OpenText Reports Fourth Quarter and Fiscal Year 2016 Financial Results
"Fiscal 2016 was a pivotal year for OpenText, in constant currency, we grew revenues 3% and created a more efficient business and expanded our adjusted operating margin by 240 bps. More importantly, we believe we have created the foundation for Fiscal 2017 to be a double-digit growth year led by M&A," said OpenText CEO & CTO
Mark J. Barrenechea. "During our Fiscal 2016 fourth quarter we announced four acquisitions that will add revenue, operating income and cash flow."
Barrenechea further added, "In Fiscal 2017, we expect all of our revenue lines and adjusted operating income to grow double digit. We also have the balance sheet and bandwidth to continue acquiring businesses."
Barrenechea concluded, "With our recent acquisitions, Release 16, EP Series, our enhancement packs, and Magellan, our next generation cognitive platform, we expect to grow our market share in Fiscal 2017."
Financial Highlights for Fiscal 2016 with Year Over Year Comparisons (1) |
|||||||||||||
Summary of Annual Results |
|||||||||||||
FY16 |
FY15 |
\\$ Change |
% Change (Y/Y) |
FY16 in CC* |
% Change in |
||||||||
Revenues: (in millions) |
|||||||||||||
Cloud services and subscriptions |
|
|
( |
(0.7)% |
|
2.5% |
|||||||
Customer support |
746.4 |
731.8 |
14.6 |
2.0% |
779.1 |
6.5% |
|||||||
Professional service and other |
193.1 |
220.5 |
(27.4) |
(12.4)% |
205.6 |
(6.8)% |
|||||||
Total Recurring revenues |
|
|
( |
(1.1)% |
|
3.0% |
|||||||
License |
283.7 |
294.3 |
(10.6) |
(3.6)% |
298.8 |
1.5% |
|||||||
Total revenues |
|
|
( |
(1.5)% |
|
2.8% |
|||||||
GAAP-based operating margin |
20.2% |
18.8% |
n/a |
140 bps |
|||||||||
Non-GAAP-based operating margin (2) |
33.8% |
30.9% |
n/a |
290 bps |
33.3% |
240 bps |
|||||||
GAAP-based EPS, diluted |
|
|
|
22.0% |
|||||||||
Non-GAAP-based EPS, diluted (2) |
|
|
|
2.3% |
|
5.8% |
|||||||
Operating cash flows (in millions) |
|
|
|
0.5% |
Note: Individual line items in tables may be adjusted by non-material amounts to enable totals to align to published financial statements. |
Summary of Quarterly Results |
|||||||||||||
Q4 FY16 |
Q4 FY15 |
\\$ Change |
% Change (Y/Y) |
Q4 FY16 in CC* |
% Change in |
||||||||
Revenues: (in millions) |
|||||||||||||
Cloud services and subscriptions |
|
|
|
5.1% |
|
5.2% |
|||||||
Customer support |
193.0 |
184.2 |
8.8 |
4.7% |
193.0 |
4.8% |
|||||||
Professional service and other |
48.1 |
52.4 |
(4.3) |
(8.2)% |
48.4 |
(7.6)% |
|||||||
Total Recurring revenues |
|
|
|
3.1% |
|
3.3% |
|||||||
License |
86.1 |
97.1 |
(11) |
(11.3)% |
85.6 |
(11.8)% |
|||||||
Total revenues |
|
|
|
0.2% |
|
0.2% |
|||||||
GAAP-based operating margin |
19.3% |
17.1% |
n/a |
220 bps |
|||||||||
Non-GAAP-based operating margin (2) |
32.7% |
30.8% |
n/a |
190 bps |
32.1% |
130 bps |
|||||||
GAAP-based EPS, diluted |
|
|
|
26.8% |
|||||||||
Non-GAAP-based EPS, diluted (2) |
|
|
|
2.3% |
|
—% |
|||||||
Operating cash flows (in millions) |
|
|
( |
(9.6)% |
Note: Individual line items in tables may be adjusted by non-material amounts to enable totals to align to published financial statements. |
"In Fiscal 2016, we delivered solid operating cash flow. This demonstrates our strong track record of performance achieving a ten-year cumulative growth rate of 24% for both adjusted operating income and operating cash flow," said OpenText CFO John Doolittle. "Our balance sheet and liquidity position remain very strong with approximately |
*CC: Constant currency for this purpose is defined as the current period reported revenues/expenses/earnings represented at the prior comparative period's foreign exchange rate. |
OpenText Quarterly Business Highlights
- 20 customer transactions over
\\$1 million , 10 OpenText Cloud contract signings and 10 on-premises - Financial, services and technology industries saw the most demand in cloud and license
- New customers in the quarter included Red Hat Inc., s.Oliver, Nevada State Controller's Office, Schwan Cosmetics,
Kamehameha Schools , eMeter Corporation, APA Group,State Of Iowa , KUKA,Miller Insurance Services LLP , Kno2, Delta RM, Sanofi,Mount Sinai Health System ,Inland Revenue Department , HKSAR and Constellation Brands - OpenText signs definitive agreement to acquire Customer Communications Management assets from HP Inc.
- OpenText signs definitive agreement to acquire
Recommind, Inc. - OpenText signs definitive agreement to acquire, and closes acquisition of,
ANXe Business Corporation - OpenText signs definitive agreement to acquire, and closes acquisition of, certain customer experience software and services assets and liabilities from HP Inc.
- OpenText receives 2016 SAP® Pinnacle Award: Application Innovation Partner of the Year
- Thousands attend
OpenText Enterprise World 2016
Dividend Program Highlights
Cash Dividend
As part of our quarterly, non cumulative cash dividend program the Board declared on
Summary of Annual Results | ||||||
FY16 |
FY15 |
% Change | ||||
Revenue (million) |
|
|
(1.5)% |
|||
GAAP-based gross margin |
68.5% |
67.7% |
80 bps |
|||
GAAP-based operating margin |
20.2% |
18.8% |
140 bps |
|||
GAAP-based EPS, diluted |
|
|
22.0% |
|||
Non-GAAP-based gross margin (2) |
72.8% |
72.2% |
60 bps |
|||
Non-GAAP-based operating margin (2) |
33.8% |
30.9% |
290 bps |
|||
Non-GAAP-based EPS, diluted (2) |
|
|
2.3% |
Summary of Quarterly Results | ||||||||||||
Q4 FY16 |
Q3 FY16 |
Q4 FY15 |
% Change (Q4 FY16 vs |
% Change (Q4 FY16 vs |
||||||||
Revenue (million) |
|
|
|
9.8% |
0.2% |
|||||||
GAAP-based gross margin |
68.4% |
67.9% |
68.8% |
50 bps |
(40) bps |
|||||||
GAAP-based operating margin |
19.3% |
20.1% |
17.1% |
(80) bps |
220 bps |
|||||||
GAAP-based EPS, diluted |
|
|
|
24.6% |
26.8% |
|||||||
Non-GAAP-based gross margin (2) |
72.4% |
72.0% |
73.6% |
40bps |
(120) bps |
|||||||
Non-GAAP-based operating margin (2) |
32.7% |
31.4% |
30.8% |
130bps |
190 bps |
|||||||
Non-GAAP-based EPS, diluted (2) |
|
|
|
11.3% |
2.3% |
Normal Course Issuer Bid
The Company also announced today the authorization of a new share repurchase plan and that it intends to purchase in open market transactions, from time to time over the next 12 months, if considered advisable, up to an aggregate of
The share purchases will be effected in accordance with Rule 10b-18 under the
OpenText also announced that it has entered into an automatic share purchase plan pursuant to which its designated broker may undertake purchases of its common shares under the NCIB, subject to certain parameters, during pre-determined trading blackout periods when OpenText would not otherwise be permitted to purchase its common shares.
Conference Call Information
The public is invited to listen to the earnings conference call today at
A replay of the call will be available beginning
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.
About OpenText
OpenText is the largest independent software provider of Enterprise Information Management (EIM). For more information please visit www.opentext.com.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this press release, including statements about the focus of
OTEX-F
For more information, please contact:
Greg Secord
Vice President, Investor Relations
gsecord@opentext.com
Sonya Mehan
Senior Manager, Investor Relations
smehan@opentext.com
Copyright ©2016 Open Text. OpenText is a trademark or registered trademark of
| |||||||
|
| ||||||
ASSETS |
|||||||
Cash and cash equivalents |
\\$ |
1,283,757 |
\\$ |
699,999 |
|||
Short-term investments |
11,839 |
11,166 |
|||||
Accounts receivable trade, net of allowance for doubtful accounts of |
285,904 |
284,131 |
|||||
Income taxes recoverable |
31,752 |
21,151 |
|||||
Prepaid expenses and other current assets |
59,021 |
53,191 |
|||||
Total current assets |
1,672,273 |
1,069,638 |
|||||
Property and equipment |
183,660 |
160,419 |
|||||
|
2,325,586 |
2,161,592 |
|||||
Acquired intangible assets |
646,240 |
679,479 |
|||||
Deferred tax assets |
241,161 |
181,587 |
|||||
Other assets |
53,697 |
54,946 |
|||||
Deferred charges |
22,776 |
37,265 |
|||||
Long-term income taxes recoverable |
8,751 |
8,404 |
|||||
Total assets |
\\$ |
5,154,144 |
\\$ |
4,353,330 |
|||
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||||||
Current liabilities: |
|||||||
Accounts payable and accrued liabilities |
\\$ |
257,450 |
\\$ |
241,370 |
|||
Current portion of long-term debt |
8,000 |
8,000 |
|||||
Deferred revenues |
373,549 |
358,066 |
|||||
Income taxes payable |
32,030 |
17,001 |
|||||
Total current liabilities |
671,029 |
624,437 |
|||||
Long-term liabilities: |
|||||||
Accrued liabilities |
29,848 |
34,682 |
|||||
Deferred credits |
8,357 |
12,943 |
|||||
Pension liability |
61,993 |
56,737 |
|||||
Long-term debt |
2,137,987 |
1,549,370 |
|||||
Deferred revenues |
37,461 |
28,223 |
|||||
Long-term income taxes payable |
149,041 |
151,484 |
|||||
Deferred tax liabilities |
79,231 |
65,647 |
|||||
Total long-term liabilities |
2,503,918 |
1,899,086 |
|||||
Shareholders' equity: |
|||||||
Share capital |
|||||||
121,404,677 and 122,293,986 Common Shares issued and outstanding at |
817,788 |
808,010 |
|||||
Additional paid-in capital |
147,280 |
126,417 |
|||||
Accumulated other comprehensive income |
46,310 |
51,828 |
|||||
Retained earnings |
992,546 |
863,015 |
|||||
|
(25,268) |
(19,986) |
|||||
Total OpenText shareholders' equity |
1,978,656 |
1,829,284 |
|||||
Non-controlling interests |
541 |
523 |
|||||
Total shareholders' equity |
1,979,197 |
1,829,807 |
|||||
Total liabilities and shareholders' equity |
\\$ |
5,154,144 |
\\$ |
4,353,330 |
| ||||||||||||
Year Ended | ||||||||||||
2016 |
2015 |
2014 | ||||||||||
Revenues: |
||||||||||||
License |
\\$ |
283,710 |
\\$ |
294,266 |
\\$ |
305,846 |
||||||
Cloud services and subscriptions |
601,018 |
605,309 |
373,400 |
|||||||||
Customer support |
746,409 |
731,797 |
707,024 |
|||||||||
Professional service and other |
193,091 |
220,545 |
238,429 |
|||||||||
Total revenues |
1,824,228 |
1,851,917 |
1,624,699 |
|||||||||
Cost of revenues: |
||||||||||||
License |
10,296 |
12,899 |
13,161 |
|||||||||
Cloud services and subscriptions |
244,021 |
237,310 |
142,193 |
|||||||||
Customer support |
89,861 |
94,456 |
96,068 |
|||||||||
Professional service and other |
155,584 |
172,742 |
189,403 |
|||||||||
Amortization of acquired technology-based intangible assets |
74,238 |
81,002 |
69,917 |
|||||||||
Total cost of revenues |
574,000 |
598,409 |
510,742 |
|||||||||
Gross profit |
1,250,228 |
1,253,508 |
1,113,957 |
|||||||||
Operating expenses: |
||||||||||||
Research and development |
194,057 |
196,491 |
176,834 |
|||||||||
Sales and marketing |
344,235 |
373,610 |
346,941 |
|||||||||
General and administrative |
140,397 |
162,728 |
142,080 |
|||||||||
Depreciation |
54,929 |
50,906 |
35,237 |
|||||||||
Amortization of acquired customer-based intangible assets |
113,201 |
108,239 |
81,023 |
|||||||||
Special charges |
34,846 |
12,823 |
31,314 |
|||||||||
Total operating expenses |
881,665 |
904,797 |
813,429 |
|||||||||
Income from operations |
368,563 |
348,711 |
300,528 |
|||||||||
Other income (expense), net |
(1,423) |
(28,047) |
3,941 |
|||||||||
Interest and other related expense, net |
(76,363) |
(54,620) |
(27,934) |
|||||||||
Income before income taxes |
290,777 |
266,044 |
276,535 |
|||||||||
Provision for income taxes |
6,282 |
31,638 |
58,461 |
|||||||||
Net income for the period |
\\$ |
284,495 |
\\$ |
234,406 |
\\$ |
218,074 |
||||||
Net (income) loss attributable to non-controlling interests |
(18) |
(79) |
51 |
|||||||||
Net income attributable to OpenText |
\\$ |
284,477 |
\\$ |
234,327 |
\\$ |
218,125 |
||||||
Earnings per share—basic attributable to OpenText |
\\$ |
2.34 |
\\$ |
1.92 |
\\$ |
1.82 |
||||||
Earnings per share—diluted attributable to OpenText |
\\$ |
2.33 |
\\$ |
1.91 |
\\$ |
1.81 |
||||||
Weighted average number of Common Shares outstanding—basic |
121,463 |
122,092 |
119,674 |
|||||||||
Weighted average number of Common Shares outstanding—diluted |
122,038 |
122,957 |
120,576 |
|||||||||
Dividends declared per Common Share |
\\$ |
0.8300 |
\\$ |
0.7175 |
\\$ |
0.6225 |
| |||||||
Three Months Ended | |||||||
2016 |
2015 | ||||||
Revenues: |
|||||||
License |
\\$ |
86,126 |
\\$ |
97,129 |
|||
Cloud services and subscriptions |
156,624 |
148,967 |
|||||
Customer support |
192,969 |
184,221 |
|||||
Professional service and other |
48,084 |
52,391 |
|||||
Total revenues |
483,803 |
482,708 |
|||||
Cost of revenues: |
|||||||
License |
3,106 |
3,511 |
|||||
Cloud services and subscriptions |
64,889 |
58,424 |
|||||
Customer support |
25,237 |
23,578 |
|||||
Professional service and other |
41,546 |
42,743 |
|||||
Amortization of acquired technology-based intangible assets |
17,994 |
22,454 |
|||||
Total cost of revenues |
152,772 |
150,710 |
|||||
Gross profit |
331,031 |
331,998 |
|||||
Operating expenses: |
|||||||
Research and development |
53,747 |
52,357 |
|||||
Sales and marketing |
95,815 |
104,443 |
|||||
General and administrative |
33,330 |
41,766 |
|||||
Depreciation |
14,931 |
13,390 |
|||||
Amortization of acquired customer-based intangible assets |
29,637 |
28,741 |
|||||
Special charges |
10,092 |
8,791 |
|||||
Total operating expenses |
237,552 |
249,488 |
|||||
Income from operations |
93,479 |
82,510 |
|||||
Other income (expense), net |
409 |
690 |
|||||
Interest and other related expense, net |
(21,902) |
(18,194) |
|||||
Income before income taxes |
71,986 |
65,006 |
|||||
Recovery of income taxes |
(14,347) |
(3,763) |
|||||
Net income for the period |
\\$ |
86,333 |
\\$ |
68,769 |
|||
Net loss attributable to non-controlling interests |
57 |
35 |
|||||
Net income attributable to OpenText |
\\$ |
86,390 |
\\$ |
68,804 |
|||
Earnings per share—basic attributable to OpenText |
\\$ |
0.71 |
\\$ |
0.56 |
|||
Earnings per share—diluted attributable to OpenText |
\\$ |
0.71 |
\\$ |
0.56 |
|||
Weighted average number of Common Shares outstanding—basic |
121,324 |
122,245 |
|||||
Weighted average number of Common Shares outstanding—diluted |
122,020 |
122,888 |
|||||
Dividends declared per Common Share |
\\$ |
0.2300 |
\\$ |
0.2000 |
| |||||||||||
Year Ended | |||||||||||
2016 |
2015 |
2014 | |||||||||
Net income for the period |
\\$ |
284,495 |
\\$ |
234,406 |
\\$ |
218,074 |
|||||
Other comprehensive income—net of tax: |
|||||||||||
Net foreign currency translation adjustments |
(3,318) |
15,690 |
(2,779) |
||||||||
Unrealized gain (loss) on cash flow hedges: |
|||||||||||
Unrealized (loss) |
(2,574) |
(6,064) |
(357) |
||||||||
Loss reclassified into net income |
2,956 |
5,710 |
3,242 |
||||||||
Actuarial gain (loss) relating to defined benefit pension plans: |
|||||||||||
Actuarial loss |
(3,374) |
(3,302) |
(841) |
||||||||
Amortization of actuarial loss into net income |
347 |
357 |
294 |
||||||||
Unrealized net gain (loss) on short-term investments |
445 |
(12) |
— |
||||||||
Unrealized gain on marketable securities (Actuate) |
— |
1,906 |
— |
||||||||
Release of unrealized gain on marketable securities (Actuate) |
— |
(1,906) |
— |
||||||||
Total other comprehensive income (loss), net, for the period |
(5,518) |
12,379 |
(441) |
||||||||
Total comprehensive income |
278,977 |
246,785 |
217,633 |
||||||||
Comprehensive (income) loss attributable to non-controlling interests |
(18) |
(79) |
51 |
||||||||
Total comprehensive income attributable to OpenText |
\\$ |
278,959 |
\\$ |
246,706 |
\\$ |
217,684 |
| |||||||||||
Year Ended | |||||||||||
2016 |
2015 |
2014 | |||||||||
Cash flows from operating activities: |
|||||||||||
Net income for the period |
\\$ |
284,495 |
\\$ |
234,406 |
\\$ |
218,074 |
|||||
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||||||||
Depreciation and amortization of intangible assets |
242,368 |
240,147 |
186,177 |
||||||||
Share-based compensation expense |
25,978 |
22,047 |
19,906 |
||||||||
Excess tax benefits on share-based compensation expense |
(230) |
(1,675) |
(1,844) |
||||||||
Pension expense |
4,577 |
4,796 |
3,232 |
||||||||
Amortization of debt issuance costs |
4,678 |
4,556 |
3,191 |
||||||||
Amortization of deferred charges and credits |
9,903 |
10,525 |
11,307 |
||||||||
Loss on sale and write down of property and equipment |
1,108 |
1,368 |
15 |
||||||||
Release of unrealized gain on marketable securities to income |
— |
(3,098) |
— |
||||||||
Write off of unamortized debt issuance costs |
— |
2,919 |
— |
||||||||
Deferred Taxes |
(54,461) |
(14,578) |
(12,334) |
||||||||
Changes in operating assets and liabilities: |
|||||||||||
Accounts receivable |
8,985 |
43,189 |
(17,186) |
||||||||
Prepaid expenses and other current assets |
316 |
(3,534) |
11,146 |
||||||||
Income taxes |
6,294 |
2,933 |
11,308 |
||||||||
Deferred charges and credits |
— |
— |
9,870 |
||||||||
Accounts payable and accrued liabilities |
(5,671) |
(22,714) |
(36,478) |
||||||||
Deferred revenue |
(4,781) |
6,775 |
16,601 |
||||||||
Other assets |
2,163 |
(5,031) |
(5,858) |
||||||||
Net cash provided by operating activities |
525,722 |
523,031 |
417,127 |
||||||||
Cash flows from investing activities: |
|||||||||||
Additions of property and equipment |
(70,009) |
(77,046) |
(42,268) |
||||||||
Proceeds from maturity of short-term investments |
11,297 |
17,017 |
— |
||||||||
Purchase of CEM Business |
(152,711) |
— |
— |
||||||||
Purchase of |
(104,570) |
— |
— |
||||||||
Purchase of |
(22,146) |
— |
— |
||||||||
Purchase of |
(8,153) |
(291,800) |
— |
||||||||
Purchase of |
(3,464) |
(35,180) |
— |
||||||||
Purchase of |
— |
— |
(1,076,886) |
||||||||
Purchase of |
— |
— |
(30,588) |
||||||||
Purchase of |
(2,027) |
— |
— |
||||||||
Purchase of a division of |
— |
(222) |
— |
||||||||
Purchase of Patents |
— |
— |
(192) |
||||||||
Purchase consideration for prior period acquisitions |
— |
(590) |
(887) |
||||||||
Other investing activities |
(9,393) |
(10,574) |
(2,547) |
||||||||
Net cash used in investing activities |
(361,176) |
(398,395) |
(1,153,368) |
||||||||
Cash flows from financing activities: |
|||||||||||
Excess tax benefits on share-based compensation expense |
230 |
1,675 |
1,844 |
||||||||
Proceeds from issuance of Common Shares |
20,097 |
15,240 |
24,808 |
||||||||
Proceeds from long-term debt |
600,000 |
800,000 |
800,000 |
||||||||
Repayment of long-term debt and revolver |
(8,000) |
(530,284) |
(45,911) |
||||||||
Debt issuance costs |
(6,765) |
(18,271) |
(16,685) |
||||||||
Equity issuance costs |
— |
— |
(144) |
||||||||
Common Shares repurchased |
(65,509) |
— |
— |
||||||||
Purchase of Treasury Stock |
(10,627) |
(10,126) |
(1,275) |
||||||||
Payments of dividends to shareholders |
(99,262) |
(87,629) |
(74,693) |
||||||||
Net cash provided by financing activities |
430,164 |
170,605 |
687,944 |
||||||||
Foreign exchange gain (loss) on cash held in foreign currencies |
(10,952) |
(23,132) |
5,742 |
||||||||
Increase (decrease) in cash and cash equivalents during the period |
583,758 |
272,109 |
(42,555) |
||||||||
Cash and cash equivalents at beginning of the period |
699,999 |
427,890 |
470,445 |
||||||||
Cash and cash equivalents at end of the period |
\\$ |
1,283,757 |
\\$ |
699,999 |
\\$ |
427,890 |
| |||||||
Three Months Ended | |||||||
2016 |
2015 | ||||||
Cash flows from operating activities: |
|||||||
Net income for the period |
\\$ |
86,333 |
\\$ |
68,769 |
|||
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||||
Depreciation and amortization of intangible assets |
62,562 |
64,585 |
|||||
Share-based compensation expense |
6,898 |
6,107 |
|||||
Excess tax expense (benefits) on share-based compensation expense |
27 |
(64) |
|||||
Pension expense |
1,118 |
1,194 |
|||||
Amortization of debt issuance costs |
1,208 |
1,146 |
|||||
Amortization of deferred charges and credits |
2,653 |
2,632 |
|||||
Loss on sale and write down of property and equipment |
— |
1,250 |
|||||
Deferred taxes |
(38,769) |
(10,541) |
|||||
Changes in operating assets and liabilities: |
|||||||
Accounts receivable |
(13,167) |
(33,371) |
|||||
Prepaid expenses and other current assets |
2,905 |
467 |
|||||
Income taxes |
3,004 |
1,579 |
|||||
Deferred charges and credits |
— |
— |
|||||
Accounts payable and accrued liabilities |
21,763 |
31,033 |
|||||
Deferred revenue |
(17,345) |
70 |
|||||
Other assets |
(70) |
(3,039) |
|||||
Net cash provided by operating activities |
119,120 |
131,817 |
|||||
Cash flows from investing activities: |
|||||||
Additions of property and equipment |
(21,112) |
(16,460) |
|||||
Proceeds from maturity of short-term investments |
2,058 |
9,925 |
|||||
Purchase of CEM Business |
(152,711) |
||||||
Purchase of |
(104,570) |
||||||
Purchase of |
— |
(32) |
|||||
Other investing activities |
(3,269) |
(1,659) |
|||||
Net cash used in investing activities |
(279,604) |
(8,226) |
|||||
Cash flows from financing activities: |
|||||||
Excess tax (expense) benefits on share-based compensation expense |
(27) |
64 |
|||||
Proceeds from issuance of Common Shares |
8,269 |
2,413 |
|||||
Proceeds from long-term debt |
600,000 |
— |
|||||
Repayment of long-term debt and revolver |
(2,000) |
(9,799) |
|||||
Debt issuance costs |
(6,765) |
(195) |
|||||
Purchase of |
— |
(8,875) |
|||||
Payments of dividends to shareholders |
(27,635) |
(24,455) |
|||||
Net cash provided by (used in) financing activities |
571,842 |
(40,847) |
|||||
Foreign exchange gain (loss) on cash held in foreign currencies |
(5,006) |
4,078 |
|||||
Increase in cash and cash equivalents during the period |
406,352 |
86,822 |
|||||
Cash and cash equivalents at beginning of the period |
877,405 |
613,177 |
|||||
Cash and cash equivalents at end of the period |
\\$ |
1,283,757 |
\\$ |
699,999 |
Notes |
|
(1) |
All dollar amounts in this press release are in |
(2) |
Use of Non-GAAP Financial Measures: In addition to reporting financial results in accordance with U.S. GAAP, the Company provides certain financial measures that are not in accordance with |
The Company uses these Non-GAAP financial measures to supplement the information provided in its consolidated financial statements, which are presented in accordance with | |
Non-GAAP-based net income and Non-GAAP-based EPS are calculated as net income or earnings per share on a diluted basis, excluding the amortization of acquired intangible assets, other income (expense), share-based compensation, and Special charges (recoveries), all net of tax. Non-GAAP-based gross profit is the arithmetical sum of GAAP-based gross profit, and the amortization of acquired technology-based intangible assets and share-based compensation within cost of sales. Non-GAAP-based gross margin is calculated as Non-GAAP-based gross profit expressed as a percentage of total revenue. Non-GAAP-based income from operations is calculated as income from operations, excluding the amortization of acquired intangible assets, Special charges (recoveries), and share-based compensation expense. Non-GAAP-based operating margin is calculated as Non-GAAP-based income from operations expressed as a percentage of total revenue. | |
The Company's management believes that the presentation, of the above defined Non-GAAP financial measures, provides useful information to investors because they portray the financial results of the Company before the impact of certain non-operational charges. The use of the term "non-operational charge" is defined for this purpose as an expense that does not impact the ongoing operating decisions taken by the Company's management and is based upon the way the Company's management evaluates the performance of the Company's business for use in the Company's internal reports. In the course of such evaluation and for the purpose of making operating decisions, the Company's management excludes certain items from its analysis, including amortization of acquired intangible assets, Special charges (recoveries), share-based compensation, other income
(expense), and the taxation impact of these items. These items are excluded based upon the manner in which management evaluates the business of the Company and are not excluded in the sense that they may be used under | |
The Company believes the provision of supplemental Non-GAAP measures allow investors to evaluate the operational and financial performance of the Company's core business using the same evaluation measures that management uses, and is therefore a useful indication of OpenText's performance or expected performance of future operations and facilitates period-to-period comparison of operating performance (although prior performance is not necessarily indicative of future performance). As a result, the Company considers it appropriate and reasonable to provide, in addition to U.S. GAAP measures, supplementary Non-GAAP financial measures that exclude certain items from the presentation of its financial results in this press release. | |
The following charts provide (unaudited) reconciliations of U.S. GAAP-based financial measures to Non-U.S. GAAP-based financial measures for the following periods presented: |
Reconciliation of selected GAAP-based measures to Non-GAAP-based measures for the three months ended (In thousands except for per share amounts) | ||||||||||||||
Three Months Ended | ||||||||||||||
GAAP-based Measures |
GAAP-based |
Adjustments |
Note |
Non-GAAP- Measures |
Non-GAAP- % of Total | |||||||||
Cost of revenues |
||||||||||||||
Cloud services and subscriptions |
\\$ |
64,889 |
\\$ |
(312) |
(1) |
\\$ |
64,577 |
|||||||
Customer support |
25,237 |
(269) |
(1) |
24,968 |
||||||||||
Professional service and other |
41,546 |
(540) |
(1) |
41,006 |
||||||||||
Amortization of acquired technology-based intangible assets |
17,994 |
(17,994) |
(2) |
— |
||||||||||
GAAP-based gross profit and gross margin (%) / Non-GAAP-based gross profit and gross margin (%) |
331,031 |
68.4% |
19,115 |
(3) |
350,146 |
72.4% |
||||||||
Operating expenses |
||||||||||||||
Research and development |
53,747 |
(836) |
(1) |
52,911 |
||||||||||
Sales and marketing |
95,815 |
(3,026) |
(1) |
92,789 |
||||||||||
General and administrative |
33,330 |
(1,915) |
(1) |
31,415 |
||||||||||
Amortization of acquired customer-based intangible assets |
29,637 |
(29,637) |
(2) |
— |
||||||||||
Special charges (recoveries) |
10,092 |
(10,092) |
(4) |
— |
||||||||||
GAAP-based income from operations and operating margin (%) / Non-GAAP-based income from operations and operating margin (%) |
93,479 |
19.3% |
64,621 |
(5) |
158,100 |
32.7% |
||||||||
Other income (expense), net |
409 |
(409) |
(6) |
— |
||||||||||
Provision for (recovery of) income taxes |
(14,347) |
41,644 |
(7) |
27,297 |
||||||||||
GAAP-based net income / Non-GAAP-based net income, attributable to OpenText |
86,390 |
22,568 |
(8) |
108,958 |
||||||||||
GAAP-based earnings per share / Non GAAP-based earnings per share-diluted, attributable to OpenText |
\\$ |
0.71 |
\\$ |
0.18 |
(8) |
\\$ |
0.89 |
(1) |
Adjustment relates to the exclusion of share-based compensation expense from our Non-GAAP-based operating expenses as this expense is excluded from our internal analysis of operating results. |
(2) |
Adjustment relates to the exclusion of amortization expense from our Non-GAAP-based operating expenses as the timing and frequency of amortization expense is dependent on our acquisitions and is hence excluded from our internal analysis of operating results. |
(3) |
GAAP-based and Non-GAAP-based gross profit stated in dollars, and gross margin stated as a percentage of total revenue. |
(4) |
Adjustment relates to the exclusion of Special charges (recoveries) from our Non-GAAP-based operating expenses as Special charges (recoveries) are generally incurred in the periods following the relevant acquisitions, include one-time non-recurring charges or recoveries, and are not indicative or related to continuing operations and are therefore excluded from our internal analysis of operating results. |
(5) |
GAAP-based and Non-GAAP-based income from operations stated in dollars, and operating margin stated as a percentage of total revenue. |
(6) |
Adjustment relates to the exclusion of Other income (expense) from our Non-GAAP-based operating expenses as Other income (expense) relates primarily to the transactional impact of foreign exchange and is generally not indicative or related to continuing operations and is therefore excluded from our internal analysis of operating results. |
(7) |
Adjustment relates to differences between the GAAP-based tax recovery rate of approximately 20% and a Non-GAAP-based tax rate of 20%; these rate differences are due to the income tax effects of expenses that are excluded for the purpose of calculating Non-GAAP-based adjusted net income. Such excluded expenses include amortization, share-based compensation, Special charges (recoveries) and other income (expense), net. Also excluded are tax expense items unrelated to current period income such as changes in reserves for tax uncertainties and valuation allowance reserves, tax arising on internal reorganizations, and "book to return" adjustments for tax return filings and tax assessments (in total "adjusted expenses"). In arriving at our Non-GAAP-based tax rate of 20%, we analyzed the individual adjusted expenses and took into consideration the impact of statutory tax rates from local jurisdictions incurring the expense. |
(8) |
Reconciliation of GAAP-based net income to Non-GAAP-based net income: |
Three Months Ended | ||||||
Per share diluted | ||||||
GAAP-based net income, attributable to OpenText |
\\$ |
86,390 |
\\$ |
0.71 |
||
Add: |
||||||
Amortization |
47,631 |
0.39 |
||||
Share-based compensation |
6,898 |
0.06 |
||||
Special charges (recoveries) |
10,092 |
0.08 |
||||
Other (income) expense, net |
(409) |
— |
||||
GAAP-based provision for (recovery of) income taxes |
(14,347) |
(0.12) |
||||
Non-GAAP based provision for income taxes |
(27,297) |
(0.23) |
||||
Non-GAAP-based net income, attributable to OpenText |
\\$ |
108,958 |
\\$ |
0.89 |
Reconciliation of selected GAAP-based measures to Non-GAAP-based measures for the year ended (In thousands except for per share amounts) | ||||||||||||||
Year Ended | ||||||||||||||
GAAP-based Measures |
GAAP-based |
Adjustments |
Note |
Non-GAAP- Measures |
Non-GAAP- % of Total | |||||||||
Cost of revenues |
||||||||||||||
Cloud services and subscriptions |
\\$ |
244,021 |
\\$ |
(953) |
(1) |
\\$ |
243,068 |
|||||||
Customer support |
89,861 |
(900) |
(1) |
88,961 |
||||||||||
Professional service and other |
155,584 |
(1,626) |
(1) |
153,958 |
||||||||||
Amortization of acquired technology-based intangible assets |
74,238 |
(74,238) |
(2) |
— |
||||||||||
GAAP-based gross profit and gross margin (%) / Non-GAAP-based gross profit and gross margin (%) |
1,250,228 |
68.5% |
77,717 |
(3) |
1,327,945 |
72.8% |
||||||||
Operating expenses |
||||||||||||||
Research and development |
194,057 |
(2,824) |
(1) |
191,233 |
||||||||||
Sales and marketing |
344,235 |
(12,069) |
(1) |
332,166 |
||||||||||
General and administrative |
140,397 |
(7,606) |
(1) |
132,791 |
||||||||||
Amortization of acquired customer-based intangible assets |
113,201 |
(113,201) |
(2) |
— |
||||||||||
Special charges (recoveries) |
34,846 |
(34,846) |
(4) |
— |
||||||||||
GAAP-based income from operations and operating margin (%) / Non-GAAP-based income from operations and operating margin (%) |
368,563 |
20.2% |
248,263 |
(5) |
616,826 |
33.8% |
||||||||
Other income (expense), net |
(1,423) |
1,423 |
(6) |
— |
||||||||||
Provision for (recovery of) income taxes |
6,282 |
101,793 |
(7) |
108,075 |
||||||||||
GAAP-based net income / Non-GAAP-based net income, attributable to OpenText |
284,477 |
147,893 |
(8) |
432,370 |
||||||||||
GAAP-based earnings per share / Non GAAP-based earnings per share-diluted, attributable to OpenText |
\\$ |
2.33 |
\\$ |
1.21 |
(8) |
\\$ |
3.54 |
(1) |
Adjustment relates to the exclusion of share-based compensation expense from our Non-GAAP-based operating expenses as this expense is excluded from our internal analysis of operating results. |
(2) |
Adjustment relates to the exclusion of amortization expense from our Non-GAAP-based operating expenses as the timing and frequency of amortization expense is dependent on our acquisitions and is hence excluded from our internal analysis of operating results. |
(3) |
GAAP-based and Non-GAAP-based gross profit stated in dollars, and gross margin stated as a percentage of total revenue. |
(4) |
Adjustment relates to the exclusion of Special charges (recoveries) from our Non-GAAP-based operating expenses as Special charges (recoveries) are generally incurred in the periods following the relevant acquisitions, including one-time non-recurring charges or recoveries, and are not indicative or related to continuing operations and are therefore excluded from our internal analysis of operating results. |
(5) |
GAAP-based and Non-GAAP-based income from operations stated in dollars, and operating margin stated as a percentage of total revenue. |
(6) |
Adjustment relates to the exclusion of Other income (expense) from our Non-GAAP-based operating expenses as Other income (expense) relates primarily to the transactional impact of foreign exchange and is generally not indicative or related to continuing operations and is therefore excluded from our internal analysis of operating results. |
(7) |
Adjustment relates to differences between the GAAP-based tax provision rate of approximately 2% and a Non-GAAP-based tax rate of 20%; these rate differences are due to the income tax effects of expenses that are excluded for the purpose of calculating Non-GAAP-based adjusted net income. Such excluded expenses include amortization, share-based compensation, Special charges (recoveries) and other income (expense), net. Also excluded are tax expense items unrelated to current period income such as changes in reserves for tax uncertainties and valuation allowance reserves, tax arising on internal reorganizations, and "book to return" adjustments for tax return filings and tax assessments (in total "adjusted expenses"). In arriving at our Non-GAAP-based tax rate of 20%, we analyzed the individual adjusted expenses and took into consideration the impact of statutory tax rates from local jurisdictions incurring the expense. |
(8) |
Reconciliation of GAAP-based net income to Non-GAAP-based net income: |
Year Ended | ||||||
Per share diluted | ||||||
GAAP-based net income, attributable to OpenText |
\\$ |
284,477 |
\\$ |
2.33 |
||
Add: |
||||||
Amortization |
187,439 |
1.54 |
||||
Share-based compensation |
25,978 |
0.21 |
||||
Special charges (recoveries) |
34,846 |
0.29 |
||||
Other (income) expense, net |
1,423 |
0.01 |
||||
GAAP-based provision for (recovery of) income taxes |
6,282 |
0.05 |
||||
Non-GAAP based provision for income taxes |
(108,075) |
(0.89) |
||||
Non-GAAP-based net income, attributable to OpenText |
\\$ |
432,370 |
\\$ |
3.54 |
Reconciliation of selected GAAP-based measures to Non-GAAP-based measures for the three months ended (In thousands except for per share amounts) | ||||||||||||||
Three Months Ended | ||||||||||||||
GAAP-based Measures |
GAAP-based |
Adjustments |
Note |
Non-GAAP- Measures |
Non-GAAP- % of Total | |||||||||
Cost of revenues |
||||||||||||||
Cloud services and subscriptions |
\\$ |
61,298 |
\\$ |
(202) |
(1) |
\\$ |
61,096 |
|||||||
Customer support |
22,427 |
(215) |
(1) |
22,212 |
||||||||||
Professional service and other |
37,599 |
(247) |
(1) |
37,352 |
||||||||||
Amortization of acquired technology-based intangible assets |
17,630 |
(17,630) |
(2) |
— |
||||||||||
GAAP-based gross profit and gross margin (%) / Non-GAAP-based gross profit and gross margin (%) |
299,109 |
67.9% |
18,294 |
(3) |
317,403 |
72.0% |
||||||||
Operating expenses |
||||||||||||||
Research and development |
48,160 |
(500) |
(1) |
47,660 |
||||||||||
Sales and marketing |
84,600 |
(3,213) |
(1) |
81,387 |
||||||||||
General and administrative |
37,731 |
(1,589) |
(1) |
36,142 |
||||||||||
Amortization of acquired customer-based intangible assets |
27,966 |
(27,966) |
(2) |
— |
||||||||||
Special charges (recoveries) |
(1,671) |
1,671 |
(4) |
— |
||||||||||
GAAP-based income from operations and operating margin (%) / Non-GAAP-based income from operations and operating margin (%) |
88,569 |
20.1% |
49,891 |
(5) |
138,460 |
31.4% |
||||||||
Other income (expense), net |
2,120 |
(2,120) |
(6) |
— |
||||||||||
Provision for (recovery of) income taxes |
5,353 |
19,100 |
(7) |
24,453 |
||||||||||
GAAP-based net income / Non-GAAP-based net income, attributable to OpenText |
69,115 |
28,671 |
(8) |
97,786 |
||||||||||
GAAP-based earnings per share / Non GAAP-based earnings per share-diluted, attributable to OpenText |
\\$ |
0.57 |
\\$ |
0.23 |
(8) |
\\$ |
0.80 |
(1) |
Adjustment relates to the exclusion of share-based compensation expense from our Non-GAAP-based operating expenses as this expense is excluded from our internal analysis of operating results. |
(2) |
Adjustment relates to the exclusion of amortization expense from our Non-GAAP-based operating expenses as the timing and frequency of amortization expense is dependent on our acquisitions and is hence excluded from our internal analysis of operating results. |
(3) |
GAAP-based and Non-GAAP-based gross profit stated in dollars, and gross margin stated as a percentage of total revenue. |
(4) |
Adjustment relates to the exclusion of Special charges (recoveries) from our Non-GAAP-based operating expenses as Special charges (recoveries) are generally incurred in the periods following the relevant acquisitions, including one-time non-recurring charges or recoveries, and are not indicative or related to continuing operations and are therefore excluded from our internal analysis of operating results. |
(5) |
GAAP-based and Non-GAAP-based income from operations stated in dollars, and operating margin stated as a percentage of total revenue. |
(6) |
Adjustment relates to the exclusion of Other income (expense) from our Non-GAAP-based operating expenses as Other income (expense) relates primarily to the transactional impact of foreign exchange and is generally not indicative or related to continuing operations and is therefore excluded from our internal analysis of operating results. |
(7) |
Adjustment relates to differences between the GAAP-based tax provision rate of approximately 7% and a Non-GAAP-based tax rate of 20%; these rate differences are due to the income tax effects of expenses that are excluded for the purpose of calculating Non-GAAP-based adjusted net income. Such excluded expenses include amortization, share-based compensation, Special charges (recoveries) and other income (expense), net. Also excluded are tax expense items unrelated to current period income such as changes in reserves for tax uncertainties and valuation allowance reserves, tax arising on internal reorganizations, and "book to return" adjustments for tax return filings and tax assessments (in total "adjusted expenses"). In arriving at our Non-GAAP-based tax rate of 20%, we analyzed the individual adjusted expenses and took into consideration the impact of statutory tax rates from local jurisdictions incurring the expense. |
(8) |
Reconciliation of GAAP-based net income to Non-GAAP-based net income: |
Three Months Ended | ||||||
Per share diluted | ||||||
GAAP-based net income, attributable to OpenText |
\\$ |
69,115 |
\\$ |
0.57 |
||
Add: |
||||||
Amortization |
45,596 |
0.37 |
||||
Share-based compensation |
5,966 |
0.05 |
||||
Special charges (recoveries) |
(1,671) |
(0.01) |
||||
Other (income) expense, net |
(2,120) |
(0.02) |
||||
GAAP-based provision for (recovery of) income taxes |
5,353 |
0.04 |
||||
Non-GAAP based provision for income taxes |
(24,453) |
(0.20) |
||||
Non-GAAP-based net income, attributable to OpenText |
\\$ |
97,786 |
\\$ |
0.80 |
Reconciliation of selected GAAP-based measures to Non-GAAP-based measures for the three months ended (In thousands except for per share amounts) | ||||||||||||||
Three Months Ended | ||||||||||||||
GAAP-based Measures |
GAAP-based |
Adjustments |
Note |
Non-GAAP- Measures |
Non-GAAP- % of Total | |||||||||
Cost of revenues |
||||||||||||||
Cloud services and subscriptions |
\\$ |
58,424 |
\\$ |
(252) |
(1) |
\\$ |
58,172 |
|||||||
Customer support |
23,578 |
(200) |
(1) |
23,378 |
||||||||||
Professional service and other |
42,743 |
(421) |
(1) |
42,322 |
||||||||||
Amortization of acquired technology-based intangible assets |
22,454 |
(22,454) |
(2) |
— |
||||||||||
GAAP-based gross profit and gross margin (%) / Non-GAAP-based gross profit and gross margin (%) |
331,998 |
68.8% |
23,327 |
(3) |
355,325 |
73.6% |
||||||||
Operating expenses |
||||||||||||||
Research and development |
52,357 |
(665) |
(1) |
51,692 |
||||||||||
Sales and marketing |
104,443 |
(2,508) |
(1) |
101,935 |
||||||||||
General and administrative |
41,766 |
(2,061) |
(1) |
39,705 |
||||||||||
Amortization of acquired customer-based intangible assets |
28,741 |
(28,741) |
(2) |
— |
||||||||||
Special charges (recoveries) |
8,791 |
(8,791) |
(4) |
— |
||||||||||
GAAP-based income from operations and operating margin (%) / Non-GAAP-based income from operations and operating margin (%) |
82,510 |
17.1% |
66,093 |
(5) |
148,603 |
30.8% |
||||||||
Other income (expense), net |
690 |
(690) |
(6) |
— |
||||||||||
Provision for (recovery of) income taxes |
(3,763) |
27,272 |
(7) |
23,509 |
||||||||||
GAAP-based net income / Non-GAAP-based net income, attributable to OpenText |
68,804 |
38,131 |
(8) |
106,935 |
||||||||||
GAAP-based earnings per share / Non GAAP-based earnings per share-diluted, attributable to OpenText |
\\$ |
0.56 |
\\$ |
0.31 |
(8) |
\\$ |
0.87 |
(1) |
Adjustment relates to the exclusion of share-based compensation expense from our Non-GAAP-based operating expenses as this expense is excluded from our internal analysis of operating results. |
(2) |
Adjustment relates to the exclusion of amortization expense from our Non-GAAP-based operating expenses as the timing and frequency of amortization expense is dependent on our acquisitions and is hence excluded from our internal analysis of operating results. |
(3) |
GAAP-based and Non-GAAP-based gross profit stated in dollars, and gross margin stated as a percentage of total revenue. |
(4) |
Adjustment relates to the exclusion of Special charges (recoveries) from our Non-GAAP-based operating expenses as Special charges (recoveries) are generally incurred in the periods following the relevant acquisitions, including one-time non-recurring charges or recoveries, and are not indicative or related to continuing operations and are therefore excluded from our internal analysis of operating results. |
(5) |
GAAP-based and Non-GAAP-based income from operations stated in dollars, and operating margin stated as a percentage of total revenue. |
(6) |
Adjustment relates to the exclusion of Other income (expense) from our Non-GAAP-based operating expenses as Other income (expense) relates primarily to the transactional impact of foreign exchange and is generally not indicative or related to continuing operations and is therefore excluded from our internal analysis of operating results. |
(7) |
Adjustment relates to differences between the GAAP-based tax recovery rate of approximately 6% and a Non-GAAP-based tax rate of 18%; these rate differences are due to the income tax effects of expenses that are excluded for the purpose of calculating Non-GAAP-based adjusted net income. Such excluded expenses include amortization, share-based compensation, Special charges (recoveries) and other income (expense), net. Also excluded are tax expense items unrelated to current period income such as changes in reserves for tax uncertainties and valuation allowance reserves, tax arising on internal reorganizations, and "book to return" adjustments for tax return filings and tax assessments (in total "adjusted expenses"). In arriving at our Non-GAAP-based tax rate of 18%, we analyzed the individual adjusted expenses and took into consideration the impact of statutory tax rates from local jurisdictions incurring the expense. |
(8) |
Reconciliation of GAAP-based net income to Non-GAAP-based net income: |
Three Months Ended | ||||||
Per share diluted | ||||||
GAAP-based net income, attributable to OpenText |
\\$ |
68,804 |
\\$ |
0.56 |
||
Add: |
||||||
Amortization |
51,195 |
0.42 |
||||
Share-based compensation |
6,107 |
0.05 |
||||
Special charges (recoveries) |
8,791 |
0.07 |
||||
Other (income) expense, net |
(690) |
(0.01) |
||||
GAAP-based provision for (recovery of) income taxes |
(3,763) |
(0.03) |
||||
Non-GAAP based provision for income taxes |
(23,509) |
(0.19) |
||||
Non-GAAP-based net income, attributable to OpenText |
\\$ |
106,935 |
\\$ |
0.87 |
Reconciliation of selected GAAP-based measures to Non GAAP-based measures for the year ended (In thousands except for per share amounts) | ||||||||||||||
Year Ended | ||||||||||||||
GAAP-based Measures |
GAAP-based |
Adjustments |
Note |
Non-GAAP- Measures |
Non-GAAP- % of Total | |||||||||
Cost of revenues: |
||||||||||||||
Cloud services and subscriptions |
\\$ |
237,310 |
\\$ |
(833) |
(1) |
\\$ |
236,477 |
|||||||
Customer support |
94,456 |
(832) |
(1) |
93,624 |
||||||||||
Professional service and other |
172,742 |
(1,335) |
(1) |
171,407 |
||||||||||
Amortization of acquired technology-based intangible assets |
81,002 |
(81,002) |
(2) |
— |
||||||||||
GAAP-based gross profit and gross margin (%) / Non-GAAP-based gross profit and gross margin (%) |
1,253,508 |
67.7% |
84,002 |
(3) |
1,337,510 |
72.2% |
||||||||
Operating expenses |
||||||||||||||
Research and development |
196,491 |
(2,496) |
(1) |
193,995 |
||||||||||
Sales and marketing |
373,610 |
(9,095) |
(1) |
364,515 |
||||||||||
General and administrative |
162,728 |
(7,456) |
(1) |
155,272 |
||||||||||
Amortization of acquired customer-based intangible assets |
108,239 |
(108,239) |
(2) |
— |
||||||||||
Special charges (recoveries) |
12,823 |
(12,823) |
(4) |
— |
||||||||||
GAAP-based income from operations and operating margin (%) / Non-GAAP-based income from operations and operating margin (%) |
348,711 |
18.8% |
224,111 |
(5) |
572,822 |
30.9% |
||||||||
Other income (expense), net |
(28,047) |
28,047 |
(6) |
— |
||||||||||
Provision for (recovery of) income taxes |
31,638 |
61,559 |
(7) |
93,197 |
||||||||||
GAAP-based net income / Non-GAAP-based net income, attributable to OpenText |
234,327 |
190,599 |
(8) |
424,926 |
||||||||||
GAAP-based earnings per share / Non GAAP-based earnings per share-diluted, attributable to OpenText |
\\$ |
1.91 |
\\$ |
1.55 |
(8) |
\\$ |
3.46 |
(1) |
Adjustment relates to the exclusion of share-based compensation expense from our Non-GAAP-based operating expenses as this expense is excluded from our internal analysis of operating results. |
(2) |
Adjustment relates to the exclusion of amortization expense from our Non-GAAP-based operating expenses as the timing and frequency of amortization expense is dependent on our acquisitions and is hence excluded from our internal analysis of operating results. |
(3) |
GAAP-based and Non-GAAP-based gross profit stated in dollars, and gross margin stated as a percentage of total revenue. |
(4) |
Adjustment relates to the exclusion of Special charges (recoveries) from our Non-GAAP-based operating expenses as Special charges (recoveries) are generally incurred in the periods following the relevant acquisitions, including one-time non-recurring charges or recoveries, and are not indicative or related to continuing operations and are therefore excluded from our internal analysis of operating results. |
(5) |
GAAP-based and Non-GAAP-based income from operations stated in dollars, and operating margin stated as a percentage of total revenue. |
(6) |
Adjustment relates to the exclusion of Other income (expense) from our Non-GAAP-based operating expenses as Other income (expense) relates primarily to the transactional impact of foreign exchange and is generally not indicative or related to continuing operations and is therefore excluded from our internal analysis of operating results. |
(7) |
Adjustment relates to differences between the GAAP-based tax provision rate of approximately 12% and a Non-GAAP-based tax rate of 18%; these rate differences are due to the income tax effects of expenses that are excluded for the purpose of calculating Non-GAAP-based adjusted net income. Such excluded expenses include amortization, share-based compensation, Special charges (recoveries) and other income (expense), net. Also excluded are tax expense items unrelated to current period income such as changes in reserves for tax uncertainties and valuation allowance reserves, tax arising on internal reorganizations, and "book to return" adjustments for tax return filings and tax assessments (in total "adjusted expenses"). In arriving at our Non-GAAP-based tax rate of 18%, we analyzed the individual adjusted expenses and took into consideration the impact of statutory tax rates from local jurisdictions incurring the expense. |
(8) |
Reconciliation of GAAP-based net income to Non-GAAP-based net income: |
Year Ended | ||||||
Per share diluted | ||||||
GAAP-based net income, attributable to OpenText |
\\$ |
234,327 |
\\$ |
1.91 |
||
Add: |
||||||
Amortization |
189,241 |
1.54 |
||||
Share-based compensation |
22,047 |
0.18 |
||||
Special charges (recoveries) |
12,823 |
0.10 |
||||
Other (income) expense, net |
28,047 |
0.23 |
||||
GAAP-based provision for (recovery of) income taxes |
31,638 |
0.26 |
||||
Non-GAAP based provision for income taxes |
(93,197) |
(0.76) |
||||
Non-GAAP-based net income, attributable to OpenText |
\\$ |
424,926 |
\\$ |
3.46 |
(3) |
The following tables provide a composition of our major currencies for revenue and expenses, expressed as a percentage, for the three months and year ended |
Three Months Ended |
Three Months Ended | ||||||||
Currencies |
% of Revenue |
% of Expenses* |
% of Revenue |
% of Expenses* | |||||
EURO |
25% |
15% |
23% |
14% | |||||
GBP |
7% |
7% |
8% |
8% | |||||
CAD |
5% |
12% |
5% |
14% | |||||
USD |
54% |
49% |
52% |
48% | |||||
Other |
9% |
17% |
12% |
16% | |||||
Total |
100% |
100% |
100% |
100% | |||||
Year Ended |
Year Ended | ||||||||
Currencies |
% of Revenue |
% of Expenses* |
% of Revenue |
% of Expenses* | |||||
EURO |
24% |
15% |
24% |
14% | |||||
GBP |
8% |
7% |
8% |
8% | |||||
CAD |
4% |
12% |
5% |
13% | |||||
USD |
54% |
49% |
51% |
48% | |||||
Other |
10% |
17% |
12% |
17% | |||||
Total |
100% |
100% |
100% |
100% |
* |
Expenses include all cost of revenues and operating expenses included within the Consolidated Statements of Income, except for amortization of intangible assets, share-based compensation and Special charges (recoveries). |
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