ROPER TECHNOLOGIES, INC. SARASOTA, Fla., April 25, 2016 /PRNewswire/ -- Roper Technologies, Inc. (NYSE: ROP) reported financial results for the first quarter ended March 31, 2016.
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 revenue increased 4% to $902 million and adjusted revenue grew 4% to $906 million. GAAP diluted earnings per share (DEPS) were $1.48 and adjusted DEPS were $1.50. Orders increased 9% in the quarter and backlog increased 7% to a record $1.12 billion.
GAAP gross margin increased to 62.0% and adjusted gross margin increased 210 basis points to 62.1%. EBITDA increased 4% to $307 million. Operating cash flow was $207 million, which included tax payments associated with the gain on the divestiture of Abel Pump in the fourth quarter of 2015. Excluding these tax payments, adjusted operating cash flow was $245 million and adjusted free cash flow was $235 million, representing 26% of revenue.
"We are very pleased with our performance in the quarter," said Brian Jellison, Roper's Chairman, President and CEO. "Although energy markets were weak as expected, strong contributions from our software and medical products businesses resulted in record revenue for the quarter. Our businesses continued to generate strong margin performance, with gross margin expansion in all four segments. In addition, orders strengthened across the enterprise, with three segments recording a book-to-bill ratio of 1.03 or greater."
"During the quarter we completed the acquisition of Clinisys Group, Ltd., adding to our platform of software solutions for hospital laboratories," Mr. Jellison continued. "In addition, we acquired PCI Medical, a provider of disinfection systems that complement our Civco Medical Solutions business. Roper's pipeline of acquisition opportunities remains attractive and the Company expects to deploy over $1 billion in 2016."
2016 Guidance
Roper maintained its guidance for full year adjusted diluted earnings per share of $6.85 - $7.15. The Company expects second quarter adjusted diluted earnings per share to be $1.56 - $1.61. The Company's guidance excludes the impact of any future acquisitions or divestitures.
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
2016 2015 V%
---- ---- ---
Q1 GAAP Revenue $902.4 $865.3 4.3%
Add: Purchase Accounting Adjustment
to Acquired Deferred Revenue 3.3 1.9
--- ---
Q1 Adjusted Revenue $905.7 $867.2 4.4%
====== ======
Components of Adjusted Revenue Growth
Acquisitions 9.6%
Divestiture (1.0%)
Organic (3.2%)
Foreign Exchange (1.0%)
-----
Total Growth 4.4%
===
Table 2: Reconciliation of Q1 2016 GAAP DEPS to
Adjusted DEPS
Q1 2016
-------
GAAP Diluted Earnings Per Share
(DEPS) $1.48
Add: Purchase Accounting Adjustment
to Acquired Deferred Revenue $0.02
Add: Acquisition-Related Inventory
Step-up Charge $0.00
Adjusted DEPS $1.50
=====
Table 3: Q1 2016 Adjusted Gross Margin Reconciliation
2016 2015 V% / V Bps
---- ---- ----------
Q1 GAAP Revenue $902.4 $865.3
Add: Purchase Accounting Adjustment
to Acquired Deferred Revenue 3.3 1.9
--- ---
Q1 Adjusted Revenue $905.7 $867.2
Q1 GAAP Gross Profit $559.5 $518.2
Add: Purchase Accounting Adjustment
to Acquired Deferred Revenue 3.3 1.9
Add: Acquisition-Related Inventory
Step-up Charge 0.1 --
Adjusted Gross (B) 562.9 520.1
GAAP Gross Margin 62.0% 59.9% +210 bps
Adjusted Gross Margin (B) / (A) 62.1% 60.0% +210 bps
Table 4: Q1 EBITDA Reconciliation
2016 2015 V%
---- ---- ---
GAAP Net Earnings $151.4 $155.8
Add: Taxes 66.0 70.6
Add: Amortization 49.5 38.4
Add: Interest Expense 27.4 19.8
Add: Depreciation 9.7 9.9
Add: Purchase Accounting Adjustment to
Acquired Deferred Revenue 3.3 1.9
Add: Acquisition-Related Inventory
Step-up Charge 0.1 --
Rounding 0.1 --
--- ---
EBITDA 307.5 296.4 +4%
Table 5: Q1 Cash Flow Reconciliation
2016
----
GAAP Operating Cash Flow $207.1
Add: Tax Related to 2015 Sale of Abel
Pump 37.4
----
Adjusted Operating Cash Flow $244.5
Less: Capital Expenditures (9.5)
----
Adjusted Free Cash Flow $235.0
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, April 25, 2016. The call can be accessed via webcast or by dialing +1 888-430-8694 (US/Canada) or +1 719-325-2315, using confirmation code 8649870. 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/866/14512 . Telephonic replays will be available for up to two weeks and can be accessed by using the following registration URL https://jsp.premiereglobal.com/webrsvp/ with access code 8649870.
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)
March 31, December 31,
ASSETS 2016 2015
------ ---- ----
CURRENT ASSETS:
Cash and cash
equivalents $523,033 $778,511
Accounts
receivable 514,616 488,271
Inventories 196,321 189,868
Unbilled
receivable 120,746 122,042
Other current
assets 77,616 39,355
Total current
assets 1,432,332 1,618,047
------------- --------- ---------
PROPERTY, PLANT
AND EQUIPMENT,
NET 106,212 105,510
--------------- ------- -------
OTHER ASSETS:
Goodwill 5,975,803 5,824,726
Other intangible
assets, net 2,622,157 2,528,996
Deferred taxes 31,254 31,532
Other assets 56,650 59,554
Total other assets 8,685,864 8,444,808
------------------ --------- ---------
TOTAL ASSETS $10,224,408 $10,168,365
============ =========== ===========
LIABILITIES AND
STOCKHOLDERS'
EQUITY
---------------
CURRENT
LIABILITIES:
Accounts payable $140,421 $139,737
Accrued
compensation 91,288 119,511
Deferred revenue 275,230 267,030
Other accrued
liabilities 185,305 168,513
Income taxes
payable 80,879 18,532
Current portion of
long-term debt 6,365 6,805
------------------ ----- -----
Total current
liabilities 779,488 720,128
------------- ------- -------
NONCURRENT
LIABILITIES:
Long-term debt 3,105,340 3,264,417
Deferred taxes 826,425 810,856
Other liabilities 71,920 74,017
Total liabilities 4,783,173 4,869,418
----------------- --------- ---------
STOCKHOLDERS'
EQUITY:
Common stock 1,031 1,028
Additional paid-
in capital 1,438,695 1,419,262
Retained earnings 4,231,589 4,110,530
Accumulated other
comprehensive
earnings (211,036) (212,779)
Treasury stock (19,044) (19,094)
-------------- ------- -------
Total
stockholders'
equity 5,441,235 5,298,947
-------------- --------- ---------
TOTAL LIABILITIES
AND STOCKHOLDERS'
EQUITY $10,224,408 $10,168,365
================== =========== ===========
Roper Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Earnings (unaudited)
(Amounts in
thousands, except
per share data)
Three months ended
March 31,
---------
2016 2015
---- ----
Net sales $902,423 $865,281
Cost of sales 342,904 347,120
------------- ------- -------
Gross profit 559,519 518,161
Selling, general
and administrative
expenses 314,528 271,265
------------------- ------- -------
Income from
operations 244,991 246,896
Interest expense 27,413 19,836
Other expense (129) (679)
------------- ---- ----
Earnings from
continuing
operations before
income taxes 217,449 226,381
Income taxes 66,033 70,608
------------ ------ ------
Net Earnings $151,416 $155,773
============ ======== ========
Earnings per share:
Basic $1.50 $1.55
Diluted $1.48 $1.54
Weighted average
common and common
equivalent shares
outstanding:
Basic 101,071 100,377
Diluted 102,318 101,361
======= ======= =======
Roper Technologies, Inc. and Subsidiaries
Selected Segment Financial Data (unaudited)
(Amounts in thousands and
percents of net sales)
Three months ended March 31,
----------------------------
2016 2015
---- ----
Amount % Amount %
------ --- ------ ---
Net sales:
Medical & Scientific
Imaging $332,214 $291,700
RF Technology 280,210 242,954
Industrial Technology 171,235 190,728
Energy Systems & Controls 118,764 139,899
------- -------
Total $902,423 $865,281
===== ======== ========
Gross profit:
Medical & Scientific
Imaging $246,897 74.3% $215,326 73.8%
RF Technology 160,365 57.2% 130,046 53.5%
Industrial Technology 86,020 50.2% 95,242 49.9%
Energy Systems & Controls 66,237 55.8% 77,547 55.4%
------ ------
Total $559,519 62.0% $518,161 59.9%
===== ======== ==== ======== ====
Operating profit*:
Medical & Scientific
Imaging $114,456 34.5% $107,779 36.9%
RF Technology 88,766 31.7% 73,977 30.4%
Industrial Technology 46,759 27.3% 57,897 30.4%
Energy Systems & Controls 24,182 20.4% 30,422 21.7%
------ ------
Total $274,163 30.4% $270,075 31.2%
===== ======== ==== ======== ====
Net Orders:
Medical & Scientific
Imaging $343,850 $275,796
RF Technology 281,125 253,127
Industrial Technology 178,905 188,740
Energy Systems & Controls 122,770 131,070
------- -------
Total $926,650 $848,733
===== ======== ========
* Operating profit is before unallocated corporate general and administrative expenses. These expenses
were $29,172 and $23,179 for the three months ended March 31, 2016 and 2015, respectively.
Roper Technologies, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (unaudited)
(Amounts in thousands)
Three months ended
March 31,
---------
2016 2015
---- ----
Net earnings $151,416 $155,773
Non-cash items:
Depreciation 9,702 9,880
Amortization 49,549 38,428
Stock-based compensation
expense 18,979 13,801
Income taxes 20,127 38,837
Changes in assets and
liabilities:
Receivables (14,059) 9,262
Inventory (3,907) (7,680)
Accounts payable (1,273) 7,078
Accrued liabilities (18,458) 1,627
Other, net (5,004) (6,607)
---------- ------ ------
Cash provided by operating
activities 207,072 260,399
Business acquisitions, net of
cash acquired (265,248) (589,577)
Capital expenditures (9,489) (9,950)
Other, net 781 (3,596)
---------- --- ------
Cash used in investing
activities (273,956) (603,123)
Principal debt payments (289) (3,454)
Revolver borrowings/
(payments), net (160,000) 415,000
Dividends (30,173) (25,024)
Excess tax benefit from share-
based payment* - 4,093
Proceeds from stock-based
compensation, net 690 6,267
Premium on convertible debt
conversions (915) (11,236)
Other, net 505 498
---------- --- ---
Cash provided by/(used in)
financing activities (190,182) 386,144
Effect of exchange rate
changes on cash 1,588 (38,357)
----------------------- ----- -------
Net increase/(decrease) in
cash and equivalents (255,478) 5,063
Cash and equivalents,
beginning of period 778,511 610,430
--------------------- ------- -------
Cash and equivalents, end of
period 523,033 $615,493
============================ ======= ========
*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.
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SOURCE Roper Technologies, Inc.
