Attached files
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| 8-K - ROPER TECHNOLOGIES INC | cover8k.htm |
Exhibit 9.1
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Contact Information:
Investor Relations
941-556-2601
investor-relations@roperind.com
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 Roper Industries, Inc.
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FOR IMMEDIATE RELEASE
Roper Industries Announces Record Third Quarter Results
Sales Increase 18%; Net Earnings Increase 31%; Guidance Raised
Sarasota, Florida, October 24, 2011... Roper Industries, Inc. (NYSE: ROP) reported record financial results for the third quarter ended September 30, 2011.
Net earnings were $110 million, a 31% increase over the third quarter of 2010, and diluted earnings per share were $1.12 versus $0.87 in the prior year. Sales increased 18% to an all-time record of $713 million. Orders for the quarter were a record $719 million. Operating income was $167 million and operating margin expanded 230 basis points to 23.5% of sales.
During the quarter, EBITDA increased to $203 million or 28.6% of sales, and gross margin expanded to 53.7%. Operating cash flow was $167 million representing 23% of sales.
“We are pleased to once again deliver record results in the quarter,” said Brian Jellison, Roper’s Chairman, President and CEO. “Our asset-light business model and continued focus on working capital resulted in free cash flow of $157 million, or 142% of net earnings.We delivered organic sales growth of 13% with strength throughout the enterprise. This strong growth combined with outstanding operating performance drove substantial margin expansion in the quarter. We continue to see favorable trends in our businesses and we enter the fourth quarter with a record $876 million in backlog as bookings exceeded revenue for the 9th consecutive quarter.”
2011 Outlook and Guidance
As a result of the Company’s third quarter performance and outlook for the year, the Company is increasing its full year diluted earnings per share guidance to $4.29- $4.33 and establishing fourth quarter guidance of $1.18 - $1.22. The Company’s guidance excludes any future acquisitions.
Table 1: Sales Growth
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Q3 2011
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Total Sales Growth
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18%
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Acquisitions / Divestitures
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3%
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Foreign Currency
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2%
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Organic Growth
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13%
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Table 2: EBITDA [millions]
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Q3 2011
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Net Earnings
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$110.3
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Add: Interest Expense
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15.4
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Add: Income Taxes
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42.3
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Add: Depreciation
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8.8
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Add: Amortization
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26.8
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Rounding
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(0.1)
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EBITDA (A)
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$203.5
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Revenue (B)
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$712.7
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EBITDA Margin (A)/(B)
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28.6%
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Table 3: Free Cash Flow and Cash Conversion [millions]
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Q3 2011
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Operating Cash Flow
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$166.6
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Less: Capital Expenditures
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(9.8)
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Free Cash Flow (A)
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$156.8
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Net Earnings (B)
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$110.3
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Cash Conversion (A) / (B)
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142%
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Conference Call to be Held at 8:30 AM (ET) Today
A conference call to discuss these results has been scheduled for 8:30 AM ET on Monday, October 24, 2011. The call can be accessed via webcast or by dialing +1 888-259-8389 (US/Canada) or +1 913-312-1448, using confirmation code 4786378. Webcast information and conference call materials will be made available in the Investors section of Roper’s website (www.roperind.com) prior to the start of the call. Telephonic replays will be available for up to two weeks by calling +1 719-457-0820 and using the access code 4786378.
About Roper Industries
Roper Industries is a diversified growth company and is a constituent of the S&P 500, Fortune 1000, and the Russell 1000 indices. Roper provides engineered products and solutions for global niche markets, including water, energy, transportation, medical, education, and SaaS-based information networks. Additional information about Roper is available on the Company’s website at www.roperind.com.
The information provided in this press release contains forward-looking statements within the meaning of the federal securities laws. These forward looking statements include, among others, statements regarding operating results, the success of our internal operating plans, and the prospects for newly acquired businesses to be integrated and contribute to future growth and profit expectations. Forward looking statements may be indicated by words or phrases such as "anticipate," "estimate," "plans," "expects," "projects," "should," "will," "believes" or "intends" and similar words and phrases. These statements reflect management's current beliefs and are not guarantees of future performance. They involve risks and uncertainties that could cause actual results to differ materially from those contained in any forward-looking statement. Such risks and uncertainties include our ability to integrate our acquisitions and realize expected synergies. We also face other general risks, including our ability to realize cost savings from our operating initiatives, general economic conditions, unfavorable changes in foreign exchange rates, difficulties associated with exports, risks associated with our international operations, difficulties in making and integrating acquisitions, risks associated with newly acquired businesses, increased product liability and insurance costs, increased warranty exposure, future competition, changes in the supply of, or price for, parts and components, environmental compliance costs and liabilities, risks and cost associated with asbestos related litigation and potential write-offs of our substantial intangible assets, and risks associated with obtaining governmental approvals and maintaining regulatory compliance for new and existing products. Important risks may be discussed in current and subsequent filings with the SEC. You should not place undue reliance on any forward-looking statements. These statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events.
# # #
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Roper Industries, Inc. and Subsidiaries
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Condensed Consolidated Balance Sheets (unaudited)
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(Amounts in thousands)
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September 30,
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December 31,
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|||||||
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ASSETS
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2011
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2010
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||||||
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CURRENT ASSETS:
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||||||||
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Cash and cash equivalents
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$ | 246,454 | $ | 270,394 | ||||
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Accounts receivable
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422,418 | 403,337 | ||||||
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Inventories
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211,582 | 178,559 | ||||||
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Deferred taxes
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34,141 | 32,894 | ||||||
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Unbilled receivable
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72,681 | 75,620 | ||||||
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Other current assets
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42,747 | 37,287 | ||||||
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Total current assets
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1,030,023 | 998,091 | ||||||
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PROPERTY, PLANT AND EQUIPMENT, NET
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106,965 | 103,487 | ||||||
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||||||||
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OTHER ASSETS:
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||||||||
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Goodwill
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2,874,732 | 2,727,780 | ||||||
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Other intangible assets, net
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1,109,406 | 1,104,513 | ||||||
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Deferred taxes
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60,587 | 57,850 | ||||||
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Other assets
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76,725 | 77,803 | ||||||
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Total other assets
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4,121,450 | 3,967,946 | ||||||
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TOTAL ASSETS
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$ | 5,258,438 | $ | 5,069,524 | ||||
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LIABILITIES AND STOCKHOLDERS' EQUITY
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CURRENT LIABILITIES:
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Accounts payable
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$ | 144,606 | $ | 137,778 | ||||
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Accrued liabilities
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302,058 | 298,080 | ||||||
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Deferred taxes
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7,971 | 10,445 | ||||||
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Current portion of long-term debt
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71,194 | 93,342 | ||||||
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Total current liabilities
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525,829 | 539,645 | ||||||
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NONCURRENT LIABILITIES:
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Long-term debt
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1,103,296 | 1,247,703 | ||||||
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Deferred taxes
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486,095 | 465,001 | ||||||
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Other liabilities
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74,555 | 66,268 | ||||||
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Total liabilities
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2,189,775 | 2,318,617 | ||||||
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STOCKHOLDERS' EQUITY:
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||||||||
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Common stock
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982 | 971 | ||||||
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Additional paid-in capital
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1,087,245 | 1,045,286 | ||||||
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Retained earnings
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1,954,728 | 1,680,849 | ||||||
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Accumulated other comprehensive earnings
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45,681 | 43,978 | ||||||
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Treasury stock
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(19,973 | ) | (20,177 | ) | ||||
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Total stockholders' equity
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3,068,663 | 2,750,907 | ||||||
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
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$ | 5,258,438 | $ | 5,069,524 | ||||
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Roper Industries, Inc. and Subsidiaries
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Condensed Consolidated Statements of Earnings (unaudited)
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(Amounts in thousands, except per share data)
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Three months ended
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Nine months ended
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|||||||||||||||
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September 30,
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September 30,
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2011
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2010
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2011
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2010
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Net sales
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$ | 712,705 | $ | 605,088 | $ | 2,057,885 | $ | 1,706,633 | ||||||||
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Cost of sales
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330,149 | 283,339 | 948,170 | 803,372 | ||||||||||||
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Gross profit
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382,556 | 321,749 | 1,109,715 | 903,261 | ||||||||||||
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Selling, general and administrative expenses
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215,341 | 193,516 | 636,530 | 555,125 | ||||||||||||
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Income from operations
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167,215 | 128,233 | 473,185 | 348,136 | ||||||||||||
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Interest expense
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15,373 | 17,134 | 48,265 | 49,608 | ||||||||||||
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Other income
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690 | 2,631 | 8,644 | 1,421 | ||||||||||||
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Earnings from continuing operations before
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||||||||||||||||
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income taxes
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152,532 | 113,730 | 433,564 | 299,949 | ||||||||||||
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Income taxes
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42,251 | 29,467 | 127,993 | 84,680 | ||||||||||||
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Net Earnings
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$ | 110,281 | $ | 84,263 | $ | 305,571 | $ | 215,269 | ||||||||
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Earnings per share:
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||||||||||||||||
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Basic
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$ | 1.15 | $ | 0.89 | $ | 3.19 | $ | 2.29 | ||||||||
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Diluted
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$ | 1.12 | $ | 0.87 | $ | 3.11 | $ | 2.23 | ||||||||
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Weighted average common and common
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||||||||||||||||
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equivalent shares outstanding:
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||||||||||||||||
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Basic
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96,083 | 94,312 | 95,792 | 94,046 | ||||||||||||
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Diluted
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98,308 | 96,671 | 98,285 | 96,374 | ||||||||||||
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Roper Industries, Inc. and Subsidiaries
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Selected Segment Financial Data (unaudited)
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(Amounts in thousands and percents of net sales)
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Three months ended September 30,
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Nine months ended September 30,
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2011
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2010
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2011
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2010
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Amount
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%
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Amount
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%
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Amount
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%
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Amount
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%
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Net sales:
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Industrial Technology
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$ | 185,258 | $ | 161,205 | $ | 538,695 | $ | 442,007 | ||||||||||||||||||||||||
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Energy Systems & Controls
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150,385 | 123,458 | 425,768 | 348,523 | ||||||||||||||||||||||||||||
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Medical & Scientific Imaging
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156,470 | 134,434 | 452,835 | 393,192 | ||||||||||||||||||||||||||||
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RF Technology
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220,592 | 185,991 | 640,587 | 522,911 | ||||||||||||||||||||||||||||
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Total
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$ | 712,705 | $ | 605,088 | $ | 2,057,885 | $ | 1,706,633 | ||||||||||||||||||||||||
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Gross profit:
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Industrial Technology
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$ | 91,238 | 49.2 | % | $ | 82,383 | 51.1 | % | $ | 269,020 | 49.9 | % | $ | 223,825 | 50.6 | % | ||||||||||||||||
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Energy Systems & Controls
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81,832 | 54.4 | % | 65,590 | 53.1 | % | 232,390 | 54.6 | % | 183,884 | 52.8 | % | ||||||||||||||||||||
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Medical & Scientific Imaging
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99,035 | 63.3 | % | 82,610 | 61.5 | % | 285,295 | 63.0 | % | 238,427 | 60.6 | % | ||||||||||||||||||||
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RF Technology
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110,451 | 50.1 | % | 91,166 | 49.0 | % | 323,010 | 50.4 | % | 257,125 | 49.2 | % | ||||||||||||||||||||
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Total
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$ | 382,556 | 53.7 | % | $ | 321,749 | 53.2 | % | $ | 1,109,715 | 53.9 | % | $ | 903,261 | 52.9 | % | ||||||||||||||||
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Operating profit*:
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Industrial Technology
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$ | 52,238 | 28.2 | % | $ | 44,954 | 27.9 | % | $ | 150,156 | 27.9 | % | $ | 115,462 | 26.1 | % | ||||||||||||||||
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Energy Systems & Controls
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38,675 | 25.7 | % | 28,611 | 23.2 | % | 105,423 | 24.8 | % | 76,606 | 22.0 | % | ||||||||||||||||||||
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Medical & Scientific Imaging
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38,610 | 24.7 | % | 31,193 | 23.2 | % | 108,999 | 24.1 | % | 88,323 | 22.5 | % | ||||||||||||||||||||
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RF Technology
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52,552 | 23.8 | % | 37,155 | 20.0 | % | 150,413 | 23.5 | % | 104,060 | 19.9 | % | ||||||||||||||||||||
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Total
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$ | 182,075 | 25.5 | % | $ | 141,913 | 23.5 | % | $ | 514,991 | 25.0 | % | $ | 384,451 | 22.5 | % | ||||||||||||||||
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Net Orders:
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Industrial Technology
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$ | 192,905 | $ | 169,887 | $ | 582,969 | $ | 488,665 | ||||||||||||||||||||||||
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Energy Systems & Controls
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151,294 | 135,224 | 436,633 | 377,484 | ||||||||||||||||||||||||||||
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Medical & Scientific Imaging
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159,140 | 152,499 | 459,452 | 418,874 | ||||||||||||||||||||||||||||
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RF Technology
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215,244 | 196,265 | 649,513 | 555,427 | ||||||||||||||||||||||||||||
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Total
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$ | 718,583 | $ | 653,875 | $ | 2,128,567 | $ | 1,840,450 | ||||||||||||||||||||||||
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* Operating profit is before unallocated corporate general and administrative expenses. These expenses
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were $14,860 and $13,680 for the three months ended September 30, 2011 and 2010, respectively and
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$41,806 and $36,315 for the nine months ended September 30, 2011 and 2010, respectively.
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Roper Industries, Inc. and Subsidiaries
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Condensed Consolidated Statements of Cash Flows (unaudited)
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(Amounts in thousands)
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Nine months ended
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September 30,
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2011
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2010
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Net earnings
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$ | 305,571 | $ | 215,269 | ||||
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Non-cash items:
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||||||||
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Depreciation
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27,669 | 27,271 | ||||||
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Amortization
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77,056 | 61,430 | ||||||
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Stock-based compensation expense
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23,466 | 19,384 | ||||||
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Income taxes
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5,888 | 10,943 | ||||||
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Changes in assets and liabilities:
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||||||||
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Receivables
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(16,531 | ) | (13,118 | ) | ||||
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Inventory
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(28,422 | ) | (7,277 | ) | ||||
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Accounts payable
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3,910 | 22,549 | ||||||
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Accrued liabilities
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12,806 | 10,561 | ||||||
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Other, net
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(2,339 | ) | (2,594 | ) | ||||
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Cash provided by operating activities
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409,074 | 344,418 | ||||||
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Business acquisitions, net of cash acquired
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(227,197 | ) | (536,413 | ) | ||||
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Capital expenditures
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(29,143 | ) | (20,391 | ) | ||||
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Other, net
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(132 | ) | 1,815 | |||||
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Cash used by investing activities
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(256,472 | ) | (554,989 | ) | ||||
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Principal debt payments
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(25,057 | ) | (20,123 | ) | ||||
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Revolver borrowings (payments), net
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(145,000 | ) | 318,000 | |||||
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Dividends
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(31,529 | ) | (26,722 | ) | ||||
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Excess tax benefit from share-based payment
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4,101 | 4,287 | ||||||
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Proceeds from exercise of stock options
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14,479 | 16,955 | ||||||
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Other, net
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1,052 | 922 | ||||||
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Cash provided by (used in) financing activities
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(181,954 | ) | 293,319 | |||||
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Effect of exchange rate changes on cash
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5,412 | 357 | ||||||
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Net increase (decrease) in cash and equivalents
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(23,940 | ) | 83,105 | |||||
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Cash and equivalents, beginning of period
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270,394 | 167,708 | ||||||
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Cash and equivalents, end of period
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$ | 246,454 | $ | 250,813 | ||||