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Celestica winding down manufacturing services for RIM

Working with the Blackberry maker to reassess supply chain strategy


June 18, 2012
by CANADIAN PRESS

TORONTO: Celestica Inc. says it plans to wind down its manufacturing services for Research in Motion over the next three to six months.

The electronics contract manufacturer based in Toronto said it has been working closely with RIM as the troubled BlackBerry maker assesses its supply chain strategy, and it plans to continue to do so during the transition period.

Celestica did not provide further details, saying those would come when it releases second-quarter results on June 22.

However, the company said that prior to any recoveries, its restructuring charges would not exceed US$35 million.

Waterloo, Ont.,-based Research in Motion said in an emailed statement that it does not normally comment on specific supplier relationships.

“As we outlined in our Q4 earnings call, we are making changes to our supply chain as part of wider efforts to improve the efficiency and cost effectiveness of RIM’s operations to help meet our strategic objectives and to deliver long-term value to our stakeholders,” it said.

Celestica, meanwhile, reaffirmed its second-quarter financial guidance provided April 24. The company anticipates revenue to be in the range of US$1.65 billion to US$1.75 billion, with adjusted net earnings of 20 to 26 cents per share.

Celestica supplies original equipment manufacturers in the communications, computer, telecom aerospace, defence and other markets.

© 2012 The Canadian Press