Good afternoon, I would like to welcome to everyone to the Celestica Second Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks there will be a question-and-answer session. [Operator Instructions] Thank you. Jim Fitzpatrick, Vice President of Investor Relations and Communications, you may begin your conference.

Thank you, Yen. Good afternoon and thank you for joining us on Celestica's second quarter 2015 earnings conference call. On the call today are Craig Muhlhauser, President, Chief Executive Officer and Darren Myers, Chief Financial Officer. This conference call will last approximately 45 minutes Darren and Craig will provide some comments on the quarter then we will open up the call for questions. During the Q&A session please limit yourself to one question and a brief follow-up. We will be available after the conference call for additional follow-up. Please visit our website at celestica.com to view the supporting slides accompanying this webcast. As a reminder, during the call we make forward-looking statements related to our future growth, trends in our industry, our financial and operational results and performance and financial guidance that are based on management's current expectations, forecasts and assumptions that are subject to risks and uncertainties that could cause actual outcomes and results to differ materially. So please refer to our cautionary statements regarding forward-looking information in the company's various public filings, including the cautionary note regarding forward-looking information in today's press release. We also refer you to the company's various public filings, which contain and identify material factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements and which discuss material factors and assumptions on which such forward-looking statements are based. These filings include our Annual Report on Form 20-F and subsequent reports on Form 6-K filed with or furnished to the Securities and Exchange Commission, and our Annual Information Form filed with the Canadian Securities Administrators, which can be accessed, respectively, at sec.gov and sedar.com. During this call, we will refer to certain non-IFRS financial measures, which include adjusted gross margin, adjusted SG&A, adjusted operating earnings or adjusted EBIAT, adjusted operating margins, adjusted net earnings, adjusted EPS, return on invested capital or ROIC, inventory turns, cash cycle days, free cash flow and adjusted tax rate. These non-IFRS measures do not have any standardized meaning under IFRS and may not be comparable with other non-GAAP or non-IFRS financial measures presented by other public companies, including our major competitors. We also refer you to today's press release, which is available at celestica.com for more information about these and certain other non-IFRS measures, including a reconciliation of the historical non-IFRS measures to the corresponding IFRS measures where comparable IFRS measure exists. Unless otherwise specified, all reference to dollars in this call are to US dollars. I'll now turn the call over to Darren Myers.

Thank you, Jim and good morning everyone. Celestica delivered a solid second quarter with revenue and adjusted earnings per share above the mid-point of our guidance range. Revenue of $1.417 billion was above the mid-point of our guidance range driven primarily by strong demand in our communication, storage and semiconductor end-markets. Second quarter revenue increased 9% compared with the first quarter of 2015 and decreased 4% compared with the second quarter of 2014. Some highlights for the quarter include adjusted operating margin of 3.4%, improved 30 basis points compared to the first quarter of 2015. Adjusted earnings per share of $0.25 were $0.02 above the mid-point of our guidance range and up from $0.19 in the first quarter of 2015. IFRS net earnings are 24 million or $0.14 per share. We generated $2 million free cash flow for the quarter which included approximately $50 million of investment in support of our energy and aerospace and defense businesses. We achieved ROIC of 19.6% and we repurchase and cancelled 26.3 million subordinate voting shares through our substantial issuer bid. Looking at the revenue from an end market perspective, we delivered quarter-over-quarter revenue growth from four of our five end markets. Our communications end market represent a 40% of total revenue for the quarter, communications revenue increased 9% sequentially which was higher than expected due to strong demand as well as new program ramps, compared with the second quarter of 2014 communications revenue declined 5% primarily due to program completion partially offset by new wins. Our diversified end markets comprise 28% of our total revenue for the second quarter of 2015 diversified revenue increased 7% sequentially driven primarily by growth in aerospace and defense and semiconductor which were more than offset, a sequential decline in our energy business as we transition part of…

Thank you, Darren. Good morning to everyone on the call. And thank you for joining us today. Celestica delivered a solid second quarter which revenue and earnings per share above the midpoint of our guidance, including sequential improvements in revenue, net earnings, operating margin and return on invested capital. We experience quarter-over-quarter revenue growth across four of our five end markets. With the strongest growth and our communications and storage end markets and our semi-conductor business. Now let me turn to the near-term outlook in our end markets. For the third quarter relative to our diversified market business, we are expecting sequential revenue growth in the high-double-digit range representing growth in four of our five sub-markets. On a year-over-year basis, we expect our diversified end markets to increase in the low to mid-double-digits driven primarily by new program ramps and aerospace and diversify and demand strength in our semi-conductor business. Over the last several quarters we’ve highlighted some of the operational challenges that we’ve been experiencing and our semi-conductor business. Primarily relating to production and efficiencies fixed costs absorption and the impact of new program ramps. On our last earnings call, we commented that we based on these investments we’ve been making in the actions we are taking to improve our quality, cost productivity and delivery performance including the streamlining and simplifying of our supply chain network. We expect at the semi-conductor business with deliver positive gross margin in the second half of 2015. However based on the tremendous effort by the semi-conductor business team. I am pleased to report that we deliver operational and financial improvements beyond or beginning of second quarter forecast as evidence by positive gross margin in the second quarter. More importantly based on our current forecast, we expect to further improve the financial performance of…

[Operator Instructions]. And your first question comes from Joe Wittine with Longbow Research for --. Your line is open.

The semi-cap improvement is a little bit surprising, given what Intel and some of the others in the supply chain have been seeing. I understand you guys have operational improvements that it sounds like have you have partially conquered but any additional details on why you are seeing an uplift in the top line, which is what it sounds like was happening?

Well, I think Joe let me, we are serving the top players in the equipment industry and obviously we are serving those players in the areas of the market that are seeing strong demand for, due to the semiconductor technology aka the 3D NAND technology. So with the right customers with the programs and the right segments of the market now that we are getting the operating performance, as you can see we are getting strong year-on-year. And it is also the thesis that we have, the industry needs a powerful global player have the fragmented industry, especially in the area of machining. I think this is going to be a very very lucrative area for Celestica provided we continue to execute. I think reconfirming although it has taken a couple of years to get there, part of it is staying with learning difference between electronics. But when we start doing it, the Celestica I think we are seeing some real potential growth opportunities and profitability opportunities for this company and I believe we are very bullish on attraction and the men that we have got in that industry.

Okay. Thanks. And then maybe switching gears the cash advance to the solar supplier, maybe just you give why it was necessary? And the economics, why the deal makes sense for Celestica and whether there is any potential risk or what this kind of business as usual for a cross continental manufacturing transfer?

Yeah. Hi, Joe it's Darren. It's more typical in the solar industry, we have seen this before from time to time, we have also have deposits to us from our some of the various customers so it's I would say more or less usual business there. Part of it is around the expansion of Asia and we think there is a lot of exciting opportunities for us within solar.

And your next question comes from the line of Amit Daryanani from RBC Capital Markets. Your line is open.

Maybe just two questions. One, I think I heard you talk about $8 million to $12 million of additional restructuring that is getting announced in the back half of the year. It sounds like the demand trend is doing well. Semi-cap is kind of rebounding. Can you help me understand why the incremental restructuring right now?

Yes. Absolutely. In terms of restructuring, we look at the portfolio, yes, we have got pockets of strength, I mean we have been winning programs, we have got some momentum there we believe and starting to see that, it is always areas where we can find further cost productivity. And I would say that we are striking the balance which we are investing in the business and investing in sales, investing in design, while looking for further opportunities and productivity and we will see some room there. It is choppy in certain markets and there is always some opportunities so we are going to capitalize on some of those right now.

Got it. And then on the real estate transaction you are starting right now, I want to make sure I understand this. The site will get sold eventually in a two year process once the approvals are done, but once that is done, you would still need to figure out how to get manufacturing capacity somewhere in the greater Toronto area. So does that mean that we need to start seeing of a bigger uptick in CapEx, as you need to replicate some of the equipment in manufacturing site that you have? How do I think of CapEx plan to create that?

Yeah. Certainly you will see a couple of things happen. So when the sales close and so you will see the cash approximately half of the cash and then two years later the other half. And through that time after the two years, we will be looking for our footprint for the future for the manufacturing and yes, that will require CapEx and fill up costs. So what have we -- we have not -- we are not obviously at the stage of escalating that I think it'd be well so for the proceeds of the sales.

Got it. That's it for me. Thank you.

And our next question comes from the line of Jim Suva with Citi. Your line is open.

Thank you guys and congratulations to your team. I wasn't exactly clear on why you are selling your headquarters site and that manufacturing facility. Is it just to unlock some value of what is happening in the real estate market there or does the size not quite fits your needs? And also can you clarify that the restructuring of the additional $8 million to $12 million that is separate from your headquarters site and should we expect more restructuring to then come on after this headquarters sale or how should we think about those, if they are together or different?

So Jim I will take the first part. In terms of the property, the largest contiguous acreage in the city of Toronto is an underutilized site, it's a valuable asset. It has a significant value based on this location. Due to the current trends of plan and it's in proximity to downtown Toronto. I mean actually this is exciting new. I mean it's a 1954 facility, it's underutilized, now we have the opportunity to recite the corporate headquarters, either near or on the same location. And then Toronto DMS operation will move to a new location that will give us a more optimized footprint for the business we are doing today which is high mix, low volume largely in the diversified stage and it's really going to be tailored to the future and forward looking business that we expect to attract to Toronto. What's nice about the transaction is this provides us ample time to find the right facility for AMS operation, property designed and executed product transfer plans for the customers that we have and the customers that we intend to capture for the next four years. So it's a very very good investment and it really starts laying the groundwork for the transformation that we are looking -- undertake here and it sets the tone at the top that everything we are doing is to build this company for a very, very successful future.

And Jim for perspective it's on 60 acres so obviously a very large facility in Toronto that we have a portion of. To your other question it's the restructuring, they are not related, there is a planned restructuring as a result of the sale of the property to more, looking at the continued productivity within the business and areas where we still see some opportunity.

And then as a follow-up, can you help us with sharecount? What we should model for the next quarter given your tender off of the shares? And how it equates to the average share for this quarter versus what the diluted and share count should be for the next quarter?

We entered in a 143 million or 142.9 million share I would say at actual million to that and is around 145 million for your sharecount.

And our next question comes from the line of Thanos Moschopoulos with BMO Capital Markets.

Hi. Good afternoon. Both the SG&A and R&D expense came down sequentially. Was that just reflecting the restructuring or was there some other dynamic at play in the currency?

That was two things, one is just a continued focus on cost, but the other one was just some spends and timing of certain spends. So we expect to be back to normal life SG&A levels for the third quarter.

Okay. And Craig you commented that you are seeing strength in the communications market. Can you clarify on whether that is coming in networking or telecom or across both and what type of trends you are seeing in those markets?

It's going to be largely in networking and the enterprise states Thanos. And essentially it's program specific, customer specific related to the launch and then the take up bridge for the new program that we are participating in. So we are very pleased with the progress, looks like it'll continue. We have got a strong mix of business and it appears to be more stable part of that business today which is this enterprise and networking space as opposed to some of the infrastructure material demand. So the market is challenging today and it's dynamic and but we are expecting to hold our own underpin the diversified growth that we expect to see in the second half of the -- the good performance this year for communications and greater use in market.

That's great. Thanks and best of luck on your retirement Craig.

Thank you very much.

And there are no further questions on the phone.

Okay. Thank you, Ian. And given that this is my final quarterly earnings call and I wanted to take this opportunity to express my deep appreciation and gratitude to all Celestica's stakeholders. First to our 25,000 employees across the company, thank you for your ongoing dedication and commitment to make Celestica and our customers successful. I also want to thank all of our customers, suppliers and other partners for your ongoing trust and support and finally to the analyst community and investors it's been an honor to privilege to serve as a CEO of Celestica, I want to thank each of you for your time, your interest, your effort, and support you have given Celestica during my tenure as CEO. Thank you very much and good bye.

This concludes today’s conference call. You may now disconnect.