Table 1: Revenue and adjusted EBITDA reconciliation ($M) (from continuing operations) | |||||||||||||||||
Q2 2022 | Q2 2023 | V % | |||||||||||||||
GAAP revenue | $ | 1,311 | $ | 1,531 | 17 | % | |||||||||||
Components of revenue growth | |||||||||||||||||
Organic | 9 | % | |||||||||||||||
Acquisitions/divestitures | 8 | % | |||||||||||||||
Foreign exchange | — | % | |||||||||||||||
Revenue growth | 17 | % | |||||||||||||||
Adjusted EBITDA reconciliation | |||||||||||||||||
GAAP net earnings | $ | 225 | $ | 361 | |||||||||||||
Taxes | 92 | 103 | |||||||||||||||
Interest expense | 45 | 35 | |||||||||||||||
Depreciation | 9 | 9 | |||||||||||||||
Amortization | 146 | 176 | |||||||||||||||
EBITDA | $ | 516 | $ | 683 | 32 | % | |||||||||||
Purchase accounting adjustment to acquired commission expense | (1) | — | |||||||||||||||
Financial impacts associated with the minority investment in Indicor | — | (66) | A | ||||||||||||||
Adjusted EBITDA | $ | 515 | $ | 617 | 20 | % | |||||||||||
% of revenue | 39.3 | % | 40.3 | % | +100 bps |
Table 2: Adjusted DEPS reconciliation (from continuing operations) | |||||||||||||||||
Q2 2022 | Q2 2023 | V % | |||||||||||||||
GAAP DEPS | $ | 2.11 | $ | 3.36 | 59 | % | |||||||||||
Purchase accounting adjustment to acquired commission expense | (0.01) | — | |||||||||||||||
Financial impacts associated with the minority investment in Indicor | — | (0.50) | A | ||||||||||||||
Amortization of acquisition-related intangible assets | 1.05 | 1.25 | B | ||||||||||||||
Income tax restructuring expense associated with discontinued operations | 0.27 | — | |||||||||||||||
Adjusted DEPS | $ | 3.43 | $ | 4.12 | 20 | % |
Table 3: Adjusted cash flow reconciliation ($M) (from continuing operations) | |||||||||||||||||
Q2 2022 | Q2 2023 | V % | |||||||||||||||
Operating cash flow | $ | (110) | $ | 320 | |||||||||||||
Taxes paid in period related to divestitures | 378 | — | |||||||||||||||
Adjusted operating cash flow | $ | 268 | $ | 320 | 20 | % | |||||||||||
Capital expenditures | (8) | (15) | |||||||||||||||
Capitalized software expenditures | (8) | (9) | |||||||||||||||
Free cash flow | $ | 252 | $ | 295 | 17 | % |
Table 4: Forecasted adjusted DEPS reconciliation (from continuing operations) | |||||||||||||||||||||||
Q3 2023 | FY 2023 | ||||||||||||||||||||||
Low end | High end | Low end | High end | ||||||||||||||||||||
GAAP DEPS C | $ | 2.91 | $ | 2.95 | $ | 11.36 | $ | 11.50 | |||||||||||||||
Financial impacts associated with the minority investment in Indicor A | TBD | TBD | TBD | TBD | |||||||||||||||||||
Amortization of acquisition-related intangible assets B | 1.25 | 1.25 | 5.00 | 5.00 | |||||||||||||||||||
Adjusted DEPS | $ | 4.16 | $ | 4.20 | $ | 16.36 | $ | 16.50 | |||||||||||||||
A. | Financial impacts associated with the minority investment in Indicor as shown below ($M, except per share data). | |||||||||||||||||||||||||||||||
Q2 2022A | Q2 2023A | Q3 2023E | FY 2023E | |||||||||||||||||||||||||||||
Pretax | $ | — | $ | (66) | TBD | TBD | ||||||||||||||||||||||||||
After-tax | $ | — | $ | (53) | TBD | TBD | ||||||||||||||||||||||||||
Per share | $ | — | $ | (0.50) | TBD | TBD | ||||||||||||||||||||||||||
B. | Actual results and forecast of estimated amortization of acquisition-related intangible assets as shown below ($M, except per share data). These adjustments are taxed at 21%. | |||||||||||||||||||||||||||||||
Q2 2022A | Q2 2023A | Q3 2023E | FY 2023E | |||||||||||||||||||||||||||||
Pretax | $ | 143 | $ | 170 | $ | 170 | $ | 680 | ||||||||||||||||||||||||
After-tax | $ | 113 | $ | 135 | $ | 134 | $ | 537 | ||||||||||||||||||||||||
Per share | $ | 1.05 | $ | 1.25 | $ | 1.25 | $ | 5.00 | ||||||||||||||||||||||||
C. | Forecasted results do not include any potential impact associated with our Indicor investment, and will be adjusted out of all GAAP results in future periods. | |||||||||||||||||||||||||||||||
Roper Technologies, Inc. and Subsidiaries | |||||||||||
Condensed Consolidated Balance Sheets (unaudited) | |||||||||||
(Amounts in millions) | |||||||||||
June 30, 2023 | December 31, 2022 | ||||||||||
ASSETS: | |||||||||||
Cash and cash equivalents | $ | 1,462.8 | $ | 792.8 | |||||||
Accounts receivable, net | 684.4 | 724.5 | |||||||||
Inventories, net | 118.0 | 111.3 | |||||||||
Income taxes receivable | 53.4 | 61.0 | |||||||||
Unbilled receivables | 108.1 | 91.5 | |||||||||
Other current assets | 179.4 | 151.3 | |||||||||
Total current assets | 2,606.1 | 1,932.4 | |||||||||
Property, plant and equipment, net | 93.7 | 85.3 | |||||||||
Goodwill | 16,002.5 | 15,946.1 | |||||||||
Other intangible assets, net | 7,718.8 | 8,030.7 | |||||||||
Deferred taxes | 48.2 | 55.9 | |||||||||
Equity investment | 591.3 | 535.0 | |||||||||
Other assets | 399.8 | 395.4 | |||||||||
Total assets | $ | 27,460.4 | $ | 26,980.8 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY: | |||||||||||
Accounts payable | $ | 141.1 | $ | 122.6 | |||||||
Accrued compensation | 183.8 | 228.8 | |||||||||
Deferred revenue | 1,279.8 | 1,370.7 | |||||||||
Other accrued liabilities | 397.1 | 454.6 | |||||||||
Income taxes payable | 62.3 | 16.6 | |||||||||
Current portion of long-term debt, net | 699.8 | 699.2 | |||||||||
Total current liabilities | 2,763.9 | 2,892.5 | |||||||||
Long-term debt, net of current portion | 5,966.3 | 5,962.5 | |||||||||
Deferred taxes | 1,589.4 | 1,676.8 | |||||||||
Other liabilities | 394.9 | 411.2 | |||||||||
Total liabilities | 10,714.5 | 10,943.0 | |||||||||
Common stock | 1.1 | 1.1 | |||||||||
Additional paid-in capital | 2,655.3 | 2,510.2 | |||||||||
Retained earnings | 14,233.2 | 13,730.7 | |||||||||
Accumulated other comprehensive loss | (126.7) | (187.0) | |||||||||
Treasury stock | (17.0) | (17.2) | |||||||||
Total stockholders’ equity | 16,745.9 | 16,037.8 | |||||||||
Total liabilities and stockholders’ equity | $ | 27,460.4 | $ | 26,980.8 |
Roper Technologies, Inc. and Subsidiaries | |||||||||||||||||||||||
Condensed Consolidated Statements of Earnings (unaudited) | |||||||||||||||||||||||
(Amounts in millions, except per share data) | |||||||||||||||||||||||
Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net revenues | $ | 1,531.2 | $ | 1,310.8 | $ | 3,000.9 | $ | 2,590.6 | |||||||||||||||
Cost of sales | 464.1 | 399.3 | 915.2 | 781.9 | |||||||||||||||||||
Gross profit | 1,067.1 | 911.5 | 2,085.7 | 1,808.7 | |||||||||||||||||||
Selling, general and administrative expenses | 631.8 | 548.6 | 1,249.4 | 1,089.9 | |||||||||||||||||||
Income from operations | 435.3 | 362.9 | 836.3 | 718.8 | |||||||||||||||||||
Interest expense, net | 34.8 | 44.7 | 72.2 | 97.3 | |||||||||||||||||||
Equity investment activity, net | 66.0 | — | 64.8 | — | |||||||||||||||||||
Other expense, net | (2.8) | (1.3) | (5.1) | (3.4) | |||||||||||||||||||
Earnings before income taxes | 463.7 | 316.9 | 823.8 | 618.1 | |||||||||||||||||||
Income taxes | 102.7 | 91.9 | 178.5 | 156.7 | |||||||||||||||||||
Net earnings from continuing operations | 361.0 | 225.0 | 645.3 | 461.4 | |||||||||||||||||||
Earnings (loss) from discontinued operations, net of tax | — | 54.5 | (1.2) | 121.3 | |||||||||||||||||||
Gain (loss) on disposition of discontinued operations, net of tax | 3.9 | (10.7) | 3.9 | 1,706.6 | |||||||||||||||||||
Net earnings from discontinued operations | 3.9 | 43.8 | 2.7 | 1,827.9 | |||||||||||||||||||
Net earnings | $ | 364.9 | $ | 268.8 | $ | 648.0 | $ | 2,289.3 | |||||||||||||||
Net earnings per share from continuing operations: | |||||||||||||||||||||||
Basic | $ | 3.38 | $ | 2.13 | $ | 6.06 | $ | 4.36 | |||||||||||||||
Diluted | $ | 3.36 | $ | 2.11 | $ | 6.02 | $ | 4.32 | |||||||||||||||
Net earnings per share from discontinued operations: | |||||||||||||||||||||||
Basic | $ | 0.04 | $ | 0.41 | $ | 0.03 | $ | 17.28 | |||||||||||||||
Diluted | $ | 0.04 | $ | 0.41 | $ | 0.02 | $ | 17.12 | |||||||||||||||
Net earnings per share: | |||||||||||||||||||||||
Basic | $ | 3.42 | $ | 2.54 | $ | 6.09 | $ | 21.64 | |||||||||||||||
Diluted | $ | 3.40 | $ | 2.52 | $ | 6.04 | $ | 21.44 | |||||||||||||||
Weighted average common shares outstanding: | |||||||||||||||||||||||
Basic | 106.6 | 105.9 | 106.4 | 105.8 | |||||||||||||||||||
Diluted | 107.4 | 106.8 | 107.2 | 106.8 |
Roper Technologies, Inc. and Subsidiaries | |||||||||||||||||||||||||||||||||||||||||||||||
Selected Segment Financial Data (unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||
(Amounts in millions; percentages of net revenues) | |||||||||||||||||||||||||||||||||||||||||||||||
Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||||||||||||||||||||
Amount | % | Amount | % | Amount | % | Amount | % | ||||||||||||||||||||||||||||||||||||||||
Net revenues: | |||||||||||||||||||||||||||||||||||||||||||||||
Application Software | $ | 770.3 | $ | 627.5 | $ | 1,531.7 | $ | 1,255.7 | |||||||||||||||||||||||||||||||||||||||
Network Software | 358.1 | 342.9 | 712.6 | 681.4 | |||||||||||||||||||||||||||||||||||||||||||
Technology Enabled Products | 402.8 | 340.4 | 756.6 | 653.5 | |||||||||||||||||||||||||||||||||||||||||||
Total | $ | 1,531.2 | $ | 1,310.8 | $ | 3,000.9 | $ | 2,590.6 | |||||||||||||||||||||||||||||||||||||||
Gross profit: | |||||||||||||||||||||||||||||||||||||||||||||||
Application Software | $ | 531.0 | 68.9% | $ | 430.9 | 68.7% | $ | 1,051.5 | 68.6% | $ | 866.3 | 69.0% | |||||||||||||||||||||||||||||||||||
Network Software | 303.9 | 84.9% | 289.1 | 84.3% | 603.3 | 84.7% | 574.0 | 84.2% | |||||||||||||||||||||||||||||||||||||||
Technology Enabled Products | 232.2 | 57.6% | 191.5 | 56.3% | 430.9 | 57.0% | 368.4 | 56.4% | |||||||||||||||||||||||||||||||||||||||
Total | $ | 1,067.1 | 69.7% | $ | 911.5 | 69.5% | $ | 2,085.7 | 69.5% | $ | 1,808.7 | 69.8% | |||||||||||||||||||||||||||||||||||
Operating profit*: | |||||||||||||||||||||||||||||||||||||||||||||||
Application Software | $ | 201.2 | 26.1% | $ | 165.3 | 26.3% | $ | 394.4 | 25.7% | $ | 337.6 | 26.9% | |||||||||||||||||||||||||||||||||||
Network Software | 153.1 | 42.8% | 137.1 | 40.0% | 300.6 | 42.2% | 273.9 | 40.2% | |||||||||||||||||||||||||||||||||||||||
Technology Enabled Products | 139.1 | 34.5% | 111.4 | 32.7% | 254.6 | 33.7% | 211.1 | 32.3% | |||||||||||||||||||||||||||||||||||||||
Total | $ | 493.4 | 32.2% | $ | 413.8 | 31.6% | $ | 949.6 | 31.6% | $ | 822.6 | 31.8% | |||||||||||||||||||||||||||||||||||
*Segment operating profit is before unallocated corporate general and administrative expenses and enterprise-wide stock-based compensation. These expenses were $58.1 and $50.9 for the three months ended June 30, 2023 and 2022, respectively, and $113.3 and $103.8 for the six months ended June 30, 2023 and 2022, respectively. |
Roper Technologies, Inc. and Subsidiaries | ||||||||||||||
Condensed Consolidated Statements of Cash Flows (unaudited) | ||||||||||||||
(Amounts in millions) | ||||||||||||||
Six months ended June 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
Cash flows from operating activities: | ||||||||||||||
Net earnings from continuing operations | $ | 645.3 | $ | 461.4 | ||||||||||
Adjustments to reconcile net earnings from continuing operations to cash flows from operating activities: | ||||||||||||||
Depreciation and amortization of property, plant and equipment | 17.3 | 18.7 | ||||||||||||
Amortization of intangible assets | 350.6 | 291.3 | ||||||||||||
Amortization of deferred financing costs | 5.1 | 6.3 | ||||||||||||
Non-cash stock compensation | 63.5 | 61.2 | ||||||||||||
Equity investment activity, net | (64.8) | — | ||||||||||||
Income tax provision | 178.5 | 156.7 | ||||||||||||
Changes in operating assets and liabilities, net of acquired businesses: | ||||||||||||||
Accounts receivable | 46.7 | 55.2 | ||||||||||||
Unbilled receivables | (14.9) | (24.7) | ||||||||||||
Inventories | (5.9) | (23.7) | ||||||||||||
Accounts payable | 17.9 | 30.9 | ||||||||||||
Other accrued liabilities | (91.0) | (64.7) | ||||||||||||
Deferred revenue | (98.3) | 38.6 | ||||||||||||
Cash tax paid for gain on disposal of businesses | — | (377.9) | ||||||||||||
Cash income taxes paid, excluding tax associated with gain on disposal of businesses | (231.5) | (279.4) | ||||||||||||
Other, net | (33.5) | (18.9) | ||||||||||||
Cash provided by operating activities from continuing operations | 785.0 | 331.0 | ||||||||||||
Cash provided by (used in) operating activities from discontinued operations | (1.7) | 80.1 | ||||||||||||
Cash provided by operating activities | 783.3 | 411.1 | ||||||||||||
Cash flows from (used in) investing activities: | ||||||||||||||
Acquisitions of businesses, net of cash acquired | (17.3) | (258.9) | ||||||||||||
Capital expenditures | (24.9) | (13.7) | ||||||||||||
Capitalized software expenditures | (19.3) | (15.0) | ||||||||||||
Distributions from equity investment | 12.1 | — | ||||||||||||
Other, net | (2.9) | — | ||||||||||||
Cash used in investing activities from continuing operations | (52.3) | (287.6) | ||||||||||||
Proceeds from disposition of discontinued operations | 2.0 | 2,995.9 | ||||||||||||
Cash used in investing activities from discontinued operations | — | (3.3) | ||||||||||||
Cash provided by (used in) investing activities | (50.3) | 2,705.0 | ||||||||||||
Cash flows used in financing activities: | ||||||||||||||
Payments under revolving line of credit, net | — | (470.0) | ||||||||||||
Cash dividends to stockholders | (144.8) | (130.7) | ||||||||||||
Proceeds from stock-based compensation, net | 60.8 | 40.9 | ||||||||||||
Treasury stock sales | 8.4 | 8.5 | ||||||||||||
Other | (0.2) | (0.2) | ||||||||||||
Cash flows used in financing activities from continuing operations | (75.8) | (551.5) | ||||||||||||
Cash flows used in financing activities from discontinued operations | — | (11.4) | ||||||||||||
Cash flows used in financing activities | (75.8) | (562.9) | ||||||||||||
(Continued) | ||||||||||||||
Roper Technologies, Inc. and Subsidiaries | ||||||||||||||
Condensed Consolidated Statements of Cash Flows (unaudited) - Continued | ||||||||||||||
(Amounts in millions) | ||||||||||||||
Six months ended June 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
Effect of foreign currency exchange rate changes on cash | 12.8 | (25.6) | ||||||||||||
Net increase in cash and cash equivalents | 670.0 | 2,527.6 | ||||||||||||
Cash and cash equivalents, beginning of period | 792.8 | 351.5 | ||||||||||||
Cash and cash equivalents, end of period | $ | 1,462.8 | $ | 2,879.1 |