CGI begins fiscal 2015 with strong Q1 results - Earnings expand by 24.5% and backlog exceeds $20 billion
Stock Market Symbols
GIB.A (TSX)
GIB (NYSE)
www.cgi.com/newsroom
Q1-F2015 year-over-year highlights
- Revenue of $2.5 billion;
- Bookings of $4.3 billion, or 169.4% of revenue;
- Backlog of $20.2 billion;
- Adjusted EBIT of $344.0 million, up 13.6%;
- Adjusted EBIT margin of 13.5%, up 200 basis points;
- Net earnings of $236.3 million, up 24.5%;
- Diluted EPS of $0.74, up 23.3%;
- Cash provided by operating activities of $339.2 million, up 411.6%;
- Return on invested capital of 14.7%, up 200 basis points;
- Return on equity of 18.9%, up 290 basis points.
| Note: All figures in Canadian dollars. Q1-F2015 MD&A, interim condensed consolidated financial statements and accompanying notes can be found at www.cgi.com/investors and have been filed with both SEDAR in Canada and EDGAR in the U.S. |
MONTREAL, Jan. 28, 2015 /PRNewswire/ - CGI (TSX: GIB.A) (NYSE: GIB) reported fiscal 2015 first quarter revenue of $2.5 billion, compared with $2.6 billion in the year ago period. Sequentially, revenue improved by $57.6 million.
During the quarter, $4.3 billion in contract awards were booked, for a book-to-bill ratio of 169.4%; bringing the trailing twelve month bookings to $11.7 billion, or 112.1% of revenue. At the end of December 2014, the Company's backlog of signed orders stood at a record $20.2 billion, an increase of $1.9 billion from Q4-2014.
Adjusted EBIT was $344.0 million, representing a margin of 13.5%. This compares with $302.9 million, or 11.5% in Q1-F2014.
Net earnings were $236.3 million, compared with $189.8 million in the year ago period, an improvement of 24.5%. Earnings were 74 cents per diluted share, representing a 23.3% expansion from 60 cents per diluted share in Q1-F2014.
The Company generated $339.2 million in cash from operating activities, an increase of 411.6% from Q1-F2014. Over the last twelve months, the Company has generated $1.4 billion or $4.54 in cash per diluted share, representing 13.9% of revenue.
| In millions of Canadian dollars except earnings per share | ||
| and where noted | ||
| Q1-F2015 | Q1-F2014 | |
| Revenue | 2,541.3 | 2,644.7 |
| Adjusted EBIT | 344.0 | 302.9 |
| Margin | 13.5% | 11.5% |
| Net earnings prior to specific items* | 236.3 | 200.1 |
| Margin | 9.3% | 7.6% |
| Earnings per share (diluted) prior to specific items* | 0.74 | 0.63 |
| Net earnings | 236.3 | 189.8 |
| Margin | 9.3% | 7.2% |
| Earnings per share (diluted) | 0.74 | 0.60 |
| Weighted average number of outstanding shares (diluted) | 320,079,669 | 318,679,293 |
| Net finance costs | 23.6 | 27.4 |
| Net debt | 1,924.5 | 2,890.4 |
| Net debt to capitalization ratio | 25.1% | 38.9% |
| Cash provided by operating activities | 339.2 | 66.3 |
| Days sales outstanding (DSO) | 42 | 55 |
| Return on invested capital (ROIC) | 14.7% | 12.7% |
| Return on equity (ROE) | 18.9% | 16.0% |
| Bookings | 4,304 | 2,818 |
| Backlog | 20,175 | 19,253 |
| *Specific items in Q1-F2014 include: $18.1 million in integration-related costs net of tax, offset by the positive resolution of acquisition-related provisions in the amount of $7.8 million net of tax. |
Net debt was $1.9 billion in Q1-F2015, representing a year-over-year reduction of $965.9 million. As a result, the net debt to capitalization ratio improved from 38.9% in the year ago period to 25.1%. At the end of December 2014, the Company had approximately $2.0 billion in available cash and unused credit facilities.
"Our strong performance continues to reinforce our ability and commitment to creating significant value for our investors," said Michael E. Roach, President and CEO. "Our pipeline of new opportunities is expanding, reflecting improving market conditions and growing client recognition of the significant value created by our business enabling solutions."
"Our operational and financial discipline is visible in our ability to increase earnings and accelerate cash generation. Together with our expanded access to long term capital, we are well positioned with ample financial flexibility to execute our Build and Buy profitable growth strategy."
Normal Course Issuer Bid
On January 28, 2015 the Company's Board of Directors authorized the renewal of the Normal Course Issuer Bid and the purchase of up to an additional 10% of the Company's public float of shares, or approximately 19.05 million shares during the next year, subject to acceptance by the Toronto Stock Exchange.
Q1-F2015 results conference call
Management will host a conference call this morning at 9:00 a.m. Eastern time to discuss results. Participants may access the call by dialing 866-225-2055 or via cgi.com/investors. For those unable to participate on the live call, a podcast and copy of the slides will be archived for download at cgi.com/investors.
Fiscal 2014 Annual General Meeting of Shareholders
This morning at 11:00 a.m. Eastern time, the Company will hold its Annual General Meeting of Shareholders at the Ritz Carlton Hotel in Montreal (1228 Sherbrooke Street West). The meeting, as well as the question and answer session that follows will be broadcast live via cgi.com/investors.
About CGI
Founded in 1976, CGI Group Inc. is the fifth largest independent information technology and business process services firm in the world. Approximately 68,000 professionals serve thousands of global clients from offices and delivery centers across the Americas, Europe and Asia Pacific, leveraging a comprehensive portfolio of services including high-end business and IT consulting, systems integration, application development and maintenance, infrastructure management as well as a wide range of proprietary solutions. With annual revenue in excess of C$10 billion and an order backlog exceeding C$20 billion, CGI shares are listed on the TSX (GIB.A) and the NYSE (GIB). Website: cgi.com.
Non-GAAP financial metrics used in this release: Adjusted EBIT, net debt, net debt to capitalization ratio, bookings, book-to-bill ratio, backlog, DSO, ROIC, ROE and net earnings and diluted EPS prior to specific items.
CGI reports its financial results in accordance with IFRS. However, management believes that these 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. Additional details for these non-GAAP measures can be found on page 2 and 3 of our 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 Canadian securities laws. These statements and this information represent CGI'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 or forward-looking information. These factors include but 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 IT industry; general economic and business conditions; foreign exchange and other risks identified in the press release, in CGI's annual and quarterly Management's Discussion and Analysis ("MD&A"), in CGI's Annual Report, 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 the Company's 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.
SOURCE CGI Group Inc.
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