of $32.1 million, or 14 cents a share, a year earlier.

The loss “reflects the impact of weaker end-market demand, as well as higher restructuring costs,” Celestica said in a statement.

During the quarter, the Toronto-based company booked $42 million of restructuring costs, it said.

Celestica has been hurt by continuing weakness in the telecom market and has pursued new consumer electronics business to help make up for slumping demand in other areas.

During the quarter, the telecom market accounted for 12 percent of Celestica’s revenue, while consumer electronics represented 32 percent.

“We’re beginning to see modest revenue growth as end-market demand appears to be stabilizing from the volatility experienced earlier this year,” chief executive Craig Muhlhauser said in a conference call with analysts.

He added the company is considering making acquisitions, but declined to be more specific. The company had cash and cash equivalents of about $1.26 billion as of Sept. 30.

Its closely watched adjusted profit was 17 cents a share, down from 24 cents a share a year earlier, but at the high end of its forecasts.

Revenue was $1.56 billion, down from $2.03 billion a year earlier — but again hitting the high end of what the company forecast in July.

For the current quarter, ending Dec. 31, Celestica forecast revenue of $1.55 billion to $1.7 billion and adjusted earnings of 14 to 20 cents a share.

Celestica released its results after markets closed. Its shares rose 19 Canadian cents to end at C$9.65 on the Toronto Stock Exchange on Thursday. The stock has almost tripled in value since hitting a low of C$3.36 in early March.

$1=$1.05 Canadian Reporting by Wojtek Dabrowski; editing by Rob Wilson

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