Q3-F2020 performance highlights
- Revenue of $3.05 billion, down
2.2% year-over-year or down 3.5% in constant currency;
- Adjusted EBIT of $448.0 million,
down 5.5% year-over-year;
- Adjusted EBIT margin of 14.7%, down 50 basis points
year-over-year;
- Net earnings of $260.9 million,
for a margin of 8.5% and diluted EPS of $1.00;
- Net earnings excluding specific items* of $308.4 million, for a margin of 10.1% and diluted
EPS of $1.18;
- Cash provided by operating activities of $584.8 million, up $209.6
million, representing 19.2% of revenue;
- Bookings of $2.84 billion for a
book-to-bill of 93% and;
- Backlog of $22.30 billion or 1.8x
annual revenue.
*Specific items in Q3-F2020 include: $18.2 million in acquisition-related and
integration costs and $29.3 million
in restructuring costs, both net of tax; Specific items in Q3-F2019
include: $27.9 million in
acquisition-related and integration costs, net of tax.
Note: All figures in Canadian dollars. Q3-F2020 MD&A,
interim condensed consolidated financial statements and
accompanying notes can be found at cgi.com/investors and have been
filed with both SEDAR in Canada
and EDGAR in the U.S.
To access the financial statements – click here (PDF)
To access the MD&A – click here (PDF)
MONTRÉAL, July 29, 2020
/PRNewswire/ - CGI (TSX: GIB.A) (NYSE: GIB) reported Fiscal 2020
third quarter results this morning.
"Our Q3 performance continues to reflect the resilience of our
company and the strength of our strategy and leadership team," said
President and Chief Executive Officer, George Schindler. "Our strong cash generation in
the quarter was driven by the quality of our client relationships
and delivery excellence. Looking ahead, we believe market and
business conditions for our end-to-end services will gradually
improve throughout the rest of this year, and we see expanding
opportunities for profitable growth through both build and
buy."
For the third quarter of F2020, the Company reported revenue of
$3.05 billion, representing a
decrease of $67.1 million, or 2.2%
year-over-year. On a constant currency basis, revenue decreased by
3.5% as foreign exchange fluctuations positively impacted revenue
by $42.1 million.
Adjusted EBIT was $448.0 million,
a decrease of $26.2 million when
compared to Q3-F2019. Adjusted EBIT margin of 14.7% is down from
15.2% in the year ago period.
On a GAAP basis, net earnings were $260.9
million in Q3-F2020, and earnings per diluted share were
$1.00 compared with $1.12 in Q3-F2019.
When excluding $47.5 million in
acquisition related, integration and restructuring costs, net
earnings were $308.4 million in
Q3-F2020, representing a margin of 10.1%. On the same basis, EPS of
$1.18 per diluted share in Q3-F2020
compares with $1.22 in the year ago
period.
Bookings were $2.84 billion in
Q3-F2020, representing 93.1% of revenue. Over the last twelve
months, bookings have totaled $11.78
billion, or 96.6% of revenue. At the end of June 2020, the Company's backlog stood at
$22.30 billion.
Cash provided by operating activities was $584.8 million, or 19.2% of revenue, representing
a year-over year increase of $209.6
million. Over the last twelve months, $1.85 billion in cash has been generated by
operating activities, or 15.2% of revenue.
In millions of
Canadian dollars except earnings per share
and where noted
|
Q3-F2020
|
Q3-F2019
|
Revenue
|
3,052.7
|
3,119.8
|
Growth
|
(2.2)%
|
6.1%
|
Growth
at constant currency
|
(3.5)%
|
6.6%
|
Adjusted
EBIT
|
448.0
|
474.2
|
Margin
|
14.7%
|
15.2%
|
Net
earnings
|
260.9
|
309.4
|
Margin
|
8.5%
|
9.9%
|
Net earnings
excluding specific items*
|
308.4
|
337.2
|
Margin
|
10.1%
|
10.8%
|
Diluted earnings per
share
|
1.00
|
1.12
|
Diluted earnings per
share, excluding specific items*
|
1.18
|
1.22
|
Weighted average
number of outstanding shares (diluted)
|
261.4
|
277.3
|
Net finance
costs
|
30.7
|
19.4
|
Net debt
|
3,243.5
|
2,336.1
|
Net debt to
capitalization ratio
|
28.0%
|
25.2%
|
Cash provided by
operating activities
|
584.8
|
375.2
|
Days sales
outstanding (DSO)
|
48
|
52
|
Return on invested
capital (ROIC)
|
13.0%
|
15.0%
|
Return on equity
(ROE)
|
17.3%
|
18.1%
|
Bookings
|
2,841
|
2,951
|
Backlog
|
22,295
|
22,418
|
|
**Specific items in
Q3-F2020 include: $18.2 million in acquisition-related and
integration costs and $29.3 million in restructuring costs, both
net of tax; Specific items in Q3-F2019 include: $27.9 million in
acquisition-related and integration costs, net of tax;
|
At the end of June, net debt stood at $3.2 billion dollars, representing a net
debt-to-capitalization ratio of 28.0%, up from 25.2% last year.
When excluding the impact of adopting IFRS 16, the net debt to
capitalization ratio would have been 22.2%.
With cash of $1.4 billion on hand
at the end of June, 2020 and its revolving credit facility, the
Company has more than $2.9 billion in
readily available liquidity to pursue its profitable Build and Buy
strategy.
Q3-F2020 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 1-877-879-0631 (Conference ID: 1495772) 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.
About CGI
Founded in 1976, CGI is among the largest
independent IT and business consulting services firms in the world.
With approximately 77,500 consultants and professionals across the
globe, CGI delivers an end-to-end portfolio of capabilities, from
strategic IT and business consulting to systems integration,
managed IT and business process services and intellectual property
solutions. CGI works with clients through a local relationship
model complemented by a global delivery network that helps clients
digitally transform their organizations and accelerate results.
With Fiscal 2019 reported revenue of C$12.1
billion, CGI shares are listed on the TSX (GIB.A) and the
NYSE (GIB). Learn more at cgi.com.
Non-GAAP financial metrics used in this press release:
Constant currency growth, adjusted EBIT, adjusted EBIT margin, net
debt, net debt to capitalization ratio, bookings, book-to-bill
ratio, backlog, DSO, ROIC, ROE, net earnings margin, net earnings
excluding specific items, net earnings margin excluding specific
items, and diluted EPS excluding 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 pages 3 and 4 of our MD&A which is
posted on CGI's website, and filed with SEDAR and EDGAR.
Forward-looking information and statements
This press
release contains "forward-looking information" within the meaning
of Canadian securities laws and "forward-looking statements" within
the meaning of the United States Private Securities Litigation
Reform Act of 1995 and other applicable United States safe harbours. All such
forward-looking information and statements are made and disclosed
in reliance upon the safe harbour provisions of applicable Canadian
and United States securities laws.
Forward-looking information and statements include all information
and statements regarding CGI's intentions, plans, expectations,
beliefs, objectives, future performance, and strategy, as well as
any other information or statements that relate to future events or
circumstances and which do not directly and exclusively relate to
historical facts. Forward-looking information and statements often
but not always use words such as "believe", "estimate", "expect",
"intend", "anticipate", "foresee", "plan", "predict", "project",
"aim", "seek", "strive", "potential", "continue", "target", "may",
"might", "could", "should", and similar expressions and variations
thereof. These information and statements are based on our
perception of historic trends, current conditions and expected
future developments, as well as other assumptions, both general and
specific, that we believe are appropriate in the circumstances.
Such information and statements are, however, by their very nature,
subject to inherent risks and uncertainties, of which many are
beyond the control of CGI, and which give rise to the possibility
that actual results could differ materially from our expectations
expressed in, or implied by, such forward-looking information or
forward-looking statements. These risks and uncertainties include
but are not restricted to: risks related to the market such as the
level of business activity of our clients, which is affected by
economic and political conditions, external risks (such as
pandemics) and our ability to negotiate new contracts; risks
related to our industry such as competition and our ability to
attract and retain qualified employees, to develop and expand our
services, to penetrate new markets, and to protect our intellectual
property rights; risks related to our business such as risks
associated with our growth strategy, including the integration of
new operations, financial and operational risks inherent in
worldwide operations, foreign exchange risks, income tax laws, our
ability to negotiate favorable contractual terms, to deliver our
services and to collect receivables, and the reputational and
financial risks attendant to cybersecurity breaches and other
incidents; as well as other risks identified or incorporated by
reference in this press release, in CGI's annual and quarterly
MD&A and in other documents that we make public, including our
filings with the Canadian Securities Administrators (on SEDAR at
www.sedar.com) and the U.S. Securities and Exchange Commission (on
EDGAR at www.sec.gov). For a discussion of risks in response to the
coronavirus (COVID-19) pandemic, see Pandemic Risks in section
8.1.1. of our Q3 2020 quarterly MD&A. Unless otherwise
stated, the forward-looking information and statements contained in
this press release are made as of the date hereof and CGI disclaims
any intention or obligation to publicly update or revise any
forward-looking information or forward-looking statements, whether
as a result of new information, future events or otherwise, except
as required by applicable law. While we believe that our
assumptions on which these forward-looking information and
forward-looking statements are based were reasonable as at the date
of this press release, readers are cautioned not to place undue
reliance on these forward-looking information or statements.
Furthermore, readers are reminded that forward-looking information
and statements are presented for the sole purpose of assisting
investors and others in understanding our objectives, strategic
priorities and business outlook as well as our anticipated
operating environment. Readers are cautioned that such information
may not be appropriate for other purposes. Further information on
the risks that could cause our actual results to differ
significantly from our current expectations may be found in the
section titled "Risk Environment" of CGI's annual and quarterly
MD&A, which is incorporated by reference in this cautionary
statement. We also caution readers that the above-mentioned risks
and the risks disclosed in CGI's annual and quarterly MD&A and
other documents and filings are not the only ones that could affect
us. Additional risks and uncertainties not currently known to us or
that we currently deem to be immaterial could also have a material
adverse effect on our financial position, financial performance,
cash flows, business or reputation.
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content:http://www.prnewswire.com/news-releases/cgi-reports-q3-fiscal-2020-results-301101774.html
SOURCE CGI Inc.