The Open Text building in Waterloo, Ont.Kevin Van Paassen
Open Text Corp.'s quarterly profit rose sharply on strong revenue growth and cost controls, the Canadian business software firm said on Wednesday.
Net income rose to $51.5-million (U.S.) in the fourth quarter, ended June 30, from $19.5-million a year earlier. That equated to earnings per share of 89 cents, compared with analyst forecasts for 86 cents, according to Thomson Reuters I/B/E/S.
Revenue climbed 18 per cent to $240-million from $203.4-million, with licenses bringing in $68.5-million of that.
The Waterloo, Ont.-based company has the second-largest share of the market for enterprise content management after International Business Machines Corp., and partners with tech infrastructure vendors SAP AG, Microsoft Corp. and Oracle Corp.
Open Text shares closed up 36 cents (Canadian) at $38.41 each in Toronto on Wednesday, but were well off their year high of $51.92. The results were released after markets closed.
RBC Capital Markets downgraded the stock to "neutral" from "outperform" earlier on Wednesday, citing increased competition and broader economic uncertainty.