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Roper Technologies, Inc.$232.50$4.712.07%

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 Roper Technologies Announces Third Quarter Results
   Monday, October 31, 2016 6:55:00 AM ET

Roper Technologies, Inc. (ROP ) reported financial results for the third quarter ended September 30, 2016.

Roper reports results, including revenue, gross margin, 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.

Third quarter GAAP diluted earnings per share (DEPS) were $1.63, a 3% increase over the prior year, and adjusted DEPS were $1.65. GAAP revenue increased 7% to $945 million and adjusted revenue increased 7% to $947 million. Organic revenue increased 2% led by the Company’s medical, software, toll and traffic and water meter technology businesses.

GAAP operating profit increased 7% to $267 million, representing 28.3% of revenue. Adjusted operating profit increased to $270 million, 28.5% of adjusted revenue. Orders increased 4% to $929 million. GAAP gross margin increased 80 basis points over the prior year to 61.2% and adjusted gross margin increased to 61.3%, a 60 basis point gain.

Operating cash flow increased 40% to $317 million, or 33.5% of GAAP revenue and 33.4% of adjusted revenue. Free cash flow increased 40% to $308 million.

"Our businesses executed very well in the quarter, establishing record levels for orders, revenue, net earnings, EBITDA and cash flow," said Brian Jellison, Roper’s Chairman, President and CEO. "Growth in revenue was led by medical, software and water businesses more than offsetting continued weakness in energy end markets. Cash flow was exceptionally strong, bringing year-to-date free cash flow to $704 million, an increase of 11% over last year’s level."

TransCore MTA All-Electronic Tolling Project

New York City’s Metropolitan Transportation Authority (MTA) has selected the Company’s TransCore business to convert nine of its bridges and tunnels to All-Electronic Tolling (AET). Under an accelerated roll-out schedule, TransCore expects to finish converting the first three facilities by January 2017. The remaining conversions will be completed by November 2017.

"We are excited to have won this important project to serve the largest tolling authority in the United States with our industry-leading technology. TransCore’s Infinity Digital Lane SystemTM will enable the MTA to eliminate existing gated toll plazas, allowing traffic to flow freely on these bridges and tunnels," added Mr. Jellison.

ConstructConnect Acquisition

Roper separately announced today an agreement to acquire ConstructConnect, a leading provider of cloud-based data, collaboration, and workflow automation solutions to the commercial construction industry.

"We are excited to acquire another industry-leading Software as a Service (SaaS) and informatics business," said Mr. Jellison. "ConstructConnect has created the largest cloud-based network for collaboration between participants in the commercial construction industry. Its solutions facilitate the pre-construction process from opportunity identification through project award, driving efficiency and creating revenue opportunities for its users." said Mr. Jellison.

The purchase price for the acquisition is $632 million and the transaction is expected to close this week. Roper expects ConstructConnect to generate approximately $150 million of revenue in 2017.

Guidance Update and Outlook

Roper is establishing fourth quarter 2016 adjusted diluted earnings per share guidance of $1.77 - $1.89 and updating its full year adjusted diluted earnings per share guidance to $6.48 - $6.60. The company’s guidance excludes the impact of any future acquisitions or divestitures.

"We had a strong third quarter with excellent cash performance. While product orders for fourth quarter delivery were modestly weaker than expected, the ConstructConnect acquisition, MTA project win and positive momentum across our software and services businesses give us confidence as we look forward to 2017," concluded Mr. Jellison.

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:  Q3 Revenue Growth Detail
                                                                  Q3 2016 Q3 2015 V%
Q3 GAAP Revenue                                                   $945.1  $883.9  6.9%
Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue 2.2     2.2
Q3 Adjusted Revenue                                               $947.3  $886.1  6.9%
Components of Adjusted Revenue Growth
Organic                                                           1.6%
Acquisitions / Divestitures                                       5.9%
Foreign Exchange                                                  (0.6%)
Total Growth                                                      6.9%
Table 2:  Reconciliation of GAAP DEPS to Adjusted DEPS
                                                                                   Q3 2016 Q3 2015 V%
GAAP Diluted Earnings Per Share (DEPS)                                             $1.63   $1.58   3%
Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue, net of tax @35% $0.01   $0.01
Add:  Acquisition-Related Inventory Step-up Charge, net of tax @35%
                                                                                   --      $0.01
Add:  Debt Extinguishment Charge, net of tax @35%                                  $0.01   --
Rounding                                                                           --      $0.01
Adjusted DEPS                                                                      $1.65   $1.61   2%
Table 3: Q3 Cash Flow Reconciliation
                                     Q3 2016 Q3 2015 V%
Q3 GAAP Operating Cash Flow          $316.5  $226.6  40%
Less:  Capital Expenditures          (8.6)   (6.8)
Rounding                             0.1     --
Q3 Free Cash Flow                    $308.0  $219.8  40%
Table 4: 2016 Cash Flow Reconciliation
                                           YTD 2016 YTD 2015 V%
2016 GAAP Operating Cash Flow              $693.4   $659.6   5%
Add: Tax Related to 2015 Sale of Abel Pump 37.4     --
Adjusted Operating Cash Flow               $730.8   $659.6   11%
Less:  Capital Expenditures                (26.9)   (27.5)
Adjusted Free Cash Flow                    $703.9   $632.1   11%
Table 5:  Adjusted Revenue and Adjusted Gross Margin Reconciliation
                                                                    2016   2015   V bps
Q3 GAAP Revenue                                                     $945.1 $883.9
Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue   2.2    2.2
Q3 Adjusted Revenue (A)                                             $947.3 $886.1
Q3 GAAP Gross Profit                                                $578.5 $533.5
Add:  Purchase Accounting Adjustment to Acquired Deferred           2.2    2.2
Add:  Acquisition-Related Inventory Step-up Charge                  --     2.0
Adjusted Gross Profit (B)                                           $580.7 $537.7
GAAP Gross Margin                                                   61.2%  60.4%  +80 bps
Adjusted Gross Margin (B) / (A)                                     61.3%  60.7%  +60 bps
Table 6:  Adjusted Revenue and Adjusted Operating Margin Reconciliation
                                                                        2016   2015   V bps
Q3 GAAP Revenue                                                         $945.1 $883.9
Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue       2.2    2.2
Q3 Adjusted Revenue (A)                                                 $947.3 $886.1
Q3 GAAP Operating Profit                                                $267.4 $250.4
Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue       2.2    2.2
Add:  Acquisition-Related Inventory Step-up Charge                      --     2.0
Rounding                                                                --     (0.1)
Adjusted Operating Profit (B)                                           $269.6 $254.5
GAAP Operating Margin                                                   28.3%  28.3%  0 bps
Adjusted Operating Margin (B) / (A)                                     28.5%  28.7%  (20) bps
Table 7:  Adjusted Revenue and EBITDA Margin Reconciliation
                                                                  2016   2015   V bps
Q3 GAAP Revenue                                                   $945.1 $883.9
Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue 2.2    2.2
Q3 Adjusted Revenue (A)                                           $947.3 $886.1
Q3 GAAP Net Earnings                                              $167.1 $160.4
Add:  Interest Expense                                            26.8   20.4
Add:  Taxes                                                       73.0   69.8
Add:  Depreciation                                                8.9    9.0
Add:  Amortization                                                49.4   41.0
Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue 2.2    2.2
Add:  Acquisition-Related Inventory Step-up Charge                --     2.0
Add:  Debt Extinguishment Charge                                  0.9    --
Rounding                                                          (0.1)  --
EBITDA (B)                                                        $328.2 $304.8
EBITDA Margin (B) / (A)                                           34.6%  34.4%  +20 bps

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 31, 2016. The call can be accessed via webcast or by dialing +1 888-297-0353 (US/Canada) or +1 719-325-2165, using confirmation code 7873619. 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 https://www.webcaster4.com/Webcast/Page/866/17746. Telephonic replays will be available for up to two weeks and can be accessed by using the following registration URL https://premiereglobal.com/webrsvp with access code 7873619.

About Roper Technologies

Roper Technologies is a constituent of the S&P 500, Fortune 1000, and the Russell 1000 indices. Roper designs and develops software (both software-as-a-service and licensed), and engineered products and solutions for healthcare, transportation, food, energy, water, education and other niche markets worldwide. Additional information about Roper is available on the company’s website at www.ropertech.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, 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.

Roper Technologies, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (unaudited)
(Amounts in thousands)
                                           September 30,     December 31,
ASSETS                                     2016              2015
CURRENT ASSETS:
Cash and cash equivalents                  $        882,270  $        778,511
Accounts receivable                        498,006           488,271
Inventories                                197,529           189,868
Unbilled receivable                        119,109           122,042
Other current assets                       77,897            39,355
Total current assets                       1,774,811         1,618,047
PROPERTY, PLANT AND EQUIPMENT, NET         103,847           105,510
OTHER ASSETS:
Goodwill                                   5,969,328         5,824,726
Other intangible assets, net               2,541,482         2,528,996
Deferred taxes                             30,663            31,532
Other assets                               59,997            59,554
Total other assets                         8,601,470         8,444,808
TOTAL ASSETS                               $    10,480,128   $    10,168,365
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable                           $        144,235  $        139,737
Accrued compensation                       106,906           119,511
Deferred revenue                           290,231           267,030
Other accrued liabilities                  200,463           168,513
Income taxes payable                       28,003            18,532
Current portion of long-term debt          1,902             6,805
Total current liabilities                  771,740           720,128
NONCURRENT LIABILITIES:
Long-term debt                             3,087,151         3,264,417
Deferred taxes                             821,349           810,856
Other liabilities                          87,381            74,017
Total liabilities                          4,767,621         4,869,418
STOCKHOLDERS’ EQUITY:
Common stock                               1,033             1,028
Additional paid-in capital                 1,482,963         1,419,262
Retained earnings                          4,495,907         4,110,530
Accumulated other comprehensive earnings   (248,452)         (212,779)
Treasury stock                             (18,944)          (19,094)
Total stockholders’ equity                 5,712,507         5,298,947
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $    10,480,128   $    10,168,365
Roper Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Earnings (unaudited)
(Amounts in thousands, except per share data)
                                              Three months ended          Nine months ended
                                              September 30,               September 30,
                                              2016          2015          2016           2015
Net sales                                     $  945,144    $  883,933    $2,779,125     $2,638,755
Cost of sales                                 366,651       350,450       1,073,593      1,053,200
Gross profit                                  578,493       533,483       1,705,532      1,585,555
Selling, general and administrative expenses  311,103       283,112       940,073        836,314
Income from operations                        267,390       250,371       765,459        749,241
Interest expense                              26,800        20,369        81,076         60,382
Debt extinguishment costs                     871                         871
Other income/(expense)                        337           251           (1,126)        (1,948)
Earnings from continuing operations before
income taxes                                  240,056       230,253       682,386        686,911
Income taxes                                  72,977        69,836        205,822        199,441
Net Earnings                                  $  167,079    $  160,417    $   476,564    $   487,470
Earnings per share:
Basic                                         $       1.65  $       1.59  $        4.71  $        4.85
Diluted                                       $       1.63  $       1.58  $        4.65  $        4.80
Weighted average common and common
equivalent shares outstanding:
Basic                                         101,372       100,681       101,231        100,545
Diluted                                       102,522       101,607       102,424        101,512
Roper Technologies, Inc. and Subsidiaries
Selected Segment Financial Data (unaudited)
(Amounts in thousands and percents of net sales)
                              Three months ended September 30,        Nine months ended September 30,
                              2016                2015                2016                 2015
                              Amount      %       Amount      %       Amount       %       Amount       %
Net sales:
Medical & Scientific Imaging  $  338,027          $  299,621          $1,010,826           $   893,583
RF Technology                 303,565             253,556             872,536              752,068
Industrial Technology         178,317             186,147             528,179              563,342
Energy Systems & Controls     125,235             144,609             367,584              429,762
Total                         $  945,144          $  883,933          $2,779,125           $2,638,755
Gross profit:
Medical & Scientific Imaging  $  247,432  73.2%   $  222,655  74.3%   $   740,725  73.3%   $   660,971  74.0%
RF Technology                 169,123     55.7%   133,692     52.7%   492,493      56.4%   397,874      52.9%
Industrial Technology         90,950      51.0%   92,245      49.6%   266,679      50.5%   281,052      49.9%
Energy Systems & Controls     70,988      56.7%   84,891      58.7%   205,635      55.9%   245,658      57.2%
Total                         $  578,493  61.2%   $  533,483  60.4%   $1,705,532   61.4%   $1,585,555   60.1%
Operating profit*:
Medical & Scientific Imaging  $  118,979  35.2%   $  108,399  36.2%   $   347,706  34.4%   $   325,439  36.4%
RF Technology                 94,785      31.2%   74,604      29.4%   272,905      31.3%   228,521      30.4%
Industrial Technology         52,800      29.6%   52,298      28.1%   150,850      28.6%   162,383      28.8%
Energy Systems & Controls     31,777      25.4%   42,300      29.3%   83,728       22.8%   110,424      25.7%
Total                         $  298,341  31.6%   $  277,601  31.4%   $   855,189  30.8%   $   826,767  31.3%
Net Orders:
Medical & Scientific Imaging  $  332,624          $  317,743          $1,014,910           $   900,176
RF Technology                 300,303             245,694             899,659              751,143
Industrial Technology         173,757             184,846             528,629              555,431
Energy Systems & Controls     121,818             145,478             368,292              416,803
Total                         $  928,502          $  893,761          $2,811,490           $2,623,553
*  Operating profit is before unallocated corporate general and administrative expenses.  These expenses
were $30,951 and $27,230 for the three months ended September 30, 2016 and 2015, respectively and
$89,730 and $77,526 for the nine months ended September 30, 2016 and 2015, respectively.
Roper Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (unaudited)
(Amounts in thousands)
                                                 Nine months ended
                                                 September 30,
                                                 2016                2015
Net earnings                                     $    476,564        $    487,470
Non-cash items:
Depreciation                                     27,954              28,454
Amortization                                     149,149             119,766
Stock-based compensation expense                 60,480              47,035
Income taxes                                     (52,728)            (35,165)
Changes in assets and liabilities:
Receivables                                      2,024               26,051
Inventory                                        (5,916)             (7,047)
Accounts payable                                 3,122               (2,085)
Accrued liabilities                              33,843              (6,603)
Other, net                                       (1,119)             1,691
Cash provided by operating activities            693,373             659,567
Business acquisitions, net of cash acquired      (277,587)           (1,024,779)
Capital expenditures                             (26,933)            (27,503)
Other, net                                       902                 (4,369)
Cash used in investing activities                (303,618)           (1,056,651)
Principal debt payments                          (4,010)             (4,006)
Revolver borrowings/(payments), net              (180,000)           590,000
Debt issuance costs                              (6,763)
Dividends                                        (90,632)            (75,210)
Excess tax benefit from share-based payment*     -                   11,593
Proceeds from stock-based compensation, net      13,895              19,237
Premium on convertible debt conversions          (13,308)            (13,126)
Other, net                                       1,523               844
Cash provided by/(used in) financing activities  (279,295)           529,332
Effect of exchange rate changes on cash          (6,701)             (42,100)
Net increase in cash and equivalents             103,759             90,148
Cash and equivalents, beginning of period        778,511             610,430
Cash and equivalents, end of period              $    882,270        $    700,578
*In the first quarter of 2016, the Company adopted ASU 2016-09, which requires excess
tax benefits to be classified along with other income tax cash flows as an operating activity.

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/roper-technologies-announces-third-quarter-results-300353856.html

SOURCE Roper Technologies, Inc.

http://rt.prnewswire.com/rt.gif?NewsItemId=CL30692&Transmission_Id=201610310655PR_NEWS_USPR_____CL30692&DateId=20161031



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