CGI Group Turns To Profit In Q4, But Revenues Miss View

(RTTNews) - Canadian IT services company CGI Group Inc. (GIB, GIB_A.TO) on Thursday reported a turnaround to profit in the fourth quarter, reflecting a surge in revenues as well as lower acquisition-related and integration costs. However, revenues for the quarter missed analysts' expectations.

Michael Roach, President and Chief Executive Officer of CGI Group said, "I am very pleased with the strong performance delivered in the fourth quarter and throughout fiscal 2013. After a full year, the Logica merger and successful execution of our integration program has, and will continue to yield significant benefits for our clients, employees and shareholders."

CGI Group's fourth-quarter net earnings were C$141.0 million or C$0.44 per share, compared to net loss of C$168.0 million or C$0.58 per share in the year-ago period.

The latest quarter's results include acquisition-related and integration costs of C$50.2 million and unfavorable tax adjustments of C$26.0 million. The prior-year quarter's results include acquisition-related and integration costs of C$248.3 million.

Excluding these, adjusted net earnings for the latest quarter were C$213.6 million or C$0.67 per share, compared to adjusted net earnings of C$100.0 million or C$0.37 per share in the year-ago period. On average, fifteen analysts polled by Thomson Reuters expected the company to report earnings of C$0.62 per share for the quarter. Analysts' estimates typically exclude one-time items.

Revenue for the quarter grew 53 percent to C$2.46 billion from C$1.61 billion in the year-ago period, but missed analysts' consensus estimate of C$2.52 billion.

Bookings at the end of the quarter rose 64 percent to C$2.50 billion from C$1.52 billion in the prior-year period. Backlog at quarter-end were C$18.68 billion, up 6 percent from C$17.65 billion in the same period last year.

For fiscal 2013, CGI's net earnings rose to C$455.8 million or C$1.44 per share from C$131.5 million or C$0.48 per share last year. Adjusted net earnings were C$727.7 million or C$2.30 per share, compared to C$401.3 million or C$1.50 per share in the previous year.

Revenue for the year more than doubled to C$10.08 billion from C$4.77 billion in the prior year.

Analysts expected the company to earn C$2.25 per share for the year on revenues of C$10.14 billion.

As part of its normal course issuer bid, the company purchased 723,100 shares for C$22.9 million, at an average price of C$31.63.

Looking ahead, Roach said, "Going forward, our focus remains on realizing incremental revenue and cost synergies that will drive additional earnings accretion in fiscal 2014 and beyond. "In summary we begin fiscal 2014 in an excellent position strategically, operationally and financially."

CGI closed Wednesday's trading on the New York stock exchange at $19.16, up $0.19 on a volume of 60,900 shares.

On the Toronto stock exchange, GIB-A.TO closed Wednesday's trading at C$37.62 0.51 1.37 percent on a volume of 2.08 million shares.