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CGI Group Q4 adjusted earnings jump to $213.6 million, beats estimates

The Canadian Press

MONTREAL - CGI Group Inc. (TSX:GIB.A) says it had $141 million of net income in its fourth quarter, after deducting acquisition- and tax-related items that reduced the total by about $76.2 million.

On an adjusted basis, the Montreal-based IT services company reported $213.6 million or 67 cents per share, up from $100 million or 37 cents per share, excluding items in both years.

Revenue for the three months ended Sept. 30, before CGI became embroiled in the controversy surrounding a high-profile Obamacare project it was completing for the U.S. government, was $2.45 billion.

The revenue was up from $1.6 billion a year earlier, largely due to CGI's acquisition of Logica PLC in August 2012, which expanded the Canadian company's presence in Western Europe.

Analysts had estimated CGI's adjusted earnings for the fourth quarter would be 62 cents per share and revenue would be $2.52 billion, according to figures compiled by Thomson Reuters.

CGI president and CEO Michael Roach said he was pleased by the company's strong performance in the fourth quarter.

"After a full year, the Logica merger and successful execution of our integration program has, and will continue to yield significant benefits for our clients, employees and shareholders," Roach said in a statement.

"Going forward, our focus remains on realizing incremental revenue and cost synergies that will drive additional earnings accretion in fiscal 2014 and beyond."

CGI's financial fourth quarter closed as the Obama administration was preparing to launch a highly controversial and politically charged website as part of the president's major health-insurance initiative.

Problems with the website began to emerge in early October, adding fuel to an already hot battle between Republicans and Democrats in Washington.

Analysts have said they don't think CGI's reputation will suffer in the long-term because of the botched project,received widespread media attention in United States and Canada.

A senior vice-president of CGI Federal testified before Congress last month that it was the government's responsibility — not the contractor's — to test the website and make sure it worked.