On August 1, 2024, Open Text Corp (OTEX, Financial) released its 8-K filing detailing its financial results for the fourth quarter and fiscal year ended June 30, 2024. Open Text Corp, originating from a technology project at Canada's University of Waterloo in the mid-1980s, provides software solutions for managing unstructured information. The company is headquartered in Ontario, Canada.
Fiscal Year 2024 Financial Highlights
Open Text Corp reported total annual revenues of $5.8 billion, representing a 28.6% year-over-year increase, slightly below the analyst estimate of $5.81 billion. The company also achieved annual recurring revenues (ARR) of $4.5 billion, up 25.4% year-over-year, and cloud revenues of $1.8 billion, up 7.1% year-over-year.
Key financial metrics for the fiscal year included:
| Metric | FY 2024 | FY 2023 | % Change |
|---|---|---|---|
| Total Revenues (in millions) | $5,769.6 | $4,485.0 | 28.6% |
| GAAP-based Net Income (in millions) | $465.1 | $150.4 | 209.3% |
| GAAP-based EPS, diluted | $1.71 | $0.56 | 205.4% |
| Non-GAAP-based EPS, diluted | $4.17 | $3.29 | 26.7% |
| Adjusted EBITDA (in millions) | $1,970.2 | $1,472.9 | 33.8% |
| Operating Cash Flows (in millions) | $967.7 | $779.2 | 24.2% |
| Free Cash Flows (in millions) | $808.4 | $655.4 | 23.3% |
Quarterly Performance
For the fourth quarter, Open Text Corp reported total revenues of $1.4 billion, a decrease of 8.6% year-over-year, reflecting the divestiture of the Application Modernization and Connectivity (AMC) business. Despite this, the company achieved a GAAP-based net income of $248 million, up 609.4% year-over-year, and a GAAP-based diluted EPS of $0.91, surpassing the analyst estimate of $0.58.
Key quarterly metrics included:
| Metric | Q4 FY 2024 | Q4 FY 2023 | % Change |
|---|---|---|---|
| Total Revenues (in millions) | $1,362.1 | $1,490.8 | (8.6)% |
| GAAP-based Net Income (in millions) | $248.2 | ($48.7) | 609.4% |
| GAAP-based EPS, diluted | $0.91 | ($0.18) | 605.6% |
| Non-GAAP-based EPS, diluted | $0.98 | $0.91 | 7.7% |
| Adjusted EBITDA (in millions) | $445.4 | $462.8 | (3.8)% |
| Operating Cash Flows (in millions) | $185.2 | $115.3 | 60.6% |
| Free Cash Flows (in millions) | $145.2 | $91.2 | 59.2% |
Strategic Initiatives and Future Outlook
Open Text Corp announced a new $300 million share repurchase program and increased its annualized dividend by 5% to $1.05 per share. The company aims to return approximately $570 million to shareholders in fiscal 2025 through dividends and share repurchases.
"We are incredibly proud of our Fiscal 2024 performance. We delivered strong operating results including our AMC divestiture, $808 million of free cash flows, and reduced our net leverage ratio from 3.8x to 2.9x. Our focus is now on delivering to our Fiscal 2025 plans and targets, and the significant margin and FCF opportunity in front of us."
— Madhu Ranganathan, OpenText President & CFO
Open Text Corp's strategic focus on expanding its Information Management competitive advantage, enhancing margins, and delivering record capital returns underscores its commitment to driving shareholder value. The company's robust financial performance
Explore the complete 8-K earnings release (here) from Open Text Corp for further details.
