Open Text Corporation Posts Record Financial Results For Fourth-Quarter and Year End Fiscal 2000
Q4: $0.16 Adjusted EPS, License Revenue Accelerates, Up 27% from Q3
Waterloo, ON - 2000-08-17 - Open Text Corporation (Nasdaq: OTEX; TSE: OTC), a worldwide leader of collaborative commerce software for e-business, today announced record revenues for its fourth quarter and fiscal year ending June 30, 2000(1). The Company reached the milestone of four million users of its Livelink product family during the fourth quarter of fiscal 2000.
Open Text reported adjusted net income(2) for the fourth quarter of $3.6 million, or $0.16 per adjusted income per diluted share. Cash flow from operations for the quarter was $7 million. During the quarter, the Company continued to grow its Application Service Provider (ASP) program and b2bScene Division with investment of approximately $1.4 million, equivalent to $0.06 per share. Prior to this investment, adjusted net income 2 was $5.0 million or $0.22 per share (diluted) for the quarter.
Driven by demand for collaborative commerce software, total revenues for the quarter were $32.3 million, up 14% from the prior quarter and license revenues were $17.9 million, up 27% from the prior quarter.
"This is a great way to finish up our fiscal year with this outstanding performance in our final quarter," said Tom Jenkins, CEO of Open Text. "We achieved significant profits and cash flow, and enjoyed the highest license revenue growth in our history. Our strong license revenue growth clearly shows our customers are past their Y2K concerns, and we are benefiting from the broad adoption of Livelink by Global 2000 corporations who are using collaborative commerce to drive their e-business strategies. This revenue growth indicates the momentum we see in our business."
Accounts Receivable as of June 30, 2000 was $27.1 million, resulting in a DSO (days sales outstanding) of 75 days an improvement of 14 days from the previous quarter. As of June 30, 2000, cash was $113.9 million or $5.63 per share. The Company continues to hold various investments in About.com, Deja.com, and Communities.com, plus other private internet-related business investments.
In accordance with US generally accepted accounting principles, the Company reported net income of $2.2 million and earnings per diluted share of $0.10 for the quarter ended June 30, 2000. For the full year, net income was $25.1 million, or $1.03 per share on a diluted basis, compared to $20.2 million or $0.85 per share in fiscal 1999. Revenue for the 2000 fiscal year was $112.9 million, up 22% from the previous year. Cash flow from operations was $19 million.
Global Growth drives License Revenues
During the fiscal year, results were driven by large enterprise-wide adoptions and continued purchases by the Company s largest customers. Customers contributing to revenues included AT&T, Bertelsmann, Andersen Consulting, Booz Allen & Hamilton, British Telecom, General Dynamics, and US Army, US Navy and US Air Force. Revenue results were broadly based across North America, Europe and Asia.
Major User Milestone Reached
The number of users reached four million during the fourth quarter, an increase of one million users for the fiscal year. The growth in license revenue reflects the strong adoption of Livelink by Global 2000 corporations for e-business.
Strategy for Growth Increased Channel Distribution
Taking advantage of the opportunity to broaden channel reach for Livelink, Open Text has initiated an ASP (application service provider) partnership program to offer Livelink to small and medium sized enterprises (SMEs). The SME market had not previously been a focus of Livelink sales, since Open Text historically concentrated on a direct sales force selling to the world s largest corporations (the Global 2000). The ASP program is currently building on a successful partnership with KPNQwest, a joint venture of KPN and Qwest. In addition, Open Text today announced it has partnered with Cowan Insurance to provide an Insurance ASP. The Company will enter more ASP relationships with partners from around the world.
Strategy for Growth Value Add Program for Livelink Users
During fiscal 2000, Open Text announced and invested in several initiatives and partnerships to offer value added products and services to its install base. Open Text initiatives will exploit the fact that Livelink users are not desktop users but rather Webtop users who can easily link to other products and services via the Web from within Livelink applications. Open Text created a new Division called b2bScene, which offers additional knowledge and collaborative services to Livelink users. The Company plans other initiatives as opportunities arise in the future.
Major Product Initiatives
During this past year, the Company continued to expand its product offering with the launch of myLivelink, Open Text s Collaborative Portal, now available to all Livelink users. myLivelink combined with the Open Text s Open Interchange Architecture (OIA) has become an important means by which Livelink connects to other types of portals, such as Epicentric, while at the same time connecting Livelink users to value-add services such as b2bScene.
Additional Significant Achievements During Fiscal 2000
1. Reported under U.S. Generally Accepted Accounting Principles (GAAP). All amounts are in US Dollars.
2. Adjusted net income: net income excluding restructuring costs, gain on investments, amortization of acquired intangible assets and income taxes.
View the Financial Statements
About Open Text
Open Text has pioneered the development of innovative intranet and extranet ebusiness applications. Since creating one of the first search engines to index the World Wide Web, the Company has remained at the forefront of Internet-based technologies. Its product family called Livelink enables individuals, teams, organizations, and global trading communities to collaborate on e-business applications that facilitate e-commerce and other transactions among Global 2000 organizations. Open Text has become one of the largest providers of Web based collaboration software for e-business applications for e-communities of all types from intranets to extranets and public groups. The Livelink product family has over 4 million users in over 4,000 installations in 31 countries, speaking 12 languages throughout the world. For more information, visit www.opentext.com.
Trademark
Copyright © 2000 by Open Text Corporation. Livelink, myLivelink, b2bScene and Open Text are trademarks or registered trademarks of Open Text Corporation. This list is not exhaustive. Other product and company names herein may be trademarks of their respective owners.
Release Disclaimer
This news release may contain forward-looking statements relating to the deployment of Livelink and myLivelink by customers, and future performance of Open Text Corporation and b2bscene. Forward-looking statements are subject to certain risks and uncertainties, and actual results may differ materially. These risks and uncertainties include, among others, risks involved in the completion and integration of acquisitions, the possibility of technical, logistical or planning issues in connection with deployments, the continuous commitment of the Company s customers and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission (SEC), including the final prospectus for the Company s initial public offering of common stock in January 1996, Form 10-K for the years ended June 30, 1997, June 30, 1998 and June 30, 1999, and Form 10-Q for the quarters ended September 30, 1999, December 31, 1999 and March 31, 2000. Forward-looking statements are based on management s beliefs and opinions at the time the statements are made, and the Company does not undertake any obligations to update forward-looking statements should circumstances or management s beliefs or opinions change.
For more information, please contact
Alan Hoverd
Chief Financial Officer
Open Text Corporation
+1-519-888-7111 ext. 2480
ahoverd@opentext.com
Greg Secord
Open Text Corporation
+1-519-888-7111 ext.2408
gsecord@opentext.com
