Electronics Production | January 26, 2007
Celestica lawsuit beeing investigated
The law firm of Milberg Weiss & Bershad LLP announces that it is investigating possible illegal conduct as alleged in class action lawsuits filed by certain law firms on behalf of investors in Celestica Inc.
("Celestica" or the "Company") who purchased the common stock of Celestica between July 27, 2006 and December 12, 2006, inclusive (the "Class Period"). The class actions are pending in the United States District Court for the Southern District of New York against Celestica and certain of the Company's officers and directors. The complaints in the above referenced actions allege that Celestica and certain of its officers and directors violated the Securities Exchange Act of 1934. If you purchased the common stock of Celestica during the Class Period, you may, no later than March 13, 2007, request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. To be appointed lead plaintiff, the Court must decide that your claim is typical of the claims of other class members, and that you will adequately represent the class. Your share in any recovery will not be enhanced or diminished by the decision whether or not to serve as a lead plaintiff. You may retain Milberg Weiss & Bershad LLP, or other attorneys, to serve as your counsel in this action. The complaint in one of the above-referenced actions alleges that Celestica provides electronic manufacturing services to original equipment manufacturers in the computing, telecommunications, aerospace and defense, automotive, consumer electronics, and industrial sectors in Asia, the Americas, and Europe. According to the complaint, during the Class Period, Celestica issued positive statements regarding its financial results and business prospects which it attributed to, in part, restructuring activities and increased efficiencies in its Mexico and European operations. The complaint alleges that, unbeknownst to investors, these statements were materially false and misleading because they failed to disclose that the Company was experiencing a significant reduction in demand in its Information Technology and Communications market division and an increase in unneeded inventory that would have to be written off. On December 12, 2006, the last day of the Class Period, Celestica issued a press release drastically lowering its 4Q:06 guidance to between $2.20 billion to $2.25 billion in revenues, or adjusted net earnings per share of $0.00 to $0.06, from previous guidance of between $2.25 billion to $2.45 billion in revenues, or $0.15 to $0.23 in adjusted net earnings per share. The Company stated in the release that the lowered guidance was caused by a reduction in demand from several customers and a charge of between $0.08 to $0.12 per share as a result of "an increase in inventory provisions at the Monterrey, Mexico facility." In reaction to this news, the price of Celestica stock fell $1.14 per share, or 12.1%, from its closing price of $9.37 on December 11, 2006 to close at $8.23 on December 12, 2006.