Open Text Reports Fourth Quarter and Fiscal Year-End 2008 Financial Results



    WATERLOO, ON, Aug. 19 /CNW/ - Open Text(TM) Corporation (NASDAQ:  OTEX)
(TSX:OTC), a leading provider of Enterprise Content Management (ECM) software,
today announced unaudited financial results for its fourth quarter and fiscal
year ended June 30, 2008. (1)
    Total revenue for the fourth quarter was $200.3 million, up 14% compared
to $175.2 million for the same period in the prior fiscal year. License
revenue in the fourth quarter was $68.2 million, up 15% compared to
$59.2 million in the fourth quarter of the prior fiscal year.
    Adjusted net income in the quarter was $33.3 million or $0.63 per share
on a diluted basis, up 25% compared to $26.7 million or $0.52 per share on a
diluted basis for the same period in the prior fiscal year. Net income in
accordance with U.S. generally accepted accounting principles ("US GAAP") was
$27.3 million or $0.51 per share on a diluted basis, compared to $8.2 million
or $0.16 per share on a diluted basis for the same period in the prior fiscal
year. (2)
    Total revenue for fiscal year 2008 was $725.5 million, up 22% compared to
$595.7 million for the previous fiscal year. License revenue for fiscal year
2008 was $219.1 million, up 20% compared to $182.5 million in the previous
fiscal year.
    Adjusted net income for fiscal year 2008 was $107.0 million, or $2.03 per
share on a diluted basis, up 44% compared to adjusted net income for the
previous fiscal year of $74.3 million, or $1.46 per share on a diluted basis.
Net income for fiscal year 2008 in accordance with US GAAP was $53.0 million,
or $1.01 per share on a diluted basis, compared to the prior fiscal year's net
income of $21.7 million, or $0.43 per share on a diluted basis. (2)
    Operating cash flow in the fourth quarter of fiscal 2008 was
$44.6 million, compared to $28.5 million in the fourth quarter of the prior
fiscal year. For the full 2008 fiscal year, Open Text generated $166.0 million
in operating cash flow compared to $110.9 million in fiscal 2007.
    The cash, cash equivalents and short-term investments balance as of June
30, 2008 was $254.9 million. Accounts receivable as of June 30, 2008, totaled
$134.4 million, compared to $128.8 million as of June 30, 2007, and Days Sales
Outstanding (DSO) was 60 days in the fourth quarter of fiscal 2008, compared
to 66 days in the fourth quarter of fiscal 2007.
    "I am very pleased with our performance in the quarter and for the full
fiscal year," said John Shackleton, President and Chief Executive Officer of
Open Text. "We have achieved our goal of strong license growth, record
profitability and exemplary cash flow accumulation. As we enter into fiscal
2009, we remain confident in our momentum and look forward to continued growth
in the coming year."
    Please see note (2) below for a reconciliation of non-US GAAP based
financial measures used in this press release, to US GAAP based financial
measures.

    Teleconference Call

    Open Text will host a conference call on August 19, 2008 at 5:00 p.m. ET
to discuss the final financial results of its fourth quarter and fiscal
year-end 2008.

    
                       Date: Tuesday, August 19, 2008
                       Time: 5:00 p.m. ET/2:00 p.m. PT
                       Length: 60 minutes
                       Where: 416-640-1907
    

    Please dial-in approximately 10 minutes before the teleconference is
scheduled to begin. A replay of the call will be available beginning
August 19, 2008 at 7:00 p.m. ET through 11:59 p.m. on September 2, 2008 and
can be accessed by dialing 416-640-1917 and using pass code 21276674 followed
by the number sign.
    For more information or to listen to the call via Web cast, please use
the following link: http://www.opentext.com/events/wa-event.html?id=6789650.

    About Open Text

    Open Text(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. Open Text
supports approximately 46,000 customers in 114 countries and 12 languages. For
more information about Open Text, visit www.opentext.com.

    Safe Harbor Statement under the Private Securities Litigation Reform Act
    of 1995

    This press release contains forward-looking statements, including
statements about the financial conditions, and results of operations and
earnings for Open Text Corporation ("Open Text" or "the Company").
Forward-looking statements in this press release are not promises or
guarantees of future performance and are subject to risks and uncertainties
that could cause the Company's actual results to differ materially from those
anticipated. The Company cautions you not to place undue reliance upon any
such forward-looking statements, which speak only as of the date made. The
results included in this press release are unaudited and therefore are deemed
to be forward-looking statements. Factors that may cause actual results or
earnings to differ materially from such forward-looking statements include,
among others, the following: (i) the future performance, financial and
otherwise, of Open Text; (ii) the ability of Open Text 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 thereunder; (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; (ix) demand for
the Company's products; and (10) other risks detailed from time to time in the
Company's filings with the Securities and Exchange Commission (SEC), including
the Company's Annual Report on Form 10-K for the year ended June 30, 2007.
Forward-looking statements are based on management's beliefs and opinions at
the time the statements are made, and the Company does not undertake any
obligation to update forward-looking statements should circumstances or
management's beliefs or opinions change.

    
    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) In addition to these GAAP and adjusted results the Company has
        provided financial information that adds back maintenance revenue
        eliminated due to the impact of purchase accounting entries on
        deferred revenue and the impact of interest expense. Management
        believes that the furnishing of these adjustments provides a
        consistent basis for comparison between quarters and help to more
        accurately reflect Open Text's underlying operating results.


                                                          Three months ended
                                                               June 30, 2008
        Adjusted Income                                              $  33.3
        Net Interest Expense                                             0.7
        Income tax effect                                               (0.2)
                                                          -------------------
        Non-GAAP net income                                          $  33.8
                                                          -------------------
                                                          -------------------

        Adjusted EPS Diluted                                         $  0.63
        Non GAAP Adjustments (net of tax)
        - Interest                                                      0.01
                                                          -------------------
        Non-GAAP EPS                                                 $  0.64
                                                          -------------------
                                                          -------------------


                                                         Twelve months ended
                                                               June 30, 2008
        GAAP Revenue                                                 $ 725.5
        Maintenance revenue adjustment for purchase
         accounting                                                      1.6
                                                          -------------------
        Non-GAAP revenue                                             $ 727.1
                                                          -------------------
                                                          -------------------

        Adjusted Income                                              $ 107.0
        Maintenance revenue adjustment for purchase
         accounting                                                      1.6
        Net Interest Expense                                            22.9
        Income tax effect                                               (7.4)
                                                          -------------------
        Non-GAAP net income                                          $ 124.1
                                                          -------------------
                                                          -------------------

        Adjusted EPS Diluted                                         $  2.03
        Non GAAP Adjustments (net of tax)
        - Maintenance                                                   0.02
        - Interest                                                      0.30
                                                          -------------------
        Non-GAAP EPS                                                 $  2.35
                                                          -------------------
                                                          -------------------

    (3) Use of US 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
        adjusted net income and adjusted 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 adjusted EPS and adjusted net income to supplement the
        information provided in its consolidated financial statements, which
        are presented in accordance with US GAAP. The presentation of
        adjusted net income and adjusted 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. Open Text 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. Adjusted net income and adjusted 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 (loss), share-based compensation, and
        restructuring, all net of tax. The Company's management believes that
        the presentation of adjusted net income and adjusted 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 intangibles, restructuring costs, 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. The following charts provide reconciliation
        (unaudited) of US GAAP based financial measures to non-US GAAP based
        financial measures referred to in this press release:

        Reconciliation (unaudited) of US GAAP based Net Income to Adjusted
        --------------------------------------------------------------------
        Net Income (in millions of US dollars) for the quarters ended
        --------------------------------------------------------------------
        June 30, 2008 and 2007:
        -----------------------

                                      Three months ended  Three months ended
                                           June 30, 2008       June 30, 2007
        GAAP based "Net Income"                  $  27.3             $   8.2
        Special Charges/(recovery)                  (0.3)                7.7
        Amortization of intangibles                 18.4                18.0
        Other (Income)/Expense                     (11.3)               (1.1)
        Share-based compensation                     1.0                 1.5
        Tax Impact on Above                         (1.8)               (7.6)
        Non-GAAP based "Adjusted Net Income"     $  33.3             $  26.7


        Reconciliation (unaudited) of US GAAP based EPS to non-US GAAP based
        --------------------------------------------------------------------
        EPS (calculated on a diluted basis) for the quarters ended
        --------------------------------------------------------------------
        June 30, 2008 and 2007:
        -----------------------

                                      Three months ended  Three months ended
                                           June 30, 2008       June 30, 2007

        GAAP based "Net Income"                  $  0.51             $  0.16
        Special Charges/(recovery)                 (0.01)               0.15
        Amortization of intangibles                 0.35                0.35
        Other (Income)/Expense                     (0.21)              (0.02)
        Share-based compensation                    0.02                0.03
        Tax Impact on Above                        (0.03)              (0.15)
        Non-GAAP based "Adjusted Net Income"     $  0.63             $  0.52


        Reconciliation (unaudited) of US GAAP based Net Income to Adjusted
        --------------------------------------------------------------------
        Net Income (in millions of US dollars) for the fiscal years ended
        --------------------------------------------------------------------
        June 30, 2008 and 2007:
        -----------------------


                                                  Twelve              Twelve
                                            months ended        months ended
                                           June 30, 2008       June 30, 2007

        GAAP based "Net Income"                  $  53.0             $  21.7
        Special Charges/(recovery)                  (0.4)               12.9
        Amortization of intangibles                 72.3                60.8
        Other (Income)/Expense                       1.0                (1.8)
        Share-based compensation                     3.8                 5.4
        Tax Impact on Above                        (22.7)              (24.7)
        Non-GAAP based "Adjusted Net Income"     $ 107.0             $  74.3


        Reconciliation (unaudited) of US GAAP based EPS to non-US GAAP based
        --------------------------------------------------------------------
        EPS (calculated on a diluted basis) for the fiscal years ended
        --------------------------------------------------------------------
        June 30, 2008 and 2007:
        -----------------------

                                                  Twelve              Twelve
                                            months ended        months ended
                                           June 30, 2008       June 30, 2007

        GAAP based "Net Income"                  $  1.01             $  0.43
        Special Charges/(recovery)                 (0.01)               0.25
        Amortization of intangibles                 1.37                1.19
        Other (Income)/Expense                      0.02               (0.03)
        Share-based compensation                    0.07                0.11
        Tax Impact on Above                        (0.43)              (0.49)
        Non-GAAP based "Adjusted Net Income"     $  2.03             $  1.46



                            OPEN TEXT CORPORATION
                         CONSOLIDATED BALANCE SHEETS
              (In thousands of U.S. Dollars, except share data)

                                                             June 30,
                                                    -------------------------
                                                         2008        2007
                                                    ------------ ------------
                                                    (unaudited)    (audited)
                        ASSETS

    Current assets:
      Cash and cash equivalents.................... $   254,916  $   149,979
      Accounts receivable trade, net of allowance
       for doubtful accounts of $3,974 as of
       June 30, 2008 and $2,089 as of June 30,
       2007........................................     134,396      128,781
      Income taxes recoverable.....................      48,310       31,060
      Prepaid expenses and other current assets....      10,544       10,368
      Deferred tax assets..........................      13,455       30,248
                                                    ------------ ------------
        Total current assets.......................     461,621      350,436
    Capital assets.................................      43,582       43,614
    Goodwill.......................................     564,648      528,312
    Acquired intangible assets.....................     281,824      343,324
    Deferred tax assets............................      59,881       42,078
    Other assets...................................      10,491        9,524
    Long-term income taxes recoverable.............      30,348        9,557
                                                    ------------ ------------
                                                    $ 1,452,395  $ 1,326,845
                                                    ------------ ------------
                                                    ------------ ------------

          LIABILITIES AND SHAREHOLDERS' EQUITY

    Current liabilities:
      Accounts payable and accrued liabilities..... $    99,035  $   100,211
      Current portion of long-term debt............       3,486        4,048
      Deferred revenues............................     176,967      143,097
      Income taxes payable.........................      43,202       33,705
      Deferred tax liabilities.....................       4,876        1,601
                                                    ------------ ------------
        Total current liabilities..................     327,566      282,662
    Long-term liabilities:
      Accrued liabilities..........................      20,513       22,516
      Long-term debt...............................     304,301      366,765
      Deferred revenues............................       2,573        3,840
      Long-term income taxes payable...............      42,697            -
      Deferred tax liabilities.....................     109,912      120,019
                                                    ------------ ------------
        Total long-term liabilities................     479,996      513,140
    Minority interest..............................       8,672        6,975
    Shareholders' equity:

      Share capital
        51,151,666 and 50,180,118 Common Shares
         issued and outstanding at June 30, 2008
         and June 30, 2007, respectively;
         Authorized Common Shares: unlimited.......     438,471      426,188
      Additional paid-in capital...................      39,330       35,311
      Accumulated other comprehensive income.......     110,819       68,034
      Retained earnings (deficit)..................      47,541       (5,465)
                                                    ------------ ------------
    Total shareholders' equity.....................     636,161      524,068
                                                    ------------ ------------
                                                    $ 1,452,395  $ 1,326,845
                                                    ------------ ------------
                                                    ------------ ------------


                            OPEN TEXT CORPORATION
                      CONSOLIDATED STATEMENTS OF INCOME
       (In thousands of U.S. Dollars, except share and per share data)

                                                Year ended June 30,
                                        -------------------------------------
                                           2008         2007         2006
                                        ----------- ------------ ------------
                                        (unaudited)   (audited)    (audited)
    Revenues:
      License.......................... $  219,103   $  182,507   $  122,520
      Customer support.................    363,580      287,570      183,878
      Service..........................    142,849      125,587      103,164
                                        ----------- ------------ ------------
        Total revenues.................    725,532      595,664      409,562
                                        ----------- ------------ ------------
    Cost of revenues:
      License..........................     15,415       13,652       11,196
      Customer support.................     58,764       46,433       28,908
      Service..........................    117,037      105,955       83,469
      Amortization of acquired
       technology intangible assets....     41,515       36,206       18,900
                                        ----------- ------------ ------------
        Total cost of revenues.........    232,731      202,246      142,473
                                        ----------- ------------ ------------
                                           492,801      393,418      267,089
                                        ----------- ------------ ------------
    Operating expenses:
      Research and development.........    105,894       79,102       58,469
      Sales and marketing..............    174,185      150,958      104,225
      General and administrative.......     69,985       61,092       44,960
      Depreciation.....................     12,017       13,846       11,103
      Amortization of acquired
       intangible assets...............     30,759       24,586        9,199
      Special charges (recoveries).....       (418)      12,908       26,182
                                        ----------- ------------ ------------
        Total operating expenses.......    392,422      342,492      254,138
                                        ----------- ------------ ------------
    Income from operations.............    100,379       50,926       12,951
                                        ----------- ------------ ------------
    Other income (expense), net........     (1,023)       1,742       (4,788)
    Interest income (expense), net.....    (22,859)     (20,282)       1,487
                                        ----------- ------------ ------------
    Income before income taxes.........     76,497       32,386        9,650
    Provision for income taxes.........     22,993       10,334        4,093
                                        ----------- ------------ ------------
    Net income before minority
     interest..........................     53,504       22,052        5,557
    Minority interest..................        498          392          579
                                        ----------- ------------ ------------
    Net income for the year............ $   53,006   $   21,660   $    4,978
                                        ----------- ------------ ------------
                                        ----------- ------------ ------------
    Net income per share - basic....... $     1.04   $     0.44   $     0.10
                                        ----------- ------------ ------------
                                        ----------- ------------ ------------
    Net income per share - diluted..... $     1.01   $     0.43   $     0.10
                                        ----------- ------------ ------------
                                        ----------- ------------ ------------
    Weighted average number of Common
     Shares outstanding - basic........ 50,779,530   49,392,845   48,666,139
                                        ----------- ------------ ------------
                                        ----------- ------------ ------------
    Weighted average number of Common
     Shares outstanding - diluted...... 52,604,115   50,907,897   49,949,593
                                        ----------- ------------ ------------
                                        ----------- ------------ ------------


                            OPEN TEXT CORPORATION
                      CONSOLIDATED STATEMENTS OF INCOME
            (In thousands of U.S. dollars, except per share data)
                                 (Unaudited)

                                                  Three months ended June 30,
                                                    -------------------------
                                                         2008        2007
                                                    ------------ ------------
    Revenues:
      License...................................... $    68,151  $    59,225
      Customer support.............................      95,056       82,218
      Service......................................      37,062       33,753
                                                    ------------ ------------
        Total revenues.............................     200,269      175,196
    Cost of revenues:
      License......................................       4,119        4,015
      Customer support.............................      17,683       14,356
      Service......................................      30,485       28,505
      Amortization of acquired technology-based
       intangible assets...........................      10,615       10,531
                                                    ------------ ------------
        Total cost of revenues.....................      62,902       57,407
                                                    ------------ ------------
                                                        137,367      117,789
                                                    ------------ ------------
    Operating expenses:
      Research and development.....................      28,527       21,113
      Sales and marketing..........................      51,966       43,193
      General and administrative...................      17,752       18,452
      Depreciation.................................       2,372        3,321
      Amortization of acquired customer-based
       intangible assets...........................       7,753        7,439
      Special charges (recoveries).................        (296)       7,655
                                                    ------------ ------------
        Total operating expenses...................     108,074      101,173
                                                    ------------ ------------
    Income from operations.........................      29,293       16,616
    Other income (expense), net....................      11,318        1,138
    Interest income (expense), net.................        (736)      (5,612)
                                                    ------------ ------------
    Income before income taxes.....................      39,875       12,142
    Provision for (recoveries from) income taxes...      12,545        3,913
                                                    ------------ ------------
    Net income before minority interest............      27,330        8,229
    Minority interest..............................          76            -
                                                    ------------ ------------
    Net income for the period...................... $    27,254  $     8,229
                                                    ------------ ------------
                                                    ------------ ------------
    Net income per share - basic................... $      0.53  $      0.16
                                                    ------------ ------------
                                                    ------------ ------------
    Net income per share - diluted................. $      0.51  $      0.16
                                                    ------------ ------------
                                                    ------------ ------------
    Weighted average number of Common Shares
     outstanding - basic...........................      51,124       49,964
                                                    ------------ ------------
                                                    ------------ ------------
    Weighted average number of Common Shares
     outstanding - diluted.........................      53,068       51,571
                                                    ------------ ------------
                                                    ------------ ------------


                            OPEN TEXT CORPORATION
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                       (In thousands of U.S. Dollars)

                                                   Year ended June 30,
                                           ----------------------------------
                                              2008        2007        2006
                                           ----------  ----------  ----------
                                          (unaudited)  (audited)   (audited)
    Cash flows from operating activities:
      Net income for the year............. $  53,006   $  21,660   $   4,978
      Adjustments to reconcile net income
       to net cash provided by operating
       activities:

        Depreciation and amortization.....    84,291      74,638      39,202
        In-process research and
         development......................       500           -           -
        Share-based compensation expense..     3,789       5,376       5,196
        Employee long-term incentive
         plan.............................     2,154           -           -
        Excess tax benefits from
         share-based compensation.........    (1,079)     (1,285)       (865)
        Undistributed earnings related to
         minority interest................       498         392         579
        Amortization of debt issuance
         costs............................     1,220         805           -
        Unrealized (gain) loss on financial
         instruments......................     3,178        (380)          -
        Deferred taxes....................   (27,136)    (19,097)     (4,314)
        Impairment of capital assets......         -           -       3,819
        Impairment of intangible assets...         -         697       1,046

      Changes in operating assets and
       liabilities:
        Accounts receivable                   (5,626)     11,089       9,406
        Prepaid expenses and other current
         assets...........................      (168)      1,425         (65)
        Income taxes......................    15,410      (8,313)     (2,953)
        Accounts payable and accrued
         liabilities......................       914       6,195      (3,204)
        Deferred revenue..................    33,751      13,746       5,228
        Other assets......................     1,274       3,916       2,745
                                           ----------  ----------  ----------
    Net cash provided by operating
     activities...........................   165,976     110,864      60,798

    Cash flows from investing activities:
      Acquisition of capital assets.......    (6,895)     (5,260)    (19,278)
      Additional purchase consideration
       for prior period acquisitions......    (1,065)     (2,283)     (8,410)
      Purchase of Hummingbird, net of
       cash acquired......................         -    (384,761)          -
      Purchase of Momentum, net of cash
       acquired...........................         -      (4,076)          -
      Purchase of an asset group
       constituting a business............    (2,209)          -           -
      Investments in marketable
       securities.........................         -        (829)    (20,241)
      Acquisition related costs...........   (18,248)    (39,061)     (6,798)
                                           ----------  ----------  ----------
    Net cash used in investment activities   (28,417)   (436,270)    (54,727)

    Cash flow from financing activities:
      Excess tax benefits on share-based
       compensation expense...............     1,079       1,285         865
      Proceeds from issuance of Common
       Shares.............................    12,272      11,734       4,569
      Proceeds from long-term debt........         -     390,000      12,928
      Repayment of long-term debt.........   (63,616)    (33,247)       (160)
      Debt issuance costs.................      (349)     (7,433)          -
                                           ----------  ----------  ----------
    Net cash provided by (used in)
     financing activities.................   (50,614)    362,339      18,202
    Foreign exchange gain on cash held in
     foreign currencies...................    17,992       5,692       3,183
    Increase (decrease) in cash and cash
     equivalents during the year..........   104,937      42,625      27,456
    Cash and cash equivalents at beginning
     of the year..........................   149,979     107,354      79,898
                                           ----------  ----------  ----------
    Cash and cash equivalents at end of
     the year............................. $ 254,916   $ 149,979   $ 107,354
                                           ----------  ----------  ----------
                                           ----------  ----------  ----------


                            OPEN TEXT CORPORATION
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                       (In thousands of U.S. Dollars)

                                                      For the three months
                                                          ended June 30,
                                                    ------------ ------------
                                                         2008        2007
                                                    ------------ ------------
    Cash flows from operating activities:
      Net income for the period.................... $    27,254  $     8,229
      Adjustments to reconcile net income to net
       cash provided by operating activities:
        Depreciation and amortization..............      20,740       21,291
        Share-based compensation expense...........         994        1,515
        Employee long-term incentive plan..........         664            -
        Excess tax benefits from share based
         compensation..............................        (212)        (163)
        Undistributed earnings related to minority
         interest..................................          76            -
        Amortization of debt issuance costs........         216          274
        Unrealized (gain) loss on financial
         instruments...............................      (2,401)        (956)
        Deferred taxes.............................     (22,517)       4,097
        Impairment of intangible assets............           -          697
      Changes in operating assets and liabilities:
        Accounts receivable........................       1,392      (15,958)
        Prepaid expenses and other current assets..       1,840          743
        Income taxes...............................       9,518      (6,054)
        Accounts payable and accrued liabilities...       8,763       15,885
        Deferred revenue...........................      (2,304)      (1,143)
        Other assets...............................         588            -
                                                    ------------ ------------
    Net cash provided by operating activities......      44,611       28,457

    Cash flows from investing activities:
      Acquisition of capital assets................      (1,481)        (640)
      Additional purchase consideration for prior
       period acquisitions.........................        (614)        (341)
      Acquisition related costs....................      (3,341)     (10,812)
                                                    ------------ ------------
    Net cash used in investment activities.........      (5,436)     (11,793)

    Cash flow from financing activities:
      Excess tax benefits on share-based
       compensation expense........................         212          163
      Proceeds from issuance of Common Shares......         857        2,905
      Repayment of long-term debt..................        (870)     (31,003)
                                                    ------------ ------------
    Net cash provided by (used in) financing
     activities....................................         199      (27,935)
    Foreign exchange gain (loss) on cash held in
     foreign currencies............................        (220)       1,567
    Increase (decrease) in cash and cash equivalents
     during the period.............................      39,154       (9,704)
    Cash and cash equivalents at beginning of the
     period........................................     215,762      159,683
                                                    ------------ ------------
    Cash and cash equivalents at end of the period. $   254,916  $   149,979
                                                    ------------ ------------
                                                    ------------ ------------
    





For further information:

For further information: Paul McFeeters, Chief Financial Officer, Open
Text Corporation, (905) 762-6121, pmcfeeters@opentext.com; Greg Secord,
Vice-President, Investor Relations, Open Text Corporation, (519) 888-7111
ext.2408, gsecord@opentext.com


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