Attached files
| file | filename |
|---|---|
| 8-K - ROPER TECHNOLOGIES INC | cover8k.htm |
Exhibit 99.1
|
Contact Information:
Investor Relations 941-556-2601
investor-relations@ropertech.com |
 Roper Technologies, Inc.
|
Roper Technologies Announces First Quarter Results
GAAP Revenue Increased 20%; Adjusted Revenue Increased 22%
Operating Cash Flow Increased to $378 Million
Sarasota, Florida, April 28, 2017 ... Roper Technologies, Inc. (NYSE: ROP), a diversified technology company, reported financial results for the first quarter ended March 31, 2017.
Roper reports results – including revenue, operating margin, net income and diluted earnings per share – on a GAAP basis and an adjusted basis.
First quarter GAAP revenue increased 20% to $1.09 billion and adjusted revenue grew 22% to $1.11 billion. GAAP diluted earnings per share (DEPS) were $1.53 (+3%), while adjusted diluted earnings per share increased 17% to $2.11.
GAAP gross margin was 61.5% while adjusted gross margin was 62.2%. Operating cash flow increased to $378 million and adjusted EBITDA increased 18% to $362 million.
"Our businesses performed exceptionally well in the first quarter," said Brian Jellison, Roper's Chairman, President and CEO. "Our significant revenue increase included 5% organic growth, as our software and medical businesses continued their strong performance and we benefited from improvement in industrial and energy markets. Growth was broad-based as revenue in each of our four segments increased organically in the quarter."
"Our cash flow performance was outstanding in the quarter with significant contributions from our recent application software acquisitions, Deltek and ConstructConnect, as well as strong execution across the enterprise. We are very pleased by our great start to 2017," concluded Mr. Jellison.
2017 Guidance
Roper is raising its full year 2017 guidance. The Company now expects full year Adjusted DEPS of $8.98 - $9.28, compared to previous guidance of $8.82 - $9.22.
For the second quarter of 2017, the Company expects Adjusted DEPS to be between $2.16 and $2.24.
The Company's guidance excludes the impact of future acquisitions or divestitures.
Conference Call to be Held at 8:30 AM (ET) Today
A conference call to discuss these results has been scheduled for 8:30 AM ET on Friday, April 28, 2017. The call can be accessed via webcast or by dialing +1 877-857-6149 (US/Canada) or +1 719-325-4845, using confirmation code 4090618. Webcast information and conference call materials will be made available in the Investors section of Roper's website (www.ropertech.com) prior to the start of the call. The webcast can also be accessed directly by using the following URL http://edge.media-server.com/m/p/skmkjsqe. Telephonic replays will be available for up to two weeks and can be accessed by using the following registration URL https://event.replay with access code 4090618.
Use of Non-GAAP Financial Information
The Company supplements its consolidated financial statements presented on a GAAP basis with certain non-GAAP financial information to provide investors with greater insight, increase transparency and allow for a more comprehensive understanding of the information used by management in its financial and operational decision-making. Reconciliation of non-GAAP measures to their most directly comparable GAAP measures are included in the accompanying financial schedules or tables. The non-GAAP financial measures disclosed by the company should not be considered a substitute for, or superior to, financial measures prepared in accordance with GAAP, and the financial results prepared in accordance with GAAP and reconciliations from these results should be carefully evaluated.
Table 1: Revenue Growth Detail ($M)
|
Q1 2017
|
Q1 2016
|
V %
|
|
|||||||
|
GAAP Revenue
|
$
|
1,086
|
$
|
902
|
20
|
%
|
||||
|
Purchase accounting adjustment to acquired deferred revenueA,B
|
22
|
A
|
3
|
B
|
||||||
|
Rounding
|
1
|
|||||||||
|
Adjusted Revenue
|
$
|
1,108
|
$
|
906
|
22
|
%
|
||||
|
Components of Adjusted Revenue Growth
|
||||||||||
|
Organic
|
5
|
%
|
||||||||
|
Acquisitions
|
+18
|
%
|
||||||||
|
Foreign Exchange
|
(1
|
)%
|
||||||||
|
Total Adjusted Revenue Growth
|
22
|
%
|
||||||||
Table 2: Reconciliation of Q1 2017 GAAP DEPS to Adjusted DEPS
|
Q1 2017
|
Q1 2016
|
|||||||
|
GAAP Diluted Earnings Per Share (DEPS)
|
$
|
1.53
|
$
|
1.48
|
||||
|
Purchase accounting adjustment to acquired deferred revenueA,B
|
0.14
|
A
|
0.02
|
B
|
||||
|
Purchase accounting adjustment for commission expenseC
|
(0.01
|
)C
|
-
|
|||||
|
Acquisition-related inventory step-up chargeD
|
-
|
0
|
D
|
|||||
|
Amortization of Acquisition-related intangible assets, after tax F
|
0.45
|
F
|
0.31
|
F
|
||||
|
Adjusted DEPS
|
$
|
2.11
|
$
|
1.81
|
Table 3: Q1 Free Cash Flow Reconciliation ($M)
|
Q1 2017
|
Q1 2016
|
V % |
|
||||||||
|
GAAP Operating Cash Flow
|
$
|
378
|
$
|
207
|
+83%
|
|
|||||
|
Cash taxes related to 2015 sale of Abel Pump
|
37
|
||||||||||
|
Rounding
|
1
|
||||||||||
|
Adjusted Operating Cash Flow
|
$
|
378
|
$
|
245
|
+55%
|
|
|||||
|
Capital expenditures
|
(15
|
) |
(9
|
) | |||||||
|
Capitalized software expenditures
|
(3
|
) |
(1
|
) | |||||||
|
Rounding
|
-
|
(1
|
) | ||||||||
|
Adjusted Free Cash Flow
|
$
|
360
|
$
|
234
|
+54%
|
|
Table 4: Adjusted Gross Margin Reconciliation (M)
|
Q1 2017
|
Q1 2016
|
V Bps
|
|||||||||
|
GAAP Revenue
|
$
|
1,086
|
$
|
902
|
|||||||
|
Purchase accounting adjustment to acquired deferred revenueA,B
|
22
|
A |
3
|
B | |||||||
|
Rounding
|
1
|
||||||||||
|
Adjusted Revenue
|
$
|
1,108
|
$
|
906
|
|||||||
|
GAAP Gross Profit
|
$
|
668
|
$
|
560
|
|||||||
|
Purchase accounting adjustment to acquired deferred revenueA,B
|
22
|
A |
3
|
B | |||||||
|
Rounding
|
(1
|
) | |||||||||
|
Adjusted Gross Profit
|
$
|
689
|
$
|
563
|
|||||||
|
GAAP Gross Margin
|
61.5%
|
|
62.0%
|
|
(50) bps
|
||||||
|
Adjusted Gross Margin
|
62.2%
|
|
62.1%
|
|
+ 10 bps
|
||||||
Table 5: Q1 EBITDA Reconciliation ($M)
|
Q1 2017
|
Q1 2016
|
V % |
|
||||||||
|
GAAP Revenue
|
$
|
1,086
|
$
|
902
|
|||||||
|
Purchase accounting adjustment to acquired deferred revenueA,B
|
22
|
A |
3
|
B
|
|||||||
|
Rounding
|
1
|
||||||||||
|
Adjusted Revenue
|
$
|
1,108
|
$
|
906
|
|||||||
|
GAAP Net Earnings
|
$
|
158
|
$
|
151
|
|||||||
|
Taxes
|
53
|
66
|
|||||||||
|
Interest expense
|
46
|
27
|
|||||||||
|
Depreciation
|
12
|
10
|
|||||||||
|
Amortization
|
73
|
50
|
|||||||||
|
Purchase accounting adjustment to acquired deferred revenue, pretaxA,B
|
22
|
A |
3
|
B
|
|||||||
|
Purchase accounting adjustment for prepaid commission expense, pretaxC
|
(2
|
) | |||||||||
|
Acquisition-related inventory step-up charge, pretaxD
|
-
|
0
|
D
|
||||||||
|
Rounding
|
-
|
-
|
|||||||||
|
Adjusted EBITDA
|
$
|
362
|
$
|
307
|
+18% |
|
|||||
|
% of Adjusted Revenue
|
32.7%
|
|
34.0%
|
||||||||
Table 6: Forecasted Diluted Earnings Per Share (DEPS)
|
Q2 2017
|
Full Year 2017
|
|||||||||||||||
|
Low End
|
High End
|
Low End
|
High End
|
|||||||||||||
|
GAAP DEPS
|
$
|
1.62
|
$
|
1.70
|
$
|
6.86
|
$
|
7.16
|
||||||||
|
Purchase accounting adjustments to acquired deferred revenue and commissionsE
|
0.09
|
E
|
0.09
|
E
|
0.32
|
E
|
0.32
|
E
|
||||||||
|
Amortization of acquisition-related intangible assets, after-taxF
|
0.45
|
F
|
0.45
|
F
|
1.80
|
F
|
1.80
|
F
|
||||||||
|
Adjusted DEPS
|
$
|
2.16
|
$
|
2.24
|
$
|
8.98
|
$
|
9.28
|
||||||||
| A |
Acquisition-related fair value adjustments to deferred revenue related to the acquisitions of CliniSys ($0.0M pretax, $0.0M after-tax), ConstructConnect ($5.3M pretax, $3.4M after-tax) and Deltek ($16.3M pretax, $10.6M after-tax).
|
| B |
Acquisition-related fair value adjustments to deferred revenue related to the acquisitions of Strata ($0.2M pretax, $0.1M after-tax), Softwriters ($0.0M pretax, $0.0M after-tax), Data Innovations ($0.7m pre-tax, $0.4M after-tax), On Center Software ($0.4M pretax, $0.3M after-tax), Aderant ($1.8M pretax, $1.2M after-tax), Atlas Medical ($0.1M pretax, $0.0M after-tax) and Clinisys ($0.1M pretax, $0.1M after-tax)
|
| C |
Purchase Accounting Adjustment for Commission Expense related to the acquisition of Deltek ($1.8M pretax, $1.2M after-tax),
|
| D |
Acquisition-related inventory step-up charge related to the acquisition of PCI Medical ($0.1M pretax, $0.1M after-tax)
|
| E |
Forecasted acquisition-related fair value adjustments to acquired deferred revenue and commissions of ConstructConnect and Deltek, as shown below ($M, except per share data)
|
|
|
Q2 2017
|
FY 2017
|
||||||
|
Pretax
|
$
|
15
|
$
|
51
|
||||
|
After-tax
|
$
|
10
|
$
|
33
|
||||
|
Per Share
|
$
|
0.09
|
$
|
0.32
|
||||
| F |
Actual results and forecast of estimated amortization of acquisition-related intangible assets ($M); For comparison purposes, prior period amounts are also shown below. Tax Rate of 35% applied to amortization in all periods.
|
|
Q1 2016A
|
|
Q2 2016A
|
|
FY 2016A
|
Q1 2017A
|
|
Q2 2017E
|
|
FY 2017E
|
|||||||||||||||
|
Pretax
|
$
|
49
|
$
|
50
|
$
|
201
|
$
|
72
|
$
|
72
|
$
|
286
|
||||||||||||
|
After-tax
|
$
|
32
|
$
|
32
|
$
|
131
|
$
|
47
|
$
|
47
|
$
|
186
|
||||||||||||
|
Per share
|
$
|
0.31
|
$
|
0.31
|
$
|
1.27
|
$
|
0.45
|
$
|
0.45
|
$
|
1.80
|
||||||||||||
|
Roper Technologies, Inc. and Subsidiaries
|
||||||||
|
Condensed Consolidated Balance Sheets (unaudited)
|
||||||||
|
(Amounts in thousands)
|
||||||||
|
March 31,
|
December 31,
|
|||||||
|
2017
|
2016
|
|||||||
|
ASSETS
|
||||||||
|
CURRENT ASSETS:
|
||||||||
|
Cash and cash equivalents
|
$
|
730,666
|
$
|
757,200
|
||||
|
Accounts receivable
|
549,838
|
619,854
|
||||||
|
Inventories
|
191,426
|
181,952
|
||||||
|
Unbilled receivable
|
143,589
|
129,965
|
||||||
|
Other current assets
|
97,104
|
87,530
|
||||||
|
Total current assets
|
1,712,623
|
1,776,501
|
||||||
|
PROPERTY, PLANT AND EQUIPMENT, NET
|
144,113
|
141,318
|
||||||
|
OTHER ASSETS:
|
||||||||
|
Goodwill and other intangible assets, net
|
12,268,952
|
12,302,985
|
||||||
|
Deferred taxes
|
30,300
|
30,620
|
||||||
|
Other assets
|
74,066
|
73,503
|
||||||
|
Total other assets
|
12,373,318
|
12,407,108
|
||||||
|
TOTAL ASSETS
|
$
|
14,230,054
|
$
|
14,324,927
|
||||
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
|
CURRENT LIABILITIES:
|
||||||||
|
Accounts payable
|
$
|
152,638
|
$
|
152,067
|
||||
|
Accrued compensation
|
131,584
|
161,730
|
||||||
|
Deferred revenue
|
513,820
|
488,399
|
||||||
|
Other accrued liabilities
|
251,298
|
219,339
|
||||||
|
Income taxes payable
|
88,126
|
22,762
|
||||||
|
Current portion of long-term debt
|
401,072
|
400,975
|
||||||
|
Total current liabilities
|
1,538,538
|
1,445,272
|
||||||
|
NONCURRENT LIABILITIES:
|
||||||||
|
Long-term debt
|
5,439,700
|
5,808,561
|
||||||
|
Deferred taxes
|
1,169,151
|
1,178,205
|
||||||
|
Other liabilities
|
111,875
|
104,024
|
||||||
|
Total liabilities
|
8,259,264
|
8,536,062
|
||||||
|
STOCKHOLDERS' EQUITY:
|
||||||||
|
Common stock
|
1,039
|
1,036
|
||||||
|
Additional paid-in capital
|
1,518,213
|
1,489,067
|
||||||
|
Retained earnings
|
4,764,711
|
4,642,402
|
||||||
|
Accumulated other comprehensive earnings
|
(294,327
|
)
|
(324,739
|
)
|
||||
|
Treasury stock
|
(18,846
|
)
|
(18,901
|
)
|
||||
|
Total stockholders' equity
|
5,970,790
|
5,788,865
|
||||||
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
$
|
14,230,054
|
$
|
14,324,927
|
||||
|
Roper Technologies, Inc. and Subsidiaries
|
||||||||
|
Condensed Consolidated Statements of Earnings (unaudited)
|
||||||||
|
(Amounts in thousands, except per share data)
|
||||||||
|
Three months ended
|
||||||||
|
March 31,
|
||||||||
|
2017
|
2016
|
|||||||
|
Net sales
|
$
|
1,086,305
|
$
|
902,423
|
||||
|
Cost of sales
|
418,691
|
342,904
|
||||||
|
Gross profit
|
667,614
|
559,519
|
||||||
|
Selling, general and administrative expenses
|
409,358
|
314,528
|
||||||
|
Income from operations
|
258,256
|
244,991
|
||||||
|
Interest expense
|
45,865
|
27,413
|
||||||
|
Other expense
|
(1,047
|
)
|
(129
|
)
|
||||
|
Earnings from continuing operations before
|
||||||||
|
income taxes
|
211,344
|
217,449
|
||||||
|
Income taxes
|
53,273
|
66,033
|
||||||
|
Net Earnings
|
$
|
158,071
|
$
|
151,416
|
||||
|
Earnings per share:
|
||||||||
|
Basic
|
$
|
1.55
|
$
|
1.50
|
||||
|
Diluted
|
$
|
1.53
|
$
|
1.48
|
||||
|
Weighted average common and common
|
||||||||
|
equivalent shares outstanding:
|
||||||||
|
Basic
|
101,885
|
101,071
|
||||||
|
Diluted
|
103,078
|
102,318
|
||||||
|
Roper Technologies, Inc. and Subsidiaries
|
||||||||||||||||
|
Selected Segment Financial Data (unaudited)
|
||||||||||||||||
|
(Amounts in thousands and percents of net sales)
|
||||||||||||||||
|
Three months ended March 31,
|
||||||||||||||||
|
2017
|
2016
|
|||||||||||||||
|
Amount
|
%
|
Amount
|
%
|
|||||||||||||
|
Net sales:
|
||||||||||||||||
|
Medical & Scientific Imaging
|
$
|
348,235
|
$
|
332,214
|
||||||||||||
|
RF Technology
|
429,619
|
280,210
|
||||||||||||||
|
Industrial Technology
|
183,404
|
171,235
|
||||||||||||||
|
Energy Systems & Controls
|
125,047
|
118,764
|
||||||||||||||
|
Total
|
$
|
1,086,305
|
$
|
902,423
|
||||||||||||
|
Gross profit:
|
||||||||||||||||
|
Medical & Scientific Imaging
|
$
|
251,930
|
72.3
|
%
|
$
|
246,897
|
74.3
|
%
|
||||||||
|
RF Technology
|
251,478
|
58.5
|
%
|
160,365
|
57.2
|
%
|
||||||||||
|
Industrial Technology
|
93,151
|
50.8
|
%
|
86,020
|
50.2
|
%
|
||||||||||
|
Energy Systems & Controls
|
71,055
|
56.8
|
%
|
66,237
|
55.8
|
%
|
||||||||||
|
Total
|
$
|
667,614
|
61.5
|
%
|
$
|
559,519
|
62.0
|
%
|
||||||||
|
Operating profit*:
|
||||||||||||||||
|
Medical & Scientific Imaging
|
$
|
119,793
|
34.4
|
%
|
$
|
114,456
|
34.5
|
%
|
||||||||
|
RF Technology
|
88,984
|
20.7
|
%
|
88,766
|
31.7
|
%
|
||||||||||
|
Industrial Technology
|
53,613
|
29.2
|
%
|
46,759
|
27.3
|
%
|
||||||||||
|
Energy Systems & Controls
|
30,236
|
24.2
|
%
|
24,182
|
20.4
|
%
|
||||||||||
|
Total
|
$
|
292,626
|
26.9
|
%
|
$
|
274,163
|
30.4
|
%
|
||||||||
|
Net Orders:
|
||||||||||||||||
|
Medical & Scientific Imaging
|
$
|
350,777
|
$
|
343,850
|
||||||||||||
|
RF Technology
|
441,289
|
281,125
|
||||||||||||||
|
Industrial Technology
|
195,316
|
178,905
|
||||||||||||||
|
Energy Systems & Controls
|
126,727
|
122,770
|
||||||||||||||
|
Total
|
$
|
1,114,109
|
$
|
926,650
|
||||||||||||
|
* Operating profit is before unallocated corporate general and administrative expenses. These expenses
|
||||||||||||||||
|
were $34,370 and $29,172 for the three months ended March 31, 2017 and 2016, respectively.
|
||||||||||||||||
|
Roper Technologies, Inc. and Subsidiaries
|
||||||||
|
Condensed Consolidated Statements of Cash Flows (unaudited)
|
||||||||
|
(Amounts in thousands)
|
||||||||
|
Three months ended
|
||||||||
|
March 31,
|
||||||||
|
2017
|
2016
|
|||||||
|
Net earnings
|
$
|
158,071
|
$
|
151,416
|
||||
|
Non-cash items:
|
||||||||
|
Depreciation
|
12,377
|
9,702
|
||||||
|
Amortization
|
72,998
|
49,549
|
||||||
|
Stock-based compensation expense
|
21,049
|
18,979
|
||||||
|
Income taxes
|
39,013
|
20,127
|
||||||
|
Changes in assets and liabilities:
|
||||||||
|
Receivables
|
59,536
|
(14,059
|
)
|
|||||
|
Inventory
|
(7,905
|
)
|
(3,907
|
)
|
||||
|
Accounts payable
|
(2,009
|
)
|
(1,273
|
)
|
||||
|
Accrued liabilities
|
34,094
|
(18,458
|
)
|
|||||
|
Other, net
|
(9,007
|
)
|
(5,004
|
)
|
||||
|
Cash provided by operating activities
|
378,217
|
207,072
|
||||||
|
Business acquisitions, net of cash acquired
|
(2,829
|
)
|
(265,248
|
)
|
||||
|
Capital expenditures
|
(14,930
|
)
|
(9,489
|
)
|
||||
|
Capitalized software expenditures
|
(3,169
|
)
|
(665
|
)
|
||||
|
Other, net
|
(391
|
)
|
1,446
|
|||||
|
Cash used in investing activities
|
(21,319
|
)
|
(273,956
|
)
|
||||
|
Principal debt payments
|
-
|
(289
|
)
|
|||||
|
Revolver payments, net
|
(370,000
|
)
|
(160,000
|
)
|
||||
|
Dividends
|
(35,443
|
)
|
(30,173
|
)
|
||||
|
Proceeds from stock-based compensation, net
|
7,576
|
690
|
||||||
|
Premium on convertible debt conversions
|
-
|
(915
|
)
|
|||||
|
Other, net
|
782
|
505
|
||||||
|
Cash used in financing activities
|
(397,085
|
)
|
(190,182
|
)
|
||||
|
Effect of exchange rate changes on cash
|
13,653
|
1,588
|
||||||
|
Net decrease in cash and equivalents
|
(26,534
|
)
|
(255,478
|
)
|
||||
|
Cash and equivalents, beginning of period
|
757,200
|
778,511
|
||||||
|
Cash and equivalents, end of period
|
$
|
730,666
|
$
|
523,033
|
||||