When you read this article and their revenue projection for 2002 of over $4 BILLION dollar's in Sale's, I would say their should be some major announcement's right around the corner, another one to consider is ATY, their sales are already over $2 billion and yet their stock is a steal, this one should be the next one to soar in my opinion.
CGI GROUP INC.
Montreal
Computer services
cgi.ca
Fiscal 1999 revenue: $1.4-billion
The road to a billion: For Canada's largest computer services company, the path to
$1-billion was paved with acquisitions -- 20 of them.
The Montreal-based company went public in 1986 with a plan to use its new-found
capital to purchase other companies and that strategy hasn't changed. More than 10
of the 20 acquisitions have been completed in the past four years.
Serge Godin, CGI's founder and chief executive officer, says the 23-year-old
company has pursued so many deals because it aims to offer as many services as
possible in as many places as possible.
"It's a matter of critical mass."
And that critical mass continues to build -- about 50 per cent of revenue growth has
been the result of internal growth and 50 per cent through acquisitions.
The company posted revenue of $1.4-billion during the 1999 fiscal year, almost
doubling the $741-million of revenue during the 1998 fiscal year.
Key to CGI's rapid growth was the executive team's decision about six years ago to
focus on integrating the computer networks of large operations and its success
winning outsourcing contracts within the North American market.
The company had been living off consulting and a less focused approach to the
systems integration market.
"We would have been a very strong company anyway, growing at about 20 to 25 per
cent a year," Mr. Godin says. "But with the transformation, we changed our
relationship with our clientele."
Today, about 75 per cent of the company's revenue is from outsourcing. Mr. Godin
says the company's ability to hang on to its employees has also been crucial to its
growth.
So what's next? As usual, the company says it's got its eye on three or four possible
targets and hopes to pull the trigger again before too long.
CGI is now shooting for revenue of $4-billion by 2002, a target Mr. Godin finds
incredible. "We've never dreamed of that type of situation."
ATI TECHNOLOGIES INC.
Markham, Ont.
Computer graphics equipment maker
ati.com
Fiscal 2000 revenue (est.): $2.3-billion
The road to a billion: ATI, the world-leading maker of graphics equipment that
enhances computer displays, didn't creep up on the $1-billion sales barrier -- it
exploded through it.
From relatively modest sales of $339.7-million in fiscal 1995, ATI's revenue jumped
through the $1-billion mark in 1998 as it leapfrogged over competitors such as San
Jose's S3 Inc. and Montreal's Matrox Graphics Inc. to snare the top spot in the
fast-growing market.
ATI's secret? Leading-edge research and development, savvy marketing and the
ability to offer cost-conscious computer makers bang for the buck. Acquisitions have
played only a minor role in the company's growth.
K. Y. Ho, ATI's president and chief executive officer, says the company's competitive
edge is its ability to quickly capitalize on new trends.
ATI's initial focus was the desktop market and by 1998 its success was highlighted by
supply agreements with the world's 10 largest computer makers. The company then
focused its attention on the fast-growing laptop market, taking dead aim at market
leader Neomagic Inc., which ATI believes that it finally pulled ahead of late last year.
As the computer graphics market matures, ATI's biggest challenge is finding the next
high-growth business. As a result, the company has placed a large bet on set-top
boxes.
Although still in the early stages, the set-top box business has significant potential as
consumers begin to use their televisions to surf the Internet, play video games, watch
movies and shop. Through agreements with hardware makers such as General
Instruments Inc., ATI wants to be a key supplier of components. |
