PRESS
RELEASE
Stock
Market Symbols
GIB.A
(TSX)
GIB
(NYSE)
CGI
EXPANDS Q1 2008 NET EARNINGS BY 66%
FUELED
BY GROWTH IN REVENUE AND BOOKINGS
Q1
2008 year-over-year highlights:
|
·
|
Revenue
of
$914.7 million, up 6.1% on a constant currency
basis;
|
|
·
|
Earnings
before taxes of $100.4 million, up
51.8%;
|
|
·
|
Net
earnings
of $72.6 million, up 66.2%;
|
|
·
|
Net
earnings
margin of 7.9%, up from 4.8%;
|
|
·
|
EPS
of 22
cents, up 67.1%;
|
|
·
|
Cash
generated from operating activities in Q1 2008 of $118.7
million;
|
|
·
|
Debt
repayments and stock buy backs in Q1 2008 totaled $75.1
million;
|
|
·
|
Q1
2008
bookings of $1.15 billion, compared with $769.0 million in Q1
2007.
|
Note:
Full Q1 F2008 MD&A, financial statements and accompanying notes may be found
at www.cgi.com and
have been filed with both Sedar in Canada and Edgar in the
U.S.
Montreal,
Quebec,
February 5, 2008– CGI Group Inc. (TSX: GIB.A; NYSE: GIB) reported fiscal
2008 first quarter revenue today of $914.7 million. This represents 6.1%
year-over-year revenue growth on a constant currency basis, compared with
the
first quarter of 2007. Relative to the same year ago period, foreign exchange
fluctuations negatively impacted the Company’s revenue by $44.2 million, or 4.9%
of revenue.
Earnings
before
taxes were $100.4 million or 11.0% of revenue. This is an improvement of
51.8%
compared with the first quarter of 2007.
Net
earnings in Q1
2008 were $72.6 million or 7.9% of revenue compared with net earnings of
$43.7
million or 4.8% of revenue in the same quarter last year. This represents
a
66.2% year-over-year increase.
The
first quarter
results included one-time tax benefits of $6.3 million, primarily related
to a
federal income tax rate change in Canada. Excluding these one-time tax
adjustments, the net earnings margin was 7.2%.
Earnings
per share
in the first quarter were 22 cents. This compares with 13 cents in the same
period last year.
The
Company
generated $118.7 million in cash from its operating activities, or 13% of
revenue. On a rolling twelve month basis, CGI has generated $502.7 million
or
$1.51 in cash per share from its operating activities.
|
In
millions of Canadian dollars except when noted
|
|
|
|
|
Q1
F2008
|
Q1
F2007
|
|
Revenue
|
$914.7
|
$904.1
|
|
Adjusted
EBIT
Margin
|
$106.5
11.6%
|
$99.7
11.0%
|
|
Earnings
before taxes (EBT)
Margin
|
$100.4
11.0%
|
$66.1
7.3%
|
|
Net
earnings
|
$72.6
|
$43.7
|
|
Margin
|
7.9%
|
4.8%
|
|
Earnings
per
share
|
$0.22
|
$0.13
|
|
Weighted
average number of outstanding shares (diluted)
|
329,785,001
|
331,588,537
|
|
Interest
on
long-term debt
|
$7.3
|
$12.5
|
|
Net
debt to
capitalization ratio
|
14.2%
|
22.6%
|
|
Days
of sales
outstanding (DSO)
|
41
|
44
|
|
Bookings
|
$1,151.1
|
$769.0
|
During
the quarter,
the Company booked $1.15 billion in new contract wins, extensions and renewals,
resulting in a book-to-bill of 126% in the quarter. At the end of December
2007,
the Company’s backlog stood at $12.04 billion or 3.3 times annual
revenue.
“I
am very pleased with our strong overall performance in Q1 as we continue
to
build on the momentum created in fiscal 2007,” said Michael E. Roach, President
and Chief Executive Officer. “We remain convinced that our focus on execution
will continue to be the key to achieving our profitable growth targets and
operating strategy. In this regard, the ongoing execution of our business
development strategy continues to surface significant growth opportunities
and
sales as validated by the sustained improvement in bookings this quarter
and
over the last several quarters.”
The
Company
continues to enhance its financial flexibility to invest in large outsourcing
contracts, accretive acquisitions, share buy backs and debt reduction. As
part
of its Normal Course Issuer Bid, the Company repurchased for cancellation
1.4 million subordinate class A shares during the first quarter for a
total investment of $15.8 million.
In
addition, long-term debt decreased by $37.5 million during the quarter. At
the
end of December 2007, net debt was reduced to $328.6 million, improving the
Company’s net debt to capitalization ratio to 14.2%.
During
the quarter,
the Company entered into forward contracts to limit the principal repayments
on
US$192 million (valued at $255.8 million when issued in 2004) in Senior U.S.
unsecured notes, thereby locking in its obligation in Canadian dollars to
$194.2
million.
Normal
Course Issuer Bid Renewal
Under
the terms of
the current Normal Course Issuer Bid which commenced on February 5, 2007,
the
Company repurchased 11.8 million of its Class A subordinate shares for
$127.2 million. On February 5, 2008, the Company’s Board of Directors
authorized the renewal of the Normal Course Issuer Bid and the purchase of
up to
10% of the public float of the Company’s Class A subordinate shares, or
approximately 28.5 million shares during the next year, subject to regulatory
approval.
First
Quarter F2008 Results Conference Call
Management
will
host a conference call to discuss results at 9:30 a.m. Eastern time this
morning. Participants may access the call by dialing 1-866-225-0198 or on
the
Web at www.cgi.com.
Supporting slides for the call will also be available. For those unable to
participate on the live call, a podcast and copy of the slides will be archived
for download at www.cgi.com.
Annual
General Meeting of Shareholders
This
morning at 11
a.m., the Company will hold its Annual General Meeting of shareholders at
the
Omni Mont-Royal Hotel, Salon Les Saisons, 1050 Sherbrooke Street West, Montreal.
The meeting, being presided over by Serge Godin, Founder and Executive Chairman
will be broadcast live via www.cgi.com.
Michael E. Roach, President and Chief Executive Officer will also address
the
meeting and a question and answer session will follow with the Executive
team.
Note
to the media: A press conference will be held immediately following the Annual
General Meeting, at approximately 12:15 p.m.
About
CGI
Founded
in 1976,
CGI Group Inc. is one of the largest independent information technology and
business process services firms in the world. CGI and its affiliated companies
employ approximately 26,500 professionals. CGI provides end-to-end IT and
business process services to clients worldwide from offices in Canada, the
United States, Europe, Asia Pacific as well as from centers of excellence
in
North America, Europe and India. CGI's annual revenue run rate stands at
$3.7
billion and at December 31st, 2007, CGI's order backlog was $12.04 billion.
CGI
shares are listed on the TSX (GIB.A) and the NYSE (GIB) and are included
in the
S&P/TSX Composite Index as well as the S&P/TSX Capped Information
Technology and MidCap Indices. Website: www.cgi.com.
Use
of Non-GAAP Financial Information
CGI
reports its
financial results in accordance with GAAP. However, management believes that
certain non-GAAP measures provide useful information to investors regarding
the
Company’s financial condition and results of operations as they provide
additional measures of its performance. Explanations as well as a reconciliation
of these non-GAAP measures with GAAP financial statements are provided in
the
MD&A which is posted on CGI’s website, and filed with SEDAR and
EDGAR.
Forward-Looking
Statements
All
statements in
this press release that do not directly and exclusively relate to historical
facts constitute “forward-looking statements” within the meaning of that term in
Section 27A of the United States Securities Act of 1933, as amended, and
Section
21E of the United States Securities Exchange Act of 1934, as amended, and
are
“forward-looking information” within the meaning of sections 138.3 and following
of the Ontario Securities Act, as amended. These statements and this information
represent CGI Group Inc.’s (“CGI”) 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 or forward-looking
information. These factors include and are not restricted to the timing and
size
of new contracts, acquisitions and other corporate developments; the ability
to
attract and retain qualified members; 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’s Annual Report on Form 40-F filed with the U.S.
Securities and Exchange Commission (filed on EDGAR at www.sec.gov),
and in CGI’s annual and quarterly MD&A and Annual Information Form filed
with the Canadian securities authorities (filed on SEDAR at www.sedar.com),
as well as assumptions regarding the foregoing. The words “believe,” “estimate,”
“expect,” “intend,” “anticipate,” “foresee,” “plan,” and similar expressions and
variations thereof, identify certain of such forward-looking statements or
forward-looking information, which speak only as of the date on which they
are
made. In particular, statements relating to future performance are
forward-looking statements and forward-looking information. CGI disclaims
any
intention or obligation to publicly update or revise any forward-looking
statements or forward-looking information, whether as a result of new
information, future events or otherwise, except as required by applicable
law.
Readers are cautioned not to place undue reliance on these forward-looking
statements or on this forward-looking information.
-30-
For
more information:
Lorne
Gorber
Vice-President
Global
Communications and Investor Relations
514-841-3355