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MarketScreener Homepage  >  Equities  >  Toronto Stock Exchange  >  CGI Inc.    GIB.A   CA12532H1047

CGI INC.

(GIB.A)
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CGI : Slides (Q4)

11/11/2020 | 10:51am EST

FOURTH QUARTER AND FISCAL 2020 RESULTS

For the year and three month period ended on September 30, 2020

November 11, 2020

© CGI Inc.

Forward-looking information and statements

Our presentations contain "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 our presentations, 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 10.1 of CGI's annual and quarterly MD&A. Unless otherwise stated, the forward-looking information and statements contained in our presentations 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 hereof, you are cautioned not to place undue reliance on these forward-looking information or statements. Furthermore, you 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. You 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 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.

Please refer to the "Investors" section of CGI's website at www.cgi.comto consult disclosure documents used by management when discussing CGI's financial results with investors and analysts.

All amounts are in Canadian dollars unless otherwise indicated.

Non-GAAP Financial Performance Measures Definitions

The reader should note that the Company reports its financial results in accordance with IFRS. However, we use a combination of financial measures, ratios, and non-GAAP measures to assess the Company's performance. The non-GAAP measures used in this presentation do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with IFRS. Management believes these measures are useful to investors as it best reflects the performance of our activities and allows for better comparability from period to period as well as to trend analysis. The following non-GAAP financial performance measures are defined on pages 3 and 4 of our annual and quarterly MD&A which is posted on CGI's website, and filed with SEDAR and EDGAR:

Adjusted EBIT (non-GAAP); adjusted EBIT margin (non-GAAP); net earnings excluding specific items (non-GAAP); net earnings margin (non-GAAP); net earnings margin excluding specific items (non-GAAP); diluted earnings per share excluding specific items (non-GAAP); days sales outstanding (DSO) (non-GAAP); constant currency growth (non-GAAP); backlog (non-GAAP); bookings (non-GAAP);book-to-bill ratio (non-GAAP); net debt (non-GAAP); net debt to capitalization ratio (non-GAAP); return on equity (ROE) (non-GAAP), and return on invested capital (ROIC) (non-GAAP).

© CGI Inc.

2

GEORGE D.

FRANÇOIS

SCHINDLER

BOULANGER

President and

Executive Vice-President and

Chief Executive Officer

Chief Financial Officer

© CGI Inc.

3

Q4 Fiscal 2020 Results

vs Q4 F2019

Revenue

$2.93B

-1.1%

Constant currency growth*

-4.5%

Adjusted EBIT*

$458M

flat

Adjusted EBIT margin*

15.6%

10 bps

Net earnings

$252M

-22.3%

Net earnings margin

8.6%

-240 bps

Net earnings excluding specific items*

$318M

-3.4%

Net earnings margin excluding specific items*

10.9%

-20 bps

Diluted EPS

$0.96

-19.3%

Diluted EPS excluding specific items*

$1.22

0.8%

  • Constant currency growth, adjusted EBIT and margin, net earnings, net earnings margin and diluted EPS, all three excluding specific items, are non-GAAP measures for which we provide the reconciliation to their closest IFRS measure in the Q4 and F2020 MD&A. Specific items can be comprised of acquisition-related costs, favorable tax adjustments and integration and restructuring costs, all of which are net of tax. These specific items are discussed in section 5.6.1 of the Q4 and F2020 MD&A.

© CGI Inc.

4

Q4 Fiscal 2020 Results

Revenue

$2,959 -1.1%

$2,926

Adjusted EBIT and margin

flat

$457$458

15.5%15.6%

Cash provided by operating activities

(in dollars and % of revenue)

Q4 F2019

Q4 F2020

Net earnings and margin, excluding specific items

Q4 F2019

Q4 F2020

Diluted EPS

excluding specific items

+21.4%

$405

$492

$329 -3.4%

$318

11.1%10.9%

Q4 F2019

Q4 F2020

+0.8%

$1.22

$1.21

Q4 F2019

Q4 F2020

13.7%16.8%

Q4 F2019

Q4 F2020

  • Adjusted EBIT and margin, net earnings, net earnings margin and diluted EPS, all three excluding specific items, and backlog are non-GAAP measures for which we provide more details in the Q4 and F2020 MD&A.

© CGI Inc.

5

Fiscal 2020 Results

vs F2019

Revenue

$12.2B

0.4%

Constant currency growth*

-0.1%

Adjusted EBIT*

$1.86B

2.1%

Adjusted EBIT margin*

15.3%

20 bps

Net earnings

$1.12B

-11.5%

Net earnings margin

9.2%

-120 bps

Net earnings excluding specific items*

$1.30B

-0.4%

Net earnings margin excluding specific items*

10.7%

-10 bps

Diluted EPS

$4.20

-7.7%

Diluted EPS excluding specific items*

$4.89

4.0%

  • Constant currency growth, adjusted EBIT and margin, net earnings, net earnings margin and diluted EPS, all three excluding specific items, are non-GAAP measures for which we provide the reconciliation to their closest IFRS measure in the Q4 and F2020 MD&A. Specific items can be comprised of acquisition-related costs, favorable tax adjustments and integration and restructuring costs, all of which are net of tax. These specific items are discussed in sections 3.7.1, 3.7.2 and 3.8.1 of the Q4 and F2020 MD&A.

© CGI Inc.

6

Fiscal 2020 Results

Revenue

Adjusted EBIT and margin

Cash provided by operating activities

+0.4%

+2.1%

(in dollars and % of revenue)

$1,863

$12,164

$1,939

+18.6%

$12,111

$1,825

$1,634

15.1%

15.3%

13.5%

15.9%

F2019

F2020

F2019

F2020

F2019

F2020

Net earnings and margin

Net earnings and margin,

Diluted EPS

excluding specific items

excluding specific items

$1,263

$1,306

-0.4%

-11.5%

$1,300

+4.0%

$4.89

$1,118

$4.70

10.4%

9.2%

10.8%

10.7%

F2019

F2020

F2019

F2020

F2019

F2020

  • Adjusted EBIT and margin, net earnings, net earnings margin and diluted EPS, all three excluding specific items, and backlog are non-GAAP measures for which we provide more details in the Q4 and F2020 MD&A.

© CGI Inc.

7

Demand for end-to-end services driving bookings

$3.5B in Q4 bookings, book-to-bill of 119%

New

Extensions &

business

renewals

Q4 F2020

$3.5B

119%

22%

78%

BOOKINGS

BOOK-TO-BILL

CONTRACT TYPE

Extensions &

New

renewals

business

$11.8B

97%

25%

FISCAL 2020

75%

* Bookings and book-to-bill ratio are non-GAAP measures for which we provide more details in the Q4 and F2020 MD&A.

© CGI Inc.

8

Cash provided by operating activities

Q4 F2020

$492M

16.8%

$1.88

CASH FLOW

% OF REVENUE

PER SHARE

FISCAL 2020

$1.9B

15.9%

$7.28

© CGI Inc.

9

Fourth quarter Fiscal 2020

For the three months ended on September 30, 2020

© CGI Inc.

Q4 Fiscal 2020 Results

Adj. EBIT of $458 million, flat year-over-year; margin of 15.6%

In millions

Adjusted EBIT

$600

15.6%

Adjusted EBIT margin

$500

$400

$300

$200

$100

$0

  • Adjusted EBIT and adjusted EBIT margin are non-GAAP measures for which we provide the reconciliation to their closest IFRS measure in the Q4 and F2020 MD&A.
    © CGI Inc.

15%

12%

9%

6%

3%

0%

11

Q4 Fiscal 2020 Results

Net earnings of $252M - diluted EPS of $0.96

$1.40

12%

Diluted EPS

GAAP Net earnings Margin

$1.20

10%

$1.00

8.6%

8%

$0.80

6%

$0.60

4%

$0.40

$0.20

2%

$0.00

0%

* Net earnings margin is a non-GAAP measure for which we provide the reconciliation to their closest IFRS measure in the Q4 and F2020 MD&A.

© CGI Inc.

12

Q4 Fiscal 2020 Results

Net earnings excluding specific items of $318M - diluted EPS of $1.22 excluding specific items, up 0.8% from Q4-F2019

$1.40

11.5%

Diluted EPS - excl. specific items

Net Margin - excl. specific items

$1.20

10.9%

11.0%

$1.00

10.5%

$0.80

10.0%

$0.60

9.5%

$0.40

9.0%

$0.20

8.5%

$0.00

8.0%

  • Net earnings, net earnings margin and diluted EPS, all excluding specific items, are non-GAAP measures for which we provide the reconciliation to their closest IFRS measure in the Q4 and F2020 MD&A.

© CGI Inc.

13

Q4 Fiscal 2020 Results

Net debt at $2.78B or 23.6% net debt to capitalization ratio

In millions

$3,500

45%

Net debt

Net debt to capitalization ratio

40%

$3,000

35%

$2,500

30%

$2,000

25%

23.6%

$1,500

20%

15%

$1,000

10%

$500

5%

$0

0%

  • Net debt and net debt to capitalization ratio are non-GAAP measures for which we provide the definitions in the section "Non-GAAP and Key Performance Measures" of the Q4 and F2020 MD&A.

© CGI Inc.

14

Fiscal 2020

For the year ended on September 30, 2020

© CGI Inc.

Strong profitability maintained

Adj. EBIT at $1.9B, up $38 million; margin of 15.3%, up 20 basis points

In millions

Adjusted EBIT

$2,000

Adjusted EBIT margin

16.0%

$1,800

$1,600

15.5%

$1,400

$1,200

$1,000

15.0%

$800

$600

14.5%

$400

$200

$0

14.0%

  • Adjusted EBIT is a non-GAAP measure for which we provide the reconciliation to its closest IFRS measure in the Q4 and F2020 MD&A.

© CGI Inc.

16

GAAP Net earnings of $1.1B - EPS of $4.20, down 7.7%

GAAP Net earnings margin of 9.2%, down 120 basis points

$5.00

11.0%

Diluted EPS

$4.50

Net Margin (GAAP)

$4.00

10.5%

$3.50

10.0%

$3.00

$2.50

9.5%

$2.00

$1.50

9.0%

$1.00

8.5%

$0.50

$0.00

8.0%

* Net earnings margin is a non-GAAP measure for which we provide the reconciliation to their closest IFRS measure in the Q4 and F2020 MD&A.

© CGI Inc.

17

Net earnings ex-items of $1.3B - EPS of $4.89, up 4.0%

Net earnings margin of 10.7%, down 10 basis points

$5.00

11.0%

Diluted EPS adj.

Net Margin adj.

$4.00

10.5%

$3.00

10.0%

$2.00

9.5%

$1.00

$0.00

9.0%

  • Net earnings, net earnings margin and diluted EPS, all excluding specific items, are non-GAAP measures for which we provide the reconciliation to their closest IFRS measure in the Q4 and F2020 MD&A.

© CGI Inc.

18

$1.9 billion provided by operating activities or 15.9% of revenue $7.28 in cash per share in Fiscal 2020

In millions

% revenue

$2,500

20%

Cash Flow from Operations (CFO)

CFO (% of revenue)

19%

$2,000

18%

17%

$1,500

16%

15%

$1,000

14%

13%

$500

12%

11%

$0

10%

© CGI Inc.

19

Contact investor relations team to continue the conversation

Maher Yaghi, MSc., CFA, CPA, FRM

Aliasghar Taha, CFA

Vice-President, Investor Relations

Director, Investor Relations

maher.yaghi@cgi.com

aliasghar.taha@cgi.com

+1 (514) 415-3651

+1 (514) 415-3611

For more information: CGI.com/investors

© CGI Inc.

20

Disclaimer

CGI Inc. published this content on 11 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 11 November 2020 15:50:03 UTC


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