So there were no — like, whether you think the OpenText ledger or the Micro Focus ledger. And, of course, you have like significant interest expense as well. So during fiscal 2023 and 2024, if you put aside interest expense, that is the period of time when all of these charges are coming into the cash flows. And then, we recover pretty quickly from there to get to the $1.5 billion plus, you’ll start to see the recovery coming in the early part of fiscal 2025. From a working capital perspective, it’s important to note that throughout this process, the model assumes that we’re actually improving Micro Focus working capital very steadily from day one and we’re maintaining the OpenText — like, OpenText working capital performance as well.
Steven Li: Right. And Madhu, just to clarify. Micro Focus when they acquired HP, the HP assets, they had this reverse moving structure. Is that in your numbers, but which year does it go away? Does it — is it already expired?
Mark Barrenechea: It’s gone, does not exist. It’s their history, does not exist at OpenText.
Madhu Ranganathan: Right. I was just going to add that our efforts on this is going to be grounds up brand new taking what they have today and looking at the opportunities for optimization ahead. But I agree with Mark on the divers more a tough question.
Mark Barrenechea: Yeah, absolutely gone, doesn’t exist. Stephen, if I can. I just want to note something, right? So we’re being crystal clear on what our free cash flow targets are, right? $500 million to $600 million in F ’23, $800 million to $900 million F ’24 and $1.5 billion plus in fiscal ’26. So I know you can see that place will be crystal clear, right, that we’re providing that visibility today. As Madhu noted, I do want to make kind of three pieces of emphasis that in fiscal ’24, we’re not reaching our free cash flow potential yet. We’re reaching our EBITDA potential of $2.1 billion in EBITDA to $2.24 billion in adjusted EBITDA, but we have three things going on that are really important. One is the integration expenses, as Madhu spoke about.
We’re going for a rapid integration, and we’re going for simplification, right? We are going to simplify this business and we’re going to do it upfront. Legal entity structures, all the things Madhu talked about, the word simplification and three, we’re investing in our cloud. 15% plus cloud bookings growth, 7% to 9% organic cloud revenue growth in F ’26, and that takes investment. Those are the three things that we’ve decided on to make, as you say, over the next six months, six quarters.
Steven Li: Thank you. Very helpful, Mark and Madhu.
Madhu Ranganathan: Thank you as well.
Operator: Thank you. I will now hand the call back over to Mr. Barrenechea for closing remarks.
Mark Barrenechea: All right. Thank you, everyone. I know today’s call ran a little longer than usual, and our script is a bit more fulsome than most. But Madhu and I felt it was very important to provide this level of visibility and simplification to how we’re looking at the Micro Focus business and the — and their products combined into OpenText. And I hope you’ll join us live tomorrow as we open the NASDAQ from the National Arts Center here in Ottawa. Have a good evening.
Operator: Thank you. This concludes today’s conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.
