Open Text Corporation · TSX:OTEX
Open Text — Investor Day (July 2018)
56 slides from Open Text's investor day presentation, Jul 10, 2018
Slide 1: Investor Day Presentation: Enterprise World 2018
Investor Day Presentation: Enterprise World 2018 NASDAQ: OTEX | TSX: OTEX
Slide 2: Agenda
Agenda Time Presenters Topic 12:00 – 12:30 PM Lunch Greg Secord 12:30 – 12:35 PM Welcome VP, Investor Relations Mark J. Barrenechea 12:35 – 1:20 PM Strategic Overview Vice Chair, CEO & CTO Muhi Majzoub 1:20 – 1:40 PM Product Update and Demo EVP, Engineering and Cloud Services Simon “Ted” Harrison 1:
Slide 3: Safe Harbor Statement
Safe Harbor Statement Certain statements in this presentation, including statements about the focus of Open Text Corporation (“OpenText” or “the Company”) in our fiscal year ending June 30, 2018 (Fiscal 2018) on growth in earnings and cash flows, creating value through investments in broader Enterpr
Slide 4: Mark J. Barrenechea
Mark J. Barrenechea Vice Chair, CEO and CTO OpenText Confidential. ©2018 All Rights Reserved. 4
Slide 5: Welcome to Enterprise World 2018
Welcome to Enterprise World 2018 4,000 500 265 100 90 80 50 5 Attendees Partners Breakout Customer Industry Exhibitors Countries Days Sessions Speakers Experts OpenText Confidential. ©2018 All Rights Reserved. 5
Slide 6: Customers and Partners at Enterprise World
Customers and Partners at Enterprise World Customers Partners OpenText Confidential. ©2018 All Rights Reserved. 6
Slide 7: Top Priorities
Top Priorities Intelligent and Connected OpenText Enterprise Cloud Total Security Business Network Content Services Intelligent CORE Platform for Innovation Run Anywhere Simplify Consumption OpenText Confidential. ©2018 All Rights Reserved. 7
Slide 8: Experienced Management Team
Experienced Management Team Mark J. Madhu Muhi Gordon Simon “Ted” James Barrenechea Ranganathan Majzoub Davies Harrison McGourlay Vice Chair, EVP, EVP, EVP, CLO & EVP, EVP, CEO & CTO CFO Engineering & Corporate Worldwide Worldwide Cloud Services Development Sales Support Paul Kasey David Prentiss Le
Slide 9: Global Operations and Distribution
Global Operations and Distribution San Mateo, CA Gaithersburg, MD Melbourne, AU Bangalore, India Reading, UK Singapore Waterloo, ON Total Americas EMEA APJ Total Employees United States Canada Europe, Middle East, Africa APJ # of Employees(1): 12,000 3,700 1,700 2,300 4,300 Total Revenue United Stat
Slide 10: The Information Company
NASDAQ, TSX: OTEX A TSX-60 Company The EIM market leader for enterprise software and cloud solutions enabling enterprises to create connected and intelligent organizations (1) Market Leader in EIM Market Leader in Managed Services 120,000 Customers The 100 Million End Users Information 50 Million Se
Slide 11: Our Vision: The Intelligent and Connected Enterprise
Our Vision: The Intelligent and Connected Enterprise Customer experience Content services Employee engagement Security Intelligent information core EIM EIM Supplier efficiency Business Network applications Automation & AI, platforms APIs & data management Asset utilization IoT, data integration Prod
Slide 12: $100 Billion Strategic Opportunity
$100 Billion Strategic Opportunity The Information Company SaaS Enterprise Information Management Mid-Market Managed Content Experts Services AI Business CEM IoT Security ECM Network BPM Discovery Cloud + MORE Search $5B $15B $30B $50B ( $100B 1) 1. Referencing Industry Analyst reports for EIM techn
Slide 13: Total Growth
Total Growth Acquisitions Organic Customer & Partner Success Annual Recurring Revenue • EIM Market leader and expanded portfolio to include Security, AI and IoT • Focus on select verticals: FinServ, Life Sciences, Manufacturing, Auto, Healthcare, Government OpenText Confidential. ©2018 All Rights Re
Slide 14: Six Years of Significant, Sustainable, Profitable Growth
Six Years of Significant, Sustainable, Profitable Growth Total Revenue ARR(1) Adj. Op. Margin(2) Operating Cash Flow ($US M) ($US M) (%) ($US M) $2,725 33% $607 $1,998 114% 400 bps 94% 167% $1,276 $313 $748 29% CY’12 TTM* CY’12 TTM CY’12 TTM CY’12 TTM License Cloud Customer Support Adj. EPS(2,3) ($U
Slide 15: History of Successful Acquisitions
(1) History of Successful Acquisitions • $4.8 billion of capital deployed since 2012 for acquisitions • 15 completed acquisitions over 6 years 2012 2014 2016 2018 • Average revenue multiple of 2.1x revenue • Share price appreciation(2) of 216% 2013 2015 2017 • $271M OCF in Q3 FY’18 (1) Timeline base
Slide 16: Strategic Acquisitions: OpenText is a Platform Operator
Strategic Acquisitions: OpenText is a Platform Operator • Platform Operators have a strategic market thesis, purchase assets within that market strategy, and drive deep value through innovation and integration • Asset Managers purchase individual assets and operate them standalone Platform Asset Ope
Slide 17: Strategic Acquisitions Strategy
Strategic Acquisitions Strategy • Evaluate businesses within the context of “The Information Company” strategy • Fill functional white spaces, vertical capacities and key geographic expansion What We Target: opportunities Unlocking Value • We value recurring revenues, paths to higher margin and stro
Slide 18: The OpenText Business System
The OpenText Business System Acquisitions, Organic, Distribution. Optimize, Scale, Total Customer & Partner Success. Market Leadership Growth Emphasis on recurring revenues. Integration. The Information Customer driven innovation. Strategic Operational Onboarding. Tools, Systems, Methods. Acquisitio
Slide 19: Announcements at Enterprise World
Announcements at Enterprise World • Intelligent and Connected Enterprise • OpenText Blueprint for the future • Release 16 EP5, EP6, EP7 • OpenText OT2 • OpenText Enterprise Cloud run anywhere • OpenText Prime Unlimited • OpenText Prime Protect • Customer Success Stories • GM, Nestle, Malaysia Airpor
Slide 20: Muhi Majzoub
Muhi Majzoub EVP, Engineering and Cloud Services OpenText Confidential. ©2018 All Rights Reserved. 20
Slide 21: Our Vision: The Intelligent and Connected Enterprise
Our Vision: The Intelligent and Connected Enterprise Customer experience Content services Employee engagement Security Intelligent information core EIM EIM Supplier efficiency Business Network applications Automation & AI, platforms APIs & data management Asset utilization IoT, data integration Prod
Slide 22: Release 16 – Your Hybrid EIM Platform
Blue Print for the Future Release 16 – Your Hybrid EIM Platform Point Releases Release 10 Red Oxygen OpenText Release 16 EP Series 2018 - 2019 - 2020 EP1 EP2 EP3 EP4 EP5 EP6 EP7 … Pre 2013 November 2013 March 2016 2016 - 2017 April Nov April Nov Spring 2018 2018 2019 2019 2020 • Most comprehensive E
Slide 23: Blue Print for the Future: OpenText Enterprise Cloud
Blue Print for the Future: OpenText Enterprise Cloud Private Cloud On Premise Managed Services Release 16 Release 16 Business Network OpenText Confidential. ©2018 All Rights Reserved. 23
Slide 24: OpenText Leads in Content Services
OpenText Leads in Content Services Forrester ECM OpenText Content Services Business Content Services Wave 2017(1) “Customers report high levels of satisfaction with integration capabilities, life-cycle management, and overall foundational library services…OpenText Documentum continues to be a solid
Slide 25: Blue Print for the Future: OpenText Enterprise Cloud
Blue Print for the Future: OpenText Enterprise Cloud • 2,000 customers OpenText is responsible for Help IAAS Desk security Systems OT Software • 99.99% Uptime Monitoring Stack OpenText • Never upgrade again Managed Managed App • Run Anywhere DR Services Management • Standards-based: NIST, ISO, SOC,
Slide 26: Business Network Leadership
Business Network Leadership The OpenText Business Network: Optimizes operations, lower cost, accelerates time to revenue, improve customer experiences, and innovates business models Ovum Market Landscape: B2B Integrated Managed Gartner: Market Guide for Integration Brokerage, 2016 Services Providers
Slide 27: Native SaaS Micro-services
Runs in the OpenText Native SaaS Micro-services Quarterly updates Enterprise Cloud Next generation Pre integrated to One data model One tech stack SaaS Release 16 applications OpenText Confidential. ©2018 All Rights Reserved. 27
Slide 28: Blue Print for the Future: OpenText OT2
Blue Print for the Future: OpenText OT2 OT2 Platform OT2 Services OT2 Applications • Cloud Foundry • Integrated Data • CORE • Kafka (Events) • Authentication • Archive Center • Elk (Logging) • IAM • People Center • New Relic (Monitoring) • Workflow • Business Center • Containers • Administration • L
Slide 29: Completing the Need: OpenText Enterprise Cloud
Completing the Need: OpenText Enterprise Cloud Private Cloud Public SaaS On Premise Managed Services Cloud Release 16 Release 16 OT2 Business Network OpenText Confidential. ©2018 All Rights Reserved. 29
Slide 30: Blue Print for the Future: Release 16 + OT2
Blue Print for the Future: Release 16 + OT2 Point Releases Release 10 Red Oxygen OpenText Release 16 EP Series 2018 – 2019 - 2020 EP1 EP2 EP3 EP4 EP5 EP6 EP7 … Pre 2013 November 2013 March 2016 2016 - 2017 April Nov April Nov Spring 2018 2018 2019 2019 2020 Fall Spring Fall Spring 2018 2019 2019 202
Slide 31: Demo of Core, Magellan, and IoT
Demo of Core, Magellan, and IoT OpenText Confidential. ©2018 All Rights Reserved. 31
Slide 32: Simon “Ted” Harrison
Simon “Ted” Harrison EVP, Worldwide Sales OpenText Confidential. ©2018 All Rights Reserved. 32
Slide 33: Our Vision: The Intelligent and Connected Enterprise
Our Vision: The Intelligent and Connected Enterprise Customer experience Content services Employee engagement Security Intelligent information core EIM EIM Supplier efficiency Business Network applications Automation & AI, platforms APIs & data management Asset utilization IoT, data integration Prod
Slide 34: Strategies for Organic Growth
Strategies for Organic Growth Competitive Partner Expansion Install Base Replacement Global 10K Customers OpenText Confidential. ©2018 All Rights Reserved. 34
Slide 35: Competitive Replacement
Competitive Replacement CIOs are continually seeking to rationalize fragmented information systems Market Leadership Paths to Value Market Relevance • Stronger Roadmap • Specialized Migration & • On Premise • Breadth of Capability Archiving Tools • Managed Services • Suite vs. Point • Expert PS Team
Slide 36: Install Base – Our Opportunity
Install Base – Our Opportunity • Point solutions to suite • Developing digital transformation plans • Sell more suites • Migrate to the Cloud • Simplified consumption OpenText Confidential. ©2018 All Rights Reserved. 36
Slide 37: Partner Expansion
Partner Expansion Ecosystem System Integrators Partners Extend Our Reach OEM resellers Implementers Cloud Developer Communities OpenText Confidential. ©2018 All Rights Reserved. 37
Slide 38: IAM & IoT
IAM & IoT GM implemented a secure, identity based digital backbone to power OnStar! Covisint Identity Access Mgmt. drives GM OnStar • OnStar provides peace of mind that help is always on hand and encourages improved customer intimacy. • Simplifies the secure, external access to digital information a
Slide 39: Managed Services
Managed Services Nestlé digitized their supply chain to ensure shelves in retail stores aren’t left empty! Nestlé leverages a B2B Managed Services • Ensuring the timely delivery of all Nestlé products to retailers around the world! • Provides end-to-end visibility of all orders across the multiple r
Slide 40: Artificial Intelligence (AI)
Artificial Intelligence (AI) Intelligent automation & advanced analytics help to transform the passenger experience. • Magellan empowers AI-led digital transformation Malaysia Airports develop unified digital platform to deliver effective engagement & achieve all-round operational efficiency at Kual
Slide 41: Content Services
Content Services BAT creates a global, single source of the truth repository for employee records! BAT standardizes on OpenText & SuccessFactors • Managing significant volumes of employee file information & document generation for 50k employees globally • Extended ECM for SuccessFactors complements
Slide 42: James McGourlay
James McGourlay EVP, Worldwide Support OpenText Confidential. ©2018 All Rights Reserved. 42
Slide 43: Our Vision: The Intelligent and Connected Enterprise
Our Vision: The Intelligent and Connected Enterprise Customer experience Content services Employee engagement Security Intelligent information core EIM EIM Supplier efficiency Business Network applications Automation & AI, platforms APIs & data management Asset utilization IoT, data integration Prod
Slide 44: Worldwide Leadership
Worldwide Leadership One Renewals Organization Customer engagement Analytics & automation #CSAT 60+ offices 11+ supported languages* 1200+ technical analysts OpenText Confidential. ©2018 All Rights Reserved. 44
Slide 45: ARR Drivers
ARR Drivers Product Adoption Analytics & AI Customer Satisfaction Cloud ARR Best Practices OpenText Confidential. ©2018 All Rights Reserved. 45
Slide 46: Product Adoption
Product Adoption Customer Outcome Customer Success Engineering Experience OpenText Confidential. ©2018 All Rights Reserved. 46
Slide 47: Customer Success Through AI
Customer Success Through AI Customer information Renewals data Ticket information Predictive Analytics Using Magellan Sentiment analysis Feedback / CSAT Scores OpenText Confidential. ©2018 All Rights Reserved. 47
Slide 48: The OpenText Cloud
The OpenText Cloud • BYOL – Bring Your Own License • OpenText experts manage the delivery of Enterprise Information Systems • Managed Services deployments are more successful • OpenText OT2 OpenText Confidential. ©2018 All Rights Reserved. 48
Slide 49: Targeting the Global 10,000
Targeting the Global 10,000 Enterprise customers are looking for: • Business outcomes • Customer-centric focus • Integrated support • Industry expertise • One source for renewals OpenText Confidential. ©2018 All Rights Reserved. 49
Slide 50: Questions?
Questions? OpenText Confidential. ©2018 All Rights Reserved. 50
Slide 51: Appendix
Appendix OpenText Confidential. ©2018 All Rights Reserved. 51
Slide 52: Appendix A
Appendix A Use of Non-GAAP Financial Measures In addition to reporting financial results in accordance with U.S. GAAP, the Company provides certain financial measures that are not in accordance with U.S. GAAP (Non-GAAP).These Non-GAAP financial measures have certain limitations in that they do not h
Slide 53: Reconciliation of Selected Non-GAAP Measures | Fiscal 2018 YTD
Reconciliation of Selected Non-GAAP Measures | Fiscal 2018 YTD Nine Months Ended March 31, 2018 (in ‘000s USD) GAAP % of Non-GAAP % of GAAP Total Revenue Adjustments FN Non- GAAP Total Revenue COST OF REVENUES Cloud services and subscriptions $ 269,012 $ (1,119) (1) $ 267,893 Customer support 99,805
Slide 54: Reconciliation of Selected Non-GAAP Measures | Fiscal 2018 YTD
Reconciliation of Selected Non-GAAP Measures | Fiscal 2018 YTD FOOTNOTES 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. Adjustment relates to the exclusi
Slide 55: Reconciliation of Selected Non-GAAP Measures | Q4 F17
Reconciliation of Selected Non-GAAP Measures | Q4 F17 Three Months Ended June 30, 2017 (in ‘000s USD) GAAP % of Non-GAAP % of GAAP Total Revenue Adjustments FN Non- GAAP Total Revenue COST OF REVENUES Cloud services and subscriptions $ 79,588 $ (390) (1) $ 79,198 Customer support 35,224 (313) (1) 34
Slide 56: Reconciliation of Selected Non-GAAP Measures | Q4 F17
Reconciliation of Selected Non-GAAP Measures | Q4 F17 FOOTNOTES 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. Adjustment relates to the exclusion of amo