Roper Technologies Announces Record Financial Results

01 Feb, 2016, 06:55 ET from Roper Technologies, Inc.

SARASOTA, Fla., Feb. 1, 2016 /PRNewswire/ -- Roper Technologies, Inc. (NYSE: ROP), a diversified technology company, reported financial results for the fourth quarter and full year ended December 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. 

Fourth Quarter 2015

Fourth quarter GAAP diluted earnings per share (DEPS) were $2.05 and adjusted diluted earnings per share were $1.82.  GAAP revenue was $944 million and adjusted revenue was $948 million. GAAP gross margin was 61.4% and adjusted gross margin increased 190 basis points to 61.8%.

GAAP operating margin was 29.5% and adjusted operating margin was 30.1%.  EBITDA margin was 35.9% for the quarter, a 60 basis point increase over last year.  Operating cash flow in the quarter was $269 million

Full Year 2015

Full year GAAP diluted earnings per share increased 7% to $6.85 and adjusted diluted earnings per share were $6.68, a 4% increase over the prior year.  GAAP revenue was $3.58 billion and adjusted revenue was $3.59 billion, a 1% increase.  GAAP operating margin increased 50 basis points to 28.7% and adjusted operating margin was 29.0%, an 80 basis point increase over the prior year.  Full year EBITDA was $1.24 billion, or 34.6% of adjusted revenue.

Operating cash flow increased 11% to $929 million.  Free cash flow was $893 million, representing 25% of revenue.

"2015 was a record year for Roper," said Brian Jellison, Roper's Chairman, President and CEO.  "Growth in our medical, software and RF businesses offset a significant decline in energy markets and negative foreign exchange.  Our businesses executed well, driving an 11% increase in free cash flow. We successfully deployed $1.8 billion in strategic acquisitions during the year and are excited about our robust pipeline for 2016.  We expect to deploy over $1 billion in 2016, including the January acquisition of CliniSys Group, Ltd. which expands our global presence in software for hospital laboratories."

2016 Outlook and Guidance

Roper expects operating cash flow of approximately $1.0 billion.  "Our medical and software businesses will continue to lead our growth in 2016 and we expect an overall revenue increase of 8 – 10%, including 2 - 4 % organic growth, with strong operating leverage," Mr. Jellison added.

Roper expects 2016 full year adjusted diluted earnings per share (DEPS) between $6.85 and $7.15 with first quarter DEPS between $1.42 and $1.47.  

The company's guidance excludes 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 Monday, February 1, 2016.  The call can be accessed via webcast or by dialing +1 888-452-4023 (US/Canada) or +1 719-325-2420, using confirmation code 429015.  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/866/12793.  Telephonic replays will be available for up to two weeks by calling +1 719-457-0820 and using the access code 429015.

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

2015

2014

   V%

Q4 GAAP Revenue

$943.6

$946.1

(0.3%)

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

4.0

1.4

Q4 Adjusted Revenue

$947.6

$947.5

0.0%

Components of Adjusted Revenue Growth

Organic

(3.6%)

Acquisitions

6.0%

Foreign Exchange

(2.4%)

Total Growth

0.0%

 

 

Table 2:  Reconciliation of Q4 2015 GAAP DEPS to Adjusted DEPS

Q4 2015

Q4 2014

V%

GAAP Diluted Earnings Per Share (DEPS)

$ 2.05

$1.84

11%

Minus:  Gain on Sale of Divested Business

$(0.33)

--

Add:  Impairment Charge on Minority Investment

$0.06

--

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

$0.03

$0.01

Add:  Acquisition-Related Inventory Step-up Charge

$0.02

$0.00

Rounding

$(0.01)

--

Adjusted DEPS

$ 1.82

$1.85

(2%)

 

 

Table 3:  Reconciliation of Full Year GAAP DEPS to Adjusted DEPS

FY 2015

FY 2014

V%

GAAP Diluted Earnings Per Share (DEPS)

$6.85

$6.40

7%

Minus:  Gain on Sale of Divested Business

($0.33)

Add:  Impairment Charge on Minority Investment

$0.06

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

$0.07

$0.02

Add:  Acquisition-Related Inventory Step-up Charge

$0.03

$0.01

Rounding

--

($0.01)

Adjusted DEPS

$6.68

$6.42

4%

 

 

Table 4:  2015 Full Year Adjusted Revenue and Adjusted Operating Margin Reconciliation

2015

2014

V% / V Bps

Full Year GAAP Revenue

$3,582

$3,549

+1%

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

11

2

Rounding

--

1

Adjusted Revenue (A)

$3,593

$3,552

+1%

GAAP Operating Profit

$1,028

$999

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

11

2

Add:  Acquisition-Related Inventory Step-up Charge

5

1

Rounding

(1)

1

Adjusted Operating (B)

1,043

1,003

GAAP Operating Margin

28.7%

28.2%

+50 bps

Adjusted Operating Margin (B) / (A)

29.0%

28.2%

+80 bps

 

 

Table 5:  FY 2015 EBITDA  and EBITDA Margin Reconciliation

FY 2015

GAAP Revenue

$3,582.4

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

10.6

Rounding

--

Adjusted Revenue (A)

$3,593.0

GAAP Net Earnings

$696.1

Add:  Taxes

306.3

Add:  Amortization

166.1

Add:  Interest Expense

84.2

Add:  Depreciation

38.2

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

10.6

Add:  Acquisition-Related Inventory Step-up Charge

4.6

Add:  Impairment Charge on Minority Investment

9.5

Less:  Gain on Disposal of a Business

(70.9)

EBITDA (B)

1,244.7

EBITDA Margin (B) / (A)

34.6%

 

 

Table 6:  Fourth Quarter Adjusted Revenue and Adjusted Operating Margin Reconciliation

2015

2014

Q4 GAAP Revenue

$944

$946

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

4

1

Rounding

--

1

Q4 Adjusted Revenue (A)

$948

$948

Q4 GAAP Operating Profit

$278.7

$283.7

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

4.0

1.4

Add:  Acquisition-Related Inventory Step-up Charge

2.6

0.4

Rounding

--

0.1

Adjusted Operating Profit (B)

$285.3

$285.6

GAAP Operating Margin

29.5%

30.0%

Adjusted Operating Margin (B) / (A)

30.1%

30.1%

 

 

Table 7:  Fourth Quarter Adjusted Revenue and Adjusted Gross Margin Reconciliation

2015

2014

V bps

Q4 GAAP Revenue

$944

$946

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

4

1

Rounding

--

1

Q4 Adjusted Revenue (A)

$948

$948

Q4 GAAP Gross Profit

$579.1

$565.7

Add:  Purchase Accounting Adjustment to Acquired Deferred Revenue

4.0

1.4

Add:  Acquisition-Related Inventory Step-up Charge

2.6

0.4

Rounding

--

0.1

Adjusted Gross Profit (B)

$585.7

$567.6

GAAP Gross Margin

61.4%

59.8%

+160 bps

Adjusted Gross Margin (B) / (A)

61.8%

59.9%

+190 bps

 

 

Table 8:  Free Cash Flow Reconciliation

2015

2014

V%

Operating Cash Flow

$929

$840

11%

Less:  Capital Expenditures

(36)

(38)

Rounding

1

Free Cash Flow

$893

$803

11%

 

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 may 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," "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, 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, 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)

December 31,

December 31,

ASSETS

2015

2014

CURRENT ASSETS:

  Cash and cash equivalents

$        778,511

$        610,430

  Accounts receivable

488,271

511,538

  Inventories 

189,868

193,766

  Unbilled receivable

122,042

96,409

  Deferred taxes*

-

54,199

  Other current assets

39,355

45,763

    Total current assets

1,618,047

1,512,105

PROPERTY, PLANT AND EQUIPMENT, NET

105,510

110,876

OTHER ASSETS:

  Goodwill

5,824,726

4,710,691

  Other intangible assets, net

2,528,996

1,978,729

  Deferred taxes*

31,532

27,496

  Other assets

59,554

60,288

    Total other assets

8,444,808

6,777,204

TOTAL ASSETS

$    10,168,365

$     8,400,185

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:

  Accounts payable

$        139,737

$        143,847

  Accrued compensation

119,511

117,374

  Deferred revenue

267,030

190,953

  Other accrued liabilities

168,513

160,738

  Income taxes payable

18,532

-

  Deferred taxes*

-

3,943

  Current portion of long-term debt

6,805

11,092

    Total current liabilities

720,128

627,947

NONCURRENT LIABILITIES:

  Long-term debt

3,264,417

2,190,282

  Deferred taxes*

810,856

735,826

  Other liabilities

74,017

90,770

    Total liabilities

4,869,418

3,644,825

STOCKHOLDERS' EQUITY:

  Common stock

1,028

1,021

  Additional paid-in capital

1,419,262

1,325,338

  Retained earnings

4,110,530

3,520,201

  Accumulated other comprehensive earnings

(212,779)

(71,927)

  Treasury stock

(19,094)

(19,273)

    Total stockholders' equity

5,298,947

4,755,360

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$    10,168,365

$     8,400,185

*In the fourth quarter of 2015, the Company adopted ASU 2015-17, which requires that deferred tax liabilities 

and assets be classified as non-current in the consolidated balance sheet.  The Company has chosen to

adopt this ASU on a prospective basis, therefore prior periods were not retrospectively adjusted.

 

Roper Technologies, Inc. and Subsidiaries

Condensed Consolidated Statements of Earnings (unaudited)

(Amounts in thousands, except per share data)

Three months ended

Twelve months ended

December 31,

December 31,

2015

2014

2015

2014

Net sales

$  943,640

$  946,145

$   3,582,395

$  3,549,494

Cost of sales

364,549

380,404

1,417,749

1,447,595

Gross profit

579,091

565,741

2,164,646

2,101,899

Selling, general and administrative expenses

300,414

281,992

1,136,728

1,102,426

Income from operations

278,677

283,749

1,027,918

999,473

Interest expense

23,843

19,285

84,225

78,637

Other income/(expense)

60,600

(422)

58,652

620

Earnings from continuing operations before

   income taxes

315,434

264,042

1,002,345

921,456

Income taxes

106,837

78,106

306,278

275,423

Net Earnings

$  208,597

$  185,936

$     696,067

$     646,033

Earnings per share:

  Basic

$       2.07

$       1.86

$           6.92

$          6.47

  Diluted

$       2.05

$       1.84

$           6.85

$          6.40

Weighted average common and common

  equivalent shares outstanding:

    Basic

100,829

100,151

100,616

99,916

    Diluted

101,833

101,122

101,597

100,884

 

Roper Technologies, Inc. and Subsidiaries

Selected Segment Financial Data (unaudited)

(Amounts in thousands and percents of net sales)

Three months ended December 31,

Twelve months ended December 31,

2015

2014

2015

2014

Amount

%

Amount

%

Amount

%

Amount

%

Net sales:

  Medical & Scientific Imaging

$   321,735

$  286,410

$1,215,318

$1,080,309

  RF Technology

281,883

240,084

1,033,951

950,227

  Industrial Technology

182,039

219,642

745,381

827,145

  Energy Systems & Controls

157,983

200,009

587,745

691,813

    Total

$   943,640

$  946,145

$3,582,395

$3,549,494

Gross profit:

  Medical & Scientific Imaging

$   238,804

74.2%

$  206,669

72.2%

$   899,775

74.0%

$   779,407

72.1%

  RF Technology

154,731

54.9%

125,736

52.4%

552,605

53.4%

501,637

52.8%

  Industrial Technology

89,842

49.4%

111,104

50.6%

370,894

49.8%

417,568

50.5%

  Energy Systems & Controls

95,714

60.6%

122,232

61.1%

341,372

58.1%

403,287

58.3%

    Total

$   579,091

61.4%

$  565,741

59.8%

$2,164,646

60.4%

$2,101,899

59.2%

Operating profit*:

  Medical & Scientific Imaging

$   116,492

36.2%

$  100,488

35.1%

$   441,931

36.4%

$   375,867

34.8%

  RF Technology

83,591

29.7%

67,994

28.3%

312,112

30.2%

271,177

28.5%

  Industrial Technology

52,155

28.7%

69,056

31.4%

214,538

28.8%

247,596

29.9%

  Energy Systems & Controls

51,704

32.7%

72,177

36.1%

162,128

27.6%

203,021

29.3%

    Total

$   303,942

32.2%

$  309,715

32.7%

$1,130,709

31.6%

$1,097,661

30.9%

Net Orders:

  Medical & Scientific Imaging

$   334,967

$  282,169

$1,235,143

$1,081,190

  RF Technology

273,856

242,295

1,024,999

955,831

  Industrial Technology

176,379

197,847

731,810

808,921

  Energy Systems & Controls

138,869

202,030

555,672

692,136

    Total

$   924,071

$  924,341

$3,547,624

$3,538,078

*  Operating profit is before unallocated corporate general and administrative expenses.  These expenses 

       were $25,265 and $25,966 for the three months ended December 31, 2015 and 2014, respectively, and

        $102,791 and $98,188 for the twelve months ended December 31, 2015 and 2014, respectively.

 

 

Roper Technologies, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (unaudited)

(Amounts in thousands)

Twelve months ended

December 31,

2015

2014

Net earnings

$    696,067

$    646,033

Non-cash items:

Depreciation

38,185

40,890

Amortization

166,076

156,394

Stock-based compensation expense

61,766

63,027

Gain on disposal of a business

(70,860)

-

Income taxes

3,069

(46,619)

Changes in assets and liabilities:

Receivables

30,753

(10,709)

Inventory

(1,150)

6,349

Accounts payable

(6,554)

(5,070)

Accrued liabilities

6,401

(15,385)

Other, net

5,072

5,531

  Cash provided by operating activities

928,825

840,441

Business acquisitions, net of cash acquired

(1,762,883)

(305,379)

Capital expenditures

(36,260)

(37,644)

Proceeds from disposal of a business

105,624

-

Other, net

(4,813)

(5,082)

  Cash used by investing activities

(1,698,332)

(348,105)

Principal debt borrowings

900,000

-

Principal debt payments

(4,006)

(561)

Revolver borrowings (payments), net

180,000

(250,000)

Debt issuance costs

(8,044)

-

Dividends

(100,334)

(79,859)

Excess tax benefit from share-based payment

22,228

21,081

Proceeds from stock-based compensation, net

18,312

10,463

Redemption premium on convertible debt

(13,126)

(1,518)

Other, net

1,212

2,290

  Cash provided by (used in) financing activities

996,242

(298,104)

Effect of exchange rate changes on cash

(58,654)

(43,522)

Net increase in cash and equivalents

168,081

150,710

Cash and equivalents, beginning of period

610,430

459,720

Cash and equivalents, end of period

$778,511

$610,430

 

SOURCE Roper Technologies, Inc.



RELATED LINKS

http://www.ropertech.com