Open Text Corporation Posts Record Results for Second Quarter Fiscal 1999
Company continues to execute on profitable growth strategy
Waterloo, ON - 1999-01-27 - Open Text Corporation (NASDAQ:OTEX, TSE:OTC), the worldwide leader of Web-based collaborative knowledge management application software, today announced record revenues and operating profits for its second quarter ended December 31, 19981.
Net income, excluding a one time charge, for the second quarter was US$3.3 million, which is $0.15 per share (diluted) compared to net income of $153,000 or $0.01 per share, excluding a one-time charge, for the year-earlier quarter. The one-time charge of $3.4 million in the second quarter of fiscal 1999 relates to the company's purchase of certain assets of LAVA Systems.
For the twelfth consecutive quarter, Open Text reported the highest quarterly total revenues in the company's history. Total revenues for the quarter were US$20.8 million up 113% from $9.8 million for the year-earlier period. License revenues for the quarter ended December 31, 1998 were $12.9 million, up 90% compared to $6.8 million for the second quarter of fiscal 1998.
"Our strong corporate performance once again validates our ongoing strategy to combine internal growth with strategic acquisitions," said Tom Jenkins, Chief Executive Officer of Open Text Corporation. "We have moved into a solid, profitable growth position, today reporting our fifth consecutive quarter of profits, excluding one time charges, while maintaining strong growth momentum."
"We continue to enjoy a leadership position in the enterprise knowledge management market, with IDC recently reporting that we have 42% of the worldwide market in the all important enterprise-centric part of the document and knowledge management market," added Jenkins. "We are also proceeding well with the acquisition of LAVA Systems and the addition of strong enterprise integration capabilities and substantial business practices in the financial services and insurance vertical of the knowledge management industry."
New accounts contributing to Open Text's second-quarter revenues included Conoco, FIAT, Johnson & Johnson, Texaco, and Underwriters Laboratories. Existing accounts contributing to revenues included Canon, Ford, Nationsbanc, Newbridge Networks, Nortel, Motorola, Shell Corporation, Siemens, Sprint, and many others.
"Recent announcements of major companies such as Nortel and Shell Corporation deploying Livelink on an enterprise scale across their networks further demonstrates the growing market demand for a truly Web-based knowledge management solution that can scale across all of their requirements," added Jenkins.
Financial Highlights (in thousands; except for share data)
Q2 1999 Q2 1998 % change
License revenue: $12,888 $6,787 90% Service revenue: 7,932 2,988 165% Total revenue: $20,820 9,775 113%
Net Income (excluding one time charge) $3,316 $153 Earnings per share (diluted) $0.15 $0.01
To review the Statements of Operations and Balance Sheet, please see Financials.
To review information about investing in Open Text Corporation, please see our Investor Information.
1 Reported under U.S. Generally Accepted Accounting Principles (GAAP).
Trademark
Open Text, Livelink, Livelink BASIS and LAVA are trademarks of Open Text Corporation. All other trademarks are the property of their respective companies.
Release Disclaimer
This news release may contain forward-looking statements relating to the acquisition of LAVA Systems, the deployment of Livelink by customers, and future performance of Open Text Corporation. 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 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 Form 10-K for the year ended June 30, 1998, and Form 10-Q for the quarters ended September 30, 1997, December 31, 1997, March 31, 1998 and September 30, 1998. 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
For more information, please contact
Margaret E. Dobbin
Director, Industry Analyst Relations
Open Text Corporation
+1-519-888-7111 ext.2410
mdobbin@opentext.com
