The defense industry and intelligence in Canada is in the crosshairs of CGI (TSX: GIB). The Quebec company is indeed trying to have a SWAT team to convince the federal government to use its expertise in the area of cybercrime or biometric identification, for example.
The CEO of the company, Michael Roach, said Wednesday that it assessed the business opportunities in this sector to $ 1 billion per year. "Increasingly, military intelligence is based on information technology. It's less a question of hard work just about software," he said on the sidelines of the annual meeting of shareholders, Montreal.
Until now, CGI was not very present in this industry. The acquisition of U.S. firm Stanley, however, changed that. This company takes effect in 75 percent of its work with various agencies responsible for security of the United States. She enjoys a good reputation and references that may reassure other potential customers.
CGI hopes that his efforts with the Canadian authorities will yield results, "somewhere in 2011.
In the opinion of Mr. Roach, CGI could also benefit from the efforts of governments on both sides of the border to cut costs. "Our services help reduce costs and improve efficiency," he argues. The businessman said that CGI was already assisting some U.S. states to levy taxes or to better manage their bids. The company also manages the Internet portal of Medicaid.
To ensure growth, CGI also put on strategic acquisitions in North America or Western Europe. The company will celebrate its 35th anniversary this year provides $ 700 million in reserve for such projects.
Good start to the year
CGI's fiscal 2011 started off right by declaring Wednesday a net profit of $ 126.6 million or 45 cents per share for its first quarter. This is up 14 percent from that recorded in the same period last year.
This result exceeds the expectations of analysts surveyed by Thomson Reuters had forecast a profit of 34 cents per share.
The company revenue totaled $ 1.12 billion, up 23 percent. For the first half of this turnover was conducted in the United States. Mr. Roach also told Wednesday that the U.S. federal government was now the biggest customer of CGI, far ahead of others. It counts for 24 percent of its consolidated revenues.
CGI announced $ 1.2 billion in new contracts, renewals or extensions in the quarter ended in late December. Its order book stood at $ 13.1 billion then.
Wednesday afternoon at the Toronto Stock Exchange, the action of CGI was trading at $ 19.69, up 89 cents.