TORONTO -- Celestica today announced third quarter revenue fell 5% year-over-year to $1.47 billion, due to a drop in demand from Cisco.

Non-Cisco business revenue increased 6% compared to last year.

EBIT rose 8.9% to $43.9 milion, and net profit was up nearly 16% to $35.2 million.

The third quarter operating margin was 4.2%, up 30 basis points. Advanced Technology Solutions (ATS) segment revenue increased 12%, and margin rose 60 basis points to 4.3%. Connectivity & Cloud Solutions (CCS) segment revenue dropped 14% and margin rose 10 basis points to 4.1%. Non-Cisco CCS revenue increased 2% over 2020.

Adjusted return on invested capital was flat at 15.2%. Free cash flow was $27.1 million, compared to $15.8 million in 2020.

 "Celestica's strong third quarter performance reflects our consistent execution and the resiliency of our business, as we continue to successfully navigate challenges related to the pandemic and the global supply chain. Our non-IFRS operating margin of 4.2% marks our seventh consecutive quarter of year-to-year improvement, and represents the highest operating margin in Celestica's history as a publicly-traded company," said Rob Mionis, president and CEO, Celestica. "Our performance in recent quarters serves as a validation of our long-term strategy and transformation actions in the face of a challenging and constantly evolving business environment."

"The fourth quarter of 2021 serves as an important inflection point in our business, as our focus now turns squarely to growth and maintaining the momentum we've built in recent quarters. We remain on track to complete our acquisition of PCI in November. Achievement of our revenue guidance for the fourth quarter of 2021 will represent a return to top-line growth, and achievement of our non-IFRS operating margin* mid-point guidance of 4.5% will set a new high-water mark for our business. As we approach the final months of 2021, we believe we are well positioned to continue building on our success, and we reaffirm our strong outlook for 2022."

Celestica guided for fourth quarter revenue of $1.425 billion to $1.575 billion, and operating margin of 4.5% at the mid-point of revenue guidance. The forecast assumes the consummation of the acquisition of PCI Private Ltd. in November and incorporates the estimated impact of supply chain constraints.

"As we look to 2022, we expect the markets to remain dynamic," Mionis said. "However, we believe that secular tailwinds in several of our end markets, strong operational performance and the ramping of new programs bode well for Celestica." Celestica forecast revenue to grow to at least $6.3 billion in 2022, with operating margin of 4% to 5%.

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