Logica deal powers CGI results, shares rise
(Reuters) - Canadian IT services company CGI Group Inc GIBa.TO (GIB.N: Quote) reported better-than-expected quarterly results as sales were boosted by contracts from Logica Plc, an Anglo-Dutch rival CGI acquired last year.
CGI shares rose 9 percent to a life-high of C$36.36 on the Toronto Stock Exchange on Wednesday. The company completed its acquisition of Logica last August, making it the fifth-largest independent IT services firm in the world.
The Montreal-based company, founded in 1976, provides services such as business and IT consulting, application development and maintenance, and infrastructure management.
The company's net income in the second quarter rose to C$178.2 million ($173.2 million), or 56 Canadian cents per share, from C$87.2 million, or 33 Canadian cents per share, a year earlier.
Excluding integration costs related to the Logica acquisition, it earned 63 Canadian cents per share, topping analysts' average expectation of 58 Canadian cents per share, according to Thomson Reuters I/B/E/S.
Revenue more than doubled to C$2.57 billion. It beat analysts' average expectation of C$2.53 billion.
Revenue at its U.S. business, the company's largest, rose 18 percent in the quarter, driven mainly by higher-margin contracts in government and health sectors.
The Logica acquisition has given CGI access to markets in Sweden, Finland, Denmark, Norway, Portugal, Spain and Brazil.
The company said bookings in the quarter jumped 86 percent to C$2.75 billion. Continued...