Celestica Inc (CLS) 2020 Q3 法說會逐字稿

Ladies and gentlemen, thank you for standing by and welcome to the Celestica Third Quarter 2020 Earnings Call. (Operator Instructions)

女士們、先生們，感謝大家的支持，歡迎參加 Celestica 2020 年第三季財報電話會議。 （操作員指令）

Please be advised that today's conference is being recorded.

請注意，今天的會議正在錄音。

I would now like to turn the call over to your speaker today, Craig Oberg, Vice President of Investor Relations and Corporate Development. Please go ahead.

現在，我想將電話轉給今天的發言人、投資者關係和企業發展副總裁 Craig Oberg。請繼續。

Good morning, and thank you for joining us on Celestica's Third Quarter 2020 Earnings Conference Call. On the call today are Rob Mionis, President and Chief Executive Officer; and Mandeep Chawla, Chief Financial Officer.

早安，感謝您參加 Celestica 2020 年第三季財報電話會議。今天參加電話會議的有總裁兼執行長 Rob Mionis；以及財務長 Mandeep Chawla。

As a reminder, during this call we will make forward-looking statements within the meanings of the U.S. Private Securities Litigation Reform Act of 1995 and applicable Canadian Securities laws. Such forward-looking statements are based on management's current expectations, forecasts and assumptions, which are subject to risks, uncertainties and other factors that could cause actual outcomes and results to differ materially from conclusions, forecasts or projections expressed in such statements.

提醒一下，在本次電話會議中，我們將根據 1995 年美國私人證券訴訟改革法案和適用的加拿大證券法做出前瞻性陳述。此類前瞻性陳述是基於管理階層目前的預期、預測和假設，受風險、不確定性和其他因素的影響，可能導致實際結果與此類陳述中表達的結論、預測或預期有重大差異。

For identification and discussion of such factors and assumptions as well as further information concerning forward-looking statements. Please refer to today's press release including the cautionary note regarding forward-looking statements therein and our annual report on Form 20-F and other public filings, which can be accessed at sec.gov and sedar.com.

用於識別和討論這些因素和假設以及有關前瞻性陳述的更多資訊。請參閱今天的新聞稿，包括其中關於前瞻性陳述的警告說明和我們的 20-F 表年度報告以及其他公開文件，可在 sec.gov 和 sedar.com 上查閱。

We assume no obligation to update any forward-looking statement except as required by law. In addition, during this call, we will refer to various non-IFRS measures, including operating earnings, operating margin, adjusted gross margin, adjusted return on invested capital or adjusted ROIC, free cash flow, gross debt to non-IFRS trailing 12-month adjusted EBITDA leverage ratio, adjusted net earnings, adjusted EPS, adjusted SG&A and adjusted effective tax rate.

除法律要求外，我們不承擔更新任何前瞻性聲明的義務。此外，在本次電話會議中，我們將參考各種非國際財務報告準則指標，包括營業收入、營業利潤率、調整後毛利率、調整後投資資本回報率或調整後投資資本回報率、自由現金流、總債務與非國際財務報告準則過去 12 個月調整後 EBITDA 槓桿率、調整後淨收益、調整後每股收益、調整後銷售、一般稅率調整後。

Listeners should be cautioned that references to any of the foregoing measures during this call denote non-IFRS measures whether or not specifically designated as such. These non-IFRS measures do not have any standardized meanings prescribed by IFRS and may not be comparable to similar measures presented by other public companies that use IFRS or who report under U.S. GAAP and use non-GAAP measures to describe similar operating metrics.

聽眾請注意，本次電話會議中對任何上述措施的引用均表示非國際財務報告準則的措施，無論是否特別指定。這些非國際財務報告準則指標不具有國際財務報告準則規定的任何標準化含義，並且可能無法與使用國際財務報告準則或根據美國公認會計準則報告並使用非公認會計準則指標描述類似營運指標的其他上市公司提出的類似指標進行比較。

We refer you to today's press release and our Third quarter 2020 earnings presentation, which are available at celestica.com, under the Investor Relations tab, for more information about these and certain other non-IFRS measures, including a reconciliation of historical non-IFRS measures to the most directly comparable IFRS measures from our financial statements.

請您參閱今天的新聞稿和我們的 2020 年第三季度收益報告，這些報告可在 celestica.com 的“投資者關係”選項卡下找到，以獲取有關這些和某些其他非國際財務報告準則指標的更多信息，包括歷史非國際財務報告準則指標與我們財務報表中最直接可比的國際財務報告準則指標的對賬。

Unless otherwise specified, all references to dollars on this call are to U.S. dollars and per share information is based on diluted shares outstanding.

除非另有說明，本次電話會議中所有提及的美元均指美元，每股資訊基於稀釋的流通股。

Let me now turn the call over to Rob.

現在讓我把電話轉給羅布。

Thank you, Craig. Good morning, and thank you for joining today's conference call. Despite the challenging environment, Celestica performed well in the third quarter, delivering another quarter of year-over-year and sequential revenue and operating margin growth. We are continuing to see the benefits of our portfolio transformation actions, and our solid third quarter results are another sign that our strategy is yielding results.

謝謝你，克雷格。早安，感謝您參加今天的電話會議。儘管面臨嚴峻的市場環境，Celestica 第三季依然表現優異，營收和營業利潤率再次實現年比和季增。我們持續看到投資組合轉型行動帶來的好處，而我們穩健的第三季業績也顯示我們的策略正在取得成果。

Our global team is successfully navigating today's challenges and is working tirelessly to support our customers while keeping our employees safe. Our operations remain largely stabilized and our supply chain continues to improve. However, we continue to experience a fair amount of demand volatility as our customers end markets remain impacted by COVID-19. As circumstances continue to change we are well prepared to adapt and address any new COVID challenges. We believe we have a robust set of processes and protocols in place to manage our operations and global supply chain as the COVID-19 situation continues to revolve around the world.

我們的全球團隊成功應對了當今的挑戰，並且正在不懈地努力支持我們的客戶，同時確保我們員工的安全。我們的營運基本上保持穩定，供應鏈持續改善。然而，由於我們的客戶終端市場仍然受到 COVID-19 的影響，我們繼續經歷相當大的需求波動。隨著情況的不斷變化，我們已做好充分準備適應和應對任何新的 COVID 挑戰。隨著 COVID-19 疫情在全球持續蔓延，我們相信我們已經制定了一套強有力的流程和協議來管理我們的營運和全球供應鏈。

While we are experiencing demand strength in the capital equipment and health tech markets and JDM business, we continue to see softness in other markets, most significantly in commercial aerospace. Our CCS segment delivered another quarter of solid performance. Revenue grew on a year-over-year basis and segment margin came in above our 2% to 3% target range. This quarter represents the sixth consecutive quarter of sequential margin expansion in CCS.

雖然我們看到資本設備和健康技術市場以及 JDM 業務的需求強勁，但我們仍然看到其他市場疲軟，最明顯的是商業航空航太市場。我們的CCS部門又取得了穩健的業績。營收年增，分部利潤率高於我們 2% 至 3% 的目標範圍。本季是 CCS 利潤率連續第六個季度擴大。

In our ATS segment, demand weakness in some of our businesses is offsetting strong growth in Health Tech and capital equipment, driven by recent wins. The cost productivity actions taken within ATS are leading to improve profitability. While we continue to take actions to return this segment to its target operating margin of 5% to 6%, we are encouraged by the sequential and year-over-year operating margin expansion that ATS achieved in the third quarter. As we continue to drive cost productivity actions and the broader demand environment improves, we believe margins will return to target levels.

在我們的 ATS 部門，部分業務的需求疲軟抵消了健康科技和資本設備業務受近期勝利推動的強勁成長。 ATS 內部採取的成本生產力行動正在提高獲利能力。雖然我們繼續採取措施使該部門的營業利潤率恢復到 5% 至 6% 的目標，但 ATS 在第三季度實現的連續和同比營業利潤率擴大令我們感到鼓舞。隨著我們繼續推動成本生產力行動並且更廣泛的需求環境改善，我們相信利潤率將回到目標水準。

Overall, we believe the strength we are seeing in several of our end markets is a testament to our diversification strategy and our ability to innovate, execute and deliver for our customers. The actions we have taken to transform our business in some recent years have strengthened our portfolio and we are pleased to be seeing the positive results.

總體而言，我們相信我們在多個終端市場看到的實力證明了我們的多元化策略以及我們為客戶創新、執行和交付的能力。近年來，我們為轉型業務而採取的行動增強了我們的產品組合，我們很高興看到積極的成果。

I will provide some additional color on our end markets, but first I will turn the call over to Mandeep to give you further details on the third quarter results. Over to you, Mandeep.

我將提供有關我們終端市場的一些額外信息，但首先我將把電話轉給 Mandeep，讓他向您提供有關第三季度業績的更多詳細信息。交給你了，Mandeep。

Thank you, Rob, and good morning, everyone. As a reminder, we did not provide financial guidance for the third quarter of 2020 due to the uncertainty created by COVID-19. During the quarter, we experienced COVID-19-related impacts, including premiums paid to ensure continuity of supply and inefficiencies as a result of being unable to secure supply. However, these impacts were offset by various recoveries.

謝謝你，羅布，大家早安。提醒一下，由於 COVID-19 造成的不確定性，我們沒有提供 2020 年第三季的財務指引。在本季度，我們受到了與 COVID-19 相關的影響，包括為確保供應連續性而支付的溢價以及由於無法確保供應而導致的效率低下。然而，這些影響被各種復甦所抵消。

Our third quarter revenue came in higher than anticipated at $1.55 billion, mainly due to strong demand in communication fueled by JDM. Our total revenue increased 2% year-over-year and 4% sequentially.

我們第三季的營收高於預期，達到 15.5 億美元，主要得益於 JDM 推動的通訊需求強勁。我們的總收入年增2％，環比增長4％。

Our non-IFRS operating margin was 3.9%, up 110 basis points year-over-year and up 50 basis points sequentially. The year-over-year and sequential improvement was driven by productivity initiatives across our business and improved mix in CCS.

我們的非國際財務報告準則營業利益率為 3.9%，較去年同期成長 110 個基點，較上季成長 50 個基點。與去年同期相比和連續的成長得益於我們整個業務的生產力舉措和 CCS 組合的改善。

IFRS earnings per share were $0.24, up $0.29 year-over-year and up $0.14 sequentially. Non-IFRS adjusted earnings per share were $0.32, up $0.19 year-over-year and up $0.07 sequentially.

根據 IFRS，每股收益為 0.24 美元，較上年同期成長 0.29 美元，較上一季成長 0.14 美元。非國際財務報告準則調整後每股收益為 0.32 美元，較上年同期成長 0.19 美元，較上一季成長 0.07 美元。

Our ATS segment was 34% of consolidated revenue, down from 37% compared to the third quarter of last year. ATS revenue was down 6% compared to the prior year period, but up 5% sequentially. The year-over-year decline was driven primarily by COVID-19-related demand impact specifically in commercial aerospace and industrial. This was partly offset by growth driven by new program ramps in Health Tech and capital equipment as well as continued strength in the semi market. Higher sequential revenue was due to demand strength across several of our end markets.

我們的 ATS 部門佔合併收入的 34%，與去年第三季的 37% 相比有所下降。 ATS 營收與去年同期相比下降了 6%，但比上一季成長了 5%。年比下降主要是受新冠疫情相關需求影響所致，尤其是在商業航空和工業領域。但這一增幅被健康科技和資本設備新項目的成長以及半導體市場的持續強勁所抵消。連續收入的成長是由於我們多個終端市場的需求強勁。

Our CCS segment revenue was up 7% year-over-year and up 3% sequentially. Within our CCS segment, the Communications end market represented 45% of our consolidated third quarter revenue, up from 42% in the third quarter of last year. Communications revenue in the quarter was up 9% year-over-year, largely driven by strength in our JDM business.

我們的CCS部門營收年增7％，季增3％。在我們的 CCS 部門中，通訊終端市場占我們第三季綜合收入的 45%，高於去年第三季的 42%。本季的通訊收入年增 9%，這主要得益於我們 JDM 業務的強勁成長。

Sequentially, Communications revenue was up 8%, driven by strong demand across a number of our customers, including strength in JDM our Enterprise end market represented 21% of consolidated revenue in the third quarter, consistent with the same period last year.

與上一季相比，通訊收入成長了 8%，這得益於眾多客戶的強勁需求，其中包括 JDM 的強勁成長，我們企業端市場在第三季佔合併收入的 21%，與去年同期持平。

Enterprise revenue in the quarter was up 3% year-over-year, largely driven by strength in our service provider business and partially offset by planned disengagements as part of our CCS portfolio optimization program.

本季企業營收年增 3%，這主要得益於我們服務提供者業務的強勁成長，而作為我們 CCS 投資組合優化計劃的一部分，計劃中的脫離活動則部分抵消了這一增長。

Sequentially, Enterprise revenue was down 6% due to demand softness.

由於需求疲軟，企業營收季減 6%。

We are pleased with the performance of our JDM as we continue to ramp a number of new programs and support increasing levels of demand from our hyperscaler customers. Year-to-date, our JDM business achieved approximately $600 million in revenue, up approximately 90% compared to the prior year period, and accounted for approximately 15% of our total company year-to-date revenue.

隨著我們繼續推出大量新項目並支持超大規模客戶日益增長的需求，我們對 JDM 的表現感到滿意。年初至今，我們的 JDM 業務實現約 6 億美元的收入，比去年同期成長約 90%，占我們公司年初至今總收入的約 15%。

Our top 10 customers represented 68% of revenue for the third quarter, up from 67% in the same period last year and flat quarter-over-quarter. For the third quarter, we had 1 customer contributing 10% or more of total revenue, unchanged from the prior quarter and the third quarter of 2019.

我們前十大客戶佔第三季營收的 68%，高於去年同期的 67%，與上一季持平。第三季度，我們有 1 位客戶貢獻了 10% 或以上的總收入，與上一季和 2019 年第三季持平。

Turning to segment margin. Although still below our target range ATS segment margin of 3.7% was up 90 basis points year-over-year due to improvements in our capital equipment business as well as higher productivity and volume leverage across a number of our businesses within ATS, resulting from new program ramps.

轉向段邊距。儘管 ATS 分部利潤率為 3.7%，仍低於我們的目標範圍，但由於資本設備業務的改善以及新專案啟動帶來的多項業務生產力和產量槓桿率的提高，ATS 分部利潤率較上年同期上升了 90 個基點。

Sequentially, ATS segment margin was up 60 basis points, driven by cost productivity efforts across the business and higher volumes.

環比成長 60 個基點，這得益於整個業務範圍內的成本生產力提升和銷售量的增加。

CCS segment margin of 4% came in above our target range of 2% to 3% and was up 120 basis points year-over-year and up 40 basis points sequentially. This represented the highest margin in CCS since 2015 and reflects improved mixed as well as the benefits from our portfolio shaping initiative as we successfully execute our transition plan.

CCS 部門利潤率為 4%，高於我們 2% 至 3% 的目標範圍，較去年同期成長 120 個基點，較上季成長 40 個基點。這是 CCS 自 2015 年以來最高的利潤率，反映了我們成功執行過渡計畫後綜合狀況的改善以及投資組合塑造措施帶來的好處。

The year-over-year margin improvement was driven by favorable mix, including strong growth in JDM, improved operating leverage and cost productivity. The sequential margin improvement was driven by favorable mix.

利潤率較去年同期提高得益於有利的業務組合，包括 JDM 的強勁成長、經營槓桿的提高和成本生產力。連續的利潤率改善得益於有利的產品組合。

Moving to some other financial highlights for the quarter. IFRS net earnings for the quarter were $30.4 million or $0.24 per share, compared to a net loss of $6.9 million or negative $0.05 per share in the same quarter of last year.

轉向本季度的一些其他財務亮點。本季 IFRS 淨利為 3,040 萬美元，即每股 0.24 美元，而去年同期淨虧損為 690 萬美元，即每股虧損 0.05 美元。

Adjusted gross margin of 8.1% was up 150 basis points compared to last year and up 60 basis points sequentially. Year-over-year and sequential improvements were largely driven by volume leverage, improved mix and productivity across the business.

調整後毛利率為 8.1%，較去年同期上升 150 個基點，較上一季上升 60 個基點。年比和季比的成長主要得益於銷售槓桿、業務組合改善和生產效率的提高。

Year-over-year, our adjusted SG&A of $56 million was up $8 million primarily due to higher variable compensation. SG&A was up $3 million sequentially, mostly due to higher variable compensation, partly offset by favorable foreign exchange dynamics.

與去年同期相比，我們的調整後銷售、一般及行政開支為 5,600 萬美元，增加了 800 萬美元，主要原因是浮動薪酬增加。銷售、一般及行政開支環比增加 300 萬美元，主要由於浮動薪酬增加，但有利的外匯動態也部分抵消了這一影響。

Non-IFRS operating earnings were $60.1 million, up $17.5 million from the same quarter last year and up $9.3 million sequentially.

非國際財務報告準則下的營業利潤為 6,010 萬美元，較去年同期增加 1,750 萬美元，較上一季增加 930 萬美元。

Our non-IFRS adjusted effective tax rate for the third quarter was 20%, compared to 46% for the prior year period and 24% last quarter. We are pleased with the improvement in our overall tax rate, driven by increasing levels of profit in lower tax geographies.

我們第三季的非國際財務報告準則調整後有效稅率為 20%，去年同期為 46%，上季為 24%。我們很高興看到我們的整體稅率有所改善，這得益於低稅率地區的利潤水準提高。

For the third quarter, adjusted net earnings were $40.9 million compared to $16.6 million for the prior year period and $31.7 million last quarter.

第三季調整後淨利為 4,090 萬美元，去年同期為 1,660 萬美元，上季為 3,170 萬美元。

Non-IFRS adjusted earnings per share of $0.32 was up $0.19 year-over-year due to higher operating earnings, lower taxes and lower interest expense.

非國際財務報告準則調整後每股收益為 0.32 美元，較去年同期增加 0.19 美元，原因是營業收入增加、稅收減少和利息支出減少。

Sequentially, non-IFRS adjusted earnings per share were up $0.07, mainly due to higher earnings.

與上一季相比，非國際財務報告準則調整後每股收益上漲 0.07 美元，主要由於收益增加。

Non-IFRS adjusted ROIC was up 15.2% [was up] 5.1% compared to the same quarter of last year and up 2.3% sequentially.

非國際財務報告準則調整後的 ROIC 較去年同期上漲 15.2%（上漲 5.1%），較上一季上漲 2.3%。

Moving on to working capital. Our inventory at the end of the quarter was $1.2 billion, an increase of $171 million relative to the prior year period, largely driven by investments in our JDM business.

轉向營運資金。我們本季末的庫存為 12 億美元，比去年同期增加了 1.71 億美元，主要得益於我們對 JDM 業務的投資。

Sequentially, inventory was approximately flat. Inventory turns were 4.7, down 0.7 turns year-over-year and down 0.2 turns sequentially.

與上一季相比，庫存基本持平。庫存週轉率為 4.7，年減 0.7 次，季減 0.2 次。

Capital expenditures for the third quarter were $10 million or less than 1% of revenue.

第三季的資本支出為 1000 萬美元，不到收入的 1%。

Non-IFRS free cash flow was $16 million in the third quarter, compared to $66 million for the same period last year. Year-to-date, we have generated $108 million in non-IFRS free cash flow, in line with our full year 2020 target of $100 million or more. In the fourth quarter, we are targeting to generate positive free cash flow.

第三季非國際財務報告準則下的自由現金流為 1,600 萬美元，去年同期為 6,600 萬美元。年初至今，我們已產生 1.08 億美元的非國際財務報告準則自由現金流，與我們 2020 年全年 1 億美元或以上的目標一致。在第四季度，我們的目標是產生正的自由現金流。

Cash cycle days in the third quarter were 61 days, flat year-over-year and up 1 day sequentially. Our cash deposits at the end of September were $207 million, down $15 million sequentially.

第三季現金週期天數為61天，與去年同期持平，季增1天。九月底我們的現金存款為2.07億美元，比上一季下降1500萬美元。

Moving on to other key measures. Celestica continues to maintain a strong balance sheet. Our cash balance at the end of the third quarter was $451 million, up $2 million year-over-year and up $15 million sequentially. Combined with our $450 million revolver, which remains undrawn, we have a solid liquidity position of over $900 million. We believe we have sufficient liquidity to meet our current business needs.

繼續討論其他關鍵措施。 Celestica 繼續保持強勁的資產負債表。我們第三季末的現金餘額為 4.51 億美元，比去年同期增加 200 萬美元，比上一季增加 1500 萬美元。加上我們尚未動用的 4.5 億美元循環信貸，我們擁有超過 9 億美元的穩健流動資金。我們相信我們有足夠的流動資金來滿足當前的業務需求。

Our gross debt position was $470 million at the end of September, while our net debt was $19 million an improvement of $15 million sequentially. Our gross debt to non-IFRS trailing 12-month adjusted EBITDA leverage ratio was 1.6 turns, an improvement of 0.1 turn sequentially and a 0.6 turn improvement from the end of 2019. The year-over-year is a result of strong free cash flow generation, disciplined debt reduction and improved profitability.

截至 9 月底，我們的總債務狀況為 4.7 億美元，而淨債務為 1,900 萬美元，比上一季改善了 1,500 萬美元。我們的總負債與非國際財務報告準則過去 12 個月調整後 EBITDA 槓桿比率為 1.6 倍，比上一季改善 0.1 倍，比 2019 年底改善 0.6 倍。

At the end of September, we were compliant with all financial covenants under our credit agreement.

截至九月底，我們已履行完信貸協議項下的所有財務契約。

Our capital allocation priorities remain unchanged. We will continue to work towards generating strong free cash flow and, over the long term, we plan to return approximately half to shareholders while investing the other half in the business.

我們的資本配置重點維持不變。我們將繼續努力創造強勁的自由現金流，從長遠來看，我們計劃將大約一半的現金回饋給股東，同時將另一半投資於業務。

In the third quarter, we incurred $4 million of restructuring charges to adjust our cost base to fluctuating levels of demand, including in our A&D business. We will continue to take restructuring actions in the fourth quarter as we complete the Cisco transition and adjust our cost base across segments undergoing demand pressure.

第三季度，我們花了 400 萬美元的重組費用來調整成本基礎以適應不斷變化的需求水平，其中包括我們的 A&D 業務。隨著我們完成思科轉型並調整面臨需求壓力的各部門的成本基礎，我們將在第四季繼續採取重組行動。

Year-to-date, we have taken $19 million of restructuring charges and at this time anticipate that our full year restructuring charges will be less than our original estimate of $30 million.

年初至今，我們已承擔了 1,900 萬美元的重組費用，目前預計全年重組費用將低於我們最初估計的 3,000 萬美元。

Now turning to our guidance for the fourth quarter of 2020. We are projecting fourth quarter revenue to be in the range of $1.35 billion to $1.45 billion. At the midpoint of this range, revenue would be down approximately 6% year-over-year and down 10% sequentially.

現在談談我們對 2020 年第四季的預期。在這個範圍的中間點，收入將年減約 6%，環比下降 10%。

Fourth quarter non-IFRS adjusted earnings per share are expected to range between $0.22 and $0.28.

預計第四季非國際財務報告準則調整後每股收益在 0.22 美元至 0.28 美元之間。

At the midpoint of our revenue and adjusted EPS guidance ranges, non-IFRS operating margin would be approximately 3.5%, an increase of 60 basis points over the same period last year and a decrease of 40 basis points sequentially.

在我們的收入和調整後的每股盈餘指引範圍的中間點，非國際財務報告準則下的營業利潤率約為 3.5%，比去年同期增加 60 個基點，比上一季減少 40 個基點。

Non-IFRS adjusted SG&A expense for the fourth quarter is expected to be in the range of $56 million to $58 million.

預計第四季非國際財務報告準則調整後的銷售、一般及行政開支將在 5,600 萬美元至 5,800 萬美元之間。

Based on the projected geographical mix of our profits in the fourth quarter, we anticipate our non-IFRS adjusted effective tax rate to be approximately 20%, excluding any impacts from taxable foreign exchange.

根據我們第四季利潤的預期地理分佈，我們預計非國際財務報告準則調整後有效稅率約為 20%，不包括應稅外匯的影響。

Turning to our end market outlook for the fourth quarter of 2020. In our ATS end market, we anticipate revenue to be down in the low double digits year-over-year due to sustained weakness in commercial aerospace as a result of COVID-19, partly offset by growth in capital equipment and our Health Tech business.

談到我們對 2020 年第四季的終端市場展望。

In our Communications end market, we anticipate revenue to increase in the low single digits year-over-year, driven by strength in JDM, partly offset by our planned disengagement from Cisco.

在我們的通訊終端市場，我們預計營收將年成長低個位數，這得益於 JDM 的強勁成長，但部分抵消了我們計劃脫離思科的影響。

In our Enterprise end market, we anticipate revenue to decrease in the low double-digit range year-over-year, driven by weaker end-market demand and remaining portfolio shaping activity.

在我們的企業端市場，我們預期營收將年減兩位數左右，原因是終端市場需求減弱以及剩餘的投資組合塑造活動。

I'll now turn the call back over to Rob for additional color and an update on our priorities .

現在我將把電話轉回給羅布，讓他進一步說明情況並更新我們的優先事項。

Thank you, Mandeep. We are pleased with our 2020 year-to-date performance, despite the challenges resulting from COVID-19. We continue to benefit from the investments we have made and the portfolio shaping and productivity actions taken over the last few years. We believe that these actions have made us a stronger company and better position us for the future.

謝謝你，Mandeep。儘管新冠疫情帶來了挑戰，但我們對 2020 年迄今的表現感到滿意。我們繼續受益於過去幾年來所做的投資以及採取的投資組合塑造和生產力行動。我們相信，這些措施將使我們成為一家更強大的公司，並為我們的未來做好更好的準備。

Our third quarter results reflected strong mix [in] operational performance as we continue to execute on our portfolio shaping activities, including our Cisco transition.

我們的第三季業績反映了強勁的營運業績，因為我們繼續執行我們的投資組合塑造活動，包括我們的思科轉型。

We are pleased to have improved operating margin on a year-over-year basis for the third consecutive quarter, despite COVID-19 headwinds.

儘管面臨新冠疫情的不利因素，我們很高興看到連續第三個季度的營業利潤率較去年同期有所提高。

Now turning to ATS. Our capital equipment business posted another profitable quarter, with strong volume driven by increased demand in our base semi business and new wins in a number of adjacent equipment end markets. While demand is up materially from a year ago, we are seeing the overall demand environment leveling off as we end 2020 and enter 2021.

現在轉向 ATS。我們的資本設備業務又一個季度實現盈利，得益於基礎半導體業務需求增長和一系列相鄰設備終端市場的新勝利，銷量強勁增長。雖然需求較上年同期大幅增加，但隨著 2020 年結束並進入 2021 年，我們看到整體需求環境趨於穩定。

In A&D, while demand in our defense business remains stable, we continue to experience demand softness in our commercial aerospace business. Demand in 2020 is materially down from a year ago, and we expect these depressed market conditions to persist throughout 2021. We will continue to drive the appropriate cost productivity actions to improve the overall profitability of this business at lower levels of revenue.

在航空航太與國防領域，雖然我們的國防業務需求保持穩定，但我們的商業航空航太業務需求仍然疲軟。 2020 年的需求較上年大幅下降，我們預計這種低迷的市場狀況將持續整個 2021 年。

In industrial, the impacts of COVID-19 moderated in the third quarter and we experienced a gradual recovery of demand across our customer base. We also saw an improvement in profitability on a year-over-year basis as new programs ramped and we executed on our cost productivity roadmap.

在工業領域，COVID-19 的影響在第三季有所緩和，我們的客戶群需求逐漸恢復。隨著新專案的推進和我們成本生產力路線圖的執行，我們的獲利能力也較去年同期有所提升。

Within Health Tech, our team is executing very well on projects supporting the fight against COVID-19. We continue to see strong demand for diagnostic equipment and anticipate improvements in the demand for elective surgery products in the first half of 2021. We anticipate an elevated level of demand as we end 2020 and enter 2021, from the ramping of essential products to fight COVID-19.

在健康科技領域，我們的團隊在支持對抗 COVID-19 的計畫上表現非常出色。我們繼續看到對診斷設備的強勁需求，並預計 2021 年上半年對選擇性手術產品的需求將有所改善。

Now turning to CCS. Overall, I am pleased with the strong performance of our CCS segment in the third quarter. The segment posted year-over-year revenue growth as growth from our hyperscaler customers more than offset revenue declines from our portfolio shaping actions.

現在轉向 CCS。整體而言，我對我們CCS部門在第三季的強勁表現感到滿意。由於超大規模客戶的成長遠遠抵消了我們投資組合塑造行動造成的收入下降，該部門的收入較去年同期成長。

As we mentioned in the past, the strong revenue growth in CCS is driven by strategic wins over the last 2 years, compounded by increasing demand due to the work and learn from home trend as customers expand and upgrade data centers in support of growing cloud and online requirements.

正如我們過去提到的，CCS 強勁的收入成長得益於過去 2 年的策略性勝利，同時由於客戶擴展和升級資料中心以支援不斷增長的雲端和線上需求，在家工作和學習的趨勢導致的需求不斷增長。

In our JDM business, we continue to see impressive growth as a result of the investments made over the last few years, which have enabled us to deliver higher value-add services to our customers while providing further stability and diversification to our overall CCS business.

在我們的 JDM 業務中，由於過去幾年的投資，我們繼續看到令人矚目的成長，這使我們能夠為客戶提供更高增值的服務，同時為我們的整體 CCS 業務提供進一步的穩定性和多樣化。

Celestica supports 8 of the world's 10 largest hyperscaler service providers, developing technologies that are deployed throughout their data centers.

Celestica 為全球 10 大超大規模服務供應商中的 8 家提供支持，開發在其資料中心內部署的技術。

Turning to the Cisco disengagement. It is progressing as planned. Our manufacturing was mostly completed in the third quarter and we anticipate the transition to be largely complete by the end of the year. We are pleased with the progress we are making to backfill Cisco with higher value-add solutions and have secured new business across a number of customers. We remain on track to achieve our goals with a richer mix of programs.

談談思科的撤軍。一切正按計劃進展。我們的製造工作基本上在第三季完成，我們預計到今年年底轉型將基本完成。我們很高興看到我們為思科提供了更高附加價值的解決方案，並獲得了許多客戶的新業務。我們將繼續透過更豐富的專案組合來實現我們的目標。

As I look back on our performance year-to-date, I continue to see evidence that our strategy is taking hold. Our portfolio shaping and productivity actions over the last few years, while difficult at the time, have better positioned us to deliver value-added solutions across a broad set of markets. In particular, I am pleased we were able to generate 3.9% operating margin in the third quarter, despite the severe downturn in the commercial aerospace and industrial markets.

當我回顧我們今年迄今的表現時，我不斷看到證據表明我們的策略正在發揮作用。雖然過去幾年我們採取的投資組合塑造和生產力行動當時非常困難，但卻使我們能夠更好地為廣泛的市場提供增值解決方案。特別是，儘管商業航空和工業市場嚴重下滑，但我們在第三季仍能實現 3.9% 的營業利潤率，這讓我感到高興。

As we look ahead to the fourth quarter, we expect JDM to continue to be strong, fueled by recent wins and increased demand for our products and services. However, we anticipate some softness in Enterprise, driven by a soft demand environment and our portfolio actions.

展望第四季度，我們預計 JDM 將繼續保持強勁勢頭，這得益於近期的勝利以及對我們產品和服務的需求增加。然而，受需求環境疲軟和我們的投資組合行動的影響，我們預期企業業務會出現一些疲軟。

While we expect CCS segment margin to remain strong in the fourth quarter, we anticipate that margin will moderate sequentially due to mixed normalization and incremental investments in our JDM business as we invest in the next generation of products in support of a growing market.

雖然我們預計 CCS 部門利潤率在第四季度將保持強勁，但由於我們為支持不斷增長的市場而對下一代產品進行投資，混合正常化和對 JDM 業務的增量投資，我們預計利潤率將環比下降。

In ATS, we continue to build a stronger, more diverse and higher value portfolio. We expect continued weakness in commercial aerospace, partially offset by strength in our other ATS markets.

在 ATS，我們繼續打造更強大、更多樣化和更高價值的投資組合。我們預計商用航空航太業將繼續疲軟，但我們其他 ATS 市場的強勁表現將部分抵消這一影響。

During these unprecedented times, we continue to face uncertainty surrounding the potential impact from COVID-19, but we remain confident in our long-term outlook.

在這前所未有的時期，我們仍然面臨著 COVID-19 潛在影響的不確定性，但我們對我們的長期前景仍然充滿信心。

Before we close today, I would like to talk about another important area of our business, environmental, social and corporate governance, or ESG matters. For the last 10 years, these 3 focus areas have been integral to everything we do. Celestica is a technology company, but, first and foremost, we are a people company; and with that, comes responsibility of doing what's right by our employees and customers and the world around us.

在今天結束之前，我想談談我們業務的另一個重要領域，即環境、社會和公司治理，或 ESG 事項。在過去的十年裡，這三個重點領域一直是我們所做的一切的重點。 Celestica 是一家科技公司，但首先，我們是一家以人為本的公司；隨之而來的是，我們有責任為員工、顧客和周遭的世界做正確的事。

For example, to date 17,000 of our employees have signed the Sustainable Workforce Pledge. Moreover, we have shifted a large portion of our energy consumption to renewable sources, reducing our greenhouse gas emissions by 57% in 2019. We continue to set aggressive sustainability goals by establishing new targets to reduce our Scope 1 and Scope 2 Greenhouse Gas Emissions by an additional 30% by 2025.

例如，迄今為止，我們已有 17,000 名員工簽署了《永續勞動力承諾》。此外，我們已將很大一部分能源消耗轉向再生能源，從而在 2019 年減少了 57% 的溫室氣體排放量。

And when it comes to diversity and inclusion, we are taking action across our global footprint to ensure we continue to foster an environment in which employees of all backgrounds may thrive.

在多元化和包容性方面，我們在全球範圍內採取行動，確保繼續創造一個讓來自各種背景的員工都能蓬勃發展的環境。

These and other ESG initiatives will continue to remain at the core of Celestica's strategy and operations going forward.

這些和其他 ESG 舉措將繼續成為 Celestica 未來策略和營運的核心。

I want to extend my appreciation to our global team for their hard work and commitment, especially during these difficult times. Their resilience and dedication are the keys to adapting to this unprecedented moment.

我要向我們的全球團隊的辛勤工作和承諾表示感謝，尤其是在這些困難時期。他們的堅韌和奉獻精神是適應這前所未有的時刻的關鍵。

We look forward to updating you over the coming quarters. With that, I would now like to turn the call over to Amy to begin our Q&A. Thank you.

我們期待在接下來的幾個季度向您提供最新資訊。說完這些，我現在想把電話轉給艾米，開始我們的問答環節。謝謝。

(Operator Instructions) Your first question comes from the line of Todd Coupland with CIBC.

（操作員指示）您的第一個問題來自加拿大帝國商業銀行 (CIBC) 的 Todd Coupland。

I wanted to have you talk about what you think the business looks like once we get past COVID-19. So if we think about growth drivers like JDM and semi, what is a normalized growth rate for the current portfolio or at least the portfolio excluding Cisco once that disengagement is complete? Any color on that would be super helpful to think about the business once we get through the pandemic.

我想請您談談，您認為一旦我們度過新冠肺炎疫情，業務將會是什麼樣子。因此，如果我們考慮像 JDM 和半導體這樣的成長動力，那麼在脫離完成後，目前投資組合或至少不包括思科的投資組合的標準化成長率是多少？一旦我們度過疫情，任何有關這方面的詳細資訊都將對我們思考業務非常有幫助。

Hey, Todd. Thanks for joining the call today. Mandeep here. You know there's been a tremendous amount of volatility, I would say going through 2020. Some markets are up significantly, other markets are down significantly.

嘿，托德。感謝您今天的電話會議。這裡是 Mandeep。你知道，我想說，2020 年經歷了巨大的波動。

What we are seeing as we're entering into the fourth quarter is that there is some level of stability starting to appear. The softness that we've seen in the commercial aerospace side is starting to level off. The significant demand increases in the service provider business are starting to level off.

進入第四季度，我們看到某種程度的穩定開始出現。我們在商業航空航太領域看到的疲軟趨勢正在開始趨於平穩。服務提供者業務需求的大幅成長開始趨於平穩。

And so if you look over into 2021, our view at this point is that ATS should continue to target the 10% growth rate that we have always put out there and we think that we have roadmaps that give us confidence that that is a possibility for 2021.

因此，如果展望 2021 年，我們目前的觀點是，ATS 應該繼續以我們一直設定的 10% 的成長率為目標，而且我們認為，我們的路線圖讓我們有信心，2021 年是有可能實現這一目標的。

On the CCS side, there's going to be a big revenue overhang from Cisco, but we all knew that was coming. And then when you look at the CCS business ex-Cisco, we're looking to maintain our performance going into 2021, but we continue to target a series of bookings to also drive a little bit of incremental growth.

在 CCS 方面，思科的收入將大幅增加，但我們都知道這會發生。然後，當您查看思科以外的 CCS 業務時，我們希望在 2021 年保持我們的業績，但我們仍將一系列訂單作為目標，以推動一點增量成長。

But as we exit 2020, we do see some of the markets stabilizing at the levels that they're at and then there's opportunities when some of those depressed markets come back.

但隨著 2020 年即將結束，我們確實看到一些市場在目前的水平上趨於穩定，而當一些低迷的市場復甦時，就會出現機會。

I would just add some color to that. Within ATS, I think the growth drivers for us would be our capital equipment business that's really being fueled by program wins and share gains over the last couple years. Industrial, we think is going to return to growth. And of course, our Health Tech business is doing quite well.

我只是想給它添加一些顏色。在 ATS 內部，我認為我們的成長動力是資本設備業務，而這項業務的真正推動力來自於過去幾年的專案勝利和份額成長。我們認為工業將恢復成長。當然，我們的健康科技業務表現相當不錯。

And within CCS, we do, even though -- expect incremental JDM growth on a year-over-year basis, even though, as Mandeep mentioned, the demand is moderating a little bit from the very strong growth we had this year.

在 CCS 內部，我們確實預計 JDM 將同比有所增長，儘管正如 Mandeep 所提到的，需求較今年的強勁增長有所放緩。

Your next question comes from the line of Robert Young with Canaccord Genuity.

您的下一個問題來自 Canaccord Genuity 的羅伯特楊 (Robert Young)。

I'm not sure that I understand the drivers behind the moderation in CCS margins in Q4. I think you said mix normalization investments in JDM. Is that all enterprise impact? Or maybe if you can break that, is that lumpiness in hyperscalers? Could you talk about what's the driver there?

我不確定我是否了解第四季度 CCS 利潤率放緩背後的驅動因素。我認為您說的是 JDM 中的混合正常化投資。這就是所有企業受到的影響嗎？或者如果你能打破這種局面，那麼超大規模計算中的塊狀現像是否會出現？你能談談那裡的驅動因素是什麼嗎？

Sure. Hey, Rob. It's Mandeep here. So CCS had, frankly, just outstanding performance in the third quarter, generating 4% EBIAT. As you know, the target margin range for that business is 2% to 3%. And so while we continue to expect strong performance going into the fourth quarter from CCS, will it repeat 4%? We don't expect it to at this point. And so when we say moderation, it means get back to a little bit more of a normal level. And the reason for that is because a lot of things went right in the third quarter. We had strong mix with higher levels at JDM. Within JDM, we had some positive mix as well. So the margin profile of the JDM business was stronger than it normally is. And then we were also successful in generating a lot of service billings with our customers. When you start to normalize for those things, the margin profile should start leveling off a little bit.

當然。嘿，羅布。我是 Mandeep。因此，坦白說，CCS 在第三季的表現非常出色，實現了 4% 的 EBIAT。如您所知，該業務的目標利潤率範圍是 2% 至 3%。因此，儘管我們繼續期待 CCS 在第四季度表現強勁，但它會重複 4% 的成長率嗎？目前我們還不指望它會發生。所以當我們說適度時，它的意思是回到稍微正常的水平。原因在於第三季很多事情都很順利。我們在 JDM 擁有更高水準的強大組合。在 JDM 中，我們也有一些正面的組合。因此，JDM 業務的利潤率比正常情況下更高。而我們也成功地與客戶達成了大量服務帳單。當你開始將這些事情正常化時，利潤率概況就會開始稍微趨於平穩。

Okay. Great. And then my second question would be around, I was surprised to see the restructuring a little lower than your target, given aerospace. Does that suggest that you're not restructuring the aerospace business in the near term to meet demand? Or is that more related to the expectation that Cisco disengagement is lower? Why is the restructuring lower? Then I'll pass the line, I guess.

好的。偉大的。我的第二個問題是，考慮到航空航太業，我很驚訝看到重組金額略低於你的目標。這是否意味著您近期不會重組航太業務以滿足需求？或者這與思科脫離度較低的預期更相關？為何重組會更低？那麼我想我會通過這條線。

Yes. So the restructuring dollars were not as high as the first 2 quarters of this year, but we still anticipate spending $30 million for the full year. So there's some additional costs that will be incurred in the fourth quarter.

是的。因此，重組資金不如今年前兩個季度那麼多，但我們仍預計全年支出為 3,000 萬美元。因此第四季會產生一些額外成本。

When you look at where our restructuring is being targeted towards, most of the activity that we need to do in Cisco has been completed, but we still have some cost actions to take as we ship that final product in the fourth quarter.

當你看著我們的重組目標時，我們需要在思科做的大部分活動已經完成，但在第四季發布最終產品時，我們仍有一些成本行動需要採取。

And then to your point on the ATS side, where we continue to target the restructuring activities are in the businesses that have the most significant demand downturn and those are in the aerospace and defense and industrial segments. So we do expect that we'll continue to take actions in the fourth quarter and stay within that $30 million envelope.

然後回到您提到的 ATS 方面，我們繼續針對需求下滑最為嚴重的業務開展重組活動，這些業務涉及航空航太、國防和工業領域。因此，我們確實預計我們將在第四季度繼續採取行動，並保持在 3000 萬美元的範圍之內。

And I'll add, Rob that, within Cisco, the restructuring was a lot less than originally anticipated due to the strength in the base business and some new wins that we're able to direct to Thailand. So it was a lot lower than anticipate.

我要補充一點，羅布，在思科內部，由於基礎業務的強勁發展以及我們能夠向泰國轉移的一些新勝利，重組的規模比最初預期的要小得多。因此，它比預期的低很多。

Your next question comes from the line of Ruplu Bhattacharya with Bank of America.

您的下一個問題來自美國銀行的 Ruplu Bhattacharya。

For the first one, can you drill down a little bit into the Communications segment? Looks like it was up strong 9% year-on-year. What did you see in optical networking and wireless? Did the revenue from Cisco meet your expectations? And then, just on that, looks like the guide, you're saying up single digits, low single digit. So is there some incremental weakness you're seeing in that segment in 4Q?

對於第一個問題，您能否深入了解通訊領域？看起來它比去年同期增長了 9%。您在光纖網路和無線領域看到了什麼？來自思科的收入符合你的預期嗎？然後，就這一點而言，看起來像指南，你說的是上升個位數，下降個位數。那麼，您是否發現第四季度該領域出現了一些漸進式的疲軟？

Hi, Ruplu. Yes, within 3Q, broadly speaking, we saw strength in service provider ramps, and that was somewhat offset with program exits and demand dynamics. The strength really came from our networking business. And again, it was partially offset with the Cisco transition, which is part of that Communications segment.

你好，Ruplu。是的，從總體上講，在第三季度，我們看到服務提供者的成長勢頭強勁，但這在一定程度上被專案退出和需求動態所抵消。這種力量確實來自於我們的網路業務。而且，這項變化被思科的轉型部分抵消，思科的轉型屬於通訊部門。

As we move into Q4, the dynamic, really in terms of offsetting the growth, is really the program transitions, i.e., the Cisco exit. But we still see very strong growth in networking, some very strong growth in existing programs, both in networking and also optical.

隨著我們進入第四季度，真正抵銷成長的動態是專案轉型，即思科退出。但我們仍然看到網路領域的成長非常強勁，現有項目（包括網路和光纖領域）的成長也非常強勁。

Okay. Thanks for the details there, Rob. I just wanted to ask, maybe for Mandeep, can you remind us on your capital allocation priorities now? You've reduced debt quite a bit. So I mean, should we think that you'll focus more on M&A? Or how should we think about share buybacks going forward? So any thoughts just on your capital allocation priorities for the next year?

好的。謝謝你提供的詳細信息，Rob。我只是想問一下，對於 Mandeep，現在可以提醒我們您的資本配置優先事項嗎？你的債務已經減少不少了。所以我的意思是，我們是否應該認為您會更加關注併購？或者我們應該如何看待未來的股票回購？那麼您對明年的資本配置重點有什麼想法嗎？

Yes, absolutely, Ruplu. So our long-term priorities remain unchanged. We will continue to focus on generating strong cash flow, returning 50% to our shareholders and investing 50% into the business. And I know, as you know, over the last 8 or 9 years, we have been very aggressive on the share buybacks; frankly, more so than any of our peers in the space. So we are pleased with the cash flow performance that we've been seeing so far this year, and we have been able to get almost to a neutral net debt position, which is wonderful.

是的，絕對是，魯普魯。因此我們的長期重點保持不變。我們將繼續專注於創造強勁的現金流，向股東返還 50%，將 50% 的投資於業務。我知道，如你所知，在過去的 8 到 9 年裡，我們一直非常積極地回購股票；坦白說，比我們在這個領域的任何同行都要好。因此，我們對今年迄今為止的現金流表現感到滿意，而且我們幾乎能夠達到中性的淨債務狀況，這非常好。

Our focus at this time continues to be on generating additional dry powder, whether we apply that to paying down more debt or we will continue to just build up dry powder in terms of cash on our balance sheet because we continue to be focused on looking at M&A targets.

我們目前的重點仍然是產生額外的現金，無論我們用它來償還更多債務，還是我們將繼續在資產負債表上累積現金，因為我們繼續專注於尋找併購目標。

That being said, whenever we make an investment decision, we're looking at it compared to alternatives as well. And so we'll continue to monitor when the right time is to open up a share buyback program. We'll ensure that we are looking at M&A targets from an ROI and EPS accretion perspective relative to things such as share buybacks. And as we do that analysis, based on the moment that we're in, we will have flexibility to go one way or the other.

話雖如此，每當我們做出投資決策時，我們也會將其與其他選擇進行比較。因此，我們將繼續監控啟動股票回購計畫的合適時機。我們將確保從投資報酬率和每股盈餘成長的角度來審視併購目標，而不是股票回購等因素。當我們進行分析時，根據我們所處的情況，我們可以靈活地選擇一種方式或另一種方式。

Right now, we are in a position where we can now reopen a share buyback program. But again, as we take an opportunistic view towards it, we'll open it up at that time. So whether it's going to be sometime in the fourth quarter or sometime in 2021, we'll just continue to monitor how the market trades us and then also look at the alternatives in terms of M&A.

目前，我們可以重新啟動股票回購計畫。但是，當我們再次對此採取機會主義觀點時，我們就會開放它。因此，無論是在第四季度的某個時候還是在 2021 年的某個時候，我們都將繼續監控市場交易情況，然後研究併購方面的替代方案。

Okay. Congrats on the quarter and on the strong margin improvement.

好的。恭喜本季業績及利潤率強勁提升。

Thanks a lot, Ruplu.

非常感謝，Ruplu。

Thank you.

謝謝。

Your next question comes from line of Thanos Moschopoulos with BMO Capital Markets.

您的下一個問題來自 BMO 資本市場的 Thanos Moschopoulos。

Rob, can you expand on the semi business? You talked about seeing demand leveling off as you enter next year. Maybe a bit more color in terms of what you hear [from] your customers in that front?

羅布，你能拓展一下半導體業務嗎？您談到進入明年時需求將趨於平穩。就您從客戶那裡聽到的消息而言，也許能更詳細一些？

Sure. So you know semicap has been -- all of capital equipment has been very strong. Semicap has been particularly strong. In the first half of this year, we saw strong foundry spending and logic spending. As we get into the back half of this year, the foundry and logic spending is continuing and we're seeing some increase in memory spending as well. As [you] look forward to next year, we see the memory expanding continuing, even going from NAND to DRAM. A large portion of our growth is not just rising with the sea level; it's actually new share gains, approximately 30% to 40% of our growth is really being driven by new wins and new share gains across all of capital equipment.

當然。所以你知道半導體設備一直以來——所有資本設備都非常強勁。 Semicap 的表現尤其強勁。今年上半年，我們看到代工支出和邏輯支出強勁。進入今年下半年，代工和邏輯支出仍在繼續，我們也看到記憶體支出增加。展望明年，我們將看到記憶體繼續擴展，甚至從 NAND 擴展到 DRAM。我們成長的很大一部分不僅僅是隨著海平面上升；實際上是新份額增長，大約 30% 到 40% 的增長實際上是由所有資本設備的新勝利和新份額增長推動的。

We've been doing a very nice job of not just growing our semicap business, but we also have other capital equipment business that we're expanding within, and, in fact, 20 new program ramps that we're commencing right now. So a lot going on in capital equipment.

我們不僅在發展半導體業務方面做得非常出色，而且我們還在擴展其他資本設備業務，事實上，我們現在正在啟動 20 個新的專案坡道。資本設備上發生了很多事情。

Maybe in a related note, what's happening in flat panel? I mean, is that subdued? And do we need to see some of the new fabs being built for that to pick up? Or what are you seeing there?

也許在相關的說明中，平板上發生了什麼？我的意思是，這是否很低調？我們是否需要看到一些新的晶圓廠的建設來實現這一目標？或者你在那裡看到了什麼？

Correct. The overall display market is still generally depressed. A lot of the projects that we thought would start ramping this year into the first half of next year are being pushed into the right.

正確的。整體顯示器市場依然普遍低迷。我們原以為很多計畫會在今年開始加速，但結果卻延後到了明年上半年。

That being said, we did take a lot of actions last year to make the business more efficient at lower volumes. Those actions are complete. And we have a long view of the industry and we think it's well placed with the recovery. The drivers, obviously, would be smartphones as 5G gets -- that uptick happens and that'll probably be the latter part of '21 into '22. And the new large-form-factor TVs should also help uplift the market when this COVID cloud hopefully gets past.

話雖如此，去年我們確實採取了許多措施，使業務在較低量的情況下更有效率。這些操作已完成。我們對這個行業有長遠的眼光，我們認為它已經為復甦做好了準備。顯然，隨著 5G 的出現，驅動因素將是智慧型手機 — — 這種上升趨勢將會發生，並且很可能發生在 21 年後期到 22 年。希望當新冠疫情陰雲逐漸消散後，新的大尺寸電視也將有助於提振市場。

Your next question comes from the line of Paul Steep with Scotiabank.

您的下一個問題來自豐業銀行的 Paul Steep。

I guess, Rob or Mandeep, can you maybe talk a little bit about what you're thinking in terms of the M&A environment out there. Obviously, it's a challenged period and you've spent it wisely working on the business. But as cash and capital builds, it sounds like priority is to try to grow the business. How is that environment even looking or is it still sort of pause and just heads down on working your way through the current environment?

我想，Rob 或 Mandeep，您能否談談您對目前的併購環境的看法。顯然，這是一個充滿挑戰的時期，您明智地利用這段時間來開展業務。但隨著現金和資本的積累，聽起來首要任務就是努力發展業務。那個環境看起來怎麼樣？

Hi, Paul. I'll start off and Rob can add on, if he'd like to. So at the beginning of the year when COVID was starting to just hit everyone, we saw a dramatic drop off in M&A activity. That being said, we are seeing a lot more targets that are coming online, which is nice to see.

你好，保羅。我先開始，如果 Rob 願意的話，他可以繼續。因此，在今年年初，當 COVID 開始影響所有人時，我們看到併購活動急劇下降。話雖如此，我們看到越來越多的目標正在上線，這是令人欣喜的事情。

We're evaluating a number of M&A transactions every week, frankly. It's very well understood that we're looking for certain types of targets to accelerate our strategies. We have not pulled the trigger on any of them, largely because we want to make sure that it's the right fit. When we look at an M&A target, price, of course, is important. We want to make sure that we're paying the right price for it. But we're also looking for capabilities that the business will bring to us so that it can accelerate our strategies. We also want to ensure that it is able to be integrated relatively lightly. We don't want to go through a massive integration when looking at targets. And then, again, we're just making sure that the business can provide us the right level of scale when needed. And so we continue to apply the same filter. There are some good targets out there, but nothing that is imminent at this point.

坦白說，我們每週都會評估一些併購交易。眾所周知，我們正在尋找某些類型的目標來加速我們的策略。我們還沒有對其中任何一個採取行動，主要是因為我們想確保它是合適的。當我們考慮併購目標時，價格當然很重要。我們希望確保我們支付的價格合理。但我們也在尋求業務能為我們帶來的能力，以便能夠加速我們的策略。我們還希望確保它能夠相對輕鬆地整合。在審視目標時，我們不想經歷大規模的整合。然後，我們再次確保業務能夠在需要時為我們提供適當的規模。因此我們繼續應用相同的過濾器。目前已經存在一些不錯的目標，但目前還沒有任何目標能夠立即實現。

And then, just one quick follow-up. Can you give us a sense for CCS? It's hard for all of us from the outside -- obviously, Cisco, the disengagements [weren't] to sort of plan and you've been replacing and sort of shifting some of that capacity back. How far through that project would you say we are, not in terms of Cisco disengaging, but in terms of sort of reorienting that capacity in the business to new business? Thank you.

然後，只需快速跟進一次。您能為我們介紹一下 CCS 嗎？對於我們所有外部人士來說，這都很難——顯然，思科的撤軍並沒有按照計劃進行，你們一直在替換並將部分產能轉移回來。您認為該專案進度如何？謝謝。

This is Rob. So we're pretty far along on that process for a couple of different aspects. First of all, our base business is up; that's really driven by our service provider portfolio, fueled by our JDM offering. We've had significant new wins at Thailand, driven by both high value EMS players and also those JDM programs.

這是羅布。因此，從幾個不同方面來看，我們在這一進程上已經取得了巨大進展。首先，我們的基礎業務上升了；這實際上是由我們的服務提供者組合推動的，並由我們的 JDM 產品提供支援。在高價值 EMS 參與者和 JDM 計畫的推動下，我們在泰國取得了重大的新勝利。

And when we started the Cisco transition, we put in place a bookings goal. Again, we weren't intending to replace Cisco dollar for dollar. We wanted a higher rich -- programs that played to our portfolio. We put together a bookings plan and we're very close to closing that plan by the end of this year.

當我們開始向思科轉型時，我們就制定了預訂目標。我再說一遍，我們無意用一美元取代思科。我們希望有更豐富的項目能夠滿足我們的投資組合需求。我們制定了預訂計劃，並將在今年年底前完成該計劃。

Now it takes time for those bookings to actually turn to revenue, which we think will be latter part of '21 into '22, depending on market uptick. But overall, I think we're through the knothole, if you will, on the Cisco transformation and the portfolio renewal within CCS. We're very pleased with how CCS has been operating.

現在這些預訂實際上需要時間才能轉化為收入，我們認為這將是 21 年後期到 22 年的時間，具體取決於市場的上漲情況。但總體而言，我認為我們已經解決了思科轉型和 CCS 內部產品組合更新的難題。我們對 CCS 的營運情況非常滿意。

And the mix is very strong and the offering is very strong, and we're continuing to invest in our JDM portfolio and taking it to the next level.

而且產品組合非常強大，產品供應也非常強勁，我們將繼續投資我們的 JDM 產品組合，並將其提升到新的水平。

Only thing I'd maybe add to that as well, Paul, is, you're right, I mean there's a lot of moving pieces. We've done disengagements in programs in CCS going back now a year and a half. The final revenue impact is still in 2020's numbers, and then we have Cisco as well.

保羅，我可能還要補充一點，你是對的，我的意思是有很多活動的部分。我們在 CCS 的計畫脫離接觸已經持續了一年半了。最終的收入影響仍在2020年的數字中，然後我們還有思科。

If you look at overall CCS for 2020 based on the guide that we just provided, it is implying relatively flat revenue on a year-over-year basis, despite the disengagements that have been happening.

如果根據我們剛剛提供的指南來查看 2020 年的整體 CCS，則表示儘管發生了脫離的情況，但收入同比相對持平。

When you look at how CCS has been growing outside of the disengagements, the business is actually up in the double-digit percentage range. So it talks to a lot of the bookings that we've been generating to drive growth in other areas to offset the disengagements that are coming. So some pretty good underlying growth beyond the programs we're disengaging from.

當你觀察 CCS 在脫離接觸之外的成長方式時，你會發現其業務成長實際上達到了兩位數的百分比範圍。因此，這與我們為推動其他領域的成長而產生的大量預訂有關，以抵消即將到來的脫離。因此，除了我們正在脫離的計劃之外，還存在一些相當不錯的潛在成長。

Your next question comes from the line Paul Treiber with RBC Capital Markets.

您的下一個問題來自 RBC Capital Markets 的 Paul Treiber。

I was hoping that you could speak to the long-term visibility or maybe sales pipeline that you have with the hyperscalers and, in particular, on the JDM side of the business. Typically, how involved or integrated are you with the hyperscalers in terms of product roadmap and planning programs out into the future?

我希望您能談談您與超大規模廠商的長期可見性或銷售管道，特別是在業務的 JDM 方面。通常，在產品路線圖和未來規劃方案方面，您與超大規模企業的參與度或整合程度如何？

Hi, Paul. We have good visibility. Most of our CCS business and JDM business, we could have good visibility a quarter out when it comes to specific numbers. But broadly speaking, with all our hyperscalers, we have technology roadmap meetings with them. So we share our roadmap for our technology. They share their requirements. And we align closely such that we're ready when they need us to be ready. Within JDM, we've worked very closely with our customers to customize the solutions for their specific application. So in many respects, we're very tightly interlinked with them when it comes to their requirements.

你好，保羅。我們的能見度很好。對於我們大部分的 CCS 業務和 JDM 業務，我們可以在一個季度內清楚地看到具體數字。但從廣義上講，我們與所有超大規模供應商都會舉行技術路線圖會議。因此我們分享我們的技術路線圖。他們分享了他們的要求。我們緊密配合，以便在他們需要時，我們能夠做好準備。在 JDM 中，我們與客戶密切合作，為他們的特定應用客製化解決方案。因此，在許多方面，我們都與他們緊密聯繫，以滿足他們的要求。

Yes. And Paul, and I know you know this. One of the benefits that we have in our JDM business is that we are across a number of different sets of solutions. We provide solutions in networking and storage, even over into compute as well. And as Rob mentioned, we work very closely with our customers to customize product. But we also have products that customers are buying off the shelf as well where the brand is not necessary -- they're not necessarily turning around selling it, they're using it for their own consumption. And so because we have off-the-shelf products that they can take or products that they can customize with us, it gives us some more diversity in terms of the sales channel.

是的。保羅，我知道你知道這一點。我們的 JDM 業務的優勢之一是我們擁有多種不同的解決方案。我們提供網路和儲存方面的解決方案，甚至還提供運算方面的解決方案。正如 Rob 所提到的，我們與客戶密切合作以客製化產品。但我們也有一些顧客直接購買的現成產品，這些產品對品牌來說並不是必要的——他們不一定會轉手出售，而是自己消費。由於我們擁有可供客戶選擇的現成產品或可與我們一起客製化的產品，因此在銷售通路方面，我們擁有更多樣化的產品。

And then, when we look out, like so year-to-date JDM is up 90% and it's 15% of total revenue. Do you have aspirations or any long-term targets you could share in terms of how you see that growth progressing over the next couple years or maybe how large of a percent of total revenue that business could get to?

然後，當我們觀察時，就會發現今年迄今 JDM 成長了 90%，佔總收入的 15%。您能否分享一下您的願望或長期目標，例如您認為未來幾年該業務的成長情況如何，或該業務能佔總收入的多少百分比？

So I'll start off. I mean, as you know, we're not providing 2021 guidance. But what we can tell you is that, as you mentioned, the business is up materially on a year-to-date basis and we continue to see a similar level of growth in JDM going into the fourth quarter.

那我就開始了。我的意思是，如您所知，我們不提供 2021 年的指導。但我們可以告訴您的是，正如您所說，今年迄今為止，業務大幅增長，並且我們看到 JDM 在進入第四季度仍保持類似的增長水平。

From a margin profile perspective, JDM has been performing accretive to overall CCS results, and that has helped bring up the rest of the CCS business as well as the company's margins as well.

從利潤率角度來看，JDM 一直對 CCS 整體業績有增值作用，並有助於提升 CCS 業務的其餘部分以及公司的利潤率。

As we look into 2021, we are still targeting some level of growth, and Rob briefly mentioned that earlier. However, it's not going to be at the 90% levels again. What we're seeing this year is a combination of wins that we have had in place since 2018 and 2019 ramping, and then some accelerated demand because of COVID. As that acceleration starts to moderate and as we start reaching steady state in our JDM ramps, we'll expect regular growth going into 2021. But we are still expecting a strong 2021 in JDM.

展望 2021 年，我們仍以一定程度的成長為目標，Rob 之前也簡要地提到了這一點。然而，它不會再回到 90% 的水平了。我們今年看到的是自 2018 年和 2019 年以來取得的成果的結合，以及由於新冠疫情而加速的需求。隨著這種加速開始減緩，我們的 JDM 成長開始達到穩定狀態，我們預計 2021 年將出現正常成長。

And I would also add, when you look at our JDM business and you look at our ATS business, they are very similar in nature in terms of, it's an engineering-led engagement, it's high-value revenue. And when you look at our diversification efforts, part of our strategy is when you take our JDM business and you take our ATS business and you add them together, we kind of consider that our product lifecycle revenue or high-value revenue. And the broad goal of that is to have that be well north of 50% of the company's revenue moving forward. And to this extent, we're already there and we're looking to kind of grow that diversification and continue to invest in those businesses.

我還要補充一點，當您查看我們的 JDM 業務和 ATS 業務時，您會發現它們的性質非常相似，都是由工程主導的業務，可以帶來高價值的收入。當您審視我們的多元化努力時，您會發現，我們的策略之一就是將我們的 JDM 業務與 ATS 業務加在一起，我們將其視為產品生命週期收入或高價值收入。總體目標是使這一比例在未來遠超過公司總收入的 50%。就這個程度而言，我們已經達到了這個水平，我們正在尋求擴大這種多樣化，並繼續對這些業務進行投資。

Your next question comes from the line of Kurt Swartz with Stifel.

您的下一個問題來自 Stifel 的 Kurt Swartz。

I'm hoping to follow up on Cisco and CCS and see if you can maybe just drill down a bit on the cadence and the magnitude of the Cisco wind down. Should we be expecting the full roughly 10% of Cisco-related sales to come off right at the turn of the new year or could we see some lingering contribution into 2021?

我希望跟進思科和 CCS 的情況，看看您是否可以深入了解思科關閉的節奏和幅度。我們是否應該預期思科相關銷售額的約 10% 會在新年伊始全部實現，或者我們是否會看到一些持續到 2021 年的貢獻？

And then, I guess, if you're able to maybe quantify how much of this wind-down you're expecting to offset with new communication program ramps at this point, that would also be helpful. Thank you.

然後，我想，如果你能夠量化此時你預計透過新的通訊程序坡道可以抵消多少這種下降，這也會有所幫助。謝謝。

I'll start off with that. In terms of Cisco, the wind-down should be, the manufacturing activities were largely complete in the third quarter; when it comes to the fourth quarter, very little revenue contribution in terms of our business. So I would say the majority of the revenue is completed or recognized at this stage of the game.

我先從那裡開始。就思科而言，應該是逐步結束，製造活動在第三季基本完成；說到第四季度，我們的業務收入貢獻很小。因此我想說，大部分收入在現階段已經完成或確認。

The last remaining things that we have in 2021 would be very insignificant in just terms of very, very low volume production or end-of-life programs or things like that, but not material in any nature.

2021 年剩下的最後一些東西，從非常非常小的產量或報廢計劃或諸如此類的事情來看，將是非常微不足道的，但從任何性質上來說都不是實質性的。

As we move into next year, the bookings that I mentioned earlier, it's going to take some time for those bookings to convert into revenue, so perhaps the latter half of '21 as we renew our portfolio on the CCS side.

隨著進入明年，我之前提到的預訂量需要一些時間才能轉化為收入，所以也許是在 21 年下半年，屆時我們將更新 CCS 方面的投資組合。

Understood. And then I guess maybe just looking back at the recently completed quarter, can you give any sense of the sort of linearity of demand throughout the quarter and maybe any notable volatility by segment or end market?

明白了。然後我想也許只是回顧一下最近完成的這個季度，您能否給出整個季度需求的線性感覺以及細分市場或終端市場的任何顯著波動？

In terms of linearity, most of our revenue is shipped out in the third month of the quarter. I believe, generally speaking, inside a quarter about 25% of the revenue will go in month 1, 30% of the revenue will go in month 2 and the balance will go in month 3 of the quarter. Pre-COVID, post-COVID, we've seen some modest changes in that, but it's hard to figure out whether that's just due to demand dynamics or COVID dynamics. But that's our general linearity inside a quarter.

從線性來看，我們的大部分收入都是在季度的第三個月發出的。我認為，一般來說，一個季度內約 25% 的收入會流向第 1 個月，30% 的收入會流向第 2 個月，剩餘的收入會流向第 3 個月。在疫情之前和疫情之後，我們看到了一些細微的變化，但很難確定這僅僅是由於需求動態還是疫情動態所致。但這是我們一個季度內的一般線性。

So no, I guess material or notable swings within the end markets to really call out?

所以不，我猜終端市場內部的實質或顯著波動確實值得關注？

Nothing notable, no.

沒有什麼值得注意的，沒有。

(Operator Instructions) Your next question comes from line of Jim Suva with Citigroup.

（操作員指示）您的下一個問題來自花旗集團的 Jim Suva。

I am very impressed with the JDM traction you've been getting. So if you could give us a little bit more context or color around it. It sounds like it's very tied into the hyperscalers or the cloud companies. I don't know if that's an accurate statement or not. And is it a lot of servers or a lot of storage or a lot of switches? And I guess importantly, how do you ensure that your protective moat so that other suppliers, especially maybe those out of Asia who may be a little more price conscious, don't do similar JDM efforts as you know we do hear that they're doing it, but yet your numbers speak for themselves about the impressive growth that you're seeing, as well as the profitability.

我對於您所獲得的 JDM 牽引力印象非常深刻。所以如果你能給我們更多背景資訊或詳細資訊的話。聽起來它與超大規模企業或雲端運算公司密切相關。我不知道這是否是準確的說法。是否有很多伺服器、很多儲存或很多交換器？我想，最重要的是，您如何確保您的護城河，以便其他供應商，特別是那些對價格更加敏感的亞洲以外的供應商，不會採取類似的 JDM 舉措，正如您所知，我們確實聽說他們正在這樣做，但您的數字說明了您所看到的令人印象深刻的增長以及盈利能力。

Hi, Jim. Yes, thank you for that. In terms of JDM, yes, the majority of the revenue is going to the hyperscalers, but they also go into some of our Enterprise customers as well. And the products that we're making is actually on all technologies across the data center. So we're working on storage solutions, compute solutions, networking solutions, which is probably the biggest portion of them.

你好，吉姆。是的，謝謝你。就 JDM 而言，是的，大部分收入都流向了超大規模企業，但也流向我們的一些企業客戶。我們生產的產品實際上涵蓋了資料中心的所有技術。因此，我們正在研究儲存解決方案、運算解決方案和網路解決方案，這可能是其中最大的部分。

The difference I think between our offering and some of our competitors' offering is that it's truly customized to our customers' specifications. And as I mentioned earlier, we're very [excited] to have their product roadmaps and we're also working with silicon providers to make sure that we have access to early silicon and developing leading-edge capabilities to support our customers moving forward. And we're also continuing to invest in a fair amount of R&D. We've been doing that now for 7-plus years and we're continuing to speed up product roadmaps and have a very strong engineering-centric, engineering-capable organization. And that recipe's been working for us.

我認為我們的產品與一些競爭對手的產品的區別在於，它真正根據客戶的規格量身定制。正如我之前提到的，我們非常高興能夠獲得他們的產品路線圖，並且我們也正在與矽片供應商合作，以確保我們能夠獲得早期的矽片並開發尖端功能，以支持我們的客戶向前發展。我們也將繼續在研發上投入大量資金。我們已經這樣做了 7 年多，並且正在繼續加快產品路線圖，並擁有一個非常強大的以工程為中心、具有工程能力的組織。這個藥方對我們很有效。

And lastly, I would say is, because of our heritage, I think we're offering our customers enterprise-level quality at ODM-level pricing.

最後，我想說的是，由於我們的傳統，我認為我們以 ODM 級價格為客戶提供企業級品質。

Jim, maybe just to add on to some of the remarks that Rob made. We do believe that there are high barriers to entry into this business. As Rob has mentioned, we've been investing in this business for the better part of a decade, $25 million to $30 million every year. You see that on our R&D line.

吉姆，也許只是想補充一下羅布所做的一些評論。我們確實認為進入這個行業的門檻很高。正如羅布所提到的，近十年來我們一直在對這項業務進行投資，每年投資 2,500 萬到 3,000 萬美元。您可以在我們的研發線上看到這一點。

One of the reasons that the business has been doing well is we have very sticky relationships that go back a number of years. We don't compete with our customers. We don't have a brand. We don't have a direct sales channel. And so that allows for a very high trust relationship.

業務表現良好的原因之一是我們多年來一直保持著非常緊密的合作關係。我們不會與客戶競爭。我們沒有品牌。我們沒有直銷通路。這使得雙方建立起高度的信任關係。

The other thing I would say that's been benefiting us is the footprint that we have. We started off a number of years ago doing a lot of JDM production in China. And while we continue to do that, with some of our customers, they've been looking for a Southeast Asia solution. And so we do a lot of our JDM manufacturing in Thailand, which is one of our strongest sites in the network. And so because of the footprint that we're able to use as well as the types of products that we are producing, which is across a broad set, we believe that the barriers to entry are relatively high.

我想說的另一件讓我們受益的事情就是我們的足跡。我們幾年前就開始在中國進行大量 JDM 生產。在我們繼續這樣做的同時，我們的一些客戶也一直在尋找東南亞解決方案。因此，我們在泰國進行了大量 JDM 製造，泰國是我們網路中最強大的站點之一。因此，由於我們能夠使用的足跡以及我們生產的產品類型廣泛，我們認為進入門檻相對較高。

This concludes our question-and-answer session. I will now turn the call back over to Rob Mionis for closing remarks.

我們的問答環節到此結束。現在我將電話轉回給 Rob Mionis，請他作結束語。

Thank you, Amy. I'm pleased we're able to deliver another solid quarter marked by sequential operating margin improvement and strong free cash flow. Our CCS portfolio continues to perform well and delivered a sixth consecutive quarter of margin expansion as we execute our portfolio shaping actions.

謝謝你，艾米。我很高興我們能夠再創一個穩健的季度，其特點是連續的營業利潤率提高和強勁的自由現金流。隨著我們實施投資組合塑造行動，我們的 CCS 投資組合繼續表現良好並連續第六個季度實現利潤率擴大。

And in ATS, I'm pleased with the improved sequential profitability improvement of our businesses given the continued headwinds that we're seeing in commercial aerospace and industrial.

在 ATS 方面，考慮到我們在商業航空和工業領域持續面臨的阻力，我對我們業務的連續盈利能力改善感到滿意。

And while we continue to face business uncertainty amidst this pandemic, I believe we have proven that the Celestica team has the ability to successfully navigate the challenges that might lie ahead.

儘管我們在這場疫情中繼續面臨業務不確定性，但我相信我們已經證明 Celestica 團隊有能力成功應對未來可能面臨的挑戰。

I'd like to thank our global team for remaining vigilant and keeping themselves and each other safe. Thank you all for joining today's call. And we look forward to updating you as we progress throughout the year.

我要感謝我們的全球團隊保持警惕，並保護自己和彼此的安全。感謝大家參加今天的電話會議。我們期待著向您通報全年進度。

Ladies and gentlemen, this concludes today's conference call. On behalf of Celestica, thank you for participating. You may now disconnect.

女士們、先生們，今天的電話會議到此結束。我代表 Celestica 感謝您的參與。您現在可以斷開連線。