UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

 

FORM 8-K

 

CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

 

April 27, 2015

DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED)

 

ROPER TECHNOLOGIES, INC.

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

 

DELAWARE

(STATE OR OTHER JURISDICTION OF INCORPORATION)

 

1-12273	51-0263969
(COMMISSION FILE NUMBER)	(IRS EMPLOYER IDENTIFICATION NO.)
6901 PROFESSIONAL PKWY. EAST, SUITE 200, SARASOTA, FLORIDA	34240
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)	(ZIP CODE)

 

(941) 556-2601

(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

 

(FORMER NAME OR ADDRESS, IF CHANGED SINCE LAST REPORT)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

[ ] Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

GAAP DEPS Increased to $1.54; Adjusted DEPS to $1.55

Operating Cash Flow Increased 22% to $260 Million

Organic Revenue Growth of 5%

 

Sarasota, Florida, April 27, 2015 ... Roper Technologies, Inc. (NYSE: ROP) reported financial results for the first quarter ended March 31, 2015.

Roper reports results, including revenue, operating margin, net income and diluted earnings per share, on a GAAP and adjusted basis.  Adjusted measures are reconciled to the corresponding GAAP measures at the end of this release.

First quarter GAAP diluted earnings per share (DEPS) were $1.54, a 5% increase over the prior year and adjusted DEPS were $1.55, a 6% increase over last year.  GAAP revenue increased 4% to $865 million and adjusted revenue grew 4% to $867 million.  GAAP operating profit increased 11% to $247 million, representing 28.5% of revenue.  Adjusted operating profit increased 11% to $249 million and adjusted operating margin increased to 28.7%.

GAAP gross margin increased 130 basis points to 59.9% and adjusted gross margin increased to 60.0%, a 140 basis point gain over the prior year.  EBITDA margin was a record 34.2% for the quarter.  Operating cash flow increased 22% to a record $260 million.

"We are delighted to be reporting for the first time as Roper Technologies," said Brian Jellison, Roper's Chairman, President and CEO.  "Our businesses performed exceptionally well in the quarter, with record first quarter performance for orders, revenue, margins, net earnings and cash flow.  Organic revenue increased 5%, with significant contributions from our RF Technology and Medical segments.  As a result of strong operating performance and our continued growth in asset-light software, technology and services businesses, free cash flow increased 24% to $250 million."

"During the quarter, we invested $590 million to acquire three medical software businesses:  Data Innovations, SoftWriters, and Strata Decision Technology," continued Mr. Jellison.   "These businesses bring leading software and solutions to their niche markets, and have proven leadership teams."

 

As a result of its first quarter performance and outlook for the remainder of the year, Roper is increasing its full year diluted earnings per share guidance from $6.70 - $6.94 to $6.75 - $6.95.    Second quarter diluted earnings per share is expected to be $1.59 - $1.64. The company's guidance includes contributions from completed acquisitions and the increased headwind of a stronger U.S. dollar.  The company's guidance excludes the impact of any future acquisitions.

 

On Friday, April 24, 2015, the company announced the change of its corporate name from Roper Industries, Inc. to Roper Technologies, Inc. to reflect its continued evolution as a diversified technology company.  The company's shares are expected to begin trading under its new name effective as of the market open on April 29, 2015.  The company's stock ticker symbol remains "ROP."  The company's website is now located at www.ropertech.com

 

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.

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	Revenue	V%
Q1 2014 Revenue (A)	$834M
Q1 2015 GAAP Revenue	$865M	4%
Adjustment to Acquired Deferred Revenue (SHP, FoodLink, Strata, SoftWriters, Data Innovations)	2
Q1 2015 Adjusted Revenue (B)	$867M
Increase (B)/(A)		4%
Components of Adjusted Revenue Growth
Organic		5%
Acquisitions / Divestitures		3%
Foreign Exchange		(3%)
Rounding		(1%)
Total Growth		4%

	Q1 2015	Q1 2014	V%
GAAP Diluted Earnings Per Share (DEPS)	$1.54	$1.46	5%
Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue (FoodLink, SHP, Strata, SoftWriters, Data Innovations), net of tax @35%	$0.01
Adjusted DEPS	$1.55	$1.46	6%

	Q1 2015	Q1 2014	V%
Operating Cash Flow	$260.4M	$212.6M	22%
Less:  Capital Expenditures	(10.0)	(10.5)
Rounding	--	0.1
Free Cash Flow	$250.4M	$202.2M	24%

	2015	2014	V bps
Q1 GAAP Revenue	$865.3M	$834.1M
Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue (SHP, FoodLink, Strata, SoftWriters, Data Innovations)	1.9
Q1 Adjusted Revenue (A)	$867.2M	$834.1M
Q1 GAAP Operating Profit	$246.9M	$223.4M
Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue (SHP, FoodLink, Strata, SoftWriters, Data Innovations)	1.9
Adjusted Operating Profit (B)	$248.8M	$223.4M
GAAP Operating Margin	28.5%	26.8%	+170 bps
Adjusted Operating Margin (B) / (A)	28.7%	26.8%	+190 bps

A conference call to discuss these results has been scheduled for 8:30 AM ET on Monday, April 27, 2015.  The call can be accessed via webcast or by dialing +1 888-471-3843 (US/Canada) or +1 719-325-2281, using confirmation code 8861725.  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://www.videonewswire.com/event.asp?id=102121.  Telephonic replays will be available for up to two weeks by calling +1 719-457-0820 and using the access code 8861725.

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, profit and cash flow 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 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 Technologies, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (unaudited)
(Amounts in thousands)
		March 31,				December 31,
ASSETS		2015				2014
CURRENT ASSETS:
Cash and cash equivalents		$	615,493			$	610,430
Accounts receivable			499,042				511,538
Inventories			194,737				193,766
Unbilled receivable			107,743				96,409
Deferred taxes			60,020				54,199
Other current assets			44,787				45,763
Total current assets			1,521,822				1,512,105
PROPERTY, PLANT AND EQUIPMENT, NET			110,973				110,876
OTHER ASSETS:
Goodwill			5,088,040				4,710,691
Other intangible assets, net			2,142,299				1,978,729
Deferred taxes			35,177				27,496
Other assets			76,311				73,037
Total other assets			7,341,827				6,789,953
TOTAL ASSETS		$	8,974,622			$	8,412,934
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable		$	151,139			$	143,847
Accrued compensation			95,571				117,374
Deferred revenue			237,197				190,953
Other accrued liabilities			169,332				160,738
Income taxes payable			34,934				-
Deferred taxes			3,492				3,943
Current portion of long-term debt			7,719				11,092
Total current liabilities			699,384				627,947
NONCURRENT LIABILITIES:
Long-term debt			2,617,722				2,203,031
Deferred taxes			759,813				735,826
Other liabilities			90,308				90,770
Total liabilities			4,167,227				3,657,574
STOCKHOLDERS' EQUITY:
Common stock			1,025				1,021
Additional paid-in capital			1,339,750				1,325,338
Retained earnings			3,650,843				3,520,201
Accumulated other comprehensive earnings			(165,000	)			(71,927	)
Treasury stock			(19,223	)			(19,273	)
Total stockholders' equity			4,807,395				4,755,360
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	8,974,622			$	8,412,934

 

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Roper Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Earnings (unaudited)
(Amounts in thousands, except per share data)
		Three months ended
		March 31,
		2015				2014
Net sales		$	865,281			$	834,052
Cost of sales			347,120				345,116
Gross profit			518,161				488,936
Selling, general and administrative expenses			271,265				265,536
Income from operations			246,896				223,400
Interest expense			19,836				19,827
Other income/(expense)			(679	)			1,420
Earnings from continuing operations before
income taxes			226,381				204,993
Income taxes			70,608				57,767
Net Earnings		$	155,773			$	147,226
Earnings per share:
Basic		$	1.55			$	1.48
Diluted		$	1.54			$	1.46
Weighted average common and common
equivalent shares outstanding:
Basic			100,377				99,557
Diluted			101,361				100,572

 

 

 

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Roper Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (unaudited)
(Amounts in thousands)
		Three months ended
		March 31,
		2015				2014
Net earnings		$	155,773			$	147,226
Non-cash items:
Depreciation			9,880				9,666
Amortization			38,428				39,037
Stock-based compensation expense			13,800				14,571
Income taxes			38,837				24,829
Changes in assets and liabilities:
Receivables			9,262				(3,764	)
Inventory			(7,680	)			(4,712	)
Accounts payable			7,078				(5,914	)
Accrued liabilities			1,627				(6,973	)
Other, net			(6,606	)			(1,338	)
Cash provided by operating activities			260,399				212,628
Business acquisitions, net of cash acquired			(589,577	)			(2,146	)
Capital expenditures			(9,950	)			(10,478	)
Other, net			(3,596	)			108
Cash used in investing activities			(603,123	)			(12,516	)
Principal debt payments			(3,454	)			(433	)
Revolver borrowings/(payments), net			415,000				(150,000	)
Dividends			(25,024	)			(19,863	)
Excess tax benefit from share-based payment			4,093				7,511
Proceeds from stock-based compensation, net			6,267				8,026
Premium on convertible debt conversions			(11,236	)			(1,174	)
Other, net			498				1,302
Cash provided by/(used in) financing activities			386,144				(154,631	)
Effect of exchange rate changes on cash			(38,357	)			(2,316	)
Net increase in cash and equivalents			5,063				43,165
Cash and equivalents, beginning of period			610,430				459,720
Cash and equivalents, end of period		$	615,493			$	502,885

 

 

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Roper Technologies, Inc. and Subsidiaries
Selected Segment Financial Data (unaudited)
(Amounts in thousands and percents of net sales)
		Three months ended March 31,
		2015								2014
		Amount				%				Amount				%
Net sales:
Industrial Technology		$	190,728							$	197,001
Energy Systems & Controls			139,899								155,171
Medical & Scientific Imaging			291,700								256,199
RF Technology			242,954								225,681
Total		$	865,281							$	834,052
Gross profit:
Industrial Technology		$	95,242				49.9	%		$	98,470				50.0	%
Energy Systems & Controls			77,547				55.4	%			85,965				55.4	%
Medical & Scientific Imaging			215,326				73.8	%			184,850				72.2	%
RF Technology			130,046				53.5	%			119,651				53.0	%
Total		$	518,161				59.9	%		$	488,936				58.6	%
Operating profit*:
Industrial Technology		$	57,897				30.4	%		$	56,056				28.5	%
Energy Systems & Controls			30,422				21.7	%			37,025				23.9	%
Medical & Scientific Imaging			107,779				36.9	%			89,771				35.0	%
RF Technology			73,977				30.4	%			62,560				27.7	%
Total		$	270,075				31.2	%		$	245,412				29.4	%
Net Orders:
Industrial Technology		$	188,740							$	204,881
Energy Systems & Controls			131,070								150,915
Medical & Scientific Imaging			275,796								256,340
RF Technology			253,127								234,345
Total		$	848,733							$	846,481

 

* Operating profit is before unallocated corporate general and administrative expenses. These expenses were $23,179 and $22,012 for the three months ended March 31, 2015 and 2014, respectively.