Open Text (OTEX) 8-K Open Text Reports Second Quarter Fiscal 2008 Financial Results

Exhibit 99.1

PRESS RELEASE

Open Text Reports Second Quarter Fiscal 2008 Financial Results

Waterloo, ON – February 7, 2008 – Open Text™ Corporation (NASDAQ:OTEX) (TSX:OTC), a leading provider of Enterprise Content Management (ECM) software, today announced unaudited financial results for its second quarter that ended December 31, 2007. (1)

Total revenue for the second quarter was $182.5 million, up 12% compared to $163.3 million for the same period in the prior fiscal year and up 11% compared to $164.0 million in the previous quarter. License revenue in the second quarter was $55.2 million, up 7% compared to $51.4 million in the second quarter of the prior fiscal year and up 25% compared to $44.3 million in the previous quarter.

Adjusted net income in the quarter was $26.2 million or $0.50 per share on a diluted basis, up 46% compared to $18.0 million or $0.35 per share on a diluted basis for the same period in the prior fiscal year and up 19% compared to $22.1 million or $0.43 per share on a diluted basis in the previous quarter. Net income in accordance with U.S. generally accepted accounting principles (“US GAAP”) was $10.7 million or $0.20 per share on a diluted basis, up 365% compared to $2.3 million or $0.04 per share on a diluted basis for the same period in the prior fiscal year and up 37% compared to $7.8 million or $0.15 per share on a diluted basis in the previous quarter. (2)

Operating cash flow in the second quarter of fiscal 2008 was $39.3 million, up 25% compared to $31.4 million in the second quarter of the prior fiscal year and up 22% compared to $32.2 million in the previous quarter.

“I am very pleased with our performance in the quarter,” said John Shackleton, President and Chief Executive Officer of Open Text. “We have grown license revenue while maintaining our profitability targets and generating strong operating cash flow. Sales in the quarter were led by the telecommunications, energy and government sectors and our strategic partner programs with SAP, Microsoft, Oracle and Accenture continue to gain traction.”

The cash, cash equivalents and short-term investments balance as of December 31, 2007 was $159.7 million compared to $150.0 million at June 30, 2007. Accounts receivable as of December 31, 2007, totaled $120.6 million, compared to $128.8 million as of June 30, 2007, and Days Sales Outstanding (DSO) was 60 days at the end of the second quarter of fiscal 2008, compared to 66 days at June 30, 2007.

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 February 7, 2008 at 5:00 p.m. ET to discuss the final financial results for its second quarter.

Date:	Thursday, February 7, 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 February 7, 2008 at 7:00 p.m. ET through 11:59 p.m. on February 21, 2008 and can be accessed by dialing 416-640-1917 and using pass code 21258637 followed by the number sign.

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For more information or to listen to the call via Web cast, please use the following link:

http://www.opentext.com/events/event.html?id=6643048

About Open Text

Open Text™ 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.

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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, results of operations and earnings and revenue outlook 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 (x) 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 and Form 10-Q for the quarter ended September 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 historic 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, in the table below, 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 provide a consistent basis for comparison between quarters and help to more accurately reflect Open Text’s underlying operating results.

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(in millions of US dollars except share data)	Three months ended December 31, 2007
GAAP Revenue	$	182.5
Maintenance revenue adjustment for purchase accounting		0.3
Non-GAAP revenue	$	182.8
Adjusted Income	$	26.2
Maintenance revenue adjustment for purchase accounting		0.3
Net Interest Expense		7.6
Income tax effect		(2.4	)
Non-GAAP net income	$	31.7

(3) Use of Non- US 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 unaudited condensed 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 (expense), 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), share-based compensation 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 of (unaudited) US GAAP based financial measures to non-US GAAP based financial measures referred to in this press release:

Reconciliation of (unaudited) US GAAP based Net Income to Adjusted Net Income (in millions of US dollars) for the quarters ended December 31, 2007 and 2006:

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	Three months ended December 31, 2007			Three months ended December 31, 2006
GAAP based “Net Income”	$	10.7		$	2.3
Special Charges/(recovery)		0.0			4.8
Amortization of intangibles		17.8			17.8
Other (Income)/Expense		3.7			(0.3	)
Share-based compensation		0.7			1.3
Tax Impact on Above		(6.7	)		(7.9	)
Non-GAAP based “Adjusted Net Income”	$	26.2		$	18.0

Reconciliation of (unaudited) US GAAP based EPS to non-US GAAP based EPS (calculated on a diluted basis) for the quarters ended December 31 2007 and 2006:

	Three months ended December 31, 2007			Three months ended December 31, 2006
GAAP based “Net Income”	$	0.20		$	0.04
Special Charges/(recovery)		0.00			0.10
Amortization of intangibles		0.34			0.35
Other (Income)/Expense		0.07			(0.01	)
Share-based compensation		0.01			0.03
Tax Impact on Above		(0.12	)		(0.16	)
Non-GAAP based “Adjusted Net Income”	$	0.50		$	0.35

For more information, please contact:

Paul McFeeters

Chief Financial Officer

Open Text Corporation

+1-905-762-6121

pmcfeeters@opentext.com

Greg Secord

Director, Investor Relations

Open Text Corporation

+1-519-888-7111 ext.2408

gsecord@opentext.com

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OPEN TEXT CORPORATION

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. Dollars, except share data)

	December 31, 2007		June 30, 2007
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	159,709	$	149,979
Accounts receivable trade, net of allowance for doubtful accounts of $2,966 as of December 31, 2007 and $2,089 as of June 30, 2007		120,588		128,781
Income taxes recoverable		19,599		31,060
Prepaid expenses and other current assets		10,518		10,368
Deferred tax assets		32,410		30,248
Total current assets		342,824		350,436
Capital assets		42,879		43,614
Goodwill		552,079		528,312
Acquired intangible assets		313,118		343,324
Deferred tax assets		29,201		42,078
Other assets		11,119		9,524
Long-term income taxes recoverable		36,945		9,557
	$	1,328,165	$	1,326,845
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	101,403	$	100,211
Current portion of long-term debt		3,488		4,048
Deferred revenues		134,399		143,097
Income taxes payable		11,701		33,705
Deferred tax liabilities		1,198		1,601
Total current liabilities		252,189		282,662
Long-term liabilities:
Accrued liabilities		22,338		22,516
Long-term debt		306,458		366,765
Deferred revenues		3,313		3,840
Long-term income taxes payable		41,893		—
Deferred tax liabilities		102,246		120,019
Total long-term liabilities		476,248		513,140
Minority interest		7,763		6,975
Shareholders’ equity:
Share capital
50,872,016 and 50,180,118 Common Shares issued and outstanding at December 31, 2007 and June 30, 2007, respectively; Authorized Common Shares: unlimited		435,422		426,188
Additional paid-in capital		37,795		35,311
Accumulated other comprehensive income		105,728		68,034
Retained earnings (deficit)		13,020		(5,465	)
Total shareholders’ equity		591,965		524,068
	$	1,328,165	$	1,326,845

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OPEN TEXT CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands of U.S. dollars, except per share data)

	Three months ended December 31,						Six months ended December 31,
	2007			2006			2007			2006
Revenues:
License	$	55,158		$	51,425		$	99,418		$	80,250
Customer support		90,614			78,022			176,918			126,310
Service		36,762			33,814			70,165			57,856
Total revenues		182,534			163,261			346,501			264,416
Cost of revenues:
License		4,649			3,322			8,203			6,122
Customer support		14,191			12,659			26,789			19,646
Service		30,192			29,108			57,696			49,408
Amortization of acquired technology-based intangible assets		10,308			10,396			20,460			15,242
Total cost of revenues		59,340			55,485			113,148			90,418
		123,194			107,776			233,353			173,998
Operating expenses:
Research and development		25,924			22,595			49,656			36,813
Sales and marketing		42,523			43,824			80,633			68,696
General and administrative		16,955			15,474			33,965			26,693
Depreciation		3,752			3,907			6,736			6,899
Amortization of acquired customer-based intangible assets		7,514			7,369			14,929			9,751
Special charges (recoveries)		(47	)		4,843			(108	)		4,375
Total operating expenses		96,621			98,012			185,811			153,227
Income from operations		26,573			9,764			47,542			20,771
Other income (expense)		(3,683	)		329			(5,510	)		702
Interest income (expense), net		(7,567	)		(7,512	)		(15,439	)		(7,120	)
Income before income taxes		15,323			2,581			26,593			14,353
Provision for income taxes		4,511			173			7,854			4,507
Net income before minority interest		10,812			2,408			18,739			9,846
Minority interest		127			131			254			268
Net income for the period	$	10,685		$	2,277		$	18,485		$	9,578
Net income per share—basic	$	0.21		$	0.05		$	0.37		$	0.20
Net income per share—diluted	$	0.20		$	0.04		$	0.35		$	0.19
Weighted average number of Common Shares outstanding—basic		50,736			49,152			50,511			49,063
Weighted average number of Common Shares outstanding—diluted		52,689			50,739			52,224			50,497

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OPEN TEXT CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands of U.S. Dollars)

	Three months ended December 31,						Six months ended December 31,
	2007			2006			2007			2006
Cash flows from operating activities:
Net income for the period	$	10,685		$	2,277		$	18,485		$	9,578
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		21,574			21,672			42,125			31,892
In-process research and development		—			—			500			—
Share-based compensation expense		655			1,333			1,718			2,600
Employee long-term incentive plan		572			—			757			—
Excess tax benefits from share-based compensation		(369	)		(536	)		(766	)		(741	)
Undistributed earnings related to minority interest		127			131			254			268
Amortization of debt issuance costs		421			257			711			257
Unrealized loss on financial instruments		1,444			212			2,851			212
Deferred taxes		(3,408	)		(10,638	)		(4,113	)		(8,924	)
Changes in operating assets and liabilities:
Accounts receivable		(2,923	)		25,191			7,579			23,497
Prepaid expenses and other current assets		302			277			(197	)		894
Income taxes		8,070			(2,859	)		8,554			(3,813	)
Accounts payable and accrued liabilities		6,967			610			1,472			(4,913	)
Deferred revenues		(5,110	)		(10,475	)		(8,883	)		(13,437	)
Other assets		336			3,976			510			3,695
Net cash provided by operating activities		39,343			31,428			71,557			41,065
Cash flows from investing activities:
Acquisitions of capital assets		(2,170	)		(1,106	)		(3,386	)		(3,891	)
Additional purchase consideration for prior period acquisitions		(263	)		(1,390	)		(439	)		(1,723	)
Purchase of Hummingbird, net of cash acquired		—			(384,761	)		—			(384,761	)
Purchase of an asset group constituting a business		—			—			(2,209	)		—
Investments in marketable securities		—			—			—			(829	)
Acquisition related costs		(3,813	)		(17,752	)		(11,842	)		(20,200	)
Net cash used in investing activities		(6,246	)		(405,009	)		(17,876	)		(411,404	)
Cash flows from financing activities:
Excess tax benefits from share-based compensation		369			536			766			741
Proceeds from issuance of Common Shares		3,498			1,986			9,217			2,464
Repayment of long-term debt		(30,944	)		(1,074	)		(61,877	)		(1,173	)
Proceeds from long-term debt		—			390,000			—			390,000
Debt issuance costs		—			(7,412	)		(349	)		(7,433	)
Net cash provided by (used in) financing activities		(27,077	)		384,036			(52,243	)		384,599
Foreign exchange gain on cash held in foreign currencies		3,383			2,722			8,292			2,787
Increase in cash and cash equivalents during the period		9,403			13,177			9,730			17,047
Cash and cash equivalents at beginning of period		150,306			111,224			149,979			107,354
Cash and cash equivalents at end of period	$	159,709		$	124,401		$	159,709		$	124,401

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