Good evening, ladies and gentlemen. Thank you for standing by. Welcome to the OpenText Corporation Second Quarter Fiscal Year 2013 Financial Results Conference Call. [Operator Instructions] I would like to remind everyone that this conference call is being recorded today, Thursday, January 24, 2013 at 5:00 p.m. Eastern Time. I will now turn the conference over to Mr. Greg Secord, Vice President, Investor Relations. Please go ahead, sir.

Thank you and good afternoon, everybody. I'd like to start off the call with the reading of our safe harbor statement. Please note that during the course of this conference call, we may make statements relating to future performance of OpenText and certain forward-looking information. While these forward-looking statements represent our current judgment, actual results could differ materially from a conclusion, forecast, or projection in the forward-looking statements made today. Certain material factors or assumptions were applied in drawing any such conclusion, or while making any such forecast or projection as reflected in the forward-looking information. Additional information about the material factors that could cause actual results to differ materially from a conclusion, forecast or projection in the forward-looking information and the material factors or assumptions that were applied in drawing the conclusion while making the forecast or projection as reflected in the forward-looking information, as well as risk factors that may affect the future performance and results of OpenText are contained in OpenText Form 10-K and Form 10-Q, as well as our press release that was issued earlier today, each of which may be found on our website. We undertake no obligation to update these forward-looking statements unless required by law. In addition, our conference call will include a discussion of certain non-GAAP financial measures. Reconciliations of all non-GAAP financial measures to their most directly comparable GAAP measures have been included in today's press release, which may be found in our website. And with that, I'd like to welcome everybody to the call. With me today is OpenText President and CEO, Mark Barrenechea, as well as our CFO, Paul McFeeters. As with previous calls, we'll read prepared remarks followed by a question-and-answer session and the call will last approximately one hour, with a replay available shortly thereafter. I'd also like to direct our investors to the Investor Relations section of our website, where we've posted an updated PowerPoint that will be referred to in this call. We've also posted a summary table highlighting OpenText historical trend and financial metrics. And with that, I'll hand the call over to Paul McFeeters.

Thank you, Greg. Turning to the financial results, I will highlight our second quarter of fiscal year 2013. Total revenue for the quarter was $352 million, up 9.6%, compared to $321 million for the same period last year. Regionally, the Americas contributed 53%, EMEA 36% and Asia-Pacific 11%. Licensed revenue for the quarter was $76.1 million, up 37% sequentially over Q1. We saw licensed revenue broken down by vertical as 19% from financial services, 18% from services, 11% technology, 10% basic materials, 10% public sector, 8% consumer goods, 9% healthcare, 7% utilities, 7% industrial goods and 1% from conglomerates. Cloud services revenue, which we have broken out separately in our financial statements, was $46.2 million for the quarter, compared to $44.9 million in Q1. Customer support revenue for the quarter was $165 million, unchanged compared to the previous year. On a constant currency basis, customer support revenue grew by approximately 2%. Professional Services and other revenue in the quarter was $65 million, compared to $66 million in the same period last year. Professional Services margin was higher in the current quarter due to improved efficiency in our services organization and the seasonal impact of our user conference. Gross margin for the quarter, before amortization of acquired technology, was approximately 71.7%, compared to approximately 73.7% in the same period last year. The reduction was attributable to the addition of EasyLink, whose margin for the quarter was 61%, in line with our target operating model. Pretax adjusted operating margin before interest expense and stock compensation increased by 15% to $113 million this quarter, compared to $98.5 million in Q2 of the last fiscal year. Adjusted net income increased by 14% to $93.3 million this year, up from $81.7 million in Q2 of last fiscal year. Adjusted EPS was $1.58 per share on…

Thank you, Paul, and welcome, everyone to our fiscal 2013 second quarter earnings call. This month represents my 1 year anniversary with OpenText. And let me begin with our strategy, execution and financial model are working. Over the last 12 months, we have focused on strengthening our strategic position with customers; assembling a leadership team to deliver on our EIM strategy; aligning our R&D to large and relevant customer needs; expanding our sales force and distribution capabilities; introducing a new cloud services strategy supported by our acquisition of EasyLink; operational efficiencies; and a financial target model that delivers strong earnings. Paul talked about our financial target model. But let me add to his comments by looking back over the last 12 months. And comparing execution against our focused areas. I trust you'll see what I see, which is progress in key aspects of the business. Revenues have grown each quarter from $292 million, $305 million, $326 million and in Q2, $352 million. Adjusted margins have grown each quarter from 25.7%, 27.7%, 28.7% and in Q2, 32.1%. Adjusted operating incomes have grown each quarter from $73.8 million, $84.4 million, $93.8 million and in Q2, $213 million. Non-GAAP earnings-per-share have grown each quarter from $1.01, $1.17, $1.31 and in Q2, to $1.58. Our total expenses as a percent of net revenues have decreased each quarter from 74.8%, 72.3%, 71.3% and in Q2, to 67.9%. Our Q2 license was $76 million, with 37% quarter-over-quarter growth, and we continue to expect license growth in second half fiscal '13 over second half fiscal '12. Further, given the progress over the last 12 months, we would expect to enter fiscal '14 stronger than we entered fiscal '13. Our strategy, execution and financial model are working. Let me provide some Q2 highlights and start with important customer…

Your first question comes from the line of Richard Tse from Cormark Securities.

So, Paul, last quarter, you talked about sales and marketing kind of bouncing back this quarter. But now, it seems like you're pushing that out here a little bit. Is it just kind of timing of when you're hiring these guys or kind of what happened there? Maybe you can just elaborate a little bit?

I think you said it, it's timing of the hiring. They'll be fully burdened in this quarter and we're continuing to build the team. So yes, a little bit more back-ended perhaps than what I might have thought the previous quarter. And also, as I said and repeated from the previous quarter is that we will have compensation plans accelerating through the second half of the year.

And Mark, so you guys obviously have a lot of product initiatives underway. Can you maybe frame for us of your existing licensees that are in the market, how many products they have, or some kind of metric and what you plan or hope to take that to over the course of the next 12 to 18 months?

Richard, I thought I described our approach as ensuring that the teams major in the majors. And putting aside product count for a moment, we think of our EIM strategy in 5 pillars. And there are probably 5 major categories in each of those. And there's for sure some work we can do to refine that. But if you think of an ERP HR system where you might have benefits but multiple modules under benefits. You may have payroll on multiple modules under payroll. We certainly have some work to do to better refine, better bundle but in each of the 5 pillars, I would think of 4, 5 subcategories. So that's roughly 25 to 35 major modules.

And just one last question here and I'll pass the line. If you listened to the SAP call earlier this week, they sort of indicated that their business is really growing on the cloud side, but I guess the offset to that is certain takeaway from some of their traditional Professional License business. Do you see that kind of impact on your business model here as well, or do you think that you're diversified enough that it shouldn't have a meaningful impact going forward?

Richard, thank you for the question. Our relationship with SAP has never been stronger. We work in a hybrid model, both on premise and in the cloud. It's what customers are looking for. And their on-premise push, and their in the cloud push, sort of equal prominence just like ours. So we don't see their cloud initiatives as being detrimental.In fact, we see them being very favorable to our long-term partnership.

Your next question comes from the line of Thanos Moschopoulos from BMO Capital Markets.

I realize you don't provide guidance, although in the past you've talked about what typical licensees and how [indiscernible] looks like for your business. And so as we look towards Q3, is there anything that would suggest the seasonality might be any different this time around than what you've seen historically?

Thanos, this is Paul. No, I think we're still seeing that, if I can use the term more normalized basis, we still look for that seasonality that we talked about before.

And then one for Mark. Have you -- I'm starting to see in the early data points as far as your EIM vision and the traction there with your OpenText unlimited model. Are clients increasingly buying multiple modules, or is it still early days, with respect to that trend?

I think it's early days, but we're getting -- we're starting to get some early, early proof points. Sprint was a very good example within the quarter of purchasing multiple modules from us. They selected ECM, CEM and Tempo Social. So they are at least a good half-dozen modules in there. And that's part of our long-term growth thesis, is we can see lots of white space and lots of opportunity to cross sell and upsell new modules.

Your next question comes from the lineup Tom Liston from Cantor Fitzgerald.

Mark, some further commentary you made on the large deals, over 1 million of the 5 deals was obviously pretty close year-over-year, but sort of midpoint deals were down 50% year-over-year. What are you seeing there? Is it more sales force changes, or is it just hesitation around fiscal cliff, as per your commentary?

Tom, thanks for the question. As I highlighted in my prepared remarks, EMEA and APJ had good quarters on the license side. And in the Americas, our book of business look good. We won and sold good business in the Americas, but there's no doubt that the fiscal cliff had some impact to our license performance. We could've done even better in the Americas, if not for the fiscal cliff, though we still had a very fine quarter. So there's no trend in the -- greater than $1 million or between 500,000 and 1 million stats. I would look towards the fiscal cliff in the last 2 weeks of the quarter.

Your next question comes from the line of Kris Thompson from National Bank Financial.

Mark, I heard that you said it about revenue growth, but on a year-over-year basis, the license revenue growth is still negative. When do you expect you're going to start to achieve organic revenue growth and the license bucket, because I know that's one of your key pillars of growth?

Kris, thanks for the question. Look, over the last 12 months, I would describe our efforts as building capacity, building product, building efficiencies. And we see that in our results this quarter of $1.58 of adjusted EPS, record EPS for the company. I look over the next 12 months and most notably, in the next 6 months that I expect to grow license organically second half fiscal '13 over second half fiscal '12. And what's supported by that is I think of 3 Cs, real simple. One, more capacity. We're up in a number of AEs, we're up in the number of sales directors, we're up in the sales leadership. Second C, less change in the organization, as I look out over the next 12 months. Less structural changes, less plans changed, less leadership, less strategy changes, less people. We've put the major changes in. And the third C, quite candidly, is our easier compares. So when I look over the next 12 months and in particular, the next 6 months, supporting our statements of expecting to see license growth second half over second half, I look towards 3 Cs, more capacity, less change, easier compare.

Your next question comes from the line of Scott Penner from TD Securities.

Just, Paul, just to be clear on the past comments on seasonality to make sure we're all on the same page, what you've said most recently was that Q3 is normally on the license side down 5% to 10% and Q4 would be up sequentially 20% to 30%. Is that still the plan for the back half?

Scott, you're correct in that's what I said. I just want to make a couple of qualifiers. Again, it's not guidance. And as we all know, we've been more variable than that between quarters in the last recent year or 2. But as we did say, and I said, we still look at that as a more normalized seasonality. Yes, those are the numbers.

Your next question comes from the line of Paul Steep from Scotia Capital.

Mark, I guess this one is for you. Knowing that you have high expectations for the business, what would be, in your mind, success for the new products if we come back 1 year from now, particularly in Cloud and InfoFusion, where would you say you've won or OpenText has won?

Paul, tanks for the question. Look, I'm going to set the indicators pretty simple here. And it's growth. It's growth. I mean, I look at our opportunity in front of us, second half over second half, to grow organically our license. And again, with more capacity, less change, we're in a good position to have second half over second half license growth organically and enter FY '14, even stronger. EasyLink, we complete -- they've been on board for 6 months. We historically have looked at acquisitions down 10% to 30% in the first year. We came out of the gate atypical to say the business would be flat or is down 10% to 30% and quarter-over-quarter, we grew the business. So I would look towards new products and services in the cloud and growing our cloud services are aligned. And second half over second half organic license growth.

Your next question comes from the line of Stephanie Price from CIBC World Markets.

In terms of the sales force expansion, can you talk a bit more about where you are? And in the expense of the distribution networks as well. Are we in the last inning here, or is there still -- how much more work is there to be done?

Stephanie, we're, to some degree, we're always going to be expanding our sales force. We're still a relatively young company and more coverage equals more opportunities to compete. We set out a goal beginning of last calendar year to expand the sales force 20% and we're complete with that at the end of calendar '12. We're going to continue to grow our sales force here in 2013, calendar 2013 within our operating model. But the initiatives that we laid out earlier in the year, we're complete with. Telesales is up and running. We have more to hire within the team, but we've stood up our first team, made our first hires and we're taking our first phone calls. But you can expect from us to continue to disproportionately put our investment dollars towards products and the sales force. And there's more room to grow the sales force, both in emerging markets and established markets.

Your next question comes from the line of Paul Treiber from RBC Capital Markets.

There are a number of sub deals last quarter. Have they all closed this quarter? And then you mentioned that license would have been better if not for the fiscal cliff. Is that more of a general comment, or is there any way that you can quantify the potential impact from that?

Paul, thanks for the question. We go back to Q1. We highlighted that part of our challenge in Q1 of fiscal -- fiscal '13 Q1 was related to Europe in North American public sector markets. We see quarter-over-quarter public sector up slightly and we had a good quarter in EMEA this quarter. There are some deals that pushed from Q1 to Q2 and we've closed many of those deals. But here at the end of Q2 and as companies are beginning to report. You'll hear more of it. We had some impact on the fiscal cliff. Some impact. We see us having met expectations here in the quarter, record revenues, record earnings, but there's no doubt that the fiscal cliff had some impact. We're not going to quantify that in terms of a number of deals, but it had some impact. But we were still happy with our book of business. We still sold into the government, into many industries, though we could have done a little better in the Americas in Q2.

Your next question comes from the line of Michael Nemeroff from Crédit Suisse. Michael Anderson - Crédit Suisse AG, Research Division: This Mike Anderson on behalf of Michael. Just a quick one, Paul. Can you just comment on the renewal rates with respect to the customer support line, how they trended around 92% as before, a little bit higher, a little bit lower?

Michael, their consistent, as in the past, around the 92% level, trailing. Michael Anderson - Crédit Suisse AG, Research Division: Okay. And then for -- and because I'm just -- we're just trying to make sure that we get the deferred revenue right going into the next quarter, since it's your seasonally strongest per new bookings. So, I appreciate that.

[Operator Instructions] Your next question comes from Scott Penner from TD Securities.

Mark, Richard led off the Q&A by asking about the -- and you answered about the number of modules. Of the 25, how many does your average customer have right now? And is that a good way to think about penetration?

Yes, the -- when we looked across the enterprise install base, it's actually quite encouraging for upsell. We see customers majority having 1 to 3 modules, 1 to 3 modules. So we've done a fair amount of analysis and that's why we continue to focus the sales force on one of their key drivers is to drive wider and deeper within our existing install base and named accounts. So if you want to look at 25 modules, think of sub-5 of current penetration. So opportunities to go sell 6, 7 and 8.

Your next question comes from the line of Richard Tse from Cormark Securities.

Mark, I wanted to clarify a little bit on the sales side. So I think you made a commentary saying that you're pretty much up and running on the sales count, but Paul had mentioned that the sales, I guess, spending is going to increase. So I'm just trying to reconcile where that spending and what's it for and when that's going to come? I'm just a bit confused on that right now.

Richard, I'll take part of that question. My comment really was, as we were hiring through the quarter. In Q3, you'll have a full quarter with all of those sales reps. So part of my direction for cost increasing was having all of those people on board for the full quarter in Q3.

And Richard, I amplify what Paul just said. We're complete on last year's initiatives of adding capacity. We'll continue to add capacity in calendar '13 and we're starting to build out telesales.

Your next question comes from Blair Abernethy from Stifel. Blair H. Abernethy - Stifel, Nicolaus & Co., Inc., Research Division: Just 2 quick things. First up, Paul, do you have the average selling price of the deals this quarter?

Just over $250,000. Blair H. Abernethy - Stifel, Nicolaus & Co., Inc., Research Division: 250, okay great. And Mark, just one for you. I'm just wondering if you could expand a little bit more on InfoFusion in terms of some of the beta test [ph] customers, I guess, that you've had it into, how big is that sort of testbed been and what some of the feedback you've been getting there? And then finally, on the InfoFusion, what is this going to cost customers who are looking to implement this?

Blair, thanks for the question. So InfoFusion is a -- has been built on proven technology that's been inside OpenText for a while, combined with Nstein plus new innovation on top of it. So the core notion of being able to speak to Documentum, FileNet, Stellent, SharePoint, Interwoven and other repositories, we've had a fair amount of these connectors. We've taken our InfoFusion -- Nstein rather and our search technologies plus some technology from Vignette or single sign on the architecture and created a product out of it. So we have a lot of existing, proven technologies that we've been able to better package and better integrate and better communicate in what we call InfoFusion. The interest is very high. It was a delight at Enterprise World in November, to literally see lines around booths of customers trying to learn more about the product. Early feedback has been incredibly positive. I highlighted a few in the prepared remarks, AIG, Abbott, AstraZeneca, BMW, Barclays. And we see a variety of used cases, one of which is information is going to remain fragmented and customers want to be able to connect to it. Second, is to be able to reduce the cost of infrastructure, connect, but keep in place or connect and migrate and turn off and start turning off systems that are no longer key. We have an early pricing for it. But I'm sure we'll do it here this quarter and maybe give an update on the next call.

Your next question comes from Tom Liston from Cantor Fitzgerald.

Mark or Paul, just a follow-up on R&D. It's at a multiyear load, certainly a percentage of sales. Where were most of the cuts, is it more of a legacy maintenance type base for the cuts? And more importantly or as importantly, are you going to get to the model this next quarter? And where is most of that growth areas going to be in terms of product focus?

Thanks for the question -- Mark here, thanks, Tom. We are moving more and more resource to India. And Paul will talk -- Paul can talk about how that's going to flow through as a percent of revenues. But it's not that we're taking people out of the business. We're actually adding people. But we're doing it at a lower cost structure and we're doing it in a way where we can work near 24/7. So when Waterloo and Richmond and our West Coast operations start to go home, India rises and we can be writing code in India. So this is all part of our strategy to accelerate innovation, be able to work 24 hours a day and accelerate features to market. And that movement is to move in more capabilities to India. Paul can talk about how that will -- anything else you want to add, maybe, Paul, on the financial side?

No, I commented in my script, Tom, that we are -- now we are building back the team, as Mark said, on a cost-effective basis. But we certainly will see -- I know some cost will now start to increase through Q3 and Q4.

So not just labor arbitrage or expense arbitrage, but it's about changing our innovation model.

Your next question comes from the line of Kris Thompson from National Bank financial.

Mark, over the last couple of quarters, the license revenue from your install base has been higher than normal and I hear you're focusing on your current companies. But can you just give us an update on the success of the Autonomy trade-in program? Are you getting any traction there? And that sounds like a different strategy outside of your go to -- your current install base strategy.

Kris, thanks for the question. So the Autonomy program that we announced last quarter, we've actually built some pipe from it, which is wonderful to see. We've had a couple of wins from it as well. And we're going to keep at it this quarter and probably next quarter. It's another avenue to grow in license, another avenue that supports our thesis of second half over second half organic license growth. But the program has created awareness for the company, somewhat of a sort of a change of approach from historically, created some pipeline and actually brought some revenue in and helps us support our second half over second half growth thesis.

[Operator Instructions] There are no further questions. I will turn it over to Mr. Barrenechea. Please go ahead, sir.

Thank you. I'd like to leave you with a few thoughts from today. To sum up the past year, we've demonstrated progress in important areas of our business. Our strategy, execution and financial model are working. Over the next 12 months we will focus on new products in cloud services, sales execution and financial performance. In the coming weeks OpenText will be presenting at several investor conferences, including the Stifel Technology Conference in San Francisco on February 5; the Morgan Stanley Technology, Media & Telecom Conference in San Francisco on February 26; and Raymond James' annual Investor Conference in Orlando Florida on March 5. I look forward to meeting with many of you at these investor conferences. If you like more information, please contact our Investor Relations team. Thank you, everyone, for participating in the call. That ends today's call.

Ladies and gentlemen, this concludes the conference call for today. Thank you for participating. You may now disconnect your lines.