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OpenText Reports Second Quarter Fiscal Year 2012 Financial Results
Feb 01, 2012 (03:02 PM EST)


WATERLOO, ON, Feb. 1, 2012 /PRNewswire/ - Open Text(TM) Corporation (NASDAQ:OTEX) (TSX: OTC), today announced unaudited financial results for its second fiscal quarter ended December 31, 2011. (1)

Financial Highlights for Q2 FY12

  • Total revenue for the period was $321.5 million, up 20.2% Y/Y

  • License revenue was $89.7 million, up 13.3% Y/Y

  • GAAP -based EPS was $0.81 compared to $0.64 Y/Y; Non-GAAP- based EPS was $1.39 compared to $1.22 Y/Y (2)

  • GAAP-based income from operations was $55.2 million and 17.2% of revenues; Non-GAAP-based operating income was $98.5 million and 30.7% of revenues (2)

"I am delighted to join OpenText and to be based out of Waterloo, Ontario," said Mark J. Barrenechea, OpenText President and Chief Executive Officer. "With proven success as a market leader in ECM, OpenText has unparalleled talent, innovative products and an impressive group of world-class customers and partners. I see tremendous market opportunity and an exciting future for the Company. I look forward to working with the Company's employees, customers and investors to lead OpenText to the next level of success."

Business Highlights

  • Mark J. Barrenechea appointed President and CEO of OpenText effective January 2, 2012; John Shackleton retires
  • Americas contributed 53% of total revenue, while EMEA contributed 40% and Asia Pacific 7%

  • License was approximately 27.9% of revenue, customer support contributed 51.4% and services and other was approximately 20.7% of revenue

  • Partners contributed 44% of license revenue

  • Services, technology and financial services verticals saw the most demand

  • Customer successes in the second quarter include Peabody Energy, Salzgitter AG, Taco Bell and Volkswagen Finance

  • Completion of financing; 5-year term loan of $600 million replaces previous loan; repaid previous credit facility of approximately $332.9 million

  • Now shipping: OpenText Tempo, fast, easy, secure document sharing solution that allows enterprise users to share and manage content in secure folders on smartphones, tablets, PCs or laptops.

Summary of Results

  Q2 FY12   Q1 FY12   Q2 FY11   % Change (Q/Q)   % Change (Y/Y)
Revenue (million)……………………….................. $321.5   $288.0   $267.5   11.6%   20.2%
GAAP-based gross margin……………................. 67.1%   64.8%   68.4%   230 bps   (130) bps
GAAP-based operating income margin................ 17.2%   9.4%   19.7%   780 bps   (250) bps
GAAP-based EPS………..…………….................. $0.81   $0.60   $0.64   35.0%   26.6%
Non-GAAP-based gross margin (2)  …….................... 73.8%   72.1%   74.6%   170 bps   (80) bps
Non-GAAP-based operating margin (2)..  30.7%   25.3%   31.6%   540 bps   (90) bps
Non-GAAP-based EPS (2) ………………............. $1.39   $1.03   $1.22   35.0%   13.9%

Conference Call Information

The public is invited to listen to the earnings conference call at 5:00 p.m. ET (2:00 p.m. PT) by dialing 800-814-4859 (toll-free) or 416-644-3414 (international). Please dial-in 15 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 http://www.opentext.com/2/global/ex_event.html?evtype=events&id=701D0000000V7EWIA0.

An audio replay of the conference call will also be made available approximately two hours after the conclusion of the call. The audio replay will remain available until 11:59 p.m. on February 15, 2012 and can be accessed by dialing 877-289-8525 (toll-free) or 416-640-1917 (international) and entering the confirmation code: 4502362, followed by the number sign.

Please see below note (2) for a reconciliation of non-US GAAP based financial measures used in this press release, to US GAAP based financial measures.

About OpenText
OpenText (TM) is the world's largest independent provider of Enterprise Content Management software. The company's solutions manage information for all types of business, compliance and industry requirements in large companies, government agencies and professional service firms. OpenText supports approximately 46,000 customers in 114 countries and 12 languages. For more information about OpenText, visit www.opentext.com.

Cautionary Statement Regarding Forward Looking Statements

Certain statements in this press release, including statements about the financial conditions, and results of operations and earnings for Open Text Corporation ("OpenText" or "the Company"), may contain words such as "could", "expects", "may", "should", "will", "anticipates", "believes", "intends", "estimates", "targets", "plans", "envisions", "seeks" and other similar language and are considered forward-looking statements or information under applicable securities laws. These statements are based on the Company's current expectations, estimates, forecasts and projections about the operating environment, economies and markets in which the Company operates. These statements are subject to important assumptions, risks and uncertainties that are difficult to predict, and the actual outcome may be materially different. The Company's assumptions, although considered reasonable by the Company at the date of this press release, may provide to be inaccurate and consequently the Company's actual results could differ materially from the expectations set out herein.

Actual results or events could differ materially from those contemplated in forward-looking statements as a result of the following: (i) the future performance, financial and otherwise, of OpenText; (ii) the ability of OpenText to bring new products 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 ECM market; (vi) the Company's competitive position in the ECM market and its ability to take advantage of future opportunities in this market; (vii) the benefits of the Company's products to be realized by customers; and (viii) the demand for the Company's product and the extent of deployment of the company's products in the ECM marketplace. Forward-looking statements may also include, without limitation, any statement relating to future events, conditions or circumstances. 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 possibility that the Company may be unable to meet its future reporting requirements under the Securities Exchange Act of 1934, as amended, and the rules promulgated there under; (iii) the risks associated with bringing new products to market; (iv) fluctuations in currency exchange rates; (v) delays in the purchasing decisions of the Company's customers; (vi) the competition the Company faces in its industry and/or marketplace; (vii) the possibility of technical, logistical or planning issues in connection with the deployment of the Company's products or services; (viii) the continuous commitment of the Company's customers; and (ix) demand for the Company's products.

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 SEC and other securities regulators. Unless otherwise required by applicable securities laws, the Company disclaims any intention or obligations to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Use of Non-GAAP Financial Measures

In addition to reporting financial results in accordance with US GAAP, the Company provides certain non-US GAAP financial measures that are not in accordance with US GAAP. These non-US GAAP financial measures have certain limitations in that they do not have a standardized meaning and thus the Company's definition may be different from similar non-US GAAP financial measures used by other companies and/or analysts and may differ from period to period. Thus it may be more difficult to compare the Company's financial performance to that of other companies. However, the Company's management compensates for these limitations by providing the relevant disclosure of the items excluded in the calculation of non-US GAAP net income and non-US GAAP EPS both in its reconciliation to the US GAAP financial measures of net income and EPS and its consolidated financial statements, all of which should be considered when evaluating the Company's results. The Company uses the financial measures non-US GAAP EPS and non-US GAAP net income to supplement the information provided in its consolidated financial statements, which are presented in accordance with US GAAP. The presentation of non-US GAAP net income and non-US GAAP EPS is not meant to be a substitute for net income or net income per share presented in accordance with US GAAP, but rather should be evaluated in conjunction with and as a supplement to such US GAAP measures. OpenText strongly encourages investors to review its financial information in its entirety and not to rely on a single financial measure. The Company therefore believes that despite these limitations, it is appropriate to supplement the disclosure of the US GAAP measures with certain non-US GAAP measures for the reasons set forth below. Non-US GAAP net income and non-US GAAP EPS are calculated as net income or net income per share on a diluted basis, excluding, where applicable, the amortization of acquired intangible assets, other income (expense), share-based compensation, and restructuring, all net of tax. The Company's management believes that the presentation of non-US GAAP net income and non-US GAAP EPS provides useful information to investors because it excludes non-operational charges. The use of the term "non-operational charge" is defined by the Company as those that do not impact 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, such as amortization of acquired intangible assets, restructuring costs, 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 US GAAP. The Company believes the provision of supplemental non-US GAAP measures allows 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 Open Text's performance or expected performance of recurring operations and facilitates period-to-period comparison of operating performance. As a result, the Company considers it appropriate and reasonable to provide, in addition to US GAAP measures, supplementary non-US GAAP financial measures that exclude certain items from the presentation of its financial results in this press release.

Copyright © 2012 by Open Text Corporation. "OPENTEXT", "OPENTEXT EVERYWHERE" and the "OPENTEXT ECM SUITE" are trademarks or registered trademarks of Open Text Corporation in the United States of America, Canada, the European Union and/or other countries. This list of trademarks is not exhaustive. Other trademarks, registered trademarks, product names, company names, brands and service names mentioned herein are property of Open Text Corporation or other respective owners.

OPEN TEXT CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. dollars, except share data)   

       
  December 31,
2011  
  June 30,
2011
  (Unaudited)    
ASSETS      
Cash and cash equivalents ..................................................................................................................... $ 413,911    $ 284,140 
Accounts receivable trade, net of allowance for doubtful accounts of $5,630 as of December 31, 2011
  and $5,424 as of June 30, 2011 .............................................................................................................
      166,675          154,568 
Income taxes recoverable .......................................................................................................................       13,665          18,911 
Prepaid expenses and other current assets ............................................................................................       32,983          29,678 
Deferred tax assets ................................................................................................................................        30,729          27,861 
  Total current assets ..............................................................................................................................       657,963          515,158 
Capital assets ..........................................................................................................................................        83,537          77,825 
Goodwill ...................................................................................................................................................       1,040,143          832,481 
Acquired intangible assets ........................................................................................................................       381,922          344,995 
Deferred tax assets ..................................................................................................................................        74,141          42,737 
Other assets ............................................................................................................................................        28,460          19,359 
Deferred charges .....................................................................................................................................        63,583          54,989 
Long-term income taxes recoverable .......................................................................................................        51,831          44,819 
  Total assets ...................................................................................................................................... $ 2,381,580    $ 1,932,363 
       
LIABILITIES AND SHAREHOLDERS' EQUITY      
  Current liabilities:      
  Accounts payable and accrued liabilities ...............................................................................................  $ 138,437    $ 126,249 
  Current portion of long-term debt ..........................................................................................................        41,665          15,545 
  Deferred revenues ................................................................................................................................       225,743          254,531 
  Income taxes payable ............................................................................................................................       20,501          18,424 
  Deferred tax liabilities ............................................................................................................................        2,068          624 
Total current liabilities ...............................................................................................................................       428,414          415,373 
  Long-term liabilities:      
  Accrued liabilities ..................................................................................................................................        13,433          13,727 
  Deferred credits ...................................................................................................................................        6,197          6,878 
  Pension liability ......................................................................................................................................        17,180          18,478 
  Long-term debt ......................................................................................................................................       570,000          282,033 
  Deferred revenues ................................................................................................................................       11,644          11,466 
  Long-term income taxes payable ...........................................................................................................        153,424          101,434 
  Deferred tax liabilities ............................................................................................................................        53,877          43,529 
  Total long-term liabilities ........................................................................................................................       825,755          477,545 
Shareholders' equity:      
  Share capital      
    57,879,063 and 57,301,812 Common Shares issued and outstanding at December 31, 2011
  and June 30, 2011, respectively; Authorized Common Shares: unlimited .......................................
      625,357          614,279 
  Additional paid-in capital ........................................................................................................................       83,008          74,301 
  Accumulated other comprehensive income ............................................................................................       46,222          60,470 
  Retained earnings ..................................................................................................................................       399,323          316,894 
  Treasury stock, at cost (572,413 shares at December 31, 2011 and 572,413 shares at June 30, 2011,
  respectively) .......................................................................................................................................
      (26,499)         (26,499)
  Total shareholders' equity .......................................................................................................................       1,127,411          1,039,445 
  Total liabilities and shareholders' equity .......................................................................................... $ 2,381,580    $ 1,932,363 
       
       

OPEN TEXT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands of U.S. dollars, except share and per share data)
(Unaudited)  

               
  Three months ended
December 31,  
  Six months ended
December 31,  
  2011     2010     2011     2010  
Revenues:              
  License .......................................................................................... $ 89,703    $ 79,204    $ 154,731    $ 121,850 
  Customer support ..........................................................................       165,386          136,702          327,383          266,459 
  Service and other .........................................................................        66,367          51,582          127,388          96,584 
  Total revenues ..............................................................................       321,456          267,488          609,502          484,893 
Cost of revenues:              
  License ..........................................................................................       5,370          5,463          9,368          8,965 
  Customer support ..........................................................................       28,468          21,542          54,737          40,898 
  Service and other ...........................................................................       50,604          41,158          100,955          76,271 
  Amortization of acquired technology-based intangible assets .......        21,253          16,420          42,043          31,847 
  Total cost of revenues ...................................................................       105,695          84,583          207,103         157,981 
Gross profit .......................................................................................       215,761          182,905          402,399         326,912 
Operating expenses:              
  Research and development ...........................................................       42,652          34,268          86,110          65,231 
  Sales and marketing ......................................................................       68,451          58,603          133,331          102,783 
  General and administrative ............................................................       25,126          19,478          50,887          39,288 
  Depreciation ...................................................................................       5,634          5,258          10,892          10,133 
  Amortization of acquired customer-based intangible assets ..........        13,445          9,256          26,486          18,057 
  Special charges .............................................................................       5,221          3,461          12,326          6,656 
  Total operating expenses ...............................................................       160,529          130,324          320,032          242,148 
Income from operations .....................................................................       55,232          52,581          82,367          84,764 
Other income (expense), net .............................................................       2,637          (6,321)         11,949                (3,738)
Interest expense, net .........................................................................       (3,607)         (2,136)         (6,393)         (4,375)
Income before income taxes ..............................................................       54,262          44,124          87,923          76,651 
Provision for income taxes ................................................................       6,819          7,014                5,494          17,870 
Net income for the period .................................................................. $ 47,443    $ 37,110    $ 82,429    $ 58,781 
Net income per share—basic   $ 0.82    $ 0.65    $ 1.43    $ 1.03 
Net income per share—diluted .........................................................  $ 0.81    $ 0.64    $ 1.41    $ 1.01 
Weighted average number of Common Shares outstanding—basic ....       57,846          57,019          57,642          56,950 
Weighted average number of Common Shares outstanding—diluted ....       58,672          58,088          58,647          58,007 
               
               

OPEN TEXT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of U.S. dollars)
(Unaudited)  

               
  Three months ended
December 31, 2011  
  Six months ended
December 31, 2011  
  2011     2010     2011     2010  
Cash flows from operating activities:              
Net income for the period ......................................................................................... $ 47,443    $ 37,110    $ 82,429    $ 58,781 
    Adjustments to reconcile net income to net cash provided by operating
       activities:
             
    Depreciation and amortization of intangible assets ..............................................       40,332    30,934         79,421          60,037 
    Share-based compensation expense ...................................................................       3,397    2,737         8,241          5,337 
    Excess tax benefits on share-based compensation expense ...............................       (163)          (130)                     (495)         (562)
    Pension expense .................................................................................................       169        108         306          231 
    Amortization of debt issuance costs .....................................................................       248    334          578          667 
    Loss on sale and write down of capital assets .....................................................       34      —          203          — 
    Deferred taxes .....................................................................................................       7,891   (3,650)         (6,958)         (3,831)
    Impairment and other non cash charges ..............................................................       2,700    —           1,345          — 
Changes in operating assets and liabilities:              
    Accounts receivable .............................................................................................       (21,681)   (18,208)         (27)         9,670 
    Prepaid expenses and other current assets .........................................................       2,199    1,839         8,041          (689)
    Income taxes ........................................................................................................       (6,760)   3,997          10,936          36,859 
    Deferred charges and credits ..............................................................................       (8,281)   (1,542)         (17,327)         (29,267)
    Accounts payable and accrued liabilities ..............................................................       4,608   4,679                 (16,799)         (21,312)
    Deferred revenue .................................................................................................       (24,808)    (17,538)         (57,806)         (24,772)
    Other assets ........................................................................................................       (2,630)   (667)         (2,042)         (2,212)
Net cash provided by operating activities .................................................................       44,698     40,003          90,046         88,937 
Cash flows from investing activities:              
    Additions of capital assets-net .............................................................................       (8,785)   (7,639)         (16,687)         (14,582)
    Purchase of Patents .............................................................................................       (193)   —             (193)         — 
    Purchase of System Solutions Australia Pty Limited (Message Manager),
     net of cash acquired ............................................................................................
(1,524)     —          (1,524)         — 
    Purchase of Operitel Corporation, net of cash acquired ......................................              —        —          (6,260)                    — 
    Purchase of Global 360 Holding Corp., net of cash acquired ............................... 2,058      —         (245,653)         — 
    Purchase of Stream Serve Inc., net of cash acquired ........................................... —    (57,221)                  —            (57,221)
    Purchase consideration for prior period acquisitions ............................................ (335)    (1,408)         (609)         (2,814)
    Investments in marketable securities .................................................................... —      —          —          (668)
               
Net cash used in investing activities ......................................................................... (8,779)   (66,268)         (270,926)   (75,285)
Cash flow from financing activities:                                                                  
    Excess tax benefits on share-based compensation expense ................................       163        130          495          562 
    Proceeds from issuance of Common Shares ........................................................       3,424     1,307          11,261          4,553 
    Purchase of Treasury Stock .................................................................................       —     (12,499)                  —    (12,499)
    Proceeds from long-term debt and revolver .........................................................       600,000     —          648,500   — 
    Repayment of long term debt and revolver .......................................................... (332,940)   (882)   (333,856)   (1,760)
    Debt issuance costs ............................................................................................. (9,309)   (29)    (9,309)   (29)
               
Net cash provided by (used in) financing activities ...................................................       261,338    (11,973)         317,091    (9,173)
Foreign exchange gain (loss) on cash held in foreign currencies ............................       (2,640)   (5,671)         (6,440)         10,112 
Increase (decrease) in cash and cash equivalents during the period ......................       294,617   (43,909)         129,771          14,591 
Cash and cash equivalents at beginning of the period .............................................       119,294    384,692          284,140          326,192 
and cash equivalents at end of the period ................................................................ $ 413,911    $ 340,783    $ 413,911    $ 340,783 
               

Notes
(1)      Based on comparison of historical revenue figures publicly disseminated by companies in the Enterprise Content Management ("ECM") sector. All dollar amounts in this press release are in US Dollars unless otherwise indicated.
(2)  The following charts provide (unaudited) reconciliations of US GAAP based financial measures to non-US GAAP based financial measures for the three months ended December 31, 2011, and the three months ended December 31. 2010, respectively, as referred to in this press release:
   

Reconciliation of selected GAAP-based measures to Non-GAAP based measures for the three months ended December 31, 2011.

($ in thousands except for per share amounts)  
  Three months ended
December 31, 2011
  GAAP-based
Measures
  Adjustments       Non- GAAP-based
Measures
Cost of Revenues :              
Customer Support 28,468   (34)   (1)   28,434
Service and Other 50,604   (106)   (1)   50,498
Amortization of acquired technology-based intangible assets 21,253   (21,253)   (2)   -
GAAP-based gross profit/ Non-GAAP-based gross profit 215,761   21,393        237,154
Operating Expenses              
Research and  development 42,652   (768)   (1)   41,884
Sales and marketing 68,451   (1,676)   (1)   66,775
General and administrative 25,126   (813)   (1)   24,313
Amortization of acquired customer-based intangible assets 13,445   (13,445)   (2)   -
Special charges 5,221   (5,221)   (3)   -
GAAP-based income from operations/ Non-GAAP-based operating income 55,232   43,316        98,548
Other income, net 2,637   (2,637)   (4)   -
Provision for income taxes 6,819   6,472    (5)   13,291
GAAP-based net income for the period/ Non- GAAP-based net income     47,443        34,207    (6)             81,650
GAAP-based earnings per share/ Non GAAP-based earnings per share - diluted $      0.81   $      0.58    (6)   $            1.39

(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)      Adjustment relates to the exclusion of Special charges from our non-GAAP-based operating expenses as Special charges are generally incurred in the aftermath of acquisitions and are not indicative or related to continuing operations and are hence excluded from our internal analysis of operating results.
(4)      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 are generally not indicative or related to continuing operations and are hence excluded from our internal analysis of operating results.
(5)      Adjustment relates to differences between the GAAP-based tax rate of approximately13% and a non-GAAP-based tax rate of 14%; 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.
(6)      Reconciliation of non-GAAP-based net income to GAAP-based net income:
   
   
  Three months ended
December 31, 2011
    Per share
Non- GAAP- based net income 81,650  1.39 
Less:    
Amortization 34,698  0.59 
Share-based compensation 3,397  0.06 
Special charges 5,221  0.09 
Other (income) expense (2,637) (0.04)
GAAP- based provision for income tax 6,819  0.12 
Tax on non-GAAP-based provision (13,291) (0.24)
GAAP-based net income 47,443  0.81 
     

Reconciliation of selected GAAP-based measures to Non GAAP-based measures for the three months ended December 31, 2010.

($ in thousands except for per share amounts)  
  Three months ended
December 31, 2010
  GAAP-based
measures
Adjustments   Non- GAAP-based
measures
Cost of Revenues :        
Customer Support 21,542  (9) (1) 21,533 
Service and Other                       41,158                                 (172) (1)        40,986 
Amortization of acquired technology-based intangible assets 16,420    (16,420) (2)       - 
GAAP-based gross profit/ Non-GAAP-based gross profit 182,905  16,601         199,506 
Operating Expenses        
Research and  development 34,268                               (832) (1)        33,436 
Sales and marketing 58,603                            (2,299) (1)        56,304 
General and administrative 19,478                                 575  (1)        20,053 
Amortization of acquired customer-based intangible assets   9,256                            (9,256) (2)                                        - 
Special charges   3,461                             (3,461) (3)                                        - 
GAAP-based income from operations/ Non-GAAP-based operating income 52,581  31,874           84,455 
Other expense, net (6,321)                             6,321  (4)                                        - 
Provision for income taxes 7,014                              4,511  (5)        11,525 
GAAP-based net income for the period/ Non- GAAP-based net income                       37,110  33,684  (6)        70,794 
GAAP-based earnings per share/ Non GAAP-based earnings per share - diluted $  0.64                      $ 0.58  (6) $ 1.22 

(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)      Adjustment relates to the exclusion of Special charges from our non-GAAP-based operating expenses as Special charges are generally incurred in the aftermath of acquisitions and are not indicative or related to continuing operations and are hence excluded from our internal analysis of operating results.
(4)      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 are generally not indicative or related to continuing operations and are hence excluded from our internal analysis of operating results.
(5)      Adjustment relates to differences between the GAAP-based tax rate of approximately 16% and a non-GAAP-based tax rate of 14%; 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.
(6)      Reconciliation of non-GAAP-based net income to GAAP-based net income:
   
   
  Three months ended
December 31, 2010
    Per share
Non- GAAP-based net income 70,794  1.22 
Less:    
Amortization 25,676  0.44 
Share-based compensation 2,737  0.05 
Special charges 3,461  0.06 
Other (income) expense 6,321  0.11 
GAAP-based provision for income tax 7,014  0.12 
Tax on non-GAAP- based provision (11,525) (0.20)
GAAP-based net income 37,110  0.64 

(3)  The following table provides a composition of our major currencies for revenue and expenses, expressed as a percentage, for the three and six months ended December 31, 2011:
         
  Three months ended
December 31, 2011  
Currencies     % of Revenue     % of Expenses*  
EURO.....................................          29 %         19 %
GBP........................................          8 %         9 %
CHF........................................          2 %         2 %
CAD........................................          6 %         18 %
USD........................................          46 %         41 %
Other......................................          9 %         11 %
Total.......................................          100 %         100 %
       

 

  Six months ended
December 31, 2011
Currencies     % of Revenue     % of Expenses*  
EURO......................................         29 %   19 %
GBP........................................          8 %    9 %
CHF........................................          2 %    2 %
CAD........................................         6 %   19 %
USD........................................          46 %   40 %
Other......................................          9 %   11 %
Total.......................................          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.
(4)  The following table provides details of our adjustment related to deferred maintenance revenue, on account of purchase price accounting, for the three months ended December 31, 2011 and for future quarters:

In '000s USD     Total  
Q2 Fiscal Year 2012.................................................................          1,705
Q3 Fiscal Year 2012.................................................................          618
Q4 Fiscal Year 2012.................................................................         322
Fiscal year 2013.......................................................................         276
Total Fiscal Year 2012............................................................    $ 2,921
Total Fiscal Year 2013 and beyond.........................................    $ 276

 

 

 

 

 

 

 

 

 

 

SOURCE Open Text Corporation