Revenue up 10.0% in constant currency
and EPS up 14.2%, both year-over-year
Q2-F2022 performance highlights1
- Revenue of $3.27 billion, up 6.2%
year-over-year or 10.0% year-over-year in constant currency;
- Adjusted EBIT of $523.6 million,
up 7.7% year-over-year;
- Adjusted EBIT margin improved by 20 basis points year-over-year
to 16.0%;
- Net earnings of $372.0 million,
for a margin of 11.4%, up 30 basis points year-over-year;
- Diluted EPS of $1.53, up 14.2%
year-over-year;
- Net earnings excluding specific items* of $374.1 million, for a margin of 11.4%, up 30
basis points year-over-year;
- Diluted EPS excluding specific items* of $1.53, up 13.3% year-over-year;
- Cash from operating activities of $472.6
million, representing 14.5% of revenue;
- Bookings of $3.32 billion, for a
book-to-bill ratio of 101.4%;
- Backlog of $23.14 billion or 1.9x
annual revenue.
|
*Specific items in
Q2-F2022 include: $2.1 million in acquisition-related and
integration costs, net of tax; Specific items in Q2-F2021 include:
$0.6 million in acquisition-related and integration costs, net of
tax.
|
|
|
|
Note: All figures in
Canadian dollars. Q2-F2022 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.
|
MONTRÉAL, April 27,
2022 /CNW Telbec/ - CGI (TSX: GIB.A) (NYSE: GIB)
Q2-F2022 results
"In the second quarter of fiscal
2022, we delivered on our profitable growth plan with double digit
increases year-over-year in both revenue and EPS," said
George D. Schindler, President and
Chief Executive Officer. "Across our end-to-end portfolio of
services, demand remains strong as clients continue to turn to our
talented teams to help them transform their digital value chains.
This robust demand environment, and our recently announced mergers,
will continue to create new shareholder value in the second half of
the year and beyond."
For the second quarter of fiscal 2022, the Company reported
revenue of $3.27 billion,
representing a year-over-year increase of 6.2% when incorporating
unfavorable foreign currency impacts. On a constant currency basis,
revenue grew by 10.0% year-over-year. The accompanying charts
provide additional information regarding our revenue mix for the
quarter.
Adjusted EBIT was $523.6 million,
up 7.7% year-over-year, with an EBIT margin of 16.0% representing
an improvement of 20 basis points from 15.8% in the same period
last year.
Segmented
results
|
Q2-F22
|
Q2-F21
|
In millions of
CAD except for percentages
|
Revenue
|
Adjusted
EBIT
|
Revenue
|
Adjusted
EBIT
|
|
$
|
$
|
%
|
$
|
$
|
%
|
Western and
Southern Europe
|
558.6
|
85.9
|
15.4%
|
513.6
|
74.3
|
14.5%
|
U.S. Commercial
and State Government
|
506.7
|
72.1
|
14.2%
|
430.8
|
61.4
|
14.3%
|
Canada
|
495.3
|
108.3
|
21.9%
|
443.8
|
98.0
|
22.1%
|
U.S.
Federal
|
438.6
|
71.0
|
16.2%
|
399.6
|
55.9
|
14.0%
|
U.K. and
Australia
|
343.7
|
57.4
|
16.7%
|
345.1
|
62.0
|
18.0%
|
Central and
Eastern Europe
|
341.7
|
35.8
|
10.5%
|
336.9
|
36.2
|
10.7%
|
Scandinavia
|
242.7
|
12.6
|
5.2%
|
273.8
|
17.5
|
6.4%
|
Asia
Pacific
|
193.5
|
57.5
|
29.7%
|
166.5
|
52.9
|
31.7%
|
Finland, Poland
& Baltics
|
190.3
|
23.0
|
12.1%
|
198.2
|
28.2
|
14.2%
|
Eliminations
|
(42.0)
|
|
|
(29.8)
|
|
|
Total
CGI
|
3,268.9
|
523.6
|
16.0%
|
3,078.5
|
486.3
|
15.8%
|
For the three months ended March 31,
2022, our effective tax rate decreased to 25.4% from 25.7%
for the same period last year.
Net earnings were $372.0 million,
up 9.0% compared with the same period last year, for a margin of
11.4%. Diluted earnings per share, as a result, were $1.53 compared to $1.34 last year, representing an increase of
14.2%.
Excluding acquisition-related and integration costs, net of
tax, net earnings were $374.1
million, representing an increase of 9.4% or $32.3 million year-over-year and a margin of
11.4%. On the same basis, diluted earnings per share increased by
13.3% to $1.53, up from $1.35 from the same period last year.
Bookings were $3.32 billion,
representing a book-to-bill ratio of 101.4%, or 108.7% on a
trailing twelve-month basis. As of March 31, 2022, the Company's backlog stood at
$23.14 billion or 1.9x annual
revenue.
Cash provided by operating activities was $472.6 million, or 14.5% of revenue. Over the
last twelve-months ending March 31,
2022, cash provided by operating activities was $1,902.8 million, or 15.4% of revenue.
Financial
highlights
|
Q2-F2022
|
Q2-F2021
|
Change
|
In millions of
Canadian dollars except earnings per share and where
noted
|
|
|
|
Revenue
|
3,268.9
|
3,078.5
|
190.4
|
Growth
|
6.2%
|
(1.7%)
|
790 bps
|
Constant currency
growth
|
10.0%
|
(1.7%)
|
1,170 bps
|
Adjusted
EBIT
|
523.6
|
486.3
|
37.3
|
Margin
|
16.0%
|
15.8%
|
20 bps
|
Net earnings
|
372.0
|
341.2
|
30.8
|
Margin
|
11.4%
|
11.1%
|
30 bps
|
Net earnings excluding
specific items*
|
374.1
|
341.9
|
32.2
|
Margin
|
11.4%
|
11.1%
|
30 bps
|
Diluted earnings per
share (diluted EPS)
|
1.53
|
1.34
|
0.19
|
Diluted earnings per
share excluding specific items*
|
1.53
|
1.35
|
0.18
|
Weighted average number
of outstanding shares (diluted)
|
243.8
|
254.0
|
(10.2)
|
Net finance
costs
|
22.5
|
26.2
|
(3.7)
|
Net debt
|
2,729.7
|
2,938.7
|
(209.0)
|
Net debt to
capitalization ratio
|
28.7%
|
30.9%
|
(220) bps
|
Cash provided by
operating activities
|
472.6
|
572.6
|
(100.0)
|
Days sales outstanding
(DSO)
|
42
|
39
|
3
|
Return on invested
capital (ROIC)
|
15.7%
|
12.8%
|
290 bps
|
Return on equity
(ROE)
|
21.0%
|
17.2%
|
380 bps
|
Bookings
|
3,315.7
|
3,892.1
|
(576.4)
|
Backlog
|
23,144.1
|
23,094.1
|
50.0
|
|
* Specific items in
Q2-F2022 include: $2.1 million in acquisition-related and
integration costs, net of tax; Specific items in Q2-F2021
include:
$0.6 million in acquisition-related and integration costs, net of
tax.
|
During the quarter, the Company invested $400.0
million under its current Normal Course Issuer Bid to purchase
for cancellation 3,968,159 of its Class A shares and $36.3 million for the acquisition of Unico
Computer Systems Pty Ltd.
As at March 31, 2022, net debt
stood at $2.73 billion, down from
$2.94 billion at the same time last
year. The net debt-to-capitalization ratio stood at 28.7% at the
end of March 2022.
With cash of $1.1 billion on hand
at the end of March 2022, and a fully
available revolving credit facility, the Company has $2.6 billion in readily available liquidity to
pursue its Build and Buy profitable growth strategy.
Headcount increased year-over-year by more than 7,000
consultants and professionals, for a total of approximately 84,000
consultants and professionals world-wide.
To access the financial statements – click here (PDF)
To access the Q2-F2022 MD&A – click here (PDF)
Q2-F2022 results conference call
Management will host
a conference call this morning at 9:00 a.m.
Eastern Daylight time to discuss results. Participants may
access the call by dialing 1-888-440-2167 or 1-438-803-0559
Conference ID: 8986313 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 84,000 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. CGI Fiscal 2021
reported revenue is $12.13 billion
and CGI shares are listed on the TSX (GIB.A) and the NYSE
(GIB). Learn more at cgi.com.
1Non-GAAP and other key performance
measures
Non-GAAP financial metrics used in this press
release: Constant currency growth, adjusted EBIT, adjusted EBIT
margin, net debt, net debt to capitalization ratio, ROIC, 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. These measures do not have any
standardized meaning prescribed by IFRS and are therefore unlikely
to be comparable to similar measures presented by other issuers and
should be considered as supplemental in nature and not as a
substitute for the related financial information prepared in
accordance with IFRS. Additional details for these non-GAAP
measures can be found on pages 3, 4 and 5 of our Q2-F2022 MD&A
which is posted on CGI's website, and filed with SEDAR at
www.sedar.com and EDGAR at www.sec.gov.
Key performance measures used in this press release: bookings,
book-to-bill ratio, backlog, DSO, net earnings margin, and ROE. The
composition of these measures can also be found on pages 3, 4 and 5
of our Q2-F2022 MD&A.
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, additional external risks (such
as pandemics, armed conflict and inflation) 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 and other tax programs, our ability
to negotiate favourable contractual terms, to deliver our services
and to collect receivables, the reputational and financial risks
attendant to cybersecurity breaches and other incidents, and
financial risks such as liquidity needs and requirements,
maintenance of financial ratios, and changes in creditworthiness
and credit ratings; 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 Q2 2022 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.
![Revenue by Client geography (CNW Group/CGI Inc.) Revenue by Client geography (CNW Group/CGI Inc.)](https://mma.prnewswire.com/media/1805448/CGI_Inc__CGI_reports_strong_second_quarter_Fiscal_2022_results.jpg)
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