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Open Text Corp.$37.69($.35)(.92%)

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 OpenText Reports Fourth Quarter and Fiscal Year 2019 Financial Results
   Thursday, August 01, 2019 4:01:00 PM ET

Record Cloud and Annual Recurring Revenues (ARR)

Strong Margin Expansion

Record Operating Cash Flows

WATERLOO, Ontario, Aug. 1, 2019 /CNW/ --


Fiscal Year 2019

  • Total Revenues of $2.87 billion, up 1.9%, and $2.92 billion in constant currency, up 3.8%
  • Annual Recurring Revenues (ARR) of $2.16 billion, up 4.6%, and $2.19 billion in constant currency, up 6.2%
  • Cloud Services and Subscriptions Revenues of $907.8 million, up 9.5%, and $918.6 million in constant currency, up 10.8%
  • GAAP net income attributable to OpenText of $285.5 million, up 17.9%
  • Adjusted EBITDA of $1.10 billion, up 7.8%, Margin of 38.4%, up 210 basis points
  • GAAP EPS, diluted of $1.06, up 16.5%
  • Non-GAAP EPS, diluted of $2.76, up 7.8%, and $2.79 in constant currency, up 9.0%
  • Record annual Operating Cash Flows of $876.3 million, up 23.8%.

Fourth Quarter

  • Total Revenues of $747.2 million, down 0.9%, and $769.3 million in constant currency, up 2.0%
  • Annual Recurring Revenues of $557.1 million, up 4.2%, and $572.0 million in constant currency, up 7.0%
  • Cloud Services and Subscriptions Revenues of $241.9 million, up 11.0%, and $246.5 million in constant currency, up 13.1%
  • GAAP net income attributable to OpenText of $72.0 million, up 16.6%
  • Adjusted EBITDA of $283.9 million, up 0.8%, Margin of 38.0%, up 60 basis points
  • GAAP EPS, diluted of $0.27, up 17.4%
  • Non-GAAP EPS, diluted of $0.72, no change, and $0.74 in constant currency, up 2.8%
  • Operating Cash Flows of $229.8 million, up 12.6%

Open Text Corporation (NASDAQ: OTEX), (TSX: OTEX), "The Information Company," today announced its financial results for the fourth quarter and year ended June 30, 2019

"Fiscal 2019 was a momentous year for OpenText as we delivered in constant currency $2.92 billion in total revenues, a record $918.6 million in cloud revenues, up 10.8% year-over-year growth and $2.19 billion in Annual Recurring Revenues, up 6.2% year-over-year growth, representing 75% of total revenues," said Mark J. Barrenechea, OpenText CEO & CTO. "We enter Fiscal 2020 with the strongest EIM offering in the industry, empowering customers to unlock their information advantage and win in Industry 4.0.  Our expanded partnerships with Google and SAP and recently announced next generation product line, OpenText Cloud Edition, will help revolutionize the way businesses capture, govern, exchange and use information in the cloud."

Barrenechea further added, "We delivered a solid fourth quarter with total revenues of $769.3 million, up 2.0% year-over-year, and cloud revenues of $246.5 million, up 13.1% year-over-year, each in constant currency.  Operating Cash Flows were $229.8 million, up 12.6% year-over-year. These solid results were delivered against the back drop of a $22 million foreign currency headwind to revenue during the quarter."

"During Fiscal 2019, we had record Adjusted EBITDA margin of 38.4%, delivered Operating Cash Flows of $876.3 million and deployed $381.4 million of capital to acquire Liaison Technologies & Catalyst Repository Systems," said Madhu Ranganathan, OpenText EVP and CFO.  "We ended the year with $941 million of Cash & Cash Equivalents and 1.5x Consolidated Net Leverage ratio, compared to 1.9x a year ago. As we look into Fiscal 2020 and beyond, we have never been stronger in our operating framework and balance sheet flexibility to continue our investments in product innovation, go-to-market and strategic acquisitions."

Financial Highlights for Fiscal 2019 with Year Over Year Comparisons


Dividend Program

As part of our quarterly, non-cumulative cash dividend program, the Board declared on July 31, 2019 a cash dividend of $0.1746 per common share. The record date for this dividend is August 30, 2019 and the payment date is September 20, 2019. Future declarations of dividends and the establishment of future record and payment dates are subject to the final determination and discretion of the Board of Directors.

OpenText Quarterly Business Highlights

  • 26 customer transactions over $1 million, 13 in the OpenText Cloud and 13 off-cloud
  • Financial, Consumer Goods, Services, Technology and Public Sector industries saw the most demand in cloud and license
  • Key customer wins in the quarter included: BMW Group, Core-Mark Holding Company, Inc., Creative Foam Corporation, Credito Emiliano SpA, Lanxess Deutschland GmbH, Phillips Lytle LLP, Premier Healthcare Solutions, Inc. and Vertican Technologies, Inc.  
  • OpenText hosts largest Enterprise Information Management conference, OpenText Enterprise World, in Toronto
  • OpenText announces the next generation Enterprise Information Management Cloud at Enterprise World
  • OpenText announces strategic partnership with Google Cloud
  • OpenText and Mastercard Partner to Transform Financial Processes Across Global Supply Chains
  • OpenText named a Customer Communications Management leader in 2019 Aspire CCM leaderboard
  • OpenText AppWorks named a leader in Digital Process Automation for Deep Deployments
  • New OpenText Content Management Services to be delivered through SAP® Cloud Platform
  • OpenText releases new Cloud and Hybrid offerings for SAP® solutions
  • OpenText receives 2019 SAP® Pinnacle Award as the SAP Solution Extension Partner of the Year


OpenText Capital Markets Day 2019

Institutional investors and equity research analysts are invited to attend OpenText's 2019 Capital Markets Day on Friday, September 6, 2019 at the Lotte New York Palace hotel in New York, NY. This event will include an annual strategic update with formal presentations by the OpenText executive team. To register, please contact .  Presentation material as well as listen-only teleconference and webcast details will be publicly available on the Investor Relations website at: .

Conference Call Information

The public is invited to listen to the earnings conference call today at 5:00 p.m. ET (2:00 p.m. PT) by dialing 1-800-319-4610 (toll-free) or +1-604-638-5340 (international). Please dial-in 10 minutes ahead of time to ensure proper connection. Alternatively, a live webcast of the earnings conference call will be available on the Investor Relations section of the Company's website at .

A replay of the call will be available beginning August 1, 2019 at 7:00 p.m. ET through 11:59 p.m. on August 15, 2019 and can be accessed by dialing 1-855-669-9658 (toll-free) or +1-604-674-8052 (international) and using passcode 3382 followed by the number sign.

Please see below note (2) for a reconciliation of U.S. GAAP-based financial measures used in this press release, to non-U.S. GAAP-based financial measures.  Additionally, "off-cloud" is a term we use to describe license transactions.

About OpenText

OpenText, The Information Company™, a market leader in Enterprise Information Management software and solutions, enabling companies to manage, leverage, secure and gain insight into their enterprise information, on premises or in the cloud. For more information about OpenText (NASDAQ/TSX: OTEX) visit .

Cautionary Statement Regarding Forward-Looking Statements

Certain statements in this press release, including statements about the focus of Open Text Corporation ("OpenText" or "the Company") in our fiscal year ending June 30, 2020 (Fiscal 2020) on growth, anticipated benefits of our partnerships and next generation product lines, the strength of our operating framework and balance sheet flexibility, continued investments in product innovation, go-to-market and strategic acquisitions, M&A continuing to be our leading growth contributor, our capital allocation strategy, creating value through investments in broader Enterprise Information Management (EIM) capabilities, the Company's presence in the cloud and in growth markets, expected growth in our revenue lines, total growth from acquisitions, innovation and organic initiatives, the focus on recurring revenues, improving operational efficiency, expanding cash flow and strengthening the business, adjusted operating income and cash flow, its financial condition, the adjusted operating margin target range, results of operations and earnings, announced acquisitions, ongoing tax matters, the integration of the acquired businesses, declaration of quarterly dividends, future tax rates, new platform and product offerings, scaling OpenText to new levels in Fiscal 2020 and beyond, and other matters, may contain words such as "anticipates", "expects", "intends", "plans", "believes", "seeks", "estimates", "may", "could", "would", "might", "will" and variations of these words or similar expressions are considered forward-looking statements or information under applicable securities laws. In addition, any information or statements that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking, and based on our current expectations, forecasts and projections about the operating environment, economies and markets in which we operate. Forward-looking statements reflect our current estimates, beliefs and assumptions, which are based on management's perception of historic trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances, such as certain assumptions about the economy, as well as market, financial and operational assumptions. Management's estimates, beliefs and assumptions are inherently subject to significant business, economic, competitive and other uncertainties and contingencies regarding future events and, as such, are subject to change. We can give no assurance that such estimates, beliefs and assumptions will prove to be correct. Such forward-looking statements involve known and unknown risks, uncertainties and other factors and assumptions that may cause the actual results, performance or achievements to differ materially. Such factors include, but are not limited to: (i) the future performance, financial and otherwise, of OpenText; (ii) the ability of OpenText to bring new products and services to market and to increase sales; (iii) the strength of the Company's product development pipeline; (iv) the Company's growth and profitability prospects; (v) the estimated size and growth prospects of the EIM market including expected growth in the Artificial Intelligence market; (vi) the Company's competitive position in the EIM market and its ability to take advantage of future opportunities in this market; (vii) the benefits of the Company's products and services to be realized by customers; (viii) the demand for the Company's products and services and the extent of deployment of the Company's products and services in the EIM marketplace; (ix) downward pressure on our share price and dilutive effect of future sales or issuances of equity securities (including in connection with future acquisitions); (x) the Company's financial condition and capital requirements; and (xi) statements about the impact of product releases. The risks and uncertainties that may affect forward-looking statements include, but are not limited to: (i) integration of acquisitions and related restructuring efforts, including the quantum of restructuring charges and the timing thereof; (ii) the potential for the incurrence of or assumption of debt in connection with acquisitions and the impact on the ratings or outlooks of rating agencies on the Company's outstanding debt securities; (iii) the possibility that the Company may be unable to meet its future reporting requirements under the U.S. Securities Exchange Act of 1934, as amended, and the rules promulgated thereunder, or applicable Canadian securities regulation; (iv) the risks associated with bringing new products and services to market; (v) failure to comply with privacy laws and regulations that are extensive, open to various interpretations and complex to implement including General Data Protection Regulation (GDPR) and Country by Country Reporting (CBCR); (vi) fluctuations in currency exchange rates; (vii) delays in the purchasing decisions of the Company's customers; (viii) the competition the Company faces in its industry and/or marketplace; (ix) the final determination of litigation, tax audits (including tax examinations in the United States and elsewhere) and other legal proceedings; (x) potential exposure to greater than anticipated tax liabilities or expenses, including with respect to changes in Canadian, U.S. or international tax regimes including tax reform legislation enacted through the Tax Cuts and Jobs Act in the United States; (xi) the possibility of technical, logistical or planning issues in connection with the deployment of the Company's products or services; (xii) the continuous commitment of the Company's customers; and (xiii) demand for the Company's products and services. For additional information with respect to risks and other factors which could occur, see the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other securities filings with the Securities and Exchange Commission (SEC) and other securities regulators. Readers are cautioned not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.


For more information, please contact:
Harry E. Blount
Senior Vice President, Global Head of Investor Relations
Open Text Corporation

Copyright ©2019 Open Text. OpenText is a trademark or registered trademark of Open Text. The list of trademarks is not exhaustive of other trademarks. Registered trademarks, product names, company names, brands and service names mentioned herein are property of Open Text. All rights reserved. For more information, visit: .


























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