Investor Presentation. March 2011

Transcription

1 Investor Presentation March 2011

2 Disclaimer Certain statements in this presentation constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws ( forward-looking statements ). Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Open Text, or developments in Open Text s business or in its industry, to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forwardlooking statements. The historical increases in the Company's revenues and earnings do not assure the revenues and earnings will not decrease in the future. Forward-looking statements include all disclosure regarding possible events, conditions or results of operations that is based on assumptions about future economic conditions and courses of action. Forward-looking statements may also include any statement relating to future events, conditions or circumstances. Open Text cautions you not to place undue reliance upon any such forward- looking statements, which speak only as of the date they are made. Forward-looking statements relate to, among other things, changes in the ECM market; the market focus of Open Text, Open Text s revenue mix and margin targets; Open Text s operations priorities; and Open Text s strategy for its products and solutions. The risks and uncertainties that may affect forward-looking statements include, among others, the completion and integration of acquisitions, the possibility of technical, logistical or planning issues in connection with deployments, the continuous commitment of Open Text's customers, demand for Open Text 's products and other risks detailed from time to time in Open Text's filings with the Securities and Exchange Commission and Canadian provincial securities regulators, including Open Text's Annual Report on Form 10-K for the year ended June 30, 2010 and Quarterly Report on Form 10-Q for the quarters ended September 30, 2010 and December 31, Forward-looking statements are based on management s current plans, estimates, projections, beliefs and opinions, and the Company does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change. Slide 2 Copyright 2010 Open Text Corporation. All rights reserved. 2

3 Who is Open Text? World's largest independent provider of Enterprise Content Management (ECM) software Key partnerships with SAP, MSFT and ORCL Focused on profitability Slide 3 Copyright 2010 Open Text Corporation. All rights reserved. 3

4 What is Enterprise Content Management? ECM describes a collection of software applications that help organizations to manage electronic content Copyright 2010 Open Text Corporation. All rights reserved. 4

5 Global ECM Market Share -3.9% +5.5% -0.3% *Includes Microsoft SharePoint at 2.7% Market Share: Content Management Software, Worldwide, 2009, Tom Eid and Bianca Granetto 13 April 2010 Gartner Inc. Copyright 2010 Open Text Corporation. All rights reserved. 5

6 Gartner ECM Magic Quadrant

7 What is ECM and Why is it Needed? ECM manages the entire lifecycle of unstructured data (e.g. Invoices, , documents, spreadsheets, CAD, multimedia etc.) ECM solutions help corporations organize, control and access this vital business content ECM Market is driven by customers needs for regulatory compliance ECM helps deliver fast ROI by streamlining business processes Copyright 2010 Open Text Corporation. All rights reserved. 7

8 Ecosystem Strategy 8

9 Trusted Repository for Enterprise Content 9

10 Enterprise Content Human Resources Accounting Marketing Legal Call Center Personnel Management Accounts Payable Corporate Web Site Contract Management Case Management Copyright 2010 Open Text Corporation. All rights reserved. 10

11 Open Text Product Portfolio ECM Suite for Open Text ECM Suite Horizontal Applications Contracts and Case Management, Accounts Payable, ediscovery ECM Suite for Vertical Applications Energy, Life Sciences, Government, Healthcare User Experience Services ECM Suite for Engagement Lifecycle Transaction Content Management edocs Web Site Management Viewers OEM Report & Output Management Hosting/SaaS Non-ECM Products Connectivity Fax HW Enterprise Process Services Enterprise Library Group Collaboration Fax SW Copyright 2010 Open Text Corporation. All rights reserved. 11

12 OpenText Media Management 12

13 OpenText Everywhere 13

14 G20 Powered by Open Text Secure, Hosted, and Mobile Collaboration Site for Multilateral Governmental Collaboration Copyright 2010 Open Text Corporation. All rights reserved. 14

15 Diverse Customer Base Government Energy Pharmaceutical Financial Telecoms Manufacturing Legal AEC/Engineering Automotive Insurance Slide 15 15

16 FY2011 Q2 Results Total revenue $267.5 million, up 7.9% (2Q11 vs.2q10) License revenue $79.2 million, up 8.9% (2Q11 vs.2q10) Adjusted EPS $1.21, up 41% (2Q11 vs.2q10)* Pre-tax adjusted operating margin 31.6%, up from 28.8% (2Q11 vs.2q10)** Operating cash flow $40.0 million Cash and cash equivalents $340.8 million * See reconciliation of Non-GAAP measures to GAAP measures at the end of this presentation **before taxes and interest expense Slide 16 Copyright 2010 Open Text Corporation. All rights reserved. 16

17 Metastorm Acquisition Leading Business Process Management (BPM) software company based in Baltimore, Maryland According to Gartner, the BPM market was $1.9 billion in 2009, growing 15 percent that year Key addition to OpenText s Microsoft partner strategy $70-75M run rate; approximately 350 employees 17

18 FY2010 Global Revenue Mix 52% 41% 7% North America 52% Europe 41% Asia Pac/Other 7% Slide 18 Copyright 2010 Open Text Corporation. All rights reserved. 18

19 Revenue Mix & Margin Target Model Revenue Type Product License 25-30% Product Maintenance 52-57% Professional Services 18-23% Overall Gross Margin 73-75% Development 14-16% Sales & Marketing 21-23% General & Admin 8-10% Depreciation 2% Pre-tax Adj. Ops Margin 25-30% 19

20 Thank You 20

21 Reconciliation of Adjusted Operating Margin to GAAP Net Income* (in 000s USD) 2Q10 2Q11 Non GAAP adjusted operating margin (31.6% and 28.8% respectively) $ 71,383 $ 84,455 Less: Amortization 23,887 25,676 Share-based compensation expense 1,160** 2,737 Special charges 10,423 3,461 Other income, net 1,671 6,003 Interest expense, net 2,716 2,473 Provision for income taxes 10,325 6,995 GAAP Net income for the period $ 21,201 $ 37,110 *Amounts may differ from those shown on the face of the financial statements due to non-material rounding adjustments ** In addition $1.0 million of share-based compensation is included within special charges For more details see our second quarter of Fiscal year 2011 earnings release, posted on our website under Investor Relations at Copyright 2010 Open Text Corporation. All rights reserved. 21

22 Reconciliation of GAAP based EPS to Non GAAP based EPS (on a diluted basis)* 2Q10 2Q11 Non GAAP-based adjusted EPS $ 0.87 $ 1.21 Less: Amortization Share-based compensation expense Special charges Other income, net GAAP based provision for income taxes Tax on non-gaap based adjusted net income (0.32) (0.20) GAAP based EPS $ 0.37 $ 0.64 *Amounts may differ from those shown on the face of the financial statements due to non-material rounding adjustments For more details see our second quarter of Fiscal year 2011 earnings release, posted on our website under Investor Relations at 22