All participants thank you for standing by. Your meeting is ready to begin. Good morning, ladies and gentlemen. Welcome to the CGI Third Quarter 2015 Conference Call. I would now like to turn the meeting over to Mr. Lorne Gorber, Executive Vice President, Global Communications and Investor Relations. Please go ahead, Mr. Gorber.

Thank you Corey [ph] and good morning everyone. With me to discuss CGI's third quarter of fiscal 2015 are Michael Roach, our President and CEO; and Francois Boulanger, Executive Vice President and CFO. This call has been broadcast on cgi.com and recorded live at 9 am on Wednesday, July 29, 2015. Supporting slides, as well as the press release, financial statements and MD&A issued earlier this morning are available on cgi.com in addition to being filed with both SEDAR and EDGAR. Some statements made on the call may be forward looking. Actual events or results may differ materially from those expressed or implied, and CGI disclaims any intent or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The complete Safe Harbor statement is available on cgi.com and included in this morning's disclosures. We encourage our investors to read it in its entirety. We are reporting our financial results in accordance with International Financial Reporting Standards or IFRS. However, we will also discuss non-GAAP performance measures, which should be viewed as supplemental. The MD&A contains definitions of each one used in our reporting. All of the dollar figures expressed on this call are in Canadian unless otherwise noted. I will turn it over to Francois as usual to first review our Q3 financial performance and then to Mike will make a few comments on our operating strategic highlights. So with that, Francois?

Thank you, Lorne and good morning everyone. I am pleased to share the results of another strong quarter. Revenue was $2.6 billion compared with $2.7 billion last year and flat with Q2. Four primary factors account for the year-over-year delta. The additional efforts needed last year to complete the wind down of government healthcare projects in the U.S., the temporary slowdown in UK government spending as a result of the recent election, the continued delays in U.S. Federal Government procurement and headwind from currency as a stronger U.S. dollar has been more than offset by the euro and Swedish krona. These factors were partially offset by the ongoing strength in our commercial business, growth in IP related services and solutions globally, as well as organic growth in France. For the last 12 months, our bookings totaled $10.8 billion or 106% of revenue. For the quarter, $2.2 billion in contracts were awarded for 87% of revenue, reflecting the seasonality of our government business coupled with delays in U.S. Federal and the UK government. Areas of strength in the quarter were France, the Nordics and the U.S. excluding federal each exceeding a 100% of revenue and building their backlog of future business. Adjusted EBIT was $371 million, while our EBIT margin increased by 170 basis points to 14.5%. The continued improvement in our North American operations is contributing to the ongoing profitability. Net earnings were a record $257 million up 14% from last year. Net earnings margin was 10.1%, up a 170 basis points in line with pre-acquisition levels of profitability. Earnings per shares were $0.80, up 13% compared with $0.71 last year. A higher effective tax rate driven by better U.S. profitability this year with used Q3 EPS by $0.01. Looking forward, we expect to remain at the high-end of our…

Thank you, François and good morning everyone. As we approached the third anniversary of our transformational merger with Logica and finalized our fiscal 2016 business plan, I thought this would be a good opportunity to provide investors with additional insight into a number of proactive efforts we have taken to ensure we continue providing significant value to our stakeholders over time. Let me begin by reinforcing our commitment to continue aggressively executing both pillars of our profitable growth strategy; the buying or acquisition pillar and the build our organic pillar. As you know the successful implementation of the strategy has allowed us to double our company, every four years over the past two decades. It has positioned us to better serve our clients at home and around the globe. It has also provided shareholders with an average annual return of 19% since we went public in 1986. At our most recent strategic planning session, our leadership team reiterated their commitment to doubling the business over the next 5 to 7 years. As always, I remind you our goal is not to be the biggest, but to be the best in our sector. To support this growth initiative, we have made a number of significant leadership adjustments, including the appointment of George Schindler as Chief Operating Officer. As COO, George is now accountable for the performance of our global client facing operations. George's appointment also gave us the opportunity to name three new presidents in key markets, the U.S., Canada and in our Nordic operations. George, Dave, Mark and Heikki, each have the leadership attributes, performance track records and the CGI experience necessary to drive our business forward. Their profiles can be found in the leadership section of cgi.com. So with these key leadership adjustments in place, I would like to…

Just a reminder, there will be a replay of the call available either via our website or by dialing 1800-408-3053 and using the pass code 5105277, that will be good until August 29. As well as usual a podcast will be available for download within a few hours. And please follow-up directly with me for any questions 514-841-3355. So Corey, if we could poll for questions, please.

Thank you. We will now take questions from the telephone lines. [Operator Instructions] There will be a brief, while the participants register for questions. Thank you for your patience. The first question is from Steven Li from Raymond James. Please go ahead.

Mike on organic growth I presume we're still on track for calendar Q4, so when you look at the different regions, so for the U.S. has the [ACA] wind down being lapped or next quarter we might see a little bit of growth back in the U.S.?

So thank you Steven for your question. As I mentioned in my comments, our 2016 plan embeds EPS growth coming both from the build side in terms of organic growth. In the U.S., we are lapping the impact but in some of the states like Hawaii and Vermont. We had a push to the end of December there so we will continue to see some tough comps on that side, but it is running down. So it will be nip and tuck to see whether the U.S. turns the corner. But we are clearly confident that that will change as we enter into 2016. I think the other thing the U.S. federal government business which is a big part of our U.S. businesses is above 50%, the awards tend to continue to move to the right. And when that happens it makes it more difficult of course to drive the organic growth in the U.S. So we are seeing some signs that things maybe improving on that front. Just over the last week we have renewed and booked over $160 million in the U.S. Army and we have also qualified as one of 25 large businesses on a multi-award contract in the U.S. government with a $6 billion ceiling. So, those are early signs that things maybe picking up in that area. Of course that will be a major driver to our growth in the U.S.

Great. And for Canada, Mike, can you talk a little bit about the prospects, do you need Canada to have organic growth for CGI to have organic growth? Thank you.

Well, need and want are probably two different things. I want every operating territory to have organic growth. I think it's important to our overall strategy of recruiting and retaining the best people and also to serve our clients locally which is part of our strategy and globally. So in Canada, the Canadian team over the last period of time has renewed a significant portion of their recurring revenue. And I think there is one more so that we are close to closing, you will see that booking probably in the next number of weeks. So that gives us again a very high recurring level of revenues. It also preserves our mix in terms of being able to deliver margins in excess of 20%. We are running off some lower margin business, primarily in the infrastructure helpdesk, desktop support areas that are much more capital intensive part of our business with frankly marginal returns. So that piece, it will run off. We are addressing some of that impact here in the restructuring. All said, I believe Canadian operation will grow. We have doubled down significantly on banks in Toronto. We formed the separate business unit focused solely on the banks, Peter Sweers runs that, he has a long carrier in the Canadian Bank and is worked internationally and with the appointment of Mark, when you go on and then you look at his background, he is also very deep in banking, having worked for [BAV] and other financial institutions. So part of the strategy or big part of the strategy is to renew the base, protect the mix and drive for disproportional amount of growth coming out of the Canadian Banks.

And Mike I saw your nice win with the City of Edinburgh. Why not you expecting it to get approved on the contract to start ramping? That’s all for me. Thanks.

That’s good Steve and I’m impressed that you’re monitoring that Internet that fast. I think for the benefit of the other members on the call, the City of Edinburgh which we’ve been in a competitive bidding situation for well over a year now. Announced this morning that they have selected CGI as their preferred bidder. It’s not a contract win or award just quite yet. It’s a full outsourcing contract, it includes cloud and cyber solutions which are the areas I talked about where we’re increasing our investment. It is a significant win for us because starts to push us into those local governments in the UK which are very significant investors in information technology and also a very targeted group for us in terms of pulling in our IP, things like advantage and other enablers that we built over the years for government. At this point to contract, I think they have announced the contract is worth roughly £186 million over 7 years. And it’s an interesting opportunity as well because my understanding is other jurisdictions and actually joined, it’s kind of like a vehicle as well where other jurisdictions can actually join and take advantage of this contract which of course would drive up the benefits to the clients and also drive up the value of the contract. So a very strategic opportunity here and one that you should expect to see us focus a little more heavily on the local side of the U.S. government market.

The next question is from Rod Bourgeois from DeepDive Equity Research. Please go ahead.

So your comments on your latest acquisition strategy were helpful. On that topic can you let us know your stands on the prospects of acquiring a company with a heavy infrastructure outsourcing mix and I’m asking that because several of the big IT services businesses are quite reliant on the infrastructure outsourcing business which is pretty trouble right now, that's definitely the case that IBM and HP, but also at CAC in Peru, it seems like you have shown discipline in the past like when you passed on buying Xerox as infrastructure business and I just wanted to enquire about your stands now, concerning other acquisition candidates with the substantial infrastructure mix?

Well, thank you, Rod and again it does give me an opportunity to reinforce some of the points I made in the script that our senses, we need to go where we are delivering the highest value for the customer, which also in most cases lines to creating the highest value for the shareholders. If you look at the infrastructure business generally, it is the most cost heavy piece of the business, it requires a lot of capital just to invest to stand still in lot of cases, I would tell you that our operations are very effective, but in the final analysis it’s still a business that is very heavy from capital intensive and a business that's in transformation. Our percent of revenue coming from that is roughly 15% to 16% revenue which is down as a percent of revenue significantly from a lot of the earlier years and certainly much different profile than a lot of our competitors, the second thing that's going is happening in there is there is an opportunity now to use more of a consulting approach to managing customers infrastructure which really means gradually shifting away from acquiring assets thus reducing the capital outlay and move to a more of the managed services on the customer premises or on hours without owning the assets. This is an area obviously that we’re looking at especially it implies to a full outsourcing opportunity that has the all tiers, having said that we will maintain our infrastructure business, it plays a very key part Rod in our whole push toward as more IP based services and solutions, especially on the SaaS side and as also very useful to us should there be a full outsourcing opportunity which we believe is still out there, and for opportunities to provide cloud services both private and public cloud to customers who require that. So we will continue in that business, but we are much likely we are doing with the other part of business. We are listening to our clients, we are moving our offerings proactively with the client demand and we are not afraid to phase out runoff businesses that aren’t accord to our strategy and to where the customer has taken their business.

Okay. Great. And just one other quick question. Your book to bill has been at 87% for the past two quarters, but those book to bill numbers can sometimes be somewhat misleading. So I wanted to ask about bookings conversion. Can you give us a sense about how quickly you are likely to see recent bookings converting to revenues, in order to it is the pace of bookings to revenue conversion prone to be an encouraging revenue factor in the upcoming months or is the bookings conversion pace still somewhat slow?

Yes. Good question again. First let me say the right way as you know look at bookings is on trailing 12 months. This quarter is a good example because the book to bill in the quarter was under one in 12 months, it's still over one, and I just mentioned here probably in the last 15 minutes, roughly $160 million U.S. contracts booked over the last week or so in the U.S. Federal Government, w have others that we will close this month, this quarter and quarters Edinburgh alone is £186 million. So bookings we believe will continue to run over one. The conversion rate, there is two things happening there. One is of course we have been locking down those long-term contracts, which has been a very successful strategy for us. Because when you had locked down a contract for 10 years, we have three investment periods, every three years we can make an investment, get the return which drives value for the customer, more earnings in cash for us. So that's a good strategy. On the flip side, it does cause a bit of a short-term headwind, because you do have to offer additional savings to the customer to secure it. So you have got a headwind pressure on organic growth. And you also have a headwind in our case as we runoff that lower margin business, and as we exit some of these geographies that I mentioned. So in South America we have been moving over there with couple of more countries to exit and we will be left with Brazil. So you have got those headwinds to the organic growth. On the other side, on the tail side, we are winning better quality business that will improve and are improving the margins. And we are starting to get more traction in our IP business which is a winner from virtually every standpoint in terms of revenue growth, recurring revenue because this stuff is a very sticky cash generation and of course margins. So the conversion rate -- our belief is it will pick up as we go through '16 and that's why Rod we've built into our '16 plan, which by the way I'll remind everybody on the call we're compensated on organic growth we haven’t profiled it yet, we're still in those discussions with the operations, but as I said we have a sense and all of that we bottomed out here but again there's headwinds, tailwinds that I can see at this point but the whole message was today we're committed to growing the business organically. We're committed to using both the buy and build side to continue to drive EPS growth and we got the financial resources to do both.

Thank you. The next question is from Thanos Moschopoulos from BMO Capital Markets.

Mike you mentioned that you're seeing some very good strains in your IP portfolio, can you update us in terms of what portion of your revenue mix that now accounts for and also what specific areas within your IP portfolio are driving some of that strains?

Yes so good question, again the ones that are -- first off to give you some context, we have developed a very large funnel in IP based services and solutions. It's approaching $10 billion, so it's a big number. You have to understand within this portfolio it's not a typical portfolio that is driven by an IP license. IP license is part of that component, but what you really look at is what we've been doing is building what we call an IP based services and solutions offering which has all the elements that CGI offer. An IP license if it's appropriate installing it, maintaining it, running it all of which adds more value to the customer and in the SaaS case it means sharing it with other customers and in the case of 360. So what we have now built is a global funnel. Some of that funnel has local IP in it that we have done a lot of work on in terms of trying to improve the margin, take a look at the pricing and some of the restructuring that I mentioned this morning will in fact see us move some of that IP cost in a number of the geographies some of which we've acquired move that offshore which then increases the margin, gives us more room to be competitive on that. So the big ones that are really impactful are again the ones that on a global side collections is in big demand right now a lot of financial institutions and jurisdictions government are looking to improve their rate of collections. We have when I believe is the best end-to-end integrated collection solution on the market funnel there is very large. And these are very long-term deals companies do not change their collection infrastructure systems…

Thank you. The next question is from Richard Tse from Cormark Securities. Please go ahead.

Mike, just judging by your comments on acquisitions, should we be thinking about you guys doing more smaller tuck ins as opposed to bigger transmission deals like you have done in recent years?

Well, I think as I said we went very broad with Logica. I mean it was an ideal pick for us as you know we have hit all the strategic imperatives that we are looking for. Part of the issue right now Richard as you know there for the lot of players in the same space as Logica was. It doesn’t mean there aren’t any; just means there are not as many. So as we continue to look at those opportunities we are as I mentioned actively building and qualifying and will action funnels and customers are targets that were identified by the customers. So again you should expect us to do obviously more tuck-in things that as I say that fill the gap either of the IP portfolio in a specific geography or areas that align with where the customer is going in terms of cyber and IP and digitization. I think the other thing that we look at very carefully is the opportunity to be a consolidator in markets that are not yet consolidated. So as I often say with a less standing IT services company in Canada, Logica was the last one probably traded in the UK, so these markets have begin to consolidated. There are other markets where they are local champions of significant size and scale and we would look carefully at them as well as long as they are on strategy and in the geographies that we operate in to move on them as well and they could a small as 100 million, they could be all the way up to billion dollars depending on where they are and what the mix looks like.

Okay. And then on the IP side, notwithstanding your comments on getting a lift in margin, yes moving some of the stuff offshore, do you generally get better margins off of these IP deals your traditional ones?

It's a traditional is more the standalone IT services, the integration -- the answer is absolutely. And the reason for that is if you look at it when you sell something this IP based services and solutions, it’s increased in utilization of all three classes of assets might people the IP and the data centers. And so that drives up the utilization there and contributes to a very significant margin appreciation as well where you have it in a SaaS model, of course it’s even better, because essentially the infrastructure is in place to fix cost are there and what you really doing is adding transactions that every additional transaction comes on at an incremental higher margin opportunity. So this is where its convince that this is one of the key criteria here of being a -- the best in breed in this sector and we’re pushing hard on that part of the restructuring benefits will be invested to even accelerate that and so it does form a significant part of our strategic plan and this is embedded in terms of the ’16 plan as well.

Great and just one last question. I think in the comments early you guys mentioned that the DSO has moved up a bit due to some stoppage in payments, have you guys are see those payments as of Q4?

We unfortunately received some of them three days after the quarter-end. So we do have them. And again this is why I reiterate all the time, look at cash, look at bookings trailing 12 months, but yes, now we feel good about our cash generation and I think somebody asked earlier the use of cash, I maybe forgot to cover that so I will now. I mean if you look at our financial situation and you look at the cost of money, which continues to drop we have the financial ability to really invest across all four of our uses of capital. So we invest back into business which I covered on in terms of one of the things we're doing as part of the ’16 plan and part of the restructuring benefits. We can continue to pay down debt, although we're not under a lot of pressure on the debt. We've got a quarter of 1 billion that's due in May ’16, but candidly if it moved into the credit line it's -- the interest rates are dropping there, so there's not a lot of pressure there. We did start to buy back shares and we will continue. We believe that our shares have a significant appreciation opportunity, so we will continue what we started last quarter and then as I mentioned we have qualified the bi-funnel, a lot better over the last nine months, so we're positioned to pull trigger on an acquisition. And as I mentioned, we have the financial resources to do all four of those.

Thank you. The next question is from Phillip Huang from Barclays. Please go ahead.

I wanted to go back to the revenue trajectory for a second, it sounds like the timeline for organic growth has been pushed out a little bit. Just trying to better understand what if anything has changed? Would you say that there is a bigger mix of contracts that you feel do not fit with your strategy than you have previously expected? And do you think that there might be a little bit more, you have to be a little bit more promotional and demonstrate bigger savings in order to drive some of these relationships than you have previously expected?

That's a good question Phillip and I did try to address earlier the headwinds and tailwinds and if we look at those headwinds to tailwinds they're not something that are restricted to a quarter. Some of those move over depending on various things customers, take the UK Government as example, pretty well in a lockdown mode pre-election, contract awards were stopped, the amount of add-on business on the T&M side slipped out to the right. You get things like I mentioned the announcement today made by Edinburgh that we're their preferred partner. We've been working on that deal for well over a year and still a process to go there Phillip before that convert into revenue, but what significant here is we've got visibility on the deals that will bring on the organic growth. On the flipside as I say we are disciplined on our approach to driving quality of business. So we made the decision in South America that this is an area that is not core to our strategy. And over the last quarter I think alone we had to take a hit of about $4 million to restructure or close off various entities down there. That continues us and we will have an impact in the fourth quarter. But it's the right thing to do. And so we always tend to go with the right thing to do. I can't predict the stuff by quarter, but I think the whole intend to my script today Philip is to reiterate that this is the strategy that we have proven that works and that we are reinforcing our commitment across that strategy. I understand folks would like to see this pop a little faster so would I, but I am also very realistic here and I want quality revenue…

Do you expect, I think you mentioned a little bit about the lower utilization in Europe, like in Netherlands, [Greek], Sweden and Denmark. So what extent would you sort of attribute that to deliver again more disciplines on the [indiscernible] charging on the sales or do you see perhaps a little bit more macro headwinds or less predictable and it should be under control?

Well, again in some of these countries, what has happened over the years is the labor cost permit has got out of line with the market price. So what happens is you have embedded costs about that are greater than what the customers prepared to pay for and give you a fair rate of return. So over the time and as part of the logical restructuring we attempted to start to move that pyramid but it’s not an easy one-time adjustment. So what has to happen there, so we have to, in some cases move these folks to higher end business where the rates are higher which could mean retraining folks. On the other hand, we’ve got unionize on the other end of the pyramid and finally, we have to improve our rate of business development and sales in some of these countries so that we’re also absorbing some of the utilization pressures through growth. So it’s a combination of all three factors. Also in some cases, it’s more utilization of the offshore centers. So again much like we saw in North America years ago, in some cases, there are still some passive resistance to fully utilizing that lever. But we’re addressing that and as I mentioned in the restructuring in fact we have built in jobs and functions moving to India, which will help make us more competitive on bids that we making some of those countries and contribute to addressing that issues that I mentioned. The shape of the labor pyramid and need to win more business in line with the strategy.

Maybe last question for me just on the restructuring how should we -- what magnitude of savings can we expect and how we see the run rate ramping up next year?

Okay. So again first thing I would say on this. So $60 million pretax are for our own modeling and we are looking at perhaps $40 million hit in this quarter, the balance in the following quarter, probably $40 million is net $30 million Francois?

Yes.

On the P&L. the payback is one year. So you should expect that. And the benefits have built in to the F16 plan with the operations.

Got it. Thank you so much Mike.

Okay. Thanks Phillip.

Thanks Phillip.

Thank you. The next question is from Kris Thompson from National Bank. Please go ahead.

Great. Thanks. Mike just a follow up on that, the payback is one year. Is that because you are spending some of the savings on investing in IP et cetera, so the savings will actually be higher than $40 million?

No, maybe a little bit but Kris a lot of it is back to what I said about some of the entities of where we will make some targeted force adjustments that the severance costs are much higher than were used to. For example in this restructuring we are not doing any restructuring in United States where the restructuring costs are much lower. So the mix here tells a little higher. But my sense of one to one payback is a good business investment here, but part of it is that.

Okay. That makes sense. I saw your EBIT margins fell sequentially, I think in every region outside of Canada and U.S. So on that restructuring, can you give us some more idea of what regions and how the notice has already gone out?

The notice is that's a bit of our dilemma here. The notices are in process in some cases, we are working with the line operations right now, in fact George is heading up that initiative working with the aligned leaders to walk through specific functions and individuals here. So that piece has not been fully determined. But I think it's pretty safe bet to make the assumption that the investments are tight areas where we believe we have additional opportunities to drive margins. And that's exactly what we’re attempting do here. In some cases it’s also addressing the opportunity again to take another uptick in changing the mix. So in Canada we have some lower end business that is in the infrastructure side that is linked to things like the helpdesk and as I mentioned the desktop support, our intent would be to adjust the force on the realization and that work is decreasing by design and then focused force more in Canada again to push that high-end services that we talk about, which we see in Canada pretty good opportunity, we have a nice funnel on IP in Canada that as we worked that through will help us on the topline and also on the recurring revenue and margins. So we’re working through that detail, but that gives you a pretty good idea of what we are targeting.

Okay. That's helpful and just a last one from me, Mike. The double-digit EPS guidance for next fiscal year is helpful but can you narrow that range a bit I mean should we think it’s in between 10 to 15 or is that say?

You got to come back next call, Kris.

Thank you. Your next question is from Paul Treiber from RBC Capital Markets. Please go ahead.

I just wanted to follow-up on one of Richard’s question which in regards to M&A, how does you relatively smaller footprint in the U.S. commercial market factor into your analysis that when you are looking at potential software IP acquisitions, in that do you need a larger footprint in the U.S. to maximize the synergies from potential software acquisition?

Actually on the software side, what we need Paul and we are at much better shape in the -- valuation of software companies are going to be much higher and what we paid in typical services side, and the issue we had prior logical we only had the ability to market that in North America essentially, now we’ve got 40 countries in a much bigger footprint, so that does give us more confidence that we could in fact pay a higher valuation and still get the return that we’re looking for, what is very important in that assumption of course is that the business development machine is running optimally and that those relationships with those customers in Europe in these other jurisdictions is well established and that the IP can in fact travel globally, hence priority and things like horizontal IP or financial institutions IP, which tends to travel very, very easily or more easily. Now, on the U.S. as I mentioned first I will tell you, the U.S. team is done an excellent job this year as we added over a $100 million to the bottom-line causing a little pressure on the tax rate. In fact hit is for $0.01 on the EPS this quarter. But we do need a commercial acquisition in the U.S. to actually help us putting better balance, the revenue portfolio we have down there. And also put us in a better position to write the economic curve up of the recovery that is happening in the U.S. and that will happen in other parts of the world. It’s very similar in the UK, we’ve got a very strong government franchise in the UK as further reinforce this morning with the Edinburgh announcement. But again, we’re hitting the UK market on the commercial side essentially from an organic standpoint which can be successful but it takes more time. So, if we look at it those are two areas that would be very accretive tools or we have to find somebody who fits criteria and is willing to sell. Having said that if we’re not limiting ourselves to those two markets, we continue to look globally at the markets and which we operate along the criteria that I say.

Okay. Just want to switch gears to off shoring. It seems like you seeing accelerating interest in the off shoring just relative to near shore. How do your view offshore in light of your near shore strategy. And that is the offshore negative, how is negative implication for new shore or the two independent in your mind?

It’s very complementary. Again what we -- our model is very simple. The account manager, the local guy owns that account regardless of the work were deliver around the world, huge competitive advantage, customer doesn’t have to visit any local site or any offshore site. What we didn’t do is when we put a bid or an offer in the customer we give them a different choices and mixes of where that work could be done. Just trying to really balance two or three things, the price or the costs of where the work is done. The quality where the works done or the skills match with the customers looking for and risk. The third one risks is taking a much higher profile now than it would over the last 10 years. So it does make the local centers in fact much more relevant. On the other hand where we have a huge differentiator if we move work offshore is that in fact we can move work from various countries because in each of these countries we have people that are local, that can do the full suite of services. So if you got work over in an offshore site you say I'm concerned, I'd like it moved back, we can move it back and fairly rapidly. We're actually on a single CGI network globally. The other thing is if you look at the currency, right now the difference between the Canadian U.S. dollar as you know is approaching 25%, we do have government incentives in number of the jurisdictions including here in Quebec that can be added to that especially if the work is coming from outside of Quebec and that makes it a very significant benefit to the client. So it's really complementary I would tell you that some of our pure play competitors are trying to get these local centers because I think they're seeing the same thing but through the opposite end of the telescope.

And just one more for me and, does have to ask this so I apologize in advance if there is any sensitivities around it but with the appointment of George as COO what are your thoughts on your role on a potential transition at some point?

Well everybody's got to transition at some point. Everybody has an expiry date. I think the good news is for me my expiry date is not near term here. What the intent here was to if you're going to take the company up to the kind of levels that we're talking about what has always been our tradition is not be in a reactive mode. You have to build the leadership infrastructure and team ahead of those activities and that's exactly what we're doing here. It'll also allow me frankly a little more time to spend on the business development transformational work that we're talking about in terms of cyber and the IP portfolio, but be clear as the executive chairman is with me I still find the financial statements accountable for the performance of CGI. George and I work closely as a team to do that and we've always in CGI taken leadership changes, in fact we use the term leadership adjustments because we always look at it as an evolution and not a revolution. And the reason for that is we have a strategy. We know the strategy works and what we spend our time on is doubling down on the execution of the strategy and that's exactly what we're doing here and I did point out that the four senior leaders that have found themselves either for more than new positions they're all internal experienced in the CGI model and buy-in in on the strategy here. So not sensitive at all, you can ask any question on that but as I said my expiry date is still out there and I intend to certainly continue to help position and grow the company with the team here for the foreseeable future.

The last question is from Rob Peters from Credit Suisse. Please go ahead.

Thanks very much for squeezing me in. I will keep my question brief. Mike just wondering when we look into the UK bookings and specifically after the general election which I believe wrapped up in May, I was just wondering is the Edinburgh contract the first of kind of seeing those bookings recover or do you still think it's a little bit while out before the government begins to start ordering contracts again?

No. So on the Federal side, it's a good question Rob, we had wondered that got caught in the freeze that thing is working through weeks. We expect that to clear and will be booked in this quarter, Edinburgh will depend on the next steps in the process. But we have very good visibility there in the UK in the government sector. But as you know government they do have few more checks and balances before that stuff actually converts from a booking into a revenue. The second thing I just point out, nobody asked me the question but I do know the answer so I feel the need to share it with you. Within UK if you look at the margins there they have taken some pressure because we have invested heavily in these big transformational deals Edinburgh, some of these take a year and a half in terms of starts to finish. In some cases the investment required here is well in excess of £1 million. And in lot of cases we have to do some strategic hiring and some dedication of experts who are unbillable for the pursuit. And then when you are successful of course the thing starts to turn the other way. So part of getting organic growth is to ensure that we do make the necessary investments and the necessary calculated bets here on these big deals. And that's what Tim and his team are doing. They are very successful and I expect that the bookings in the UK will snap back here in the fourth quarter.

Thanks Rob, thank you everyone and look forward to joining again on our Q4 call, which will take place second week of November. Thank you.

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