The CGI headquarter is seen Thursday, May 31, 2012 in Montreal. CGI Group Inc. reported a profit of $311.5 million in its latest quarter, up from $285.3 million in the same quarter a year earlier. THE CANADIAN PRESS/Paul Chiasson

MONTREAL - Turmoil around Brexit and a potential economic slowdown present challenges that could work in favour of CGI Group Inc., its CEO says.

The United Kingdom’s impending withdrawal from the European Union and a sputtering global economy mean governments and companies will be looking to double down on efficiency, George Schindler told investors on a conference call Wednesday.

“The hard exit is actually an opportunity for us to deploy more resources, to assist the government,” he said.

A soft exit, where the U.K. could effectively remain in the EU single market and customs union after the March 29 exit date, would also see CGI “use our framework agreements to increase our work with the government.”

British firms that rely on the Montreal-based company’s technology and business consulting services could continue to do so easily, Schindler suggested, even if some bases of operation move to the Continent.

Schindler also spun the stuttering economy as an opportunity.

“If we’re going to prepare for maybe a slower growth environment, let’s make sure we run our own operations as efficiently as possible,” Schindler said, describing companies’ mentality.

“That should over time result in higher outsourcing opportunities.”

The U.S. government shutdown, which started Dec. 22 and continued for 35 days, had a glancing impact on revenues that will become more apparent in the current quarter, Schindler added. But he said that “90 per cent to 95 per cent of our business right from the start is unaffected.”

CGI reported a profit of $311.5 million in its latest quarter, up from $285.3 million in the same quarter a year earlier.

The results came ahead of the company's annual meeting later today.

Profits amounted to $1.11 per diluted share for the quarter ended Dec. 31, up from 98 cents per diluted share a earlier, the firm said.

Revenue for the first quarter totalled $2.96 billion, up from nearly $2.82 billion.

Excluding specific items such as acquisition and integration costs, CGI said it earned $1.12 per diluted share for the quarter, up from 99 cents per diluted share a year earlier.

Analysts on average had expected a profit of $1.11 per share for the quarter, according to Thomson Reuters Eikon.

Companies in this story: (TSX:GIB.A)

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