Exhibit 99.1

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

July 26, 2023

BASIS OF PRESENTATION

This Management’s Discussion and Analysis of the Financial Position and Results of Operations (MD&A) is a responsibility of management and has been reviewed and approved by the Board of Directors. This MD&A has been prepared in accordance with the rules and regulations of the Canadian Securities Administrators. The Board of Directors is ultimately responsible for reviewing and approving the MD&A. The Board of Directors carries out this responsibility mainly through its Audit and Risk Management Committee, which is appointed by the Board of Directors and is comprised entirely of independent and financially literate directors.

Throughout this document, CGI Inc. is referred to as “CGI”, “we”, “us”, “our” or “Company”. This MD&A provides information management believes is relevant to an assessment and understanding of the consolidated results of operations and financial condition of the Company. This document should be read in conjunction with the interim condensed consolidated financial statements and the notes thereto for the three and nine months ended June 30, 2023 and 2022. CGI’s accounting policies are in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). All dollar amounts are in Canadian dollars unless otherwise noted.

MATERIALITY OF DISCLOSURES

This MD&A includes information we believe is material to investors. We consider something to be material if it results in, or would reasonably be expected to result in, a significant change in the market price or value of our shares, or if it is likely that a reasonable investor would consider the information to be important in making an investment decision.

FORWARD-LOOKING STATEMENTS

This MD&A contains “forward-looking information” within the meaning of Canadian securities laws and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other applicable United States safe harbours. All such forward-looking information and statements are made and disclosed in reliance upon the safe harbour provisions of applicable Canadian and United States securities laws. Forward-looking information and statements include all information and statements regarding CGI’s intentions, plans, expectations, beliefs, objectives, future performance, and strategy, as well as any other information or statements that relate to future events or circumstances and which do not directly and exclusively relate to historical facts. Forward-looking information and statements often but not always use words such as “believe”, “estimate”, “expect”, “intend”, “anticipate”, “foresee”, “plan”, “predict”, “project”, “aim”, “seek”, “strive”, “potential”, “continue”, “target”, “may”, “might”, “could”, “should”, and similar expressions and variations thereof. These information and statements are based on our perception of historic trends, current conditions and expected future developments, as well as other assumptions, both general and specific, that we believe are appropriate in the circumstances. Such information and statements are, however, by their very nature, subject to inherent risks and uncertainties, of which many are beyond the control of the Company, and which give rise to the possibility that actual results could differ materially from our expectations expressed in, or implied by, such forward-looking information or forward-looking statements. These risks and uncertainties include but are not restricted to: risks related to the market such as the level of business activity of our clients, which is affected by economic and political conditions, additional external risks (such as pandemics, armed conflict, climate-related issues and inflation) and our ability to negotiate new contracts; risks related to our industry such as competition and our ability to develop and expand our services, to penetrate new markets, and to protect our intellectual property rights; risks related to our business such as risks associated with our growth strategy, including the integration of new operations, financial and operational risks inherent in worldwide operations, foreign exchange risks, income tax laws and other tax programs, the termination, modification, delay or suspension of our contractual agreements, our expectations regarding future revenue resulting from bookings and backlog, our ability to attract and retain qualified employees, to negotiate favourable contractual terms, to deliver our services and to collect receivables, to disclose, manage and implement environmental, social and governance (ESG) initiatives and standards, and to achieve ESG commitments and targets, including without limitation, our commitment to net-zero carbon emissions by 2030, as well as the reputational and financial risks attendant to cybersecurity breaches and other incidents, and financial risks such as liquidity needs and requirements, maintenance of financial ratios,

© 2023 CGI Inc. Page     1

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

interest rate fluctuations and the discontinuation of major interest rate benchmarks and changes in creditworthiness and credit ratings; as well as other risks identified or incorporated by reference in this MD&A and in other documents that we make public, including our filings with the Canadian Securities Administrators (on SEDAR+ at www.sedarplus.ca) and the U.S. Securities and Exchange Commission (on EDGAR at www.sec.gov). Unless otherwise stated, the forward-looking information and statements contained in this MD&A are made as of the date hereof and CGI disclaims any intention or obligation to publicly update or revise any forward-looking information or forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. While we believe that our assumptions on which these forward-looking information and forward-looking statements are based were reasonable as at the date of this MD&A, readers are cautioned not to place undue reliance on these forward-looking information or statements. Furthermore, readers are reminded that forward-looking information and statements are presented for the sole purpose of assisting investors and others in understanding our objectives, strategic priorities and business outlook as well as our anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes. Further information on the risks that could cause our actual results to differ significantly from our current expectations may be found in section 8 - Risk Environment, which is incorporated by reference in this cautionary statement. We also caution readers that the risks described in the previously mentioned section and in other sections of this MD&A are not the only ones that could affect us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial could also have a material adverse effect on our financial position, financial performance, cash flows, business or reputation.

© 2023 CGI Inc. Page     2

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

KEY PERFORMANCE MEASURES

The reader should note that the Company reports its financial results in accordance with IFRS. However, we use a combination of GAAP, non-GAAP and supplementary financial measures and ratios to assess the Company’s performance. The non-GAAP measures used in this MD&A do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with IFRS.

The table below summarizes our most relevant key performance measures :

Growth Revenue prior to foreign currency impact (non-GAAP) – is a measure of revenue before foreign currency translation impacts. This is calculated by translating current period results in local currency using the conversion rates in the equivalent period from the prior year. Given that we have a strong presence globally and are affected by most major international currencies, management believes that it is helpful to adjust revenue to exclude the impact of currency fluctuations to facilitate period-to-period comparisons of business performance and that this measure is useful for investors for the same reason. A reconciliation of the revenue prior to foreign currency impact to its closest IFRS measure can be found in section 3.4. of the present document.   Constant currency revenue growth (non-GAAP) – is a measure of revenue growth before foreign currency translation impacts. This is calculated by translating current period results in local currency using the conversion rates in the equivalent period from the prior year. Management believes its use of this measure is helpful for investors to facilitate period-to-period comparisons of our business growth.   Bookings – are new binding contractual agreements including wins, extensions and renewals. In addition, our bookings are comprised of committed spend and estimates from management that are subject to change, including demand-driven usage, such as volume based and time and material contracts, as well as price indexation and options years and services. Management evaluates factors such as prices and past history to support its estimates. Management believes that it is a key indicator of the volume of our business over time and potential future revenue and that it is useful trend information to investors for the same reason. Information regarding our bookings is not comparable to, nor should it be substituted for, an analysis of our revenue. Additional information on bookings can be found in section 3.1. of the present document.   Backlog – includes bookings, backlog acquired through business acquisitions, backlog consumed during the period as a result of client work performed as well as the impact of foreign currencies to our existing contracts. Backlog incorporates estimates from management that are subject to change and are mainly driven from bookings. Backlog is reduced in the case of contract cancellation. Management tracks this measure as it is a key indicator of our best estimate of contracted revenue to be realized in the future and believes that this measure is useful trend information to investors for the same reason.   Book-to-bill ratio – is a measure of the proportion of the value of our bookings to our revenue in the quarter. This metric allows management to monitor the Company’s business development efforts during the quarter to ensure we grow our backlog and our business over time and management believes that this measure is useful for investors for the same reason.   Book-to-bill ratio trailing twelve months – is a measure of the proportion of the value of our bookings to our revenue over the last trailing twelve-month period as management believes that monitoring the Company’s bookings over a longer period is a more representative measure as the services and contract type, size and timing of bookings could cause this measurement to fluctuate significantly if taken for only a three-month period and as such is useful for investors for the same reason. Management’s objective is to maintain a target ratio greater than 100% over a trailing twelve-month period.  

© 2023 CGI Inc. Page     3

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

Profitability Specific items – include acquisition-related and integration costs. Acquisition-related costs mainly include third-party professional fees incurred to close acquisitions. Integration costs are mainly comprised of expenses due to redundancy of employment and contractual agreements, cancellation of acquired leased premises and costs related to the integration towards the CGI operating model such as training activities.   Earnings before income taxes – is a measure of earnings generated for shareholders before income taxes.   Earnings before income taxes margin – is obtained by dividing our earnings before income taxes by our revenues. Management believes a percentage of revenue measure is meaningful for better comparability from period-to-period.   Adjusted EBIT (non-GAAP) – is a measure of earnings excluding specific items, net finance costs and income tax expense. Management believes its use of this measure which excludes items that are non-related to day-to-day operations, such as the impact of the capital structure, income taxes and specific items, is helpful to investors to better evaluate the Company’s core operating performance. This measure also allows for better comparability from period-to-period and trend analysis. A reconciliation of the adjusted EBIT to its closest IFRS measure can be found in section 3.7. of the present document.   Adjusted EBIT margin (non-GAAP) – is obtained by dividing our adjusted EBIT by our revenues. Management believes its use of this measure which evaluates our core operating performance before capital structure, income taxes and specific items when compared to the growth of our revenues is relevant to investors for better comparability from period-to-period. This measure demonstrates the Company’s ability to grow in a cost-effective manner, executing on our Build and Buy strategy. A reconciliation of the adjusted EBIT to its closest IFRS measure can be found in section 3.7. of the present document.   Net earnings – is a measure of earnings generated for shareholders.   Net earnings margin – is obtained by dividing our net earnings by our revenues. Management believes a percentage of revenue measure is meaningful for better comparability from period-to-period.   Diluted earnings per share (diluted EPS) – is a measure of net earnings generated for shareholders on a per share basis, assuming all dilutive elements are exercised. Please refer to note 5 of our interim condensed consolidated financial statements for additional information on earnings per share.   Net earnings excluding specific items (non-GAAP) – is a measure of net earnings excluding acquisition-related and integration costs. Management believes its use of this measure best demonstrates to investors the net earnings generated from our day-to-day operations by excluding specific items, for better comparability from period-to-period. A reconciliation of the net earnings excluding specific items to its closest IFRS measure can be found in section 3.8.3. of the present document.   Net earnings margin excluding specific items (non-GAAP) – is obtained by dividing our net earnings excluding specific items by our revenues. Management believes its use of this measure which evaluates our core operating performance when compared to the growth of our revenues is relevant to investors to assess their returns and for better comparability from period-to-period. This measure demonstrates the Company’s ability to grow in a cost-effective manner, executing on our Build and Buy strategy. A reconciliation of the net earnings excluding specific items to its closest IFRS measure can be found in section 3.8.3. of the present document.  

© 2023 CGI Inc. Page     4

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

	Diluted earnings per share excluding specific items (non-GAAP) – is defined as the net earnings excluding specific items on a per share basis. Management believes its use of this measure is useful for investors as excluding specific items best reflects the Company’s ongoing operating performance on a per share basis and allows for better comparability from period-to-period. The diluted earnings per share reported in accordance with IFRS can be found in section 3.8. of the present document while the basic and diluted earnings per share excluding specific items can be found in section 3.8.3. of the present document. Effective tax rate excluding specific items (non-GAAP) – is obtained by dividing our income tax expense by earnings before income taxes, before specific items. Management uses this measure to analyze the impact of changes in income tax rate and profitability mix from day-to-day operations on its effective tax rate and is useful for investors for the same reason. A reconciliation of the effective tax rate excluding specific items to its closest IFRS measure can be found in section 3.8.3. of the present document.
Liquidity	Cash provided by operating activities – is a measure of cash generated from managing our day-to-day business operations. Management believes strong operating cash flow is indicative of financial flexibility, allowing us to execute the Company’s strategy. Cash provided by operating activities as a percentage of revenue – is obtained by dividing our cash provided by operating activities by our revenues. Management believes strong operating cash flow compared to our revenues is a key indicator of our financial flexibility to execute the Company’s growth strategy. Days sales outstanding (DSO) – is the average number of days needed to convert our trade receivables and work in progress into cash. DSO is obtained by subtracting deferred revenue from trade accounts receivable and work in progress; the result is divided by our most recent quarter’s revenue over 90 days. Management tracks this metric closely to ensure timely collection and healthy liquidity. Management believes that this measure is useful for investors as it demonstrates the Company’s ability to timely convert its trade receivables and work in progress into cash.
Capital Structure	Net debt (non-GAAP) – is obtained by subtracting from our debt and lease liabilities, our cash and cash equivalents, short-term investments, long-term investments and adjusting for fair value of foreign currency derivative financial instruments related to debt. Management believes its use of the net debt metric to monitor the Company’s financial leverage is useful for investors as it provides insight into its financial strength. A reconciliation of net debt to its closest IFRS measure can be found in section 4.5. of the present document. Net debt to capitalization ratio (non-GAAP) – is a measure of our level of financial leverage and is obtained by dividing the net debt by the sum of shareholders’ equity and net debt. Management believes its use of the net debt to capitalization ratio is useful for investors as it monitors the proportion of debt versus capital used to finance the Company’s operations. Return on invested capital (ROIC) (non-GAAP) – is a measure of the Company’s efficiency at allocating the capital under its control to profitable investments and is calculated as the proportion of the net earnings excluding net finance costs after-tax for the last twelve months, over the last four quarters’ average invested capital, which is defined as the sum of shareholders’ equity and net debt. Management believes its use of this ratio is useful for investors as it assesses how well it is using its capital to generate returns.

© 2023 CGI Inc. Page     5

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

REPORTING SEGMENTS

The Company is managed through the following nine operating segments: Western and Southern Europe (primarily France, Spain and Portugal); United States (U.S.) Commercial and State Government; Canada; U.S. Federal; Scandinavia and Central Europe (Germany, Sweden and Norway); United Kingdom (U.K.) and Australia; Finland, Poland and Baltics; Northwest and Central-East Europe (primarily Netherlands, Denmark and Czech Republic); and Asia Pacific Global Delivery Centers of Excellence (mainly India and Philippines) (Asia Pacific).

Please refer to sections 3.4. and 3.6. of the present document and to note 9 of our interim condensed consolidated financial statements for additional information on our segments. For the nine months ended June 30, 2023, the Company has restated the segmented information to conform to the new segmented information structure effective on April 1, 2022.

© 2023 CGI Inc. Page     6

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

MD&A OBJECTIVES AND CONTENTS

In this document, we:

• Provide a narrative explanation of the interim condensed consolidated financial statements through the eyes of management;

• Provide the context within which the interim condensed consolidated financial statements should be analyzed, by giving enhanced disclosure about the dynamics and trends of the Company’s business; and

• Provide information to assist the reader in ascertaining the likelihood that past performance may be indicative of future performance.

In order to achieve these objectives, this MD&A is presented in the following main sections:

Section	Contents		Pages
1.   Corporate	1.1.	About CGI	9
Overview	1.2.	Vision and Strategy	10
	1.3.	Competitive Environment	10
2.   Highlights and      Key Performance      Measures	2.1.	Selected Quarterly Information and Key Performance Measures	11
	2.2.	Stock Performance	12
3.   Financial Review	3.1.	Bookings and Book-to-Bill Ratio	14
	3.2.	Foreign Exchange	15
	3.3.	Revenue Distribution	16
	3.4.	Revenue by Segment	17
	3.5.	Operating Expenses	22
	3.6.	Adjusted EBIT by Segment	24
	3.7.	Earnings Before Income Taxes	27
	3.8.	Net Earnings and Earnings Per Share	28
4.   Liquidity	4.1.	Interim Condensed Consolidated Statements of Cash Flows	30
	4.2.	Capital Resources	33
	4.3.	Contractual Obligations	33
	4.4.	Financial Instruments and Hedging Transactions	33
	4.5.	Selected Measures of Capital Resources and Liquidity	34
	4.6.	Guarantees	35
	4.7.	Capability to Deliver Results	35
5.   Changes in      Accounting      Policies	A summary of accounting standards adopted and future accounting changes.		36
6.   Critical      Accounting      Estimates	A discussion of the critical accounting estimates made in the preparation of the interim condensed consolidated financial statements.		38

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Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

Section	Contents		Pages
7.   Integrity of      Disclosure	A discussion of the existence of appropriate information systems, procedures and controls to ensure that information used internally and disclosed externally is complete and reliable.		41
8.   Risk Environment	8.1.	Risks and Uncertainties	42
	8.2.	Legal Proceedings	56

© 2023 CGI Inc. Page     8

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

1. Corporate Overview

1.1. ABOUT CGI

Founded in 1976 and headquartered in Montréal, Canada, CGI is a leading IT and business consulting services firm with approximately 91,500 consultants and professionals worldwide, whom are called members as they are also owners through our Share Purchase Plan. We use the power of technology to help clients accelerate their holistic digital transformation.

CGI has a people-centered culture, operating where our clients live and work to build trusted relationships and to advance our shared communities. Our consultants are committed to providing actionable insights that help clients achieve business outcomes. They leverage global delivery centers that deliver scale, innovation and delivery excellence for every engagement.

End-to-end services and solutions

CGI delivers end-to-end services that help clients achieve the digital transformation of their value chains. Together, our end-to-end services and solutions help clients design, implement, run and operate the technology critical to achieving their business strategies. Our portfolio encompasses:

i. Business and strategic IT consulting and systems integration services: CGI helps clients create a path for future growth and sustainable value through business and strategic IT consulting services such as business strategy, business and operating model design, human-centered experience, customer value and operational excellence, organizational change management, sustainability and digital transformation. In the area of systems integration, we help clients accelerate the enterprise modernization of their legacy systems and adopt new technologies to drive innovation and deliver real-time and insight-driven customer and citizen services.

ii. Managed IT and business process services: Working as an extension of our clients’ organizations, we take on full or partial responsibility for managing their IT functions, freeing them up to focus on their strategic business direction. Our services enable clients to reinvest, alongside CGI, in the successful execution of their digital transformation roadmaps. We help them increase agility, scalability and resilience; deliver operational efficiencies, innovations and reduced costs; and embed security and data privacy controls. Typical services include: application development, modernization and maintenance; holistic enterprise digitization, automation, hybrid and cloud management; and business process services.

iii. Intellectual property (IP): CGI’s portfolio of IP solutions are highly configurable “business platforms as a service” that are embedded within our end-to-end service offerings and utilize integrated security, data privacy practices and provider-neutral cloud approaches. We invest in, and deliver, market-leading IP to drive business outcomes within each of our target industries. We also collaborate with clients to build and evolve IP-based solutions while enabling a higher degree of flexibility and customization for their unique modernization and digitization needs.

Deep industry and technology expertise

CGI has long-standing and focused practices in all of its core industries, providing clients with a partner that is not only an expert in IT, but also an expert in their respective industries. This combination of business knowledge and digital technology expertise allows us to help our clients navigate complex challenges and focus on value creation. In the process, we evolve the services and solutions we deliver within our targeted industries and provide thought leadership, blueprints, frameworks and technical accelerators that help client evolve their ecosystems.

Our targeted industries include financial services (including banking and insurance), government (including space), manufacturing, retail and distribution (including consumer services, transportation and logistics), communications and utilities (including energy and media), and health (including life sciences). To help orchestrate our global posture across these industries, our leaders regularly participate in cabinet meetings and councils to advance the strategies, services and solutions we deliver to our clients.

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Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

Helping clients leverage technology to its fullest

Macro trends such as supply chain reconfiguration, climate change and energy transition, and demographic shifts including aging populations and talent shortages require new business models and ways of working. At the same time, technology is reshaping our future and creating new opportunities.

Accelerating digitization provides the inclusive, economically vibrant, and sustainable future our clients’ customers and citizens demand. Leveraging technology to its fullest helps clients to lead within their industries. Our end-to-end digital services, industry and technology expertise, and operational excellence combine to help clients advance their holistic digital transformation.

Through our proprietary Voice of Our Clients research, we analyzed the characteristics of leading digital organizations and found three common attributes:

• They have highly agile business models and are better at operating as aligned teams between business and IT.

• They have been faster in modernizing the entire IT environment - including through automation - while assuring security and data privacy.

• They are addressing business transformation holistically, including culture change, ecosystem touchpoints, and the integration of sustainability objectives.

Digital leaders across industries seek new ways to evolve their strategy and operational models and use technology and information to improve how they operate, deliver products and services, and create value.

CGI helps clients adopt leading digital attributes and design, manage, protect and evolve their digital value chains to accelerate business outcomes.

Quality processes

Our clients expect consistent service wherever and whenever they engage us. We have an outstanding track record of on-time, within-budget delivery as a result of our commitment to excellence and our robust governance model - CGI’s Management Foundation.

Our Management Foundation provides a common business language, frameworks and practices for managing operations consistently across the globe, driving continuous improvement. We also invest in rigorous quality and service delivery standards including the International Organization for Standardization (ISO) and Capability Maturity Model Integration (CMMI) certification programs, as well as a comprehensive Client Satisfaction Assessment Program, with signed client assessments, to ensure high satisfaction on an ongoing basis.

1.2. VISION AND STRATEGY

Our strategy has always been based on long-term fundamentals. For further details, please refer to section 1.2. of CGI’s MD&A for the years ended September 30, 2022 and 2021, which is available on CGI’s website at www.cgi.com and which was filed with Canadian securities regulators on SEDAR+ at www.sedarplus.ca and the U.S. Securities and Exchange Commission on EDGAR at www.sec.gov.

1.3. COMPETITIVE ENVIRONMENT

There have been no significant changes to our competitive environment since the end of Fiscal 2022. For further details, please refer to section 1.3. of CGI’s MD&A for the years ended September 30, 2022 and 2021 which is available on CGI’s website at www.cgi.com and which was filed with Canadian securities regulators on SEDAR+ at www.sedarplus.ca and the U.S. Securities and Exchange Commission on EDGAR at www.sec.gov.

© 2023 CGI Inc. Page     10

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

2. Highlights and Key Performance Measures

2.1. SELECTED QUARTERLY INFORMATION & KEY PERFORMANCE MEASURES

As at and for the three months ended	Jun. 30, 2023		Mar. 31, 2023		Dec. 31, 2022		Sep. 30, 2022		Jun. 30, 2022		Mar. 31, 2022		Dec. 31, 2021		Sep. 30, 2021
In millions of CAD unless otherwise noted
Growth
Revenue		3,623.4		3,715.3		3,450.3		3,247.2		3,258.6		3,268.9		3,092.4		3,007.5
Year-over-year revenue growth		11.2%		13.7%		11.6%		8.0%		7.9%		6.2%		2.4%		2.8%
Constant currency revenue growth		6.3%		11.4%		12.3%		13.9%		11.5%		10.0%		6.8%		6.4%
Backlog1		25,633		25,241		25,011		24,055		23,238		23,144		23,577		23,059
Bookings		4,388		3,839		4,035		3,636		3,410		3,316		3,604		2,921
Book-to-bill ratio		121.1%		103.3%		117.0%		112.0%		104.7%		101.4%		116.5%		97.1%
Book-to-bill ratio trailing twelve months		113.3%		109.1%		108.9%		108.5%		104.9%		108.7%		115.2%		114.2%
Profitability
Earnings before income taxes		559.0		564.5		516.5		485.9		489.0		498.8		493.3		464.4
Earnings before income taxes margin		15.4%		15.2%		15.0%		15.0%		15.0%		15.3%		16.0%		15.4%
Adjusted EBIT2		584.8		600.8		554.1		521.7		519.9		523.6		521.5		493.3
Adjusted EBIT margin		16.1%		16.2%		16.1%		16.1%		16.0%		16.0%		16.9%		16.4%
Net earnings		415.0		419.4		382.4		362.4		364.3		372.0		367.4		345.9
Net earnings margin		11.5%		11.3%		11.1%		11.2%		11.2%		11.4%		11.9%		11.5%
Diluted EPS (in dollars)		1.75		1.76		1.60		1.51		1.51		1.53		1.49		1.39
Net earnings excluding specific items2		425.7		435.0		398.2		373.1		371.2		374.1		369.4		346.9
Net earnings margin excluding specific items		11.7%		11.7%		11.5%		11.5%		11.4%		11.4%		11.9%		11.5%
Diluted EPS excluding specific items (in dollars)2		1.80		1.82		1.66		1.56		1.54		1.53		1.50		1.40
Liquidity
Cash provided by operating activities		409.1		469.1		605.3		488.9		419.2		472.6		484.3		526.9
As a percentage of revenue		11.3%		12.6%		17.5%		15.1%		12.9%		14.5%		15.7%		17.5%
Days sales outstanding		44		41		44		49		48		42		45		45
Capital structure
Long-term debt and lease liabilities3		3,765.9		3,852.7		3,876.4		3,976.2		3,840.1		3,733.5		3,823.1		4,178.6
Net debt2		2,279.6		2,529.0		2,503.8		2,946.9		3,073.0		2,729.7		2,687.9		2,535.9
Net debt to capitalization ratio		21.7%		24.0%		24.1%		28.8%		30.6%		28.7%		27.8%		26.6%
Return on invested capital		15.7%		15.6%		15.5%		15.7%		15.8%		15.7%		15.3%		14.9%
Balance sheet
Cash and cash equivalents, and short-term investments		1,471.9		1,285.5		1,331.1		972.6		784.1		1,059.4		1,185.7		1,700.2
Total assets		16,080.1		16,101.7		15,915.9		15,175.4		14,916.4		14,475.7		14,704.9		15,021.0
Long-term financial liabilities4		2,885.2		2,946.1		2,971.6		3,731.3		3,581.8		3,523.5		3,608.2		3,659.8

¹ Approximately $9.9 billion of our backlog as at June 30, 2023 is expected to be converted into revenue within the next twelve months, $8.7 billion within one to three years, $2.8 billion within three to five years and $4.2 billion in more than five years.

²  Please refer to sections 3.7., 3.8.3. and 4.5. of each quarter’s respective MD&A for the reconciliation of non-GAAP financial measures for the quarterly periods of 2022 and 2021. For Fiscal years ending 2021 and 2022, please refer to sections 5.6. and 5.6.1.

³ Long-term debt and lease liabilities include both the current and long-term portions of the long-term debt and lease liabilities.

⁴ Long-term financial liabilities include the long-term portion of the debt, long-term portion of lease liabilities and the long-term derivative financial instruments.

© 2023 CGI Inc. Page     11

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

2.2. STOCK PERFORMANCE

2.2.1. Q3 2023 Trading Summary

CGI’s shares are listed on the Toronto Stock Exchange (TSX) (stock quote – GIB.A) and the New York Stock Exchange (NYSE) (stock quote – GIB) and are included in key indices such as the S&P/TSX 60 Index.

TSX	(CAD)	NYSE	(USD)
Open:	129.48	Open:	96.00
High:	142.31	High:	106.32
Low:	128.78	Low:	95.11
Close:	139.70	Close:	105.43
CDN average daily trading volumes1:	534,117	NYSE average daily trading volumes:	143,754

¹  Includes the average daily volumes of both the TSX and alternative trading systems.

© 2023 CGI Inc. Page     12

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

2.2.2. Normal Course Issuer Bid (NCIB)

On January 31, 2023, the Company’s Board of Directors authorized and subsequently received regulatory approval from the TSX for the renewal of CGI’s NCIB which allows for the purchase for cancellation of up to 18,769,394 Class A subordinate voting shares (Class A Shares) representing 10% of the Company’s public float as of the close of business on January 24, 2023. Class A Shares may be purchased for cancellation under the NCIB commencing on February 6, 2023 until no later than February 5, 2024, or on such earlier date when the Company has either acquired the maximum number of Class A Shares allowable under the NCIB or elects to terminate the bid.

During the three months ended June 30, 2023, the Company purchased for cancellation 390,100 Class A Shares for a total consideration of $53.1 million, at a weighted average price of $136.02.

During the nine months ended June 30, 2023, the Company purchased for cancellation 3,735,096 Class A Shares under its current NCIB for a total consideration of $453.1 million, at a weighted average price of $121.30. The purchased shares included 3,344,996 Class A Shares purchased for cancellation from Caisse de dépôt et de placement du Québec, for a total consideration of $400.0 million. The purchase was made pursuant to an exemption order issued by the Autorité des marchés financiers and is considered within the annual aggregate limit that the Company is entitled to purchase under its current NCIB. In addition, during the nine months ended June 30, 2023, the Company paid for and cancelled 100,100 Class A Shares under the previous NCIB for a total consideration of $10.3 million, at a weighted average price of $102.81, which were purchased, or committed to be purchased, but not cancelled as at September 30, 2022.

As at June 30, 2023, the Company could purchase up to 15,034,298 Class A Shares for cancellation under the current NCIB.

2.2.3. Capital Stock and Options Outstanding

The following table provides a summary of the Capital Stock and Options Outstanding as at July 21, 2023:

Capital Stock and Options Outstanding	As at July 21, 2023
Class A subordinate voting shares		208,926,569
Class B multiple voting shares		26,445,706
Options to purchase Class A subordinate voting shares		5,405,159

© 2023 CGI Inc. Page     13

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3. Financial Review

3.1. BOOKINGS AND BOOK-TO-BILL RATIO

Bookings for the quarter were $4.4 billion representing a book-to-bill ratio of 121.1%. The breakdown of the new bookings signed during the quarter is as follows:

Information regarding our bookings is a key indicator of the volume of our business over time. Additional information on bookings can be found in the Key Performance Measures section of the present document. The following table provides a summary of the bookings and book-to-bill ratio by segment:

In thousands of CAD except for percentages	Bookings for the  three months ended June 30, 2023		Bookings for the trailing twelve months ended June 30, 2023		Book-to-bill  ratio for the trailing twelve months ended June 30, 2023
Total CGI		4,388,415		15,899,458		113.3%
U.S. Federal		1,016,033		2,513,510		131.2%
Western and Southern Europe		753,899		2,737,810		109.2%
Canada		675,008		2,419,405		108.7%
U.S. Commercial and State Government		634,170		2,750,537		111.8%
Scandinavia and Central Europe		512,972		1,795,800		105.2%
U.K. and Australia		410,906		1,979,612		122.5%
Northwest and Central-East Europe		209,967		773,945		100.5%
Finland, Poland and Baltics		175,460		928,839		111.3%

© 2023 CGI Inc. Page     14

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3.2. FOREIGN EXCHANGE

The Company operates globally and is exposed to changes in foreign currency rates. Accordingly, as prescribed by IFRS, we value assets, liabilities and transactions that are measured in foreign currencies using various exchange rates. We report all dollar amounts in Canadian dollars.

    Closing foreign exchange rates

As at June 30,	2023	2022	Change
U.S. dollar	1.3235	1.2871	2.8%
Euro	1.4452	1.3474	7.3%
Indian rupee	0.0161	0.0163	(1.2%)
British pound	1.6822	1.5653	7.5%
Swedish krona	0.1227	0.1257	(2.4%)

    Average foreign exchange rates

	For the three months ended June 30,			For the nine months ended June 30,
	2023	2022	Change	2023	2022	Change
U.S. dollar	1.3430	1.2769	5.2%	1.3510	1.2680	6.5%
Euro	1.4620	1.3589	7.6%	1.4334	1.4069	1.9%
Indian rupee	0.0163	0.0165	(1.2%)	0.0164	0.0167	(1.8%)
British pound	1.6814	1.6024	4.9%	1.6399	1.6668	(1.6%)
Swedish krona	0.1275	0.1297	(1.7%)	0.1280	0.1359	(5.8%)

© 2023 CGI Inc. Page     15

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3.3. REVENUE DISTRIBUTION

The following charts provide additional information regarding our revenue mix for the quarter:

3.3.1. Client Concentration

IFRS guidance on segment disclosures defines a single customer as a group of entities that are known to the reporting entity to be under common control. As a consequence, our work for the U.S. federal government including its various agencies represented 13.5% of our revenue for the three months ended June 30, 2023 as compared to 12.8% for the three months ended June 30, 2022.

For the nine months ended June 30, 2023 and 2022, we generated 13.3% and 13.0%, respectively, of our revenue from the U.S. federal government including its various agencies.

© 2023 CGI Inc. Page     16

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3.4. REVENUE BY SEGMENT

Our segments are reported based on where the client’s work is delivered from within our geographic delivery model.

The table below provides a summary of the year-over-year changes in our revenue, in total and by segment before eliminations, separately showing the impacts of foreign currency exchange rate variations between Q3 2023 and Q3 2022. For the three and nine months ended June 30, 2022, revenues by segment were recorded reflecting the actual foreign exchange rates for the respective period. The foreign exchange impact is the difference between the current period’s actual results and the same period’s results converted with the prior year’s foreign exchange rates.

In thousands of CAD except for percentages	For the three months ended June 30,							For the nine months ended June 30,
	2023		2022		%			2023		2022		%
Total CGI revenue		3,623,428		3,258,638		11.2	%		10,789,024		9,619,980		12.2	%
Constant currency revenue growth		6.3%							9.9%
Foreign currency impact		4.9%							2.3%
Variation over previous period		11.2%							12.2%
Western and Southern Europe
Revenue prior to foreign currency impact		610,615		553,470		10.3	%		1,964,741		1,604,597		22.4	%
Foreign currency impact		46,181							34,657
Western and Southern Europe revenue		656,796		553,470		18.7	%		1,999,398		1,604,597		24.6	%
U.S. Commercial and State Government
Revenue prior to foreign currency impact		541,456		528,046		2.5	%		1,606,869		1,518,160		5.8	%
Foreign currency impact		28,373							103,860
U.S. Commercial and State Government revenue		569,829		528,046		7.9	%		1,710,729		1,518,160		12.7	%
Canada
Revenue prior to foreign currency impact		518,281		524,511		(1.2	%)		1,554,150		1,485,331		4.6	%
Foreign currency impact		511							1,158
Canada revenue		518,792		524,511		(1.1	%)		1,555,308		1,485,331		4.7	%
U.S. Federal
Revenue prior to foreign currency impact		467,699		432,667		8.1	%		1,355,656		1,287,808		5.3	%
Foreign currency impact		24,672							89,769
U.S. Federal revenue		492,371		432,667		13.8	%		1,445,425		1,287,808		12.2	%
Scandinavia and Central Europe
Revenue prior to foreign currency impact		405,586		388,071		4.5	%		1,283,972		1,205,715		6.5	%
Foreign currency impact		11,086							(27,222)
Scandinavia and Central Europe revenue		416,672		388,071		7.4	%		1,256,750		1,205,715		4.2	%
U.K. and Australia revenue
Revenue prior to foreign currency impact		364,200		317,559		14.7	%		1,095,591		959,682		14.2	%
Foreign currency impact		17,313							(15,802)
U.K. and Australia revenue		381,513		317,559		20.1	%		1,079,789		959,682		12.5	%
Finland, Poland and Baltics
Revenue prior to foreign currency impact		195,904		181,960		7.7	%		623,465		564,548		10.4	%
Foreign currency impact		15,341							11,684
Finland, Poland and Baltics revenue		211,245		181,960		16.1	%		635,149		564,548		12.5	%

© 2023 CGI Inc. Page     17

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

In thousands of CAD except for percentages	For the three months ended June 30,							For the nine months ended June 30,
	2023		2022		%			2023		2022		%
Northwest and Central-East Europe
Revenue prior to foreign currency impact		178,675		171,632		4.1	%		555,057		537,105		3.3	%
Foreign currency impact		14,919							13,743
Northwest and Central-East Europe revenue		193,594		171,632		12.8	%		568,800		537,105		5.9	%
Asia Pacific
Revenue prior to foreign currency impact		234,347		207,901		12.7	%		694,794		585,348		18.7	%
Foreign currency impact		(2,247)							(11,873)
Asia Pacific revenue		232,100		207,901		11.6	%		682,921		585,348		16.7	%
Eliminations		(49,484)		(47,179)		4.9	%		(145,245)		(128,314)		13.2	%

For the three months ended June 30, 2023, revenue was $3,623.4 million, an increase of $364.8 million, or 11.2% over the same period last year. On a constant currency basis, revenue increased by $203.8 million or 6.3%. The increase was mainly due to organic growth across most vertical markets, including an increase in IP-based revenues, and prior year’s business acquisitions. This was partially offset by less available days to bill, due to the timing of statutory holidays in Europe.

For the nine months ended June 30, 2023, revenue was $10,789.0 million, an increase of $1,169.0 million or 12.2% over the same period last year. On a constant currency basis, revenue increased by $954.9 million or 9.9%. The increase was mainly due to the same factors identified for the quarter.

3.4.1. Western and Southern Europe

For the three months ended June 30, 2023, revenue in the Western and Southern Europe segment was $656.8 million, an increase of $103.3 million or 18.7% over the same period last year. On a constant currency basis, revenue increased by $57.1 million or 10.3%. The increase in revenue was mainly due to prior year’s business acquisitions, as well as the result of organic growth across most vertical markets. This was partly offset by two less available days to bill in France.

For the nine months ended June 30, 2023, revenue in the Western and Southern Europe segment was $1,999.4 million, an increase of $394.8 million or 24.6% over the same period last year. On a constant currency basis, revenue increased by $360.1 million or 22.4%. The increase in revenue was mainly due to prior year’s business acquisitions, as well as the result of organic growth across all vertical markets. This was partly offset by two less available days to bill in France.

On a client geographic basis, the top two Western and Southern Europe vertical markets were MRD and financial services, generating combined revenues of approximately $407 million and $1,235 million for the three and nine months ended June 30, 2023, respectively.

3.4.2. U.S. Commercial and State Government

For the three months ended June 30, 2023, revenue in the U.S. Commercial and State Government segment was $569.8 million, an increase of $41.8 million or 7.9% over the same period last year. On a constant currency basis, revenue increased by $13.4 million or 2.5%. The increase was mainly due to organic growth across most vertical markets, partially offset by increased use of our Asia Pacific offshore delivery centers for client work and lower IP license sales as we experience a shift in demand towards a software-as-a-service delivery model.

For the nine months ended June 30, 2023, revenue in the U.S. Commercial and State Government segment was $1,710.7 million, an increase of $192.6 million or 12.7% over the same period last year. On a constant currency basis, revenue increased by $88.7 million or 5.8%. The increase was mainly due to organic growth across most vertical markets, partially offset by increased use of our Asia Pacific offshore delivery centers for client work.

© 2023 CGI Inc. Page     18

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

On a client geographic basis, the top two U.S. Commercial and State Government vertical markets were financial services and government, generating combined revenues of approximately $374 million and $1,082 million for the three and nine months ended June 30, 2023, respectively.

3.4.3. Canada

For the three months ended June 30, 2023, revenue in the Canada segment was $518.8 million, a decrease of $5.7 million or 1.1% compared to the same period last year. On a constant currency basis, revenue decreased by $6.2 million or 1.2%. The change was mainly due to lower utilization within the financial services vertical market and the successful completion of contracts within the MRD vertical market. This was partially offset by an increase in IP-based revenues within the financial services vertical market.

For the nine months ended June 30, 2023, revenue in the Canada segment was $1,555.3 million, an increase of $70.0 million or 4.7% compared to the same period last year. On a constant currency basis, revenue increased by $68.8 million or 4.6%. The increase was mainly due to organic growth across most vertical markets, including an increase in IP-based revenues within the financial services vertical market.

On a client geographic basis, the top two Canada vertical markets were financial services and communications and utilities, generating combined revenues of approximately $363 million and $1,091 million for the three and nine months ended June 30, 2023, respectively.

3.4.4. U.S. Federal

For the three months ended June 30, 2023, revenue in the U.S. Federal segment was $492.4 million, an increase of $59.7 million or 13.8% over the same period last year. On a constant currency basis, revenue increased by $35.0 million or 8.1%. The increase in revenue was mainly due to higher transaction volumes related to our IP business process services and organic growth in managed services engagements.

For the nine months ended June 30, 2023, revenue in the U.S. Federal segment was $1,445.4 million, an increase of $157.6 million or 12.2% over the same period last year. On a constant currency basis, revenue increased by $67.8 million or 5.3%. The increase was mainly due to the same factors identified for the quarter.

For the three and nine months ended June 30, 2023, 90% of revenues within the U.S. Federal segment were for federal civilian-based agencies for both periods.

3.4.5. Scandinavia and Central Europe

For the three months ended June 30, 2023, revenue in the Scandinavia and Central Europe segment was $416.7 million, an increase of $28.6 million or 7.4% over the same period last year. On a constant currency basis, revenue increased by $17.5 million or 4.5%. The increase was mainly driven by organic growth across most vertical markets, primarily within the government vertical market. This was partially offset by a favourable contract settlement in the prior year and one less available day to bill in Germany.

For the nine months ended June 30, 2023, revenue in the Scandinavia and Central Europe segment was $1,256.8 million, an increase of $51.0 million or 4.2% over the same period last year. On a constant currency basis, revenue increased by $78.3 million or 6.5%. The increase was mainly driven by organic growth across most vertical markets, primarily within the government vertical market. This was partially offset by one less available day to bill in Germany.

On a client geographic basis, the top two Scandinavia and Central Europe vertical markets were MRD and government, generating combined revenues of approximately $307 million and $925 million for the three and nine months ended June 30, 2023, respectively.

© 2023 CGI Inc. Page     19

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3.4.6. U.K. and Australia

For the three months ended June 30, 2023, revenue in the U.K. and Australia segment was $381.5 million, an increase of $64.0 million or 20.1% over the same period last year. On a constant currency basis, revenue increased by $46.6 million or 14.7%. The increase was mainly due to organic growth across most vertical markets, predominantly within the government vertical market.

For the nine months ended June 30, 2023, revenue in the U.K. and Australia segment was $1,079.8 million, an increase of $120.1 million or 12.5% over the same period last year. On a constant currency basis, revenue increased by $135.9 million or 14.2%. The increase was mainly due to organic growth across most vertical markets, predominantly within the government vertical market, as well as a prior year’s business acquisition.

On a client geographic basis, the top two U.K. and Australia vertical markets were government and communications and utilities, generating combined revenues of $321 million and $898 million for the three and nine months ended June 30, 2023, respectively.

3.4.7. Finland, Poland and Baltics

For the three months ended June 30, 2023, revenue in the Finland, Poland and Baltics segment was $211.2 million, an increase of $29.3 million or 16.1% over the same period last year. On a constant currency basis, revenue increased by $13.9 million or 7.7%. The increase was mainly due to organic growth across most vertical markets, partially offset by one less available day to bill.

For the nine months ended June 30, 2023, revenue in the Finland, Poland and Baltics segment was $635.1 million, an increase of $70.6 million or 12.5% over the same period last year. On a constant currency basis, revenue increased by $58.9 million or 10.4%. The increase was mainly due to organic growth across most vertical markets, including an increase in IP-based revenues.

On a client geographic basis, the top two Finland, Poland and Baltics vertical markets were financial services and government, generating combined revenues of approximately $130 million and $400 million for the three and nine months ended June 30, 2023, respectively.

3.4.8. Northwest and Central-East Europe

For the three months ended June 30, 2023, revenue in the Northwest and Central-East Europe segment was $193.6 million, an increase of $22.0 million or 12.8% over the same period last year. On a constant currency basis, revenue increased by $7.0 million or 4.1%. The increase was mainly due to organic growth within most vertical markets, partially offset by two less available days to bill in Czech Republic.

For the nine months ended June 30, 2023, revenue in the Northwest and Central-East Europe segment was $568.8 million, an increase of $31.7 million or 5.9% over the same period last year. On a constant currency basis, revenue increased by $18.0 million or 3.3%. The increase was mainly due to organic growth within most vertical markets, partially offset by one less available day to bill across the segment.

On a client geographic basis, the top two Northwest and Central-East Europe vertical markets were MRD and government, generating combined revenues of approximately $126 million and $381 million for the three and nine months ended June 30, 2023, respectively.

3.4.9. Asia Pacific

For the three months ended June 30, 2023, revenue in the Asia Pacific segment was $232.1 million, an increase of $24.2 million or 11.6% over the same period last year. On a constant currency basis, revenue increased by $26.4 million or 12.7%. The increase was mainly driven by the continued demand for our offshore delivery centers across all commercial vertical markets.

© 2023 CGI Inc. Page     20

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

For the nine months ended June 30, 2023, revenue in the Asia Pacific segment was $682.9 million, an increase of $97.6 million or 16.7% over the same period last year. On a constant currency basis, revenue increased by $109.4 million or 18.7%. The increase was mainly driven by the same factors identified for the quarter.

© 2023 CGI Inc. Page     21

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3.5. OPERATING EXPENSES

In thousands of CAD  except for percentages	For the three months ended June 30,				For the nine months ended June 30,
	2023	% of  revenue	2022	% of  revenue	2023	% of  revenue	2022	% of  revenue
Costs of services, selling and administrative	3,037,083	83.8%	2,738,041	84.0%	9,050,008	83.9%	8,054,424	83.7%
Foreign exchange loss (gain)	1,524	—%	727	—%	(686)	—%	616	—%

3.5.1. Costs of Services, Selling and Administrative

Costs of services include the costs of our members serving our clients, which mainly consist of salaries, performance based compensation and other member costs, including travel expenses, net of tax credits. These also mainly include professional fees and other contracted labour costs, as well as hardware, software and delivery center related costs.

Costs of selling and administrative mainly include salaries, performance based compensation and other member costs for administrative and management members, office space, internal solutions and business development related costs such as travel expenses.

For the three months ended June 30, 2023, costs of services, selling and administrative expenses amounted to $3,037.1 million, an increase of $299.0 million over the same period last year. As a percentage of revenue, costs of services, selling and administrative expenses decreased to 83.8% from 84.0%.

As a percentage of revenue, costs of services increased compared to the same period last year, mainly due to the impact of less available days to bill, due to the timing of statutory holidays in Europe, and the expected increase in travel to support client delivery growth. This was partially offset by growth within most vertical markets and lower performance based compensation accruals.

As a percentage of revenue, costs of selling and administrative decreased compared to the same period last year, mainly due to lower performance based compensation accruals, which was partially offset by the increase in business development efforts, including the expected increase in travel to support growing our business.

For the nine months ended June 30, 2023, costs of services, selling and administrative expenses amounted to $9,050.0 million, an increase of $995.6 million over the same period last year. As a percentage of revenue, costs of services, selling and administrative expenses increased to 83.9% from 83.7%.

As a percentage of revenue, costs of services increased compared to the same period last year, mainly due to the same factors identified for the quarter, as well as due to a favorable supplier contract adjustment that did not repeat this year and the planned temporary dilutive impact of the prior year’s business acquisitions.

As a percentage of revenue, costs of selling and administrative decreased compared to the same period last year, mainly due to the same factors identified for the quarter, which was partially offset by the planned temporary dilutive impact of the prior year’s business acquisitions.

During the three months ended June 30, 2023, the translation of the results of our foreign operations from their local currencies to the Canadian dollar unfavourably impacted costs by $128.6 million, which was offset by the favourable translation impact of $161.0 million on our revenue.

During the nine months ended June 30, 2023, the translation of the results of our foreign operations from their local currencies to the Canadian dollar unfavourably impacted costs by $160.5 million, which was offset by the favourable translation impact of $214.2 million on our revenue.

© 2023 CGI Inc. Page     22

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3.5.2. Foreign Exchange Loss (Gain)

During the three months ended June 30, 2023, CGI incurred $1.5 million of foreign exchange losses and during the nine months ended June 30, 2023, recognized $0.7 million of foreign exchange gains, mainly driven by the timing of payments combined with the volatility of foreign exchange rates. The Company, in addition to its natural hedges, uses derivatives as a strategy to manage its exposure, to the extent possible.

© 2023 CGI Inc. Page     23

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3.6. ADJUSTED EBIT BY SEGMENT

In thousands of CAD except for  percentages	For the three months ended June 30,							For the nine months ended June 30,
	2023		2022		Change			2023		2022		Change
Western and Southern Europe		80,778		70,107		15.2%			277,510		233,817		18.7%
As a percentage of segment revenue		12.3%		12.7%					13.9%		14.6%
U.S. Commercial and State Government		98,365		75,637		30.0%			244,782		219,391		11.6%
As a percentage of segment revenue		17.3%		14.3%					14.3%		14.5%
Canada		115,843		113,617		2.0%			350,117		341,201		2.6%
As a percentage of segment revenue		22.3%		21.7%					22.5%		23.0%
U.S. Federal		87,125		78,553		10.9%			232,135		208,396		11.4%
As a percentage of segment revenue		17.7%		18.2%					16.1%		16.2%
Scandinavia and Central Europe		29,027		31,082		(6.6%	)		106,634		94,999		12.2%
As a percentage of segment revenue		7.0%		8.0%					8.5%		7.9%
U.K. and Australia		55,526		42,359		31.1%			155,879		146,954		6.1%
As a percentage of segment revenue		14.6%		13.3%					14.4%		15.3%
Finland, Poland and Baltics		22,740		22,529		0.9%			83,200		70,515		18.0%
As a percentage of segment revenue		10.8%		12.4%					13.1%		12.5%
Northwest and Central East-Europe		23,158		22,098		4.8%			75,400		69,192		9.0%
As a percentage of segment revenue		12.0%		12.9%					13.3%		12.9%
Asia Pacific		72,259		63,888		13.1%			214,045		180,475		18.6%
As a percentage of segment revenue		31.1%		30.7%					31.3%		30.8%
Adjusted EBIT		584,821		519,870		12.5%			1,739,702		1,564,940		11.2%
Adjusted EBIT margin		16.1%		16.0%					16.1%		16.3%

For the three months ended June 30, 2023, adjusted EBIT margin increased to 16.1% from 16.0% for the same period last year. The increase in adjusted EBIT margin was mostly due to the lower performance based compensation accruals and profitable growth within most vertical markets. This was partially offset by less available days to bill, due to the timing of statutory holidays in Europe, and the increase in business development efforts, including the expected increase in travel.

For the nine months ended June 30, 2023, adjusted EBIT margin decreased to 16.1% from 16.3% for the same period last year. The change in adjusted EBIT margin was mostly due to the increase in business development efforts, including the expected increase in travel, the planned temporary dilutive impact of the prior year’s business acquisitions, less available days to bill and a favourable supplier contract adjustment that did not repeat this year. This was partially offset by profitable growth within most vertical markets and lower performance based compensation accruals.

3.6.1. Western and Southern Europe

For the three months ended June 30, 2023, adjusted EBIT in the Western and Southern Europe segment was $80.8 million, an increase of $10.7 million when compared to the same period last year. Adjusted EBIT margin decreased to 12.3% from 12.7%. The change in adjusted EBIT margin was mainly due to two less available days to bill in France and the expected increase in travel to support growing our business, partially offset by lower performance based compensation accruals.

For the nine months ended June 30, 2023, adjusted EBIT in the Western and Southern Europe segment was $277.5 million, an increase of $43.7 million when compared to the same period last year. Adjusted EBIT margin decreased to 13.9% from 14.6%. The change in adjusted EBIT margin was mainly due to the planned temporary dilutive impact of the prior year’s business acquisitions, two less available days to bill in France, the expected increase in travel to support

© 2023 CGI Inc. Page     24

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

growing our business and prior year’s additional employee-related government incentive that did not repeat this year. This was partly offset by profitable organic growth within all vertical markets.

3.6.2. U.S. Commercial and State Government

For the three months ended June 30, 2023, adjusted EBIT in the U.S. Commercial and State Government segment was $98.4 million, an increase of $22.7 million when compared to the same period last year. Adjusted EBIT margin increased to 17.3% from 14.3%. The increase in adjusted EBIT margin was mainly due to lower performance based compensation accruals, the impact of a favorable supplier contract settlement and organic growth across most vertical markets. This was partially offset by lower IP license sales as we experience a shift in demand towards a software-as-a-service delivery model.

For the nine months ended June 30, 2023, adjusted EBIT in the U.S. Commercial and State Government segment was $244.8 million, an increase of $25.4 million when compared to the same period last year. Adjusted EBIT margin decreased to 14.3% from 14.5%. The change in adjusted EBIT margin was mainly due to less higher profitability IP-based revenues and the impact of temporarily lower utilization due to successful completion of projects. This was partially offset by organic growth across most vertical markets and the impact of a favorable supplier contract settlement.

3.6.3. Canada

For the three months ended June 30, 2023, adjusted EBIT in the Canada segment was $115.8 million, an increase of $2.2 million when compared to the same period last year. Adjusted EBIT margin increased to 22.3% from 21.7%. The increase in adjusted EBIT margin was mainly due to lower performance based compensation accruals. This was partially offset by the impact of temporarily lower utilization, primarily in the financial services vertical market.

For the nine months ended June 30, 2023, adjusted EBIT in the Canada segment was $350.1 million, an increase of $8.9 million when compared to the same period last year. Adjusted EBIT margin decreased to 22.5% from 23.0%. The change in adjusted EBIT margin was mainly due to the impact of temporarily lower utilization primarily within the financial services vertical market and a prior year’s favorable supplier contract adjustment that did not repeat this year. This was partially offset by lower performance based compensation accruals.

3.6.4. U.S. Federal

For the three months ended June 30, 2023, adjusted EBIT in the U.S. Federal segment was $87.1 million, an increase of $8.6 million when compared to the same period last year. Adjusted EBIT margin decreased to 17.7% from 18.2%. The change in adjusted EBIT margin was mainly due to an increase in business development efforts, including the expected increase in travel, higher performance based compensation accruals. This was partially offset by higher transaction volumes related to our IP business process services and non-renewal of low margin contracts in the prior year.

For the nine months ended June 30, 2023, adjusted EBIT in the U.S. Federal segment was $232.1 million, an increase of $23.7 million when compared to the same period last year. Adjusted EBIT margin decreased to 16.1% from 16.2%. The change in adjusted EBIT margin was mainly due to an increase in business development efforts, including the expected increase in travel, and higher performance based compensation accruals. This was mainly offset by higher transaction volumes related to our IP business process services.

3.6.5. Scandinavia and Central Europe

For the three months ended June 30, 2023, adjusted EBIT in the Scandinavia and Central Europe segment was $29.0 million, a decrease of $2.1 million when compared to the same period last year. Adjusted EBIT margin decreased to 7.0% from 8.0%. The change in adjusted EBIT margin was mainly due to a favorable client contract settlement in the prior year, one less available day to bill in Germany, the impact of temporarily lower utilization within the communications and utilities vertical market and the expected increase in travel to support growing our business. This was partially offset by lower performance based compensation accruals.

© 2023 CGI Inc. Page     25

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

For the nine months ended June 30, 2023, adjusted EBIT in the Scandinavia and Central Europe segment was $106.6 million, an increase of $11.6 million when compared to the same period last year. Adjusted EBIT margin increased to 8.5% from 7.9%. The increase in adjusted EBIT margin was mainly due to lower performance based compensation accruals and organic growth across most vertical markets. This was partially offset by one less available day to bill in Germany.

3.6.6. U.K. and Australia

For the three months ended June 30, 2023, adjusted EBIT in the U.K. and Australia segment was $55.5 million, an increase of $13.2 million when compared to the same period last year. Adjusted EBIT margin increased to 14.6% from 13.3%. The increase in adjusted EBIT margin was mainly due to profitable organic growth within the government vertical market.

For the nine months ended June 30, 2023, adjusted EBIT in the U.K. and Australia segment was $155.9 million, an increase of $8.9 million when compared to the same period last year. Adjusted EBIT margin decreased to 14.4% from 15.3%. The change in adjusted EBIT margin was mainly due to the expected increase in travel to support growing our business and an increase in energy costs.

3.6.7. Finland, Poland and Baltics

For the three months ended June 30, 2023, adjusted EBIT in the Finland, Poland and Baltics segment was $22.7 million, an increase of $0.2 million, when compared to the same period last year. Adjusted EBIT margin decreased to 10.8% from 12.4%. The change in adjusted EBIT margin was mainly due to costs associated with the ramp up of managed IT services contracts, one less available day to bill and the expected increase in travel to support growing our business. This was partially offset by organic growth across most vertical markets.

For the nine months ended June 30, 2023, adjusted EBIT in the Finland, Poland and Baltics segment was $83.2 million, an increase of $12.7 million, when compared to the same period last year. Adjusted EBIT margin increased to 13.1% from 12.5%. The increase in adjusted EBIT margin is primarily due to organic growth across most vertical markets, including an increase in IP-based revenues. This was partially offset by the costs associated with the ramp up of managed IT services contracts and the expected increase in travel to support growing our business.

3.6.8. Northwest and Central-East Europe

For the three months ended June 30, 2023, adjusted EBIT in the Northwest and Central-East Europe segment was $23.2 million, an increase of $1.1 million when compared to the same period last year. Adjusted EBIT margin decreased to 12.0% from 12.9%. The change in adjusted EBIT margin was mainly due to costs related to the optimization of our operations in Belgium and two less available days to bill in Czech Republic. This was partially offset by lower performance based compensation accruals.

For the nine months ended June 30, 2023, adjusted EBIT in the Northwest and Central-East Europe segment was $75.4 million, an increase of $6.2 million when compared to the same period last year. Adjusted EBIT margin increased to 13.3% from 12.9%. The increase in adjusted EBIT margin was mainly due to lower performance based compensation accruals and an asset impairment in the prior year. This was partially offset by one less available day to bill across the segment.

3.6.9. Asia Pacific

For the three months ended June 30, 2023, adjusted EBIT in the Asia Pacific segment was $72.3 million, an increase of $8.4 million when compared to the same period last year. Adjusted EBIT margin increased to 31.1% from 30.7%. The increase in adjusted EBIT margin was mainly driven by the same factors identified in the revenue section, as well as productivity improvements.

For the nine months ended June 30, 2023, adjusted EBIT in the Asia Pacific segment was $214.0 million, an increase of $33.6 million when compared to the same period last year. Adjusted EBIT margin increased to 31.3% from 30.8%. The increase in adjusted EBIT margin was mainly driven by the same factors identified for the quarter.

© 2023 CGI Inc. Page     26

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3.7. EARNINGS BEFORE INCOME TAXES

The following table provides a reconciliation between our adjusted EBIT and earnings before income taxes, which is reported in accordance with IFRS:

In thousands of CAD except for percentage	For the three months ended June 30,								For the nine months ended June 30,
	2023		% of revenue		2022		% of revenue		2023		% of revenue		2022		% of revenue
Adjusted EBIT		584,821		16.1%		519,870		16.0%		1,739,702		16.1%		1,564,940		16.3%
Minus the following items:
Acquisition-related and integration costs		13,032		0.4%		8,014		0.2%		53,401		0.5%		12,879		0.1%
Net finance costs		12,808		0.4%		22,887		0.7%		46,315		0.4%		71,004		0.7%
Earnings before income taxes		558,981		15.4%		488,969		15.0%		1,639,986		15.2%		1,481,057		15.4%

3.7.1. Acquisition-Related and Integration Costs

For the three and nine months ended June 30, 2023, the Company incurred $13.0 million and $53.4 million, respectively, of acquisition-related and integration costs for the integration towards the CGI operating model.

For the three and nine months ended June 30, 2023, these costs were related to integration costs, mainly costs of redundancy of employments and the impact of vacating lease premises.

3.7.2. Net Finance Costs

Net finance costs mainly include interest on our long-term debt, lease liabilities and financial assets. For the three months ended June 30, 2023, the net finance costs decreased by $10.1 million mainly due to additional interest income from our financial assets. For the nine months ended June 30, 2023, the decrease of $24.7 million was mainly due to additional interest income from our financial assets and lower interest charges related to our unsecured notes repaid in December 2021 as scheduled.

© 2023 CGI Inc. Page     27

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3.8. NET EARNINGS AND EARNINGS PER SHARE

The following table sets out the information supporting the earnings per share calculations:

In thousands of CAD except for percentage and shares data	For the three months ended June 30,						For the nine months ended June 30,
	2023		2022		Change		2023		2022		Change
Earnings before income taxes		558,981		488,969		14.3%		1,639,986		1,481,057		10.7%
Income tax expense		144,002		124,625		15.5%		423,213		377,277		12.2%
Effective tax rate		25.8%		25.5%				25.8%		25.5%
Net earnings		414,979		364,344		13.9%		1,216,773		1,103,780		10.2%
Net earnings margin		11.5%		11.2%				11.3%		11.5%
Weighted average number of shares outstanding
Class A subordinate voting shares and Class B multiple voting shares (basic)		233,075,350		237,436,642		(1.8%)		234,752,090		240,239,796		(2.3%)
Class A subordinate voting shares and Class B multiple voting shares (diluted)		236,883,434		240,802,680		(1.6%)		238,343,519		243,844,587		(2.3%)
Earnings per share (in dollars)
Basic		1.78		1.53		16.3%		5.18		4.59		12.9%
Diluted		1.75		1.51		15.9%		5.11		4.53		12.8%

3.8.1. Income Tax Expense

For the three months ended June 30, 2023, income tax expense was $144.0 million compared to $124.6 million over the same period last year, while our effective tax rate increased to 25.8% from 25.5%. Excluding specific items, the effective tax rate increased to 25.6% from 25.3%. In both cases, the increase in the income tax rate was mainly attributable to an increase in the U.K. statutory tax rate and a change in the profitability mix in certain geographies, partly offset by a lower statutory tax rate in France.

For the nine months ended June 30, 2023, income tax expense was $423.2 million compared to $377.3 million over the same period last year, while our effective tax rate increased to 25.8% from 25.5%. Excluding specific items, the effective tax rate increased to 25.7% from 25.4%. In both cases, the increase in the income tax rate was mainly attributable to the same factors identified for the quarter.

The table in section 3.8.3. shows the year-over-year comparison of the tax rate with the impact of specific items removed.

Based on the enacted rates at the end of Fiscal 2022 and our current profitability mix, we expect our effective tax rate before specific items to be in the range of 24.5% to 26.5% in subsequent periods.

3.8.2. Weighted Average Number of Shares

For Q3 2023, CGI’s basic and diluted weighted average number of shares decreased compared to Q3 2022 mostly due to the impact of the purchase for cancellation of Class A Shares, partly offset by the exercise of stock options. Please refer to note 5 of our interim condensed financial statements for additional information.

© 2023 CGI Inc. Page     28

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

3.8.3. Net Earnings and Earnings per Share Excluding Specific Items

Below is a table showing the year-over-year comparison excluding specific items namely, acquisition-related and integration costs.

In thousands of CAD except for percentages and shares data	For the three months ended June 30,						For the nine months ended June 30,
	2023		2022		Change		2023		2022		Change
Earnings before income taxes		558,981		488,969		14.3%		1,639,986		1,481,057		10.7%
Add back:
Acquisition-related and integration costs		13,032		8,014				53,401		12,879
Earnings before income taxes excluding specific items		572,013		496,983		15.1%		1,693,387		1,493,936		13.4%
Income tax expense		144,002		124,625		15.5%		423,213		377,277		12.2%
Effective tax rate		25.8%		25.5%				25.8%		25.5%
Add back:
Tax deduction on acquisition-related and integration costs		2,352		1,113				11,338		1,859
Impact on effective tax rate		(0.2%)		(0.2%)				(0.1%)		(0.1%)
Income tax expense excluding specific items		146,354		125,738		16.4%		434,551		379,136		14.6%
Effective tax rate excluding specific items		25.6%		25.3%				25.7%		25.4%
Net earnings excluding specific items		425,659		371,245		14.7%		1,258,837		1,114,801		12.9%
Net earnings margin excluding specific items		11.7%		11.4%				11.7%		11.6%
Weighted average number of shares outstanding
Class A subordinate voting shares and Class B multiple voting shares (basic)		233,075,350		237,436,642		(1.8%)		234,752,090		240,239,796		(2.3%)
Class A subordinate voting shares and Class B multiple voting shares (diluted)		236,883,434		240,802,680		(1.6%)		238,343,519		243,844,587		(2.3%)
Earnings per share excluding specific items (in dollars)
Basic		1.83		1.56		17.3%		5.36		4.64		15.5%
Diluted		1.80		1.54		16.9%		5.28		4.57		15.5%

© 2023 CGI Inc. Page     29

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

4. Liquidity

4.1. INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

CGI’s growth is financed through a combination of cash flow from operations, drawing on our unsecured committed revolving credit facility, the issuance of long-term debt, and the issuance of equity. One of our financial priorities is to maintain an optimal level of liquidity through the active management of our assets and liabilities as well as our cash flows.

As at June 30, 2023, cash and cash equivalents were $1,468.8 million. Cash included in funds held for clients was $437.0 million. The following table provides a summary of the generation and use of cash for the three and nine months ended June 30, 2023 and 2022.

In thousands of CAD	For the three months ended June 30,						For the nine months ended June 30,
	2023		2022		Change		2023		2022		Change
Cash provided by operating activities		409,110		419,183		(10,073)		1,483,515		1,376,137		107,378
Cash used in investing activities		(178,813)		(493,781)		314,968		(468,856)		(824,836)		355,980
Cash used in financing activities		(113,606)		(157,360)		43,754		(588,765)		(1,276,103)		687,338
Effect of foreign exchange rate changes on cash and cash equivalents		(34,536)		(11,486)		(23,050)		8,773		(75,651)		84,424
Net increase (decrease) in cash, cash equivalents and cash included in funds held for clients		82,155		(243,444)		325,599		434,667		(800,453)		1,235,120
4.1.1. Cash Provided by Operating Activities For the three months ended June 30, 2023, cash provided by operating activities was $409.1 million or 11.3% of revenue compared to $419.2 million or 12.9% for the same period last year. For the nine months ended June 30, 2023, cash provided by operating activities was $1,483.5 million or 13.8% of revenue compared to $1,376.1 million or 14.3% for the same period last year. The following table provides a summary of the generation and use of cash from operating activities:
In thousands of CAD	For the three months ended June 30,						For the nine months ended June 30,
	2023		2022		Change		2023		2022		Change
Net earnings		414,979		364,344		50,635		1,216,773		1,103,780		112,993
Amortization, depreciation and impairment		126,271		116,577		9,694		381,551		353,602		27,949
Other adjustments1		(14,108)		12,074		(26,182)		(50,371)		22,655		(73,026)
Cash flow from operating activities before net change in non-cash working capital items and others		527,142		492,995		34,147		1,547,953		1,480,037		67,916
Net change in non-cash working capital items and others:
Accounts receivable, work in progress and deferred revenue		(179,625)		(135,257)		(44,368)		(47,488)		(131,006)		83,518
Accounts payable and accrued liabilities, accrued compensation and employee-related liabilities, provisions and long-term liabilities		31,645		95,163		(63,518)		(177,096)		8,109		(185,205)
Others2		29,948		(33,718)		63,666		160,146		18,997		141,149
Net change in non-cash working capital items and others		(118,032)		(73,812)		(44,220)		(64,438)		(103,900)		39,462
Cash provided by operating activities		409,110		419,183		(10,073)		1,483,515		1,376,137		107,378

 ¹ Comprised of deferred income tax (recovery) expense, foreign exchange loss (gain), share-based payment costs and gain on leases termination.

 ² Comprised of prepaid expenses and other assets, long-term financial assets (excluding long-term receivables), income taxes, derivative financial instruments and retirement benefits obligations.

For the three months ended June 30, 2023, the decrease of $10.1 million from our cash provided by operating activities was mostly due to the timing of accounts payable and accrued liabilities as well as accrued compensation and employee-related liabilities, partially offset by higher net earnings.

© 2023 CGI Inc. Page     30

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

For the nine months ended June 30, 2023, the increase of $107.4 million from our cash provided by operating activities was mostly due to improved collections and higher net earnings, partially offset by the timing of accounts payable and accrued liabilities and the payment of integration costs.

The timing of our working capital inflows and outflows will always have an impact on the cash flow from operations.

4.1.2. Cash Used in Investing Activities

For the three and nine months ended June 30, 2023, $178.8 million and $468.9 million were used in investing activities, while $493.8 million and $824.8 million were used over the same periods last year, respectively.

The following table provides a summary of the use of cash from investing activities:

In thousands of CAD	For the three months ended June 30,						For the nine months ended June 30,
	2023		2022		Change		2023		2022		Change
Business acquisitions		(9,041)		(414,389)		405,348		(13,039)		(572,407)		559,368
Loan receivable		1,701		—		1,701		(17,600)		—		(17,600)
Purchase of property, plant and equipment		(37,597)		(42,307)		4,710		(125,314)		(117,893)		(7,421)
Proceeds from sale of property, plant and equipment		—		3,790		(3,790)		—		3,790		(3,790)
Additions to contract costs		(26,233)		(19,814)		(6,419)		(77,497)		(60,293)		(17,204)
Additions to intangible assets		(37,673)		(39,721)		2,048		(99,235)		(96,871)		(2,364)
Net change in short-term investments and purchase of long-term investments		(69,970)		18,660		(88,630)		(136,171)		18,838		(155,009)
Cash used in investing activities		(178,813)		(493,781)		314,968		(468,856)		(824,836)		355,980

The decrease of $315.0 million in cash used in investing activities during the three months ended June 30, 2023 was mainly due to the cash used in the prior year for acquisitions. This was partially offset by the purchase of investments for the funds held for clients.

The decrease of $356.0 million in cash used in investing activities during the nine months ended June 30, 2023 was mainly due to the same factors identified for the quarter.

© 2023 CGI Inc. Page     31

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

4.1.3. Cash Used in Financing Activities

For the three and nine months ended June 30, 2023, $113.6 million and $588.8 million were used in financing activities while $157.4 million and $1,276.1 million were used over the same periods last year, respectively.

The following table provides a summary of the use of cash from financing activities:

In thousands of CAD	For the three months ended June 30,						For the nine months ended June 30,
	2023		2022		Change		2023		2022		Change
Increase of long-term debt		—		—		—		948		—		948
Repayment of long-term debt		(3,041)		(3,342)		301		(8,830)		(334,187)		325,357
Payment of lease liabilities		(39,203)		(39,747)		544		(117,498)		(112,922)		(4,576)
Repayment of debt assumed from business acquisitions		—		(24,358)		24,358		(56,994)		(108,916)		51,922
Withholding taxes remitted on the net settlement of performance share units		(166)		—		(166)		(13,850)		—		(13,850)
Purchase of Class A subordinate voting shares held in trusts		—		—		—		(74,455)		(70,303)		(4,152)
Purchase and cancellation of Class A subordinate voting shares		(53,062)		(113,550)		60,488		(463,353)		(780,465)		317,112
Issuance of Class A subordinate voting shares		17,496		8,925		8,571		75,789		29,916		45,873
Net change in clients’ funds obligations		(35,630)		14,712		(50,342)		69,478		100,774		(31,296)
Cash used in financing activities		(113,606)		(157,360)		43,754		(588,765)		(1,276,103)		687,338

For the three months ended June 30, 2023, the decrease of $43.8 million was mainly driven by the purchase for cancellation of 390,100 Class A Shares compared to 1,120,800 Class A Shares over the same period last year, the repayment of debt assumed from business acquisitions in the prior year and by the proceeds from the exercise of stock options. This was partially offset by the net change in clients’ funds obligations.

For the nine months ended June 30, 2023, the decrease of $687.3 million was mainly driven by the scheduled repayment of senior unsecured notes in Q1 2022, the purchase for cancellation of 3,835,196 Class A Shares compared to 7,549,725 Class A Shares over the same period last year, repayment of debt assumed from business acquisitions in the prior year and by the proceeds from the exercise of stock options. This was partially offset by the net change in clients’ funds obligations.

4.1.4. Effect of Foreign Exchange Rate Changes on Cash, Cash Equivalents and Cash Included in Funds Held for Clients

For the three and nine months ended June 30, 2023, the effect of foreign exchange rate changes on cash, cash equivalents and cash included in funds held for clients had an unfavourable impact of $34.5 million and a favourable impact of $8.8 million, respectively. These amounts have no effect on net earnings as they were recorded in other comprehensive income.

© 2023 CGI Inc. Page     32

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

4.2. CAPITAL RESOURCES

As at June 30, 2023	Available
In thousands of CAD
Cash and cash equivalents	1,468,832
Short-term investments	3,060
Long-term investments	19,507
Unsecured committed revolving credit facility1	1,495,759
Total2	2,987,158

¹  As at June 30, 2023, letters of credit in the amount of $4.2 million were outstanding against the $1.5 billion unsecured committed revolving credit facility.

² Excludes cash and long-term bonds included in funds held for clients for $437.0 million and $152.2 million, respectively.

As at June 30, 2023, cash and cash equivalents and investments represented $1,491.4 million.

Cash equivalents include term deposits, all with maturities of 90 days or less. Short-term and long-term investments include corporate bonds with maturities ranging from 91 days to five years, with a credit rating of A- or higher.

As at June 30, 2023, the aggregate amount of the capital resources available to the Company was $2,987.2 million. Certain long-term debt agreements contain covenants, which require us to maintain certain financial ratios. As at June 30, 2023, CGI was in compliance with these covenants.

As at June 30, 2023, CGI was showing a positive working capital (total current assets minus total current liabilities) of $688.7 million. The Company also had $1,495.8 million available under its unsecured committed revolving credit facility and is generating a significant level of cash, which CGI’s management currently considers will allow the Company to fund its operations while maintaining adequate levels of liquidity.

The tax implications and impact related to the repatriation of cash will not materially affect the Company’s liquidity.

4.3. CONTRACTUAL OBLIGATIONS

We are committed under the terms of contractual obligations which have various expiration dates, primarily related to long-term debt and the rental of premises, computer equipment used in outsourcing contracts and long-term service agreements. There have been no material changes to these obligations since September 30, 2022.

4.4. FINANCIAL INSTRUMENTS AND HEDGING TRANSACTIONS

We use various financial instruments to help us manage our exposure to fluctuations of foreign currency exchange rates and interest rates. Please refer to note 10 of our interim condensed consolidated financial statements for additional information on our financial instruments and hedging transactions.

© 2023 CGI Inc. Page     33

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

4.5. SELECTED MEASURES OF CAPITAL RESOURCES AND LIQUIDITY

As at June 30,	2023		2022
In thousands of CAD except for percentages
Reconciliation between net debt and long-term debt and lease liabilities1:
Net debt		2,279,642		3,072,995
Add back:
Cash and cash equivalents		1,468,832		779,623
Short-term investments		3,060		4,511
Long-term investments		19,507		15,970
Fair value of foreign currency derivative financial instruments related to debt		(5,165)		(32,964)
Long-term debt and lease liabilities 1		3,765,876		3,840,135
Net debt to capitalization ratio		21.7%		30.6%
Return on invested capital		15.7%		15.8%
Days sales outstanding		44		48

¹  As at June 30, 2023, long-term debt and lease liabilities were $3,112.4 million ($3,156.0 million as at June 30, 2022) and $653.5 million ($684.2 million as at June 30, 2022), respectively, including their current portions.

During the three months ended June 30, 2023, as a result of the interbank offered rates (IBORs) reform and the related expiry of the USD London Interbank Offered Rate (Libor) rate effective June 30, 2023, the Company renegotiated the unsecured committed term loan credit facility and the related cross-currency interest rate swaps (the hedging instruments) both expiring in December 2023 to transition to the one month Secured Overnight Financing Rate (SOFR) rate from the one month USD Libor rate. The change in rate resulted in no significant impact on the Company’s interim condensed consolidated financial statements for the three months ended June 30, 2023.

During the nine months ended June 30, 2023, we’ve reclassified the unsecured committed term loan credit facility due in December 2023 under the current portion of long-term debt, within current liabilities, for a total amount of $661.7 million.

We use the net debt to capitalization ratio as an indication of our financial leverage in order to realize our Build and Buy strategy (please refer to section 1.2. of CGI’s MD&A for the years ended September 30, 2022 and 2021 for additional information on our Build and Buy strategy). The net debt to capitalization ratio decreased to 21.7% in Q3 2023 from 30.6% in Q3 2022 mostly due to our cash generation, partially offset by the repurchase of shares and investments in our business acquisitions during the last four quarters.

ROIC is a measure of the Company’s efficiency in allocating the capital under our control to profitable investments. The return on invested capital ratio remained essentially stable at 15.7% in Q3 2023 when compared to the same period last year.

DSO decreased to 44 days at the end of Q3 2023 when compared to 48 days in Q3 2022, which included an impact of two days from business acquisitions. The decrease was mainly due to improved collections.

© 2023 CGI Inc. Page     34

Management’s Discussion and Analysis  For the three and nine months ended June 30, 2023 and 2022

4.6. GUARANTEES

In the normal course of operations, we may enter into agreements to provide financial or performance assurances to third parties on the sale of assets, business divestitures and guarantees on government and commercial contracts.

In connection with sales of assets and business divestitures, the Company may be required to pay counterparties for costs and losses incurred as a result of breaches in our contractual obligations, including representations and warranties, intellectual property right infringement claims and litigation against counterparties, among others.

While some of the agreements specify a maximum potential exposure, others do not specify a maximum amount or a maturity date or survival period. It is not possible to reasonably estimate the maximum amount that may have to be paid under such guarantees. The amounts are dependent upon the outcome of future contingent events, the nature and likelihood of which cannot be determined at this time. No amount has been accrued in the consolidated balance sheets relating to this type of guarantee or indemnification as at June 30, 2023. The Company does not expect to incur any potential payment in connection with these guarantees that could have a material adverse effect on its interim condensed consolidated financial statements.

In the normal course of business, we may provide certain clients, principally governmental entities, with bid and performance bonds. In general, we would only be liable for the amount of the bid bonds if we refuse to perform the project once we are awarded the bid. We would also be liable for the performance bonds in the event of a default in the performance of our obligations. As at June 30, 2023, we had committed a total of $22.3 million for these bonds. To the best of our knowledge, we complied with our performance obligations under all service contracts for which there was a bid or performance bond, and the ultimate liability, if any, incurred in connection with these guarantees would not have a material adverse effect on our consolidated results of operations or financial condition.

4.7. CAPABILITY TO DELIVER RESULTS

CGI’s management believes that the Company has sufficient capital resources to support ongoing business operations and execute our Build and Buy growth strategy. Our principal and most accretive uses of cash are: to invest in our business (procuring new large managed IT and business process services contracts and developing business and IP solutions); to pursue accretive acquisitions; to purchase for cancellation Class A Shares and pay down debt. In terms of financing, we are well positioned to continue executing our four-pillar growth strategy in Fiscal 2023.

To successfully implement the Company’s strategy, CGI relies on a strong leadership team, supported by highly knowledgeable members with relevant relationships and significant experience in both IT and our targeted industries. CGI fosters leadership development through the CGI Leadership Institute ensuring continuity and knowledge transfer across the organization. For key positions, a detailed succession plan is established and revised frequently.

As a Company built on human capital, our professionals and their knowledge are critical to delivering quality service to our clients. Our human resources program allows us to attract and retain the best talent as it provides competitive compensation and benefits, a favourable working environment, training programs and career development opportunities. Employee satisfaction is monitored annually through a Company-wide survey. In addition, a majority of our professionals are owners of CGI through our Share Purchase Plan, which, along with our Profit Participation Plan, allows them to share in the Company’s success, further aligning stakeholder interests.

In addition to capital resources and talent, CGI has established the Management Foundation, which encompasses governance pol