Celestica winds down RIM manufacturing work

Celestica Inc. announced Monday that it plans to wind down its manufacturing services for Research in Motion over the next three to six months.

Celestica says it has been working closely with RIM as the troubled BlackBerry maker assesses its supply chain strategy. And it says 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 July 27.

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

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,"Research in Motionsaid.

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

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

On the Toronto Stock Exchange, Celestica shares were up seven cents at $7.68 at midday Monday, while RIM shares were down 23 cents at $10.94.