SEC Filing | Roper Technologies, Inc.

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------------------ FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended January 31, 1998. [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to . ---------- ------------ Commission File Number 1-12273 ROPER INDUSTRIES, INC. (Exact name of registrant as specified in its charter) Delaware 51-0263969 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 160 Ben Burton Road Bogart, Georgia 30622 (Address of principal executive offices) (Zip Code) (706) 369-7170 (Registrant's telephone number, including area code) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No --------- --------- The number of shares outstanding of the Registrant's common stock as of February 27, 1998 was 31,076,034.

ROPER INDUSTRIES, INC. REPORT ON FORM 10-Q FOR THE QUARTER ENDED JANUARY 31, 1998 TABLE OF CONTENTS Page ---- PART I. FINANCIAL INFORMATION Item 1. Financial Statements: Condensed Consolidated Statements of Earnings 1 Condensed Consolidated Balance Sheets 2 Condensed Consolidated Statements of Cash Flows 3 Notes to Condensed Consolidated Financial Statements 4 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 6 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 10 Signatures 11

PART I. FINANCIAL INFORMATION Item 1. Financial Statements Roper Industries, Inc. and Subsidiaries Condensed Consolidated Statements of Earnings (Unaudited) (In thousands, except per share data) Three Months Ended January 31, 1998 1997 - ----------------------------------------------------------------------------- Net sales $90,099 $55,108 Cost of sales 44,632 25,672 - ----------------------------------------------------------------------------- Gross profit 45,467 29,436 Selling, general and administrative expenses 27,726 19,627 - ----------------------------------------------------------------------------- Income from operations 17,741 9,809 Interest expense 1,809 1,302 Other income 371 227 - ----------------------------------------------------------------------------- Earnings before income taxes 16,303 8,734 Income taxes 5,583 2,904 - ----------------------------------------------------------------------------- Net earnings $10,720 $ 5,830 ============================================================================= Net earnings per common and common equivalent share*: Basic $ 0.35 $ 0.19 Diluted $ 0.34 $ 0.19 ============================================================================= Weighted average common and common equivalent shares outstanding*: Basic 30,973 30,215 Diluted 31,926 30,893 ============================================================================= Cash dividends per common share* $ 0.060 $ 0.045 ============================================================================= * Prior year data has been restated giving effect to the 2-for-1 stock split in the form of a 100% stock dividend that was paid in August 1997. See accompanying notes to condensed consolidated financial statements. 1

Roper Industries, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (In thousands) January 31, October 31, ASSETS 1998 1997 - -------------------------------------------------------------------------------- (Unaudited) CURRENT ASSETS: Cash and cash equivalents $ 13,864 $ 649 Accounts receivable 67,005 78,752 Inventories 50,666 50,199 Other current assets 1,561 2,290 - -------------------------------------------------------------------------------- Total current assets 133,096 131,890 - -------------------------------------------------------------------------------- PROPERTY, PLANT & EQUIPMENT: Cost 64,578 63,002 Accumulated depreciation and amortization (33,050) (31,607) - -------------------------------------------------------------------------------- Property, plant and equipment, net 31,528 31,395 - -------------------------------------------------------------------------------- OTHER ASSETS: Intangible assets, net 161,753 154,255 Other assets 11,844 11,780 - -------------------------------------------------------------------------------- Total other assets 173,597 166,035 - -------------------------------------------------------------------------------- TOTAL ASSETS $ 338,221 $ 329,320 ================================================================================ LIABILITIES AND STOCKHOLDERS' EQUITY - -------------------------------------------------------------------------------- CURRENT LIABILITIES: Accounts payable $ 14,580 $ 15,654 Accrued liabilities 25,788 25,231 Income taxes payable 7,101 1,564 Current portion of long-term debt 4,164 2,487 - -------------------------------------------------------------------------------- Total current liabilities 51,633 44,936 - -------------------------------------------------------------------------------- NONCURRENT LIABILITIES: Long-term debt 92,099 99,638 Other noncurrent liabilities 7,257 6,877 - -------------------------------------------------------------------------------- Total noncurrent liabilities 99,356 106,515 - -------------------------------------------------------------------------------- STOCKHOLDERS' EQUITY: Common stock 310 309 Additional paid-in capital 63,143 61,950 Cumulative translation adjustments (1,628) (937) Retained earnings 125,407 116,547 - -------------------------------------------------------------------------------- Total stockholders' equity 187,232 177,869 - -------------------------------------------------------------------------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 338,221 $ 329,320 ================================================================================ See accompanying notes to condensed consolidated financial statements. 2

Roper Industries, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited) (In thousands) Three Months Ended January 31, 1998 1997 - -------------------------------------------------------------------------------- Cash flows from operating activities: Net earnings $ 10,720 $ 5,830 Depreciation and amortization 3,307 2,582 Other, net 17,223 (5,794) - -------------------------------------------------------------------------------- Net cash provided by operating activities 31,250 2,618 - -------------------------------------------------------------------------------- Cash flows from investing activites: Acquisitions of businesses, net of cash acquired (10,148) - Capital expenditures (1,483) (878) Other, net (16) - - -------------------------------------------------------------------------------- Net cash used in investing activities (11,647) (878) - -------------------------------------------------------------------------------- Cash flows from financing activities: Proceeds from long-term debt 11,837 4,500 Principal payments on long-term debt (17,559) (4,626) Dividends paid on common stock (1,860) (1,365) Other, net 1,188 517 - -------------------------------------------------------------------------------- Net cash used in financing activities (6,394) (974) - -------------------------------------------------------------------------------- Effect of exchange rate changes on cash 6 (102) - -------------------------------------------------------------------------------- Net increase in cash and cash equivalents 13,215 664 Cash and cash equivalents, beginning of period 649 423 - -------------------------------------------------------------------------------- Cash and cash equivalents, end of period $ 13,864 $ 1,087 ================================================================================ See accompanying notes to condensed consolidated financial statements. 3

Roper Industries, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements 1. Basis of Presentation The accompanying condensed consolidated financial statements for the three-month periods ended January 31, 1998 and 1997 are unaudited. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the financial position, results of operations and cash flows of Roper Industries, Inc. (the "Company") and its subsidiaries for all periods presented. The results of operations are not necessarily indicative of the results to be expected for the full fiscal year. It is recommended that these unaudited condensed consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company's 1997 Annual Report on Form 10-K as filed with the Securities and Exchange Commission. 2. Business Acquisitions On February 27, 1998, a subsidiary of the Company acquired the assets of Acton Research Corporation, Inc. The purchase price was approximately $11 million and consisted of a combination of cash and Roper common stock. Acton manufactures and markets spectrometers, monochromators and optical components and coatings for various high-end analytical applications. Another of the Company's subsidiaries, Princeton Instruments, Inc., is already a significant user and distributor of certain Acton products. Both of these companies are expected to benefit from a closer working relationship with each other. Acton will be reported in the Company's Analytical Instrumentation segment. Effective December 1, 1997, the Company acquired the outstanding common stock of EG&G Flow Technology, Inc., an Arizona corporation, for cash consideration of approximately $10 million. The company was subsequently renamed FTI Flow Technology, Inc. ("Flow Technology"). Flow Technology, based in Phoenix, Arizona, manufactures and markets turbine flow meters, calibrators and emissions measurement equipment for aerospace, automotive and industrial markets. Flow Technology is reported in the Company's Fluid Handling segment. Each of these acquisitions will be or has been accounted for as a purchase. The excess of the purchase price over the fair value of the net assets acquired is or will be amortized over 20 years for Flow Technology and 15 years for Acton. Their results of operations are or will be included in the Company's reported results beginning with the effective date of the acquisition. 3. Earnings Per Common and Common Equivalent Share Basic earnings per common share is calculated by dividing net earnings by the weighted average common shares outstanding during the period. Diluted earnings per common and common equivalent share includes the dilutive effect of common stock equivalents outstanding during the period. Common stock equivalents consist of stock options. 4. Supplemental Cash Flow Information Cash payments for the three months ended January 31, 1998 and 1997 included interest of $1,270,000 and $1,704,000, respectively, and income taxes of $1,320,000 and $1,339,000, respectively. 4

5. Concentration of Credit Risk At January 31, 1998, the Company had $3.4 million of trade receivables due from RAO Gazprom (compared to $10.2 million at October 31, 1997) and $3.8 million was due from Ukrainian Gazprom (compared to $3.8 million at October 31, 1997). Bothfv of these are large natural gas companies. 6. Inventories Inventories are summarized below (in thousands): January 31, October 31, 1998 1997 - --------------------------------------------------------------------- Raw materials and supplies $ 24,554 $ 25,729 Work in process 14,716 13,715 Finished products 13,078 12,398 Less LIFO reserve (1,682) (1,643) - --------------------------------------------------------------------- Total $ 50,666 $ 50,199 ===================================================================== 7. Industry Segments Sales and operating profit by industry segment are set forth in the following table (dollars in thousands): Three Months Ended January 31, 1998 1997 % Chg - ----------------------------------------------------------------------------- Net sales: Industrial Controls $ 42,561 $ 16,975 150.7% Fluid Handling 24,236 22,153 9.4% Analytical Instrumentation 23,302 15,980 45.8% - ----------------------------------------------------------------------------- Total $ 90,099 $ 55,108 63.5% ============================================================================= Gross profit: Industrial Controls $ 20,582 $ 9,611 114.2% Fluid Handling 10,894 10,208 6.7% Analytical Instrumentation 13,991 9,617 45.5% - ----------------------------------------------------------------------------- Total $ 45,467 $ 29,436 54.5% ============================================================================= Operating profit (a): Industrial Controls $ 8,970 $ 1,553 477.6% Fluid Handling 5,648 6,107 -7.5% Analytical Instrumentation 4,746 3,487 36.1% - ----------------------------------------------------------------------------- Total $ 19,364 $ 11,147 73.7% ============================================================================= (a) Operating profit is before any allocation of corporate general and administrative expenses. Corporate general and administrative expenses were $1,623 and $1,338 for the three months ended January 31, 1998 and 1997, respectively. 5

ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This discussion should be read in conjunction with Management's Discussion and Analysis of Financial Condition and Results of Operations included in the Company's Annual Report on Form 10-K for the year ended October 31, 1997 ("Form 10-K"). Results of operations The following table sets forth certain information relating to the operations of the Company expressed as a percentage of net sales: Three Months Ended January 31, 1998 1997 - ------------------------------------------------------------------------------ Net sales 100.0% 100.0% Cost of sales 49.5% 46.6% - ------------------------------------------------------------------------------ Gross profit 50.5% 53.4% Selling, general and administrative expenses 30.8% 35.6% - ------------------------------------------------------------------------------ Income from operations 19.7% 17.8% Interest expense 2.0% 2.4% Other income 0.4% 0.4% - ------------------------------------------------------------------------------ Earnings before income taxes 18.1% 15.8% - ------------------------------------------------------------------------------ Income taxes 6.2% 5.2% - ------------------------------------------------------------------------------ Net earnings 11.9% 10.6% ============================================================================== Net sales increased $35.0 million, or 63%, during the three months ended January 31, 1998 compared to the three months ended January 31, 1997. Most of the increase was due to the inclusion of Princeton, Petrotech, Industrial Data Systems and Flow Technology (each acquired since the first quarter of fiscal 1997) in the Company's fiscal 1998 results. These companies contributed $21.9 million of sales in the first quarter of fiscal 1998. Compressor Controls also had significant shipments to RAO Gazprom at the end of the 1998 quarter compared to nominal shipments during the first quarter of fiscal 1997. The shipments to RAO Gazprom were the first significant shipments since the third quarter of fiscal 1997. Amot Controls reported increased sales of 40% due to strength across almost all of its product lines. Integrated Designs' sales increased 23% led by a 48% increase in shipments to its major OEM customers. Integrated Designs' increase in OEM activity is primarily due to the timing of certain shipments. Second quarter sales are expected to be lower compared to both the first quarter of fiscal 1998 and the second quarter of fiscal 1997. Gatan experienced a 17% decline in its sales in the first quarter of fiscal 1998 compared to the first quarter last year primarily as a result of lower booking activity, that is down over 40% compared to last year. Gatan's second quarter sales are also expected to trail its first quarter and fiscal 1997 second quarter sales. Gross profit percentage is lower in fiscal 1998 compared to the first quarter of fiscal 1997 primarily due to Petrotech, whose typical gross profit percentage is significantly less than that of the Company's other operating units. Excluding Petrotech, the Company would have reported consolidated gross profit of 6

54.6%, or a 1.2% increase compared to the first three months of fiscal 1997. The most notable improvement is at Amot Controls, where the gross profit percentage increased to 51% from 47% due to higher volume and improved product mix. Selling, general and administrative ("SG&A") expenses increased $8.1 million, or 41%, during the three months ended January 31, 1998 compared to prior-year period. Most of the increase is due to the expenses reported by Princeton, Petrotech, Industrial Data Systems and Flow Technology (combined total of $5.4 million) during the first quarter of fiscal 1998, which were not included in the Company's results for the first quarter of fiscal 1997. SG&A expenses were also higher at Compressor Controls, reflecting the commission costs associated with significantly higher sales to RAO Gazprom. The increase in interest expense (up $0.5 million, or 39%) during the three months ended January 31, 1998 compared to the three months ended January 31, 1997 is due to additional debt levels in fiscal 1998 resulting from the acquisitions that have occurred since May 1997. The Company's income tax expense is recorded at an estimated effective rate based on estimates of taxable income for the entire fiscal year. The rate recorded in the first quarter of fiscal 1998 (34%) is slightly higher than the rate recorded in the first quarter of fiscal 1997 (33%), but the 1998 rate is consistent with the rate recorded for the entire 1997 fiscal year. The net sales (in thousands) and profit margins (as a percentage of net sales) for each of the Company's business segments are listed below. Three Months Ended January 31, 1998 1997 - ------------------------------------------------------------------------ Net sales: Industrial Controls $ 42,561 $ 16,975 Fluid Handling 24,236 22,153 Analytical Instrumentation 23,302 15,980 Gross profit: Industrial Controls 48.4% 56.6% Fluid Handling 44.9% 46.1% Analytical Instrumentation 60.0% 60.2% Operating profit (a): Industrial Controls 21.1% 9.1% Fluid Handling 23.3% 27.6% Analytical Instrumentation 20.4% 21.8% (a) Before allocation of corporate general and administrative expenses. Net sales for Industrial Controls increased primarily due to the acquisition of Petrotech in May 1997, to Compressor Controls' significant shipments to RAO Gazprom and the improvements at Amot Controls. Net sales for Fluid Handling increased mostly due to the acquisition of Flow Technology in December 1997 and the strong quarter by Integrated Designs, which had its highest level of quarterly sales since the second quarter of fiscal 1996. Net sales for Analytical Instrumentation increased primarily due to the acquisition of Princeton in May 1997, partially offset by the decline at Gatan. 7

The decline in gross profit percentage in Industrial Controls in the first quarter of fiscal 1998 compared to the first quarter of fiscal 1997 is primarily due to the inclusion of Petrotech results in fiscal 1998, partially offset by the improved performance at Amot Controls. Excluding Petrotech, the rest of Industrial Controls reported gross profit of 58.1% in the 1998 quarter. All Fluid Handling and Analytical Instrumentation companies reported gross profit percentages that are fairly comparable between the first quarters of fiscal 1998 and 1997. Industrial Controls reported a higher operating profit percentage in the first quarter of fiscal 1998 compared to the first quarter of last year primarily due to the improved profitability at Compressor Controls resulting from the significant shipments to RAO Gazprom during the first quarter of fiscal 1998. Compressor Controls only had nominal shipments to RAO Gazprom during the first quarter of fiscal 1997, which resulted in an operating loss due to the significant local infrastructure costs incurred to support a much higher anticipated level of sales. Amot Controls also reported significantly improved profitability from the leverage of increased sales. Fluid Handling reported a lower operating profit percentage in the first quarter of fiscal 1998 compared to the first quarter last year due to a higher proportion of commission- generating sales in the first quarter 1998 compared to last year at Roper Pump and also its additional development costs for mud motor products incurred in the first quarter of 1998. Cornell Pump's operating profit was adversely impacted by additional personnel costs, primarily to expand its sales force. Operating profit decreased slightly at Analytical Instrumentation due to a decrease at Gatan that resulted from its lower sales activity, increased R&D activities and the fiscal 1998 costs of a sales office in Hong Kong that was established in the latter part of fiscal 1997. For the three months ended January 31, 1998, consolidated bookings were $88.1 million, or an increase of 26% compared to the three months ended January 31, 1997. Excluding the four companies acquired since May 1997, bookings are down 6% compared to the first quarter of fiscal 1997. Most of this decrease occurred at Gatan. The economic uncertainties in Asian markets contributed to less booking activity at Gatan, Princeton and Integrated Designs (which also continues to be adversely affected by soft conditions in the semiconductor equipment industry). Gatan is also experiencing reduced bookings in Europe reflecting governmental reductions in grant and research activities. If these uncertainties continue throughout 1998, the Company expects its operations to be adversely affected. Sales order backlog was $79.7 million and $71.5 million at January 31, 1998 and 1997, respectively. The 1997 acquisitions of Princeton, Petrotech, Industrial Data Systems and Flow Technology account for $24.6 million of the backlog at January 31, 1998. Compared to January 31, 1997, backlog changes are greatest at Compressor Controls (down $7.5 million), Gatan (down $3.7 million), Uson (down $2.6 million), Fluid Metering (down $1.7 million) and Integrated Designs (down $1.5 million). The largest reason for decreased backlog at Compressor Controls was the removal of $3.3 million of orders due to continued customer delays to arrange suitable financing. Uson has made significant progress improving its manufacturing processes over the past year to drive down its backlog. Fluid Metering's backlog is impacted by the timing of large blanket orders placed by its largest customer. Over the past two years, these large orders have been placed in the fourth quarter of fiscal 1996 and the third quarter of fiscal 1997. Financial Condition, Liquidity and Capital Resources Working capital declined to $81.5 million at January 31,1998 from $87.0 million at October 31, 1997. Most of the decline in working capital is due to reductions in the Company's outstanding debt. Despite spending $10 million to acquire Flow Technology in December, total debt was reduced during the quarter by $6 million. As discussed in the Company's Form 10-K, the Company has proceeded cautiously with respect to business opportunities with RAO Gazprom. The cash balance at January 31 largely represents overseas funds securing the shipments to RAO Gazprom in January, which were transferred to the U.S. in mid- February. Compressor Controls has also made significant progress reducing its accounts receivable from customers in the CIS region to $7.0 million at January 31, 1998 compared to $14.7 million at October 31, 1997. Accrued income taxes are higher at January 31, 1998 compared to October 31, 1997 because estimated U.S. tax payments based on first quarter earnings are not due until February. The increase in intangible assets at January 31, 1998 compared to October 31, 1997 results from the excess of the purchase price over the fair value of the net assets acquired related to the acquisition of Flow Technology. 8

Total debt was $96.2 million at January 31, 1997 (34% of total capital) compared to $102.1 million (36% of total capital) at October 31, 1997. Less financial leverage is due to reducing total indebtedness and strong earnings increasing equity. The Company expects cash flows from its existing business will be sufficient to fund normal operating requirements, including capital expenditures. Capital expenditures in fiscal 1998 are expected to be similar to fiscal 1997. In February 1998, the Company entered into an agreement to essentially convert $50 million of its variable-rate debt to fixed-rate debt at an interest rate of slightly less than 6%. This agreement lasts for five years. On February 27, 1998, a subsidiary of the Company acquired the assets of Acton Research Corporation, Inc. The purchase price of approximately $11 million consisted of a combination of cash and Roper common stock. This acquisition is not considered to have a significant impact on the capital structure of the Company. The Company has also been advised by the Federal Trade Commission ("FTC") that, after a longer-than-anticipated review, the Company's proposed acquisition of Photometrics Limited has received FTC clearance. Completion of this acquisition is still subject to negotiation of a definitive purchase agreement and there can be no assurance that this acquisition will be completed. The Company expects to continue an active acquisition program. However, completion of future acquisitions will be dependent upon numerous factors and, unless otherwise indicated, it is not feasible to reasonably estimate when any such acquisitions will occur, what the financing requirements will be or what the impact will be on the Company's activities, financial condition and results of operations. The Company is cautiously optimistic that RAO Gazprom will continue to provide adequate financing to support further shipments as contemplated in Compressor Controls' existing turbomachinery controls equipment supply contract with RAO Gazprom. In the event that RAO Gazprom is unable to provide such financing to support future shipments at the levels and on the schedule provided for in the supply contract, the Company maintains its position that it may walk away from much or all of this opportunity because of the prohibitive cost of maintaining the infrastructure needed to support such sales. The Financial Accounting Standards Board has issued Statement of Financial Accounting Standards ("SFAS") 130 -- Reporting Comprehensive Income and SFAS 131 - -- Disclosures about Segments of an Enterprise and Related Information that will be applicable to the Company in fiscal 1999. Once adopted, neither of these standards is expected to significantly affect the Company's disclosures. Forward-Looking Information The information provided elsewhere in this report, in other Company filings with the Securities and Exchange Commission, and in other press releases and public disclosures contains forward-looking statements about the Company's businesses and prospects as to which there are numerous risks and uncertainties which generally are beyond the Company's control. Some of these risks include the uncertainty of continuation, the level and the timing of future business with RAO Gazprom, future effects of financial and economic uncertainties in Asia and the uncertainties involved in completion of pending acquisitions. There is no assurance that these and other risks and uncertainties will not have an adverse impact on the Company's future operations, financial condition or financial results. 9

Part II - Other Information Item 6. Exhibits and Reports on Form 8-K a. Exhibits *3.1 Amended and Restated Certificate of Incorporation, including Form of Certificate of Designation, Preferences and Rights of Series A Preferred Stock **3.2 Amended and Restated By-Laws ***4.01 Rights Agreement between Roper Industries, Inc. and SunTrust Bank, Atlanta, Inc. as Rights Agent, dated as of January 8, 1996, including Certificate of Designation, Preferences and Rights of Series A Preferred Stock (Exhibit A), Form of Rights Certificate (Exhibit B) and Summary of Rights (Exhibit C). **4.02 Third Amended and Restated Credit Agreement dated May 15, 1997 by and between Roper Industries, Inc. and NationsBank, N.A. (South) and the lender parties thereto. ****10.01 Lease of Milwaukee, Oregon Facility. *10.02 1991 Stock Option Plan, as amended+ *****10.03 Non-employee Director Stock Option Plan+ ****10.04 Form of Indemnification Agreement+ *10.05 Consulting Agreement (G.L. Ohrstrom & Co.)+ *10.06 Consulting Agreement (E.D. Kenna)+ ******10.11 Labor Agreement 23 Consent of Independent Auditors- KPMG Peat Marwick LLP 27 Financial Data Schedule b. Reports on Form 8-K None ___________________________ * Incorporated herein by reference to Exhibit 3.1 to the Roper Industries, Inc. Annual Report on 10-K filed on January 21, 1998. ** Incorporated herein by reference to Exhibits 3 and 4 to the Roper Industries, Inc. Current Report on Form 8-K filed June 2, 1997. *** Incorporated by reference to Exhibit 4.02 to the Roper Industries, Inc. Current Report on Form 8-K on January 18, 1996. **** Incorporated herein by reference to Exhibit 10.8 to the Roper Industries, Inc. Registration Statement (No. 33-44665) on Form S-1 filed December 20, 1991. ***** Incorporated herein by reference to Exhibit 10.3 to the Roper Industries, Inc. Annual Report on Form 10-K filed on January 28, 1994. ****** Incorporated herein by reference to Exhibit 10.3 to the Roper Industries, Inc. Annual Report on 10-K filed January 25, 1996. + Management contract or compensatory plan or arrangement. 10

Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Signature Title Date --------- ----- ---- /s/ Derrick N. Key Chief Executive Officer and March 2, 1998 - ------------------ President Derrick N. Key /s/ Martin S. Headley Vice President and March 2, 1998 - --------------------- Chief Financial Officer Martin S. Headley /s/ Kevin G. McHugh Controller March 2, 1998 - ------------------- Kevin G. McHugh 11

EXHIBIT INDEX TO REPORT ON FORM 10-Q Number Exhibit ------ ------- 3.1 Amended and Restated Certificate of Incorporation, including Form of Certificate of Designation, Preferences and Rights of Series A Preferred Stock, incorporated herein by reference to Exhibit 3.1 to the Roper Industries, Inc. Annual Report on 10-K filed on January 21, 1998 3.2 Amended and Restated By-Laws, incorporated herein by reference to Exhibits 3 and 4 to the Roper Industries, Inc. Current Report on Form 8-K filed June 2, 1997. 4.01 Rights Agreement between Roper Industries, Inc. and SunTrust Bank, Atlanta, Inc. as Rights Agent, dated as of January 8, 1996, including Certificate of Designation, Preferences and Rights of Series A Preferred Stock (Exhibit A), Form of Rights Certificate (Exhibit B) and Summary of Rights (Exhibit C), incorporated by reference to Exhibit 4.02 to the Roper Industries, Inc. Current Report on Form 8-K on January 18, 1996. 4.02 Third Amended and Restated Credit Agreement dated May 15, 1997 by and between Roper Industries, Inc. and NationsBank, N.A. (South) and the lender parties thereto, incorporated herein by reference to Exhibit 4 to the Roper Industries, inc. Current Report on Form 8-K filed June 2, 1997. 10.01 Lease of Milwaukee, Oregon Facility incorporated herein by reference to Exhibit 10.8 to the Roper Industries, Inc. Registration Statement (No. 33-44665 on Form S-1 filed December 20, 1991. 10.02 1991 Stock Option Plan, as amended 10.03 Non-employee Director Stock Option Plan, incorporated herein by reference to Exhibit 10.3 to the Roper Industries, Inc. Annual Report on Form 10-K filed on January 28, 1994. 10.04 Form of Indemnification Agreement, incorporated herein by reference to Exhibit 10.10 to the Roper Industries, Inc. Registration Statement (No. 33-44665 on Form S-1 filed December 20, 1991. 10.05 Consulting Agreement 10.06 Consulting Agreement 10.11 Labor Agreement, incorporated herein by reference to Exhibit 10.3 to the Roper Industries, Inc. Annual Report on 10-K filed January 25, 1996. 23 Consent on Independent Auditors-KPMG Peat Marwick LLP 27 Financial Data Schedule 12

5 1,000 3-MOS OCT-31-1998 NOV-01-1997 JAN-31-1997 13,864 0 67,005 0 50,666 133,096 64,578 33,050 338,221 51,633 0 0 0 310 186,922 338,221 90,099 90,470 44,632 44,632 0 0 1,809 16,303 5,583 10,720 0 0 0 10,720 0.34 0.34