CGI continued to achieve strong revenue growth and increased profitability in the first quarter of fiscal 2000. All dollar amounts are in Canadian dollars.
For the three months ended December 31, 1999, CGI reported a 21,0% increase in revenue to $404.7 million, compared with $334.3 million in the same quarter of the previous year. Earnings before interest, taxes, depreciation and amortization (EBITDA) increased 23.7% to $60.1 million, from $48.6 million a year ago.
The company has begun reporting earnings before amortization of goodwill in the fiscal 2000 first quarter, in keeping with CICA rules which facilitate the comparison of Canadian and U.S. companies. For the first quarter, earnings before amortization of goodwill totalled $27.4 million, or $0.20 per share ($0.10 per share on a post-split basis), compared with $22.0 million, or $0.16 per share ($0.08 on a post-split basis), in the first quarter of fiscal 1999.
Net earnings increased 25.9% to $23.0 million, or $0.17 per share ($0.09 on a post-split basis), from $18.2 million, or $0.14 per share ($0.07 on a post-split basis) the previous year. Operating cash flow increased 72.5% to $43.7 million, or $0.32 per share ($0.16 on a post-split basis), from $25.3 million or $0.19 per share ($0.10 on a post-split basis), in the first quarter of fiscal 1999.
The net profit margin was 5.7% compared with 5.5% in the first quarter of fiscal 1999. At December 31, 1999, the order backlog was worth $7.2 billion.
"Through acquisitions and internal growth, CGI maintains its position as a strong, long-term growth company," said Serge Godin, Chairman and Chief Executive Officer. "We are the largest independent IT services company in Canada, where we continue to see excellent growth potential, and the fifth largest in North America. Through acquisitions, we are committed to becoming a major IT services player in the U.S. market."
"As we further enhance our market presence, we will continue to focus on our distinctive strengths, namely our unique combination of high value added IT services plus a substantial order backlog of signed, long-term outsourcing contracts," added Serge Godin. "Close to 80% of our revenues are generated by high value-added IT services, including e-space services. CGI is solidly positioned in an industry where clients increasingly favour outsourcing and require end-to-end IT services."
During the quarter ended December 31, 1999 and after, CGI made several announcements regarding IT services contracts, as well as one alliance and one acquisition:
- On October 12, 1999, CGI and Sun Microsystems of Canada announced the signing of a non-exclusive Direct Commercial Systems Integrator Agreement to conduct joint marketing and technical implementation activities to respond to the growing demand for e-commerce expert solutions and services throughtout North America.
- On October 13, 1999, CGI announced the signing of an outsourcing contract with IPSCO, for the operation of the Regina-based steel producer's mainframe systems and the support of its local area networks and desktops. For CGI, the three-year agreement is expected to generate total revenues of approximately $15 million.
- On October 21, 1999, CGI announced the signing of several Internet-related contracts with leading clients, further consolidating its strong presence in all segments of the North-American e-space market. These contracts, worth more than $15 million, supported clients such as the Canadian Department of Foreign Affairs, Compaq Computer Corporation, Cokesbury On-Line, AltusMortgage.com and TotalFunding.com.
- On October 26, 1999, CGI announced the closing of its acquisition of MCM Technology, a company based in Atlantic Canada. MCM Technology, whose activities have since been integrated into those of CGI, had built strong expertise in leading edge component-based development (CBD), among others. With this transaction, CGI now has 200 professionals in Eastern Canada.
- On November 3, 1999, CGI announced the signing of an agreement to launch a major, 10-year systems and information technology partnership to serve the needs of Portugal Telecom. This is the largest such contract ever signed in Portugal and represents CGI's first major outsourcing project outside North America.
- On December 21, 1999, CGI announced a two-for-one split of all its shares issued, effective January 7, 2000, the company's fourth such split since August 1997.
- During and after the first quarter, CGI succesfully completed the roll-over into year 2000, both its systems and those which it manages on behalf of its clients.
- On January 10, 2000, or after the end of the first quarter, CGI announced the signing of several RDIMS (Records, Document and Information Management System) contracts with federal government departments, with a total value of over $8 million in licenses and services.
About CGI
CGI is the largest independent information technology consulting firm in Canada and the fifth largest in North America, based on its revenue run rate of $1.6 billion. Its order backlog totals approximately $7.2 billion and the company currently has proposals outstanding for an additional $4 billion in potential large contracts. CGI has 10,000 professionals and provides end-to-end IT services and business solutions to 2,500 clients in Canada, the United States and more than 23 countries around the world. CGI's shares are listed on the New York Stock Exchange (GIB), as well as on the Toronto exchange (GIB.A). They are included in the Toronto Stock Exchange's TSE 300 Composite and TSE 100 indexes. Web site: www.cgi.ca.
All statements contained in this or any other press release of CGI Group
Inc., or in any document filed by the Company with the U.S. Securities
and Exchange Commission, or in any other written or oral communication
by or on behalf of the company, that do not directly and exclusively
relate to historical facts, constitute "forward looking statements"
within the meaning of the U.S. Private Securities Litigation Report Act
of 1995. These statements represent the Company's expectations and
beliefs, and no assurance can be given that the results described in
such statements will be achieved.
This press release may contain
forward looking statements that involve a number of risks and
uncertainties, including statements regarding the outlook for the
company's business and results of operations. There are a number of
factors that could cause actual results to differ materially from those
indicated. Such factors include, without limitation, the various factors
set forth in the Company's annual report.
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For further information, contact:
André Imbeau
Executive Vice-President and Chief Financial Officer
Paule Doré
Executive Vice-President, Corporate Affairs
Tel. : (514) 841-3200
