CGI Reports 90 percent Revenue Growth and 186 percent Net Earnings Growth for Fiscal 1997.MONTREAL--(BUSINESS WIRE)--Dec. 3, 1997--CGI Group Inc.(TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :GIB See NIST binary. .A.) (ME:GIB.A.) Fourth quarter growth of 88 percent in revenues and 401 percent in net earnings CGI CGI in full Common Gateway Interface. Specification by which a Web server passes data between itself and an application program. Typically, a Web user will make a request of the Web server, which in turn passes the request to a CGI application program. (ME, TSE-Gib.A) today announced results for the fiscal year ended September 30, 1997, the 21st consecutive year of revenue growth. Revenue increased by 90.1 percent to $231.9 million compared with $122.0 million the previous year, with approximately half the growth reflecting new and renewed outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management. and systems integration contracts, and the balance resulting from strategic acquisitions, notably CDSL (Consumer DSL) An asymmetric DSL variation from Rockwell International that supports standard analog modems as well as 128 Kbps upstream and 1 Mbps downstream up to a maximum distance of 18000 feet. See DSL. which CGI acquired in April 1997 and also the first full year of some earlier acquisitions and a joint venture company. Net earnings in fiscal 1997 increased by 185.7 percent to $7.8 million ($0.40 per share) compared with $2.7 million ($0.16 per share) in fiscal 1996 on 13.5 percent more shares outstanding in 1997 on a weighted average basis. The company's net profit margin increased to 3.3 percent in fiscal 1997, including a margin of 3.9 percent in the fourth quarter, from 2.2 percent in fiscal 1996. Cash flow increased 177.6 percent to $21.8 million ($1.12 per share), from $7,851,000 ($0.46 per share) in fiscal 1996. In the fourth quarter ended September 30, 1997, revenue increased 88.3 percent to $72.4 million from $38.5 million in the same quarter of fiscal 1996, and net earnings increased 401 percent to $2.9 million ($0.14 per share) from $572,000 ($0.06 per share) a year ago. Cash flow increased 216 percent to $9.0 million ($0.43 per share), from $2.9 million ($0.16 per share) in the fourth quarter of fiscal 1996. "The fourth quarter performance results from strategic initiatives which position CGI for continuing strong growth in our targeted IT services markets," said Serge serge 1 n. A twilled cloth of worsted or worsted and wool, often used for suits. [Middle English sarge, from Old French, from Vulgar Latin *s Godin, Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "We continue to strengthen our position in each of our targeted markets through a combination of internal growth and acquisitions." CGI's increasing profitability reflects a number of factors: the growth of outsourcing contracts as a percentage of total revenue, efficiencies resulting from the application of ISO (1) See ISO speed. (2) (International Organization for Standardization, Geneva, Switzerland, www.iso.ch) An organization that sets international standards, founded in 1946. The U.S. member body is ANSI. 9001 standards to project management, economies of scale related to business growth, and synergies from integrating recent acquisitions. Subsequent to year end, CGI acquired the Insurance Systems group of Teleglobe Inc. (TIS), the third largest outsourcer and provider of business solutions to the property and casualty insurance industry in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. and the largest in Canada. TIS results were consolidated into those of CGI as of October 23, 1997 and the revenue contribution of this acquisition will be reflected in the first quarter of fiscal 1998. CGI continues to benefit from a strong balance sheet, particularly subsequent to year end with the acquisition of the Insurance Systems group of Teleglobe Inc. (TIS) and the issuance to Bell Canada Bell Canada Enterprises (TSX: BCE, NYSE: BCE), legally BCE Inc., is a major Canadian telecommunications company. Through its subsidiaries including Bell Canada, Bell Aliant, Northwestel, Télébec, and NorthernTel, it is the incumbent local exchange carrier for of an additional $43.7 million of first preferred shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. , series 1, to maintain its 23.8 percent interest in CGI. Following these two transactions, on a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis, CGI as of October 23, 1997 has no debt, $12 million cash, and a $163.7 million increase in shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. from $72.3 million at September 30, 1997. Following the acquisition in October, CGI had an order backlog in excess of $1.3 billion, compared with $175 million a year earlier. At least half of the increase during the year was from internally generated contracts, primarily new outsourcing contracts and a 100 percent renewal rate of existing contracts. Operations Review During the fourth quarter, CGI continued to build its order backlog. In July, CGI was awarded a $3 million contract to customize and install AMICUS library management software for The British Library British Library, national library of Great Britain, located in London. Long a part of the British Museum, the library collection originated in 1753 when the government purchased the Harleian Library, the library of Sir Robert Bruce Cotton, and groups of manuscripts. in conjunction with Axis Resources. In September, CGI became the first non-financial institution member of Canada's Interac electronic payment system with the ability to provide Interac services including shared cash dispensing dispensing provision of drugs or medicines as set out properly on a lawful prescription. A prescription can only be filled, the drugs supplied, by a registered pharmacist, veterinarian, dentist or member of the medical profession. and direct payment to clients on a stand alone basis. CGI launched this service with a contract with the Canadian affiliate of Republic National Bank of New York The Bank of New York, abbrieviated to BNY, was a global financial services company that existed until its merger with the Mellon Financial Corporation on July 2, 2007.[1] The bank now continues under the new name of The Bank of New York Mellon Corporation. . Subsequent to the fiscal year end, CGI acquired TIS, thereby increasing its revenue run rate to in excess of $500 million, gaining a strong base of property and casualty insurance clients in the U.S. and in Canada, and a presence in the U.K. which will also provide access to European markets. CGI is the largest independent information technology consulting Information technology consulting (IT consulting or business and technology services) is a field that focuses on advising businesses on how best to use information technology to meet their business objectives. firm Canada. CGI has 4,000 professionals, a revenue run rate in excess of $500 million, and an order backlog valued at over $1.3 billion. CGI provides end-to-end IT services and business solutions to some 2,000 clients throughout North America and elsewhere in the world. -0-
THE CGI GROUP INC.
Consolidated statements of earnings
years ended September 30
(in thousands of dollars, except earnings per share)
1997 1996
$ $
Revenue 231,916 122,015
------- -------
Operating expenses
Direct costs, selling
and administration expenses 203,677 111,299
Research and development 3,115 2,115
Depreciation and amortization of fixed assets 3,583 1,264
Amortization of
costs related to outsourcing contracts 3,985 538
Amortization of software and development costs 591 86
Amortization of goodwill 1,517 475
Interest on long-term debt 647 235
Other interest expenses 908 352
-------- -------
218,023 116,364
-------- -------
Earnings before income taxes,
share in the results of an entity
subject to significant influence
and share of non controlling interest 13,893 5,651
Income taxes 5,685 2,426
-------- -------
Earnings before share in the results
of an entity subject to significant
influence and share of non controlling
interest 8,208 3,225
Share in the results of an entity
subject to significant influence,
net of deferred income taxes of
$159 ($260 in 1996) (310) (507)
Share of non controlling interest (133) -
-------- -------
Net earnings 7,765 2,718
-------- -------
Weighted average number of outstanding Class A subordinate shares,
Class B shares and first
preferred shares, Series 1 19,450,702 17,137,172
---------- ----------
Earnings per Class A subordinate share,
Class B share and first preferred
share, Series 1 0.40 0.16
-------- -------
CONTACT: CGI Group CGI Group Inc. (TSX: GIB.A, NYSE: GIB) is a Canadian-based information technology (IT) management and business process services (BPS) company. Founded in 1976 as Conseillers en Gestion et Informatique Inc. Andre Imbeau, 514/ 841-3200 Internet: www.cgi.ca or CGI Group Inc. Paule Dore, 514/ 841-3200 Internet: www.cgi.ca |
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