January 27, 2010 / 2:01 PM / 8 years ago

UPDATE 2-CGI Group quarterly earnings rise, bookings leap

* Earnings in line with market expectations

* EPS C$0.37 vs C$0.26 year earlier

* CGI sees 2010 revenue returning to “traditional” levels

(Recasts with CEO comments from conference call, more details)

VANCOUVER , Jan 27 (Reuters) - CGI Group Inc (GIBa.TO), Canada’s biggest computer consulting company, reported a jump in quarterly profit and bookings on Wednesday, and said 2010 revenue growth would recover from a recent slowdown.

Shares of CGI rose 1 percent after the news, even as the company reported revenue in the latest quarter that fell short of expectations on unfavorable foreign exchange movements.

Profit increased 39 percent to C$111.2 million ($105.5 million), or 37 Canadian cents a share, in the fiscal first quarter ended Dec. 31. That compares with C$80.1 million, or 26 Canadian cents, a year earlier.

Excluding a 10 Canadian cent a share tax benefit, earnings per share were 27 Canadian cents a share, in line with analysts’ forecasts.

Revenue fell to C$913 million from C$1 billion, below analysts’ average expectations of C$958.6 million.

In the first quarter, new contract signings ballooned to C$1.6 billion, as expected by the market, from 775 million in the same period last year as the technology outsourcing market showed signs of a revival.

“Some of our large clients who hit the brakes last year at this time have replenished their budgets and are starting to put those projects in the window,” CGI Chief Executive Michael Roach said on a conference call.

“And over the next number of quarters we expect to see that trend transition into top-line growth,” Roach said, referring to revenue growth.

Bookings in Canada were particularly strong in the first quarter, when the bulk of business came from the financial services, government and healthcare sectors, he said.

The Montreal-based company expects a “gradual return to more traditional levels of top-line growth” for the rest of this year.

CGI said it is renewing its share buyback program, targeting 10 percent of its stock over the next 12 months.

CGI’s stock was up 15 Canadian cents, or 1 percent, at C$14.84 on the Toronto Stock Exchange on Wednesday.

$1=$1.06 Canadian Reporting by Nicole Mordant and Scott Anderson; Editing by Frank McGurty

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