CGI REPORTS STRONG GROWTH IN SECOND QUARTER OF FISCAL 2002

CGI Group Inc. (NYSE: GIB; TSE: GIB.A), a leading provider of end-to-end information technology and business processing services, today reported unaudited results for its second quarter ended March 31, 2002. All figures are in Canadian dollars unless otherwise indicated.

Second Quarter Highlights

• Revenue of $539.2 million was 44.2% higher than the comparable period one year ago and 3.5% higher sequentially. Year-over-year organic growth was 14.9% in the second quarter.
• Net earnings of $33.2 million were 49.5% higher than last year’s second quarter, while net earnings per share increased 12.5% to $0.09 from $0.08 in last year’s second quarter, despite a 31.7% increase in weighted average number of shares outstanding.
• Operating cash flow was up 63.9% year-over-year to $57.4 million.
• Backlog of signed contracts stands at $9.1 billion with a weighted average remaining contract term of 6.8 years.
• Current pipeline of bids for large outsourcing contracts being reviewed by potential clients remains robust at $5 billion.
• In accordance with new CICA recommendations, the Company has concluded its assessment of the goodwill and will not record any impairment loss.

Note: In accordance with CICA recommendations, CGI stopped recording amortization of goodwill on October 1, 2001, rendering earnings before amortization of goodwill (cash net earnings) and net earnings equivalent starting FY02.   

CDN$/ 1.6= US$

“We are pleased with the financial results achieved in the quarter. The strong year-over-year and sequential growth was a function of solid demand for our IT services from new and existing clients, in all verticals and across all geographic areas, especially in Canada,” said Serge Godin, chairman and CEO. “While achieving strong financial results, we also continued to strengthen our operations and position ourselves for future growth, particularly in the US market.”

Second Quarter Results
Revenue for the second quarter ended March 31, 2002 increased 44.2% to $539.2 million, from $374.0 million in the same quarter last year, and was up 3.5% sequentially over first quarter revenue of $520.8 million. In addition to good organic growth of 14.9%, the increase in revenue also reflects the contribution of acquisitions completed in the past year.

In the second quarter, revenue from long-term outsourcing contracts represented 72% of the Company’s total revenue, including 15% from business processing services, while project oriented consulting and systems integration work represented 28%. Geographically, contribution to revenue was similar to last quarter, with clients in Canada representing 72%; clients in the US representing 21%; and all other regions, 7%. CGI improved its position as a leading IT services provider in the financial services sector, which represented 41% of revenue; while telecom represented 25%; government, 16%; manufacturing, retail and distribution, 15%; utilities and services, 2%; and healthcare, 1%.

EBITDA, Earnings Before Interest, Taxes, Depreciation & Amortization, for the second quarter increased 48.5% to $80.2 million, compared with $54.0 million in the same quarter a year ago, and increased 4.2% on a sequential basis compared with $76.9 million reported in the first quarter. The EBITDA margin improved to 14.9% at the end of the second quarter, compared with 14.4% in last year’s second quarter and 14.8% at the end of the first quarter. EBIT, Earnings Before Interest and Taxes, was $57.1 million in the second quarter, up 43.7% over last year’s second quarter EBIT of $39.7 million and up 8.6% over first quarter EBIT of $52.6 million. The EBIT margin was 10.6% for the quarter, compared with 10.1% in the first quarter and 10.6% in last year’s second quarter. EBIT is a meaningful metric because it more accurately reflects earnings after operating costs, including costs related to the amortization and depreciation of fixed assets and amortization of contract costs.

Effective October 1, 2001, CGI stopped recording the amortization of goodwill. As such, net earnings and earnings before amortization of goodwill (cash net earnings) are equivalent. For purposes of clarity and ease of comparison, CGI compares net earnings results to cash net earnings figures provided in year-over-year comparisons. Net earnings in the second quarter increased 49.5% to $33.2 million, against comparable cash net earnings of $22.2 million in the same quarter a year ago, and were 8.4% higher sequentially, compared with $30.6 million reported in the first quarter. Net earnings per share of $0.09 for the quarter were up 12.5% over $0.08 reported for the second quarter of fiscal 2001, and $0.08 reported in the first quarter. Net earnings per share increased, despite a 31.7% year-over-year and 2.8% sequential increase in weighted average number of shares outstanding. The net margin improved to 6.2%, compared with 5.9% in the first quarter and 4.1% in the second quarter of fiscal 2001.

CGI maintains a strong balance sheet and cash position, which together with bank lines are sufficient to support the Company’s growth strategy and represent a competitive strength when proposing on outsourcing contracts. At March 31, 2002, the total credit facility available amounted to $218.1 million. As of March 31, 2002, CGI had cash and cash equivalents of $152.5 million, compared with $155.8 million as of December 31, 2001.

Operating cash flow (operating cash flow represents cash provided by operating activities before changes in non-cash operating working capital items) in the second quarter improved to $57.4 million, compared with $35.0 million in the second quarter a year ago and $43.3 million in the first quarter of fiscal 2002. The year-over-year and sequential improvements in operating cash flow largely reflect the improvement in net earnings along with an increase in the depreciation of fixed assets, the amortization of contract costs and deferred credits related to the acquisitions and large outsourcing contracts closed in the year and changes in future income taxes.

Six-month Highlights
For the first six months of fiscal 2002 ended March 31, 2002, revenue increased 49.7% to $1,060.0 million, up from $708.2 million in the corresponding period of 2001. For the first six months of fiscal 2002, EBITDA increased 63.9% to $157.1 million, up from $95.9 million in the same period one year ago. Net earnings in the first six months increased 66.4% to $63.8 million, up from $38.3 million in the same period one year ago. Net earnings per share of $0.17 in the period were up 21.4% over $0.14 reported in the first six months of 2001.

Operating Highlights
In order for CGI to focus more intently on geographical areas with the highest growth potential, namely North America and Europe, CGI’s Australian and Japanese operations were recently divested in separate transactions. The combined revenue for these two units had been approximately $9 million on an annualized basis, and there was no impact on the consolidated statement of earnings from the sale of these units.

During the quarter, CGI acquired Albany, New York based Rapid Application Developers, Inc. (“RAD”) as part of its ongoing, niche acquisition strategy. RAD was acquired to enhance CGI’s presence in the state government sector in the Northeast United States. RAD had revenue last year of US$4.2 million in the government sector.

Finally, in a continuing effort to maximize the opportunities for CGI’s future growth, the Company has made adjustments to its organizational structure. Effective immediately, Satish Sanan becomes Vice-Chairman of CGI, reporting directly to Serge Godin, and is responsible for pursuing large IT and business process outsourcing opportunities in the US. Daniel Rocheleau, Executive Vice-President and Chief Business Engineering Officer, will continue his responsibility for the development of large strategic outsourcing and partnership initiatives for CGI in Canada and Europe. Michael Roach, who already managed more than 70% of CGI’s operations as President, Canada & Europe, becomes President and Chief Operating Officer, with responsibility for the continuity of all CGI operations. Joseph Saliba becomes President, US, assuming operational responsibilities for the US in addition to leading the Business Process Services unit. Joe Saliba will report to Michael Roach.

Serge Godin said, “CGI’s opportunity for growth as a leading North American provider of IT services is tremendous and we are fully intent on leveraging our potential. Especially in the US, where we see increasing demand for our service offering, we believe that these adjustments to our organizational structure will strengthen our ability to pursue new business initiatives and improve operational efficiencies.”

Initiatives and Outlook
Mr. Godin added, “Our strong growth will continue to be driven by a combination of strategic acquisitions and organic growth initiatives. Additionally, we have established a diversified client base of more than 3,000 companies and enjoy strong recurring revenue from long-term outsourcing contracts. As such, CGI’s continued growth is not solely dependent on winning large IT and business process outsourcing contracts. However, our position as the leading IT services provider in Canada and our growing recognition in the US, partly a result of a number of successful marketing initiatives, has fueled a robust pipeline of $5 billion in outstanding proposals. Our strong financial position, flexible client partnerships, and unique global delivery model give us confidence in the ability to turn this pipeline into backlog and deliver even stronger results going forward.”

Guidance
Based on the information known today about current market conditions and demand, the company reiterates its current guidance for its fiscal year ending September 30, 2002. Base revenue for the year is expected to be between $2.1 billion and $2.2 billion, representing between 33% and 39% growth over fiscal 2001 results. These numbers do not include any contribution from potential large acquisitions or large outsourcing contract wins valued at more than $50 million per year. Net earnings per share should be in the range of $0.37 to $0.40, representing between 23% and 33% growth year over year.

In the third quarter ended June 30, 2002, revenue is expected to be in the range of $545 and $560 million, representing between 35% and 39% year over year growth. Net earnings per share are expected to be between $0.09 and $0.10, compared to $0.08 for the year ago period, representing between 12.5%- 25% growth.

Quarterly Conference Call
A conference call for the investment community will be held today, April 23, at 10:00 am (Eastern Time). Participants may access the call by dialing 888-799-1759 or through the Internet at www.cgi.ca. Supporting slides for the call will also be available at www.cgi.ca. For those unable to participate on the live call, a webcast and copy of the slides will be archived at www.cgi.ca.

Forward-Looking Statements
All statements in this press release and MD&A that do not directly and exclusively relate to historical facts constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements represent CGI Group Inc.’s intentions, plans, expectations, and beliefs, and are subject to risks, uncertainties, and other factors, of which many are beyond the control of the Company. These factors could cause actual results to differ materially from such forward-looking statements.

These factors include and are not restricted to the timing and size of contracts, acquisitions and other corporate developments; the ability to attract and retain qualified employees; market competition in the rapidly-evolving information technology industry; general economic and business conditions, foreign exchange and other risks identified in the Management’s Discussion and Analysis (MD&A) in CGI Group Inc.’s Annual Report on Form 40F filed with the SEC, the Company’s Annual Information Form filed with the Canadian securities commissions, the Registration Statement on Form F-4 filed with the SEC in connection with the acquisition of IMRglobal and the Forms 10-K and 10-Q of IMRglobal filed with the SEC for the periods ended December 31, 2000 and March 31, 2001 respectively. All of the risk factors included in these filed documents are included here by reference. CGI disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

-30-

For more information:

CGI Investor Relations
Julie Creed
Vice-president, investor relations
(312) 201-8094 or (514) 841-3200

Ronald White
Director, investor relations
(514) 841-3230

CGI Media Relations
Eileen Murphy
Director, media relations
(514) 841-3430