Celestica(CLS) - 2024 Q4 - Annual Results

Financial Performance - Q4 2024 revenue reached $2.55 billion, a 19% increase year-over-year from $2.14 billion in Q4 2023[3] - Non-GAAP adjusted EPS for Q4 2024 was $1.11, the highest quarterly EPS ever, compared to $0.77 in Q4 2023, reflecting a 44% year-over-year growth[3][6] - For the full year 2024, Celestica achieved a revenue of $9.65 billion, a 21% increase from $7.96 billion in 2023, with non-GAAP adjusted EPS growing 58% to $3.88[13] - GAAP revenue for Q4 2024 was $2,545.7 million, a 19% increase from $2,140.5 million in Q4 2023[46] - GAAP net earnings for the year ended December 31, 2024, reached $428.0 million, up 75% from $244.4 million in 2023[46] - GAAP earnings per share (EPS) for Q4 2024 was $1.29, compared to $0.77 in Q4 2023[46] - Adjusted EPS (non-GAAP) for the year ended December 31, 2024, was $3.88, up from $2.46 in 2023[46] - Net earnings for the year ended December 31, 2024, were $428.0 million, compared to $244.4 million in 2023, representing a 75.0% increase[56] - Net earnings for Q4 2024 were $151.7 million, a 65.7% increase from $91.6 million in Q4 2023[58] Segment Performance - The Connectivity & Cloud Solutions (CCS) segment revenue was $1.74 billion, a 30% increase compared to Q4 2023, with a segment margin of 7.9%[9] - Hardware Platform Solutions (HPS) revenue was $0.8 billion, a significant 65% increase year-over-year[9] Guidance and Outlook - The company raised its 2025 revenue outlook to $10.7 billion from $10.4 billion, and adjusted EPS outlook to $4.75 from $4.42[4][12] - Q1 2025 guidance estimates revenue between $2.475 billion and $2.625 billion, with adjusted EPS projected between $1.06 and $1.16[5] Cash Flow and Investments - Free cash flow for 2025 is projected at $350 million, up from a previous outlook of $325 million[12] - Free cash flow (non-GAAP) for the year ended December 31, 2024, was $305.9 million, an increase from $203.8 million in 2023[46] - Cash provided by operating activities for the year ended December 31, 2024, was $473.9 million, up 45.2% from $326.2 million in 2023[58] - Net cash used in investing activities for the year was $212.5 million, compared to $122.4 million in 2023, indicating a 73.7% increase[58] - Cash and cash equivalents at the end of 2024 were $423.3 million, up from $370.4 million at the end of 2023, representing a 14.3% increase[58] Non-GAAP Measures - Non-GAAP financial measures such as adjusted gross profit, adjusted operating earnings, and free cash flow are used to provide transparency into core operations[26] - Adjusted operating earnings (Adjusted EBIAT) is defined as GAAP earnings from operations excluding specific expenses, and is used to assess core performance[41] - Adjusted net earnings exclude certain expenses and are calculated to assess core operational performance[42] - The company does not provide reconciliations for forward-looking non-GAAP financial measures due to the difficulty in estimating excluded items[29] - Adjusted ROIC is calculated to assess the effectiveness of invested capital in generating earnings[44] - The company highlights the importance of adjusted tax expense and effective tax rate for historical comparisons and forecasting[27] - Restructuring and other charges are excluded from non-GAAP measures as they do not reflect ongoing operating results[35] - The company notes that non-GAAP financial measures may not be directly comparable to similar measures presented by other companies[28] Operational Metrics - The company reported a GAAP gross profit margin of 11.7% for Q4 2024, up from 10.4% in Q4 2023[46] - Adjusted gross profit (non-GAAP) for the year ended December 31, 2024, was $1,019.0 million, representing 10.6% of revenue, compared to $780.3 million or 9.8% in 2023[46] - GAAP ROIC for the year ended December 31, 2024, was 34.0%, compared to 20.1% in 2023[46] - The company's GAAP ROIC for Q4 2024 was 34.0%, up from 20.1% in Q4 2023, showing a significant improvement in return on invested capital[51] Other Financial Metrics - Total assets as of December 31, 2024, were $5,988.2 million, an increase from $5,890.5 million in 2023[54] - Average net invested capital for Q4 2024 was $2,386.7 million, up from $2,176.9 million in Q4 2023, indicating a 9.6% increase[51] - Total depreciation and amortization increased to $151.9 million in 2024 from $130.8 million in 2023, reflecting a 16.1% rise[58] - Interest paid decreased to $52.9 million in 2024 from $68.8 million in 2023, a reduction of 23.0%[58] - Net income taxes paid increased to $106.3 million in 2024, compared to $78.4 million in 2023, marking a 35.6% increase[58] Shareholder Activities - The company repurchased $152.0 million in capital stock for cancellation during the year, compared to $35.6 million in 2023, indicating a substantial increase in share repurchase activity[58]