DEF: Celestica Seeks Shareholder Approval for 2025 Long-Term Incentive Plan Amid Strong 2024 Financial Performance

Celestica reports exceptional 2024 financial results and proposes a new long-term incentive plan for shareholder approval at the upcoming Annual and Special Meeting.

Summary

• Celestica delivered exceptional financial results in 2024, leading to significant value creation for shareholders.
• The company is holding its Annual and Special Meeting of Shareholders on June 17, 2025, with both in-person and virtual attendance options.
• Shareholders will vote on several key matters, including the election of directors, appointment of the auditor, executive compensation, and approval of the 2025 Long Term Incentive Plan.
• Celestica transitioned to U.S. GAAP reporting in 2024, moving away from IFRS.
• Revenue reached $9.65 billion in 2024, a 21% increase compared to $7.96 billion in 2023.
• GAAP earnings per share (diluted) grew by 78% to $3.61, compared to $2.03 in the previous year.
• Adjusted operating margin improved to 6.5%, up from 5.5% in 2023.
• Adjusted EPS increased by 58% to $3.88, compared to $2.46 in 2023.
• The company's stock price increased by 215% in 2024.
• The Board recommends shareholders vote in favor of all resolutions, including the approval of the 2025 Long Term Incentive Plan.
• The 2025 Long Term Incentive Plan reserves 7,000,000 common shares for issuance.
• The company is committed to high standards of corporate governance and ESG matters.
• The Board has determined that all directors, except for the President and CEO, are independent.
• The company proactively engaged with top shareholders to gather feedback on executive compensation and other matters.
• The company's commitment to corporate social responsibility has earned external recognition, including being named one of Canada's Most Admired Corporate Cultures.

Sentiment

Score: 9

Explanation: The document expresses a highly positive sentiment due to the exceptional financial results, strong stock performance, and commitment to corporate governance and ESG matters. The tone is optimistic and confident about the company's future prospects.

Positives

• Exceptional financial results in 2024, with significant revenue growth and improved profitability.
• Strong stock price performance, indicating investor confidence.
• Proactive shareholder engagement program to gather feedback and address concerns.
• Commitment to high standards of corporate governance and ESG matters.
• External recognition for corporate social responsibility and employment practices.
• The proposed 2025 Long Term Incentive Plan is designed to align executive compensation with shareholder interests and promote long-term value creation.

Risks

• The document mentions principal risks of the corporation's business, including those related to information security, cybersecurity, and ESG matters, but does not detail specific current issues or potential future challenges.
• The document mentions that the HRCC regularly reviews the risks associated with the Corporation's compensation policies and practices, but does not detail specific current issues or potential future challenges.

Future Outlook

The document underscores the company's goal of driving sustainable growth, operational excellence, and maintaining long-term financial strength.

Management Comments

• Celestica delivered exceptional financial results in 2024, reflecting strong execution by our entire team.
• Our performance translated into significant value creation for our shareholders, with robust stock performance throughout the year.
• The Board remains deeply engaged in overseeing the company's strategy, which helps to ensure that we continue to build leading-edge capabilities and deliver innovative solutions.
• We also strive for strong governance and responsible corporate stewardship that aligns with our long-term sustainability initiatives.
• The Board also recognizes the importance of consistent engagement with shareholders.

Industry Context

The document highlights Celestica's position in the EMS industry and its focus on driving profitable growth and creating long-term shareholder value.

Comparison to Industry Standards

• The document benchmarks executive compensation against a comparator group of U.S.-based technology companies and EMS peers, including Benchmark Electronics Inc., Flex Ltd., and Jabil Inc.
• The document mentions that Celestica's revenue was above the median of the comparator group.
• The document mentions that Celestica's three-year total shareholder return (TSR) was 775%, which outperformed all companies in the BMI Index.

Management Changes

Corporate Governance

Stakeholder Impact

• Shareholders benefit from the company's strong financial performance and commitment to long-term value creation.
• Employees are incentivized through the CTI and equity-based compensation plans.
• Customers benefit from the company's leading-edge capabilities and innovative solutions.
• The company contributes to the local communities in which it operates through community engagement initiatives.

Next Steps

• Shareholders are encouraged to read the Proxy Statement and vote their shares in support of the Board's recommendations.
• The Annual and Special Meeting of Shareholders will be held on June 17, 2025.
• The Board will consider the outcome of the say-on-pay vote when making future compensation decisions.
• The company will continue to engage with shareholders to gather feedback and address concerns.

Key Dates

Keywords

executive compensation, corporate governance, long term incentive plan, shareholder meeting, financial results, ESG, directors, audit, celestica