Celestica Inc EBITDA surged on 26.5% in 2016 and EBITDA Margin increased slightly on 0.60 pp from 3.3% to 3.9%
26.01.2017 • About Celestica Inc (
$CLS) • By InTwits
Celestica Inc reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is relatively stable: 3.9% in 2016 vs. 3.3% in 2015 vs. 3.0% in 2012
- Celestica Inc has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.2%. At the same time it's in pair with industry average of 24.1%.
- CAPEX is quite volatile: 109 in 2016, 88.1 in 2015, 39.6 in 2014, 22.3 in 2013, 16.6 in 2012
- The company has business model with average profitability: ROIC is at 10.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Celestica Inc ($CLS) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 6,507 | 5,796 | 5,631 | 5,639 | 6,017 | 6.7% |
| Gross Profit | 438 | 389 | 405 | 391 | 428 | 9.3% |
| SG&A | 237 | 222 | 210 | 207 | 211 | 1.7% |
| EBITDA | 197 | 205 | 196 | 184 | 232 | 26.5% |
| Net Income | 118 | 118 | 108 | 67 | 136 | 103.7% |
Balance Sheet
|
|---|
| Cash | 551 | 544 | 565 | 545 | 557 | 2.2% |
| Short Term Debt | 55 | 0 | 0 | 29 | 56 | 92.4% |
| Long Term Debt | 0 | 0 | 0 | 251 | 189 | -24.7% |
Cash flow
|
|---|
| Capex | 106 | 53 | 61 | 63 | 64 | 2.1% |
Ratios
|
|---|
| Revenue growth | -9.8% | -10.9% | -2.8% | 0.1% | 6.7% | |
| EBITDA growth | -30.0% | 4.2% | -4.3% | -6.5% | 26.5% | |
| Gross Margin | 6.7% | 6.7% | 7.2% | 6.9% | 7.1% | 0.2% |
| EBITDA Margin | 3.0% | 3.5% | 3.5% | 3.3% | 3.9% | 0.6% |
| Net Income Margin | 1.8% | 2.0% | 1.9% | 1.2% | 2.3% | 1.1% |
| SG&A, % of revenue | 3.6% | 3.8% | 3.7% | 3.7% | 3.5% | -0.2% |
| CAPEX, % of revenue | 1.6% | 0.9% | 1.1% | 1.1% | 1.1% | -0.0% |
| ROIC | 8.0% | 9.6% | 9.1% | 8.3% | 10.8% | 2.5% |
| ROE | 8.4% | 8.7% | 7.7% | 5.4% | 11.7% | 6.3% |
| Net Debt/EBITDA | -2.5x | -2.7x | -2.9x | -1.4x | -1.3x | 0.1x |
Celestica Inc ($CLS) key quoterly financial indicators
| mln. $ | 16Q1 | 16Q2 | 16Q3 | 16Q4 | YoY change |
|---|
P&L
|
|---|
| Revenue | 1,353 | 1,486 | 1,554 | 1,624 | 4.2% | 4.8% | 10.3% | 7.2% |
| EBITDA | 49 | 71 | 68 | 44 | 12.3% | 49.7% | 41.1% | -0.5% |
| Net Income | 26 | 36 | 54 | 21 | 29.9% | 49.6% | 391.7% | 72.7% |
Balance Sheet
|
|---|
| Cash | 512 | 473 | 542 | 557 | -10.1% | -4.8% | 9.3% | 2.2% |
| Short Term Debt | 69 | 84 | 69 | 56 | | 64.9% | 31.1% | 92.4% |
| Long Term Debt | 244 | 212 | 205 | 189 | | -8.1% | -11.5% | -24.7% |
Ratios
|
|---|
| Gross Margin | 6.9% | 7.5% | 7.1% | 6.9% | -0.2% | 0.7% | -0.0% | 0.2% |
| EBITDA Margin | 3.6% | 4.8% | 4.4% | 2.7% | 0.3% | 1.4% | 1.0% | -0.2% |
| Net Income Margin | 1.9% | 2.4% | 3.4% | 1.3% | 0.4% | 0.7% | 2.7% | 0.5% |
Revenue and profitability
Celestica Inc's Revenue increased on 6.7%. Revenue growth showed acceleration in 16Q4 - it increased 7.2% YoY. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 0.60 pp from 3.3% to 3.9% in 2016.
Gross Margin showed almost no change in 2016. SG&A as a % of Revenue showed almost no change in 2016.
Net Income marign increased slightly on 1.1 pp from 1.2% to 2.3% in 2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 1.1% in 2016. Celestica Inc's CAPEX/Revenue showed almost no change from 2013 to 2016. Average CAPEX/Revenue for the last three years was 1.1%.
Return on investment
The company operates at low ROIC (10.82%) and ROE (11.70%). ROIC increased on 2.5 pp from 8.3% to 10.8% in 2016. ROE increased on 6.3 pp from 5.4% to 11.7% in 2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.3x and Debt / EBITDA is 1.1x. Net Debt / EBITDA jumped on 0.1x from -1.4x to -1.3x in 2016. Debt dropped on 12.5% while cash increased on 2.2%.
Management team
Celestica Inc's CEO is Robert A Mionis "Rob". Robert A Mionis "Rob" is a founder and has 3 years tenure at the company. The company's CFO Darren G Myers has spent 5 years at the company.
Appendix 1: Peers in Industrial
Below we provide Celestica Inc benchmarking against other companies in Industrial industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Progressive Waste Solutions Ltd ($BIN) | | 16.1% | 7.8% | 1.8% | 59.4% |
| Baylin Technologies Inc ($BYL) | | 16.5% | -44.0% | -4.1% | 47.5% |
| CCL Industries Inc ($CCL.B) | | 44.4% | 36.8% | 17.5% | 30.8% |
| Stantec Inc ($STN) | | 17.9% | 13.3% | 14.4% | 30.5% |
| Avigilon Corp ($AVO) | | 72.6% | 41.9% | 17.7% | 22.2% |
| |
|---|
| Median (51 companies) | | 5.3% | 10.4% | 8.5% | 2.6% |
|---|
| Celestica Inc ($CLS) | | -10.9% | -2.8% | 0.1% | 6.7% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Pure Technologies Ltd ($PUR) | 77.9% | 78.0% | 77.5% | 75.6% | |
| WSP Global Inc ($WSP) | 81.1% | 83.2% | 81.0% | 74.0% | 76.7% |
| Avigilon Corp ($AVO) | 49.3% | 54.2% | 56.6% | 57.4% | 52.0% |
| Stantec Inc ($STN) | 55.0% | 54.7% | 54.9% | 54.5% | 54.1% |
| IWG Technologies Inc ($IWG) | 53.3% | 54.0% | 49.0% | 47.8% | 54.9% |
| |
|---|
| Median (49 companies) | 23.9% | 24.0% | 21.9% | 21.9% | 22.9% |
|---|
| Celestica Inc ($CLS) | 6.7% | 6.7% | 7.2% | 6.9% | 7.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Canadian National Railway Co ($CNR) | 46.5% | 45.9% | 46.8% | 50.9% | 54.3% |
| Canadian Pacific Railway Ltd ($CP) | 26.1% | 32.4% | 43.7% | 48.9% | 51.6% |
| Badger Daylighting Ltd ($BAD) | 25.7% | 25.9% | 27.9% | 24.6% | 24.2% |
| IWG Technologies Inc ($IWG) | 12.7% | 25.5% | 20.0% | 24.0% | 26.9% |
| Winpak Ltd ($WPK) | 19.5% | 18.6% | 18.7% | 22.7% | 23.5% |
| |
|---|
| Median (53 companies) | 10.5% | 8.4% | 8.6% | 9.5% | 11.1% |
|---|
| Celestica Inc ($CLS) | 3.0% | 3.5% | 3.5% | 3.3% | 3.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Newalta Corp ($NAL) | 21.7% | 34.5% | 35.1% | 42.0% | 9.6% |
| Cargojet Inc ($CJT.A) | 7.0% | 6.3% | 54.1% | 41.3% | |
| Algoma Central Corp ($ALC) | 15.9% | 7.3% | 5.0% | 27.4% | 58.2% |
| Canadian Pacific Railway Ltd ($CP) | 20.2% | 20.2% | 21.9% | 22.7% | 19.0% |
| Canadian National Railway Co ($CNR) | 17.4% | 18.7% | 18.9% | 21.5% | 22.4% |
| |
|---|
| Median (54 companies) | 3.2% | 3.7% | 4.4% | 3.9% | 4.8% |
|---|
| Celestica Inc ($CLS) | 1.6% | 0.9% | 1.1% | 1.1% | 1.1% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| IBI Group Inc ($IBG) | 4.8% | -9.0% | 11.6% | 21.9% | 26.2% |
| IWG Technologies Inc ($IWG) | 17.0% | 36.3% | 23.4% | 27.2% | 25.7% |
| Winpak Ltd ($WPK) | 20.4% | 18.0% | 18.3% | 22.6% | 21.8% |
| Toromont Industries Ltd ($TIH) | 28.8% | 25.8% | 24.3% | 23.5% | 21.7% |
| Intertape Polymer Group Inc ($ITP) | 12.3% | 13.7% | 22.5% | 23.0% | 21.0% |
| |
|---|
| Median (55 companies) | 12.2% | 9.7% | 11.5% | 8.9% | 8.5% |
|---|
| Celestica Inc ($CLS) | 8.0% | 9.6% | 9.1% | 8.3% | 10.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Conifex Timber Inc ($CFF) | | 2.7x | 6.1x | 35.9x | 3.6x |
| Ag Growth International Inc ($AFN) | 2.9x | -0.1x | 2.1x | 14.1x | |
| Cargojet Inc ($CJT.A) | 1.5x | 1.5x | 31.5x | 12.9x | |
| Progressive Waste Solutions Ltd ($BIN) | 4.5x | 3.3x | 2.9x | 10.6x | 3.8x |
| Finning International Inc ($FTT) | 2.3x | 1.8x | 1.4x | 9.4x | 2.5x |
| |
|---|
| Median (49 companies) | 1.5x | 1.6x | 1.3x | 1.0x | 2.1x |
|---|
| Celestica Inc ($CLS) | -2.5x | -2.7x | -2.9x | -1.4x | -1.3x |
