Sector Update: Info Tech; Absolute Software Posts Q4 Earnings, CGI Signs Agreement with Toyota Material Handling Europe
Information technology shares were mostly higher in afternoon trading. The S&P/TSX Info Tech index was up 0.2%.
BlackBerry (BB.TO): +1.1%
CGI (GIB-A.TO): -0.2%
Absolute Software (ABT.TO): +5.9%
Macdonald Dettwiler & Associates (MDA.TO): +0.5%
Constellation Software (CSU.TO): -0.2%
In company news, Absolute Software Monday reported that net income for Q4 ended June 30 increased to US$0.8 million, or US$0.02 per diluted share, from a net income of US$0.4 million, or US$0.01 per diluted share, in the same quarter last year. The improvement in earnings resulted from a climb in sales contracts to a record US$30.7 million from last year's US$26.2 million.
Revenues totaled US$23.3 million, up from US$22 million a year earlier. For fiscal year 2015, the provider of firmware-persistent security and management solutions is expecting sales contracts and cash from operating activities to increase over 2014 levels.
The board of directors approved an increase in the quarterly dividend to $0.07 per common share from $0.06 per share. This increase is expected to be implemented in Q2 2015. There is no change to the current $0.06 per share dividend scheduled to be paid on August 28 to shareholders of record at the close of business on August 7.
Also, CGI Group said Tuesday it has reached an agreement with Toyota Material Handling Europe (TMHE) for the outsourcing of the truck manufacturer and material handler's IT operations. Under the terms of the deal, most employees from TMHE's IT department will be rebadged to CGI. The information technology specialist firm will take over TMHE's data center, as well as its application management, service desk, email, network, collaboration, storage and security services. The contract has an estimated value of C$37 million over five years.
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