Canada's CGI reports higher profit, shares rise
(Reuters) - IT services company CGI Group Inc (GIBa.TO: Quote) GIB.N reported a second-quarter profit above analysts' estimates, partly helped by its acquisition of Logica Plc in August, sending its shares up more than 15 percent on Tuesday.
Excluding Logica integration costs, Canada's largest IT services provider earned 56 Canadian cents per share on an adjusted basis, above the 50 Canadian cents analysts had expected.
The company completed the $2.64 billion acquisition of larger Anglo-Dutch rival Logica in August.
"Now people have more confidence in CGI and their ability to pull off Logica's integration," Morningstar analyst Swami Shanmugasundaram told Reuters.
Second-quarter revenue more than doubled to C$2.53 billion ($2.53 billion). Analysts were looking for C$2.56 billion on average, according to Thomson Reuters I/B/E/S.
Founded in 1976 and headquartered in Montreal, CGI is the fifth largest independent information technology and business process services firm in the world.
It competes with companies such as IBM Corp (IBM.N: Quote) and Accenture Plc (ACN.N: Quote) to provide services including business and IT consulting, systems integration, application development and maintenance and infrastructure management.
Clients range from businesses such as Vodafone Plc to (VOD.L: Quote) to the U.S. Department of Homeland Security.
Revenue from CGI's Nordics, Southern Europe and South America (NSESA) division rose to C$511.2 million from C$10 million a year earlier due to the acquisition. Continued...