TORONTO -- Celestica, the world's third largest EMS company, reported a GAAP net loss of $810 million, primarily due to non-cash writedowns for asset impairment and a $161 million charge to cover a potential default by a leading customer. The company said it would close plants in higher-cost regions to improve capacity utilization.

The results marred an improvement in sales. Fourth-quarter revenue was $2.3 billion, up 22% year-on-year and 7% sequentially.

For the same period last year, the company reported a loss of $8 million.

The company also said the financial state of one of its customers "significantly deteriorated" during the quarter, resulting in uncertainty over the recoverability of certain receivables and inventory. Celestica declined to name the company in question. Celestica wrote down $161 million to cover the late payments.

For fiscal 2004, revenue rose 31% to $8.84 billion compared to $6.74 billion in 2003. The GAAP net loss widened to $854 million, versus $267 million last year.

"Although we are very disappointed with the charges taken in the quarter, we were pleased to see that the fourth quarter delivered solid revenue growth and continued expansion of operating margins," said Steve Delaney, chief executive. "We have been focused on executing our restructuring plans while meeting our customers' needs, and I am encouraged with the progress we have made. Our revenue has shown solid growth; operating margins have shown steady improvement; we are building a vibrant lean manufacturing culture; and we have improved our operations footprint and cost profile."

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