EX-99.1 2 ex_99-1.htm
Exhibit 99.1
 

Contact Information:
 Investor Relations
941-556-2601
investor-relations@roperind.com
Roper Industries, Inc.


Roper Industries Announces Record First Quarter Results

Net Earnings Increased 15% to $125 Million
Orders Increased 9% to $794 Million
Operating Cash Flow Increased 21% to $171 Million


Sarasota, Florida, April 29, 2013 ... Roper Industries, Inc. (NYSE: ROP) reported financial results for the first quarter ended March 31, 2013.

Roper reports results, including revenue, operating margin, net income and diluted earnings per share, on a GAAP and non-GAAP basis.  The company's guidance is provided on a non-GAAP basis.  Non-GAAP measures are reconciled to the corresponding GAAP measures at the end of this release.

First quarter GAAP diluted earnings per share increased 15% to $1.25 and non-GAAP diluted earnings per share increased 17% to $1.27.  GAAP revenue increased 4% to $737 million and non-GAAP revenue, which excludes a fair value adjustment to acquired deferred revenue, was $741 million.  Orders increased 9% to $794 million and represented a book-to-bill ratio of 1.07.  GAAP operating margin increased 110 basis points to 25.1%, while non-GAAP operating margin was 25.5%, a 150 basis point increase over the prior year.  Operating cash flow in the quarter was $171 million and represented 23% of revenue.

"We are pleased to deliver record first quarter performance, establishing records for revenue, orders, gross margin, operating profit, net earnings and cash flow," said Brian Jellison, Roper's Chairman, President and CEO.  "Despite a challenging global economic environment, our businesses performed exceptionally well.  Gross margin expanded 240 basis points to 57.4% and free cash flow increased 22% to $160 million.  We secured significant orders for second half delivery, helping increase our backlog to $1.0 billion and supporting our ability to deliver improving organic growth throughout the year."

"We continue to execute our proven strategies, including the disciplined investment of cash," continued Mr. Jellison.  "We expect to complete our acquisition of Managed Health Care Associates, Inc. (MHA) this week.  MHA meets all of our key acquisition criteria and is an excellent addition to our Medical businesses. The company provides the leading network of solutions to the alternate site healthcare market. MHA provides attractive cash return characteristics and generates substantial recurring revenue through long-term customer relationships with very high retention rates.  We expect the acquisition to be immediately cash accretive and to generate $95 million of EBITDA over the first twelve months of ownership, excluding the impact of acquisition-related fair value accounting."

 
2013 Outlook and Guidance

Roper is increasing its full year non-GAAP diluted earnings per share guidance from $5.60 - $5.82 to $5.76 - $5.94, which reflects a ($0.05) reduction due to currency and includes $0.14 - $0.17 from the acquisition of MHA, Inc.  The company's guidance includes the recognition of MHA revenue, a portion of which will be excluded under GAAP's purchase accounting rules.  The company's guidance excludes the impact of any future acquisitions.


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 29, 2013.  The call can be accessed via webcast or by dialing +1 888-455-2296 (US/Canada) or +1 719-457-2648, using confirmation code 1404011.  Webcast information and conference call materials will be made available in the Investors section of Roper's website (www.roperind.com) prior to the start of the call.  Telephonic replays will be available for up to two weeks by calling +1 719-457-0820 and using the access code 1404011.
 

 
 
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.  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
 
Q1 2013
Acquisitions / Divestitures
7%
Organic
(3%)
Foreign Currency
-    
Total Revenue Growth
4%
 
 


 
 
 
 
 
 
Table 2:  Gross Margin Reconciliation
 
Q1 2013
 
Q1 2012
 
GAAP Revenue
$737.1
 
$711.1
 
Add:  Fair Value Adj. to Acquired Deferred Revenue
3.6
 
0.0
 
Non-GAAP Revenue (B)
$740.7
 
$711.1
 
 
 
 
 
 
GAAP Gross Profit
$421.6
 
$391.2
 
Add:  Fair Value Adj. to Acquired Deferred Revenue
3.6
 
0.0
 
Non-GAAP Gross Profit (A)
$425.2
 
$391.2
 
 
 
 
 
 
 
 
 
 
 
Non-GAAP Gross Margin (A)/(B)
57.4%
 
55.0%
 

 
 
 
 
 
 
 
 
 
 
 
 
 
Table 3:  Free Cash Flow
 
Q1 2013
 
Q1 2012
 
Operating Cash Flow
$171.3
 
$141.5
 
Less:  Capital Expenditures
(11.2)
 
(10.0)
 
Rounding
0.0
 
(0.1)
 
Free Cash Flow
$160.1
 
$131.4
 


 
 
 
 
 
About Roper Industries

Roper Industries is a diversified growth company and is a constituent of the S&P 500, Fortune 1000, and the Russell 1000 indices. Roper provides engineered products and solutions for global niche markets, including software information networks, medical, water, energy, and transportation. Additional information about Roper is available on the company's website at www.roperind.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 and profit 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 our 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 Industries, Inc. and Subsidiaries
  
   
 
Condensed Consolidated Balance Sheets (unaudited)
  
   
 
(Amounts in thousands)
  
   
 
 
  
   
 
 
  
   
 
 
  
March 31,
    
December 31,
  
ASSETS
  
2013
    
2012
  
 
  
   
 
CURRENT ASSETS:
  
   
 
  Cash and cash equivalents
  
$
430,022
    
$
370,590
  
  Accounts receivable
    
483,861
      
526,408
  
  Inventories
    
200,023
      
190,867
  
  Unbilled receivable
    
84,948
      
72,193
  
  Deferred taxes
    
47,372
      
41,992
  
  Other current assets
    
38,830
      
43,492
  
    Total current assets
    
1,285,056
      
1,245,542
  
 
                
PROPERTY, PLANT AND EQUIPMENT, NET
    
110,637
      
110,397
  
 
                
OTHER ASSETS:
                
  Goodwill
    
3,848,078
      
3,868,857
  
  Other intangible assets, net
    
1,657,893
      
1,698,867
  
  Deferred taxes
    
82,288
      
78,644
  
  Other assets
    
69,038
      
68,797
  
    Total other assets
    
5,657,297
      
5,715,165
  
 
                
TOTAL ASSETS
  
$
7,052,990
    
$
7,071,104
  
 
                
 
                
LIABILITIES AND STOCKHOLDERS' EQUITY
                
 
                
CURRENT LIABILITIES:
                
  Accounts payable
  
$
138,541
    
$
138,340
  
  Accrued compensation
    
80,043
      
110,724
  
  Deferred revenue
    
190,678
      
185,912
  
  Other accrued liabilities
    
133,403
      
128,351
  
  Income taxes payable
    
15,378
      
-
  
  Deferred taxes
    
8,216
      
3,868
  
  Current portion of long-term debt
    
516,514
      
519,015
  
    Total current liabilities
    
1,082,773
      
1,086,210
  
 
                
NONCURRENT LIABILITIES:
                
  Long-term debt
    
1,403,259
      
1,503,107
  
  Deferred taxes
    
701,567
      
707,278
  
  Other liabilities
    
83,215
      
86,783
  
    Total liabilities
    
3,270,814
      
3,383,378
  
 
                
STOCKHOLDERS' EQUITY:
                
  Common stock
    
1,010
      
1,006
  
  Additional paid-in capital
    
1,182,304
      
1,158,001
  
  Retained earnings
    
2,598,434
      
2,489,858
  
  Accumulated other comprehensive earnings
    
20,048
      
58,537
  
  Treasury stock
    
(19,620
)
    
(19,676
)
    Total stockholders' equity
    
3,782,176
      
3,687,726
  
 
                
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
  
$
7,052,990
    
$
7,071,104
  
 
 
 
 
Roper Industries, Inc. and Subsidiaries
  
   
 
Condensed Consolidated Statements of Earnings (unaudited)
    
 
(Amounts in thousands, except per share data)
    
 
 
  
   
 
 
  
   
 
 
  
Three months ended
  
 
  
March 31,
  
 
  
2013
    
2012
  
 
  
   
 
Net sales
  
$
737,135
    
$
711,066
  
Cost of sales
    
315,559
      
319,873
  
 
                
Gross profit
    
421,576
      
391,193
  
 
                
Selling, general and administrative expenses
    
236,399
      
220,889
  
 
                
Income from operations
    
185,177
      
170,304
  
 
                
Interest expense
    
20,858
      
15,483
  
Other expense
    
2,492
      
490
  
 
                
Earnings from continuing operations before
                
   income taxes
    
161,827
      
154,331
  
 
                
Income taxes
    
36,913
      
46,022
  
 
                
Net Earnings
  
$
124,914
    
$
108,309
  
 
                
 
                
 
                
 
                
 
                
Earnings per share:
                
  Basic
  
$
1.26
    
$
1.12
  
  Diluted
  
$
1.25
    
$
1.09
  
 
                
Weighted average common and common
                
  equivalent shares outstanding:
                
    Basic
    
98,876
      
97,039
  
    Diluted
    
99,986
      
99,307
  
 
 
 
 
Roper Industries, Inc. and Subsidiaries
  
   
   
   
 
Selected Segment Financial Data (unaudited)
  
   
   
   
 
(Amounts in thousands and percents of net sales)
  
   
   
   
 
 
  
   
   
   
 
 
  
   
   
   
 
 
  
Three months ended March 31,
  
 
  
2013
    
   
2012
    
 
 
  
Amount
    
%
    
Amount
    
%
  
Net sales:
  
   
   
   
 
  Industrial Technology
  
$
182,239
    
   
$
195,136
    
 
  Energy Systems & Controls
    
145,642
    
     
148,602
    
 
  Medical & Scientific Imaging
    
200,444
    
     
162,811
    
 
  RF Technology
    
208,810
    
     
204,517
    
 
    Total
  
$
737,135
    
   
$
711,066
    
 
 
          
           
 
 
          
           
 
Gross profit:
          
           
 
  Industrial Technology
  
$
93,311
      
51.2
%
  
$
98,663
      
50.6
%
  Energy Systems & Controls
    
80,906
      
55.6
%
    
80,408
      
54.1
%
  Medical & Scientific Imaging
    
134,869
      
67.3
%
    
106,186
      
65.2
%
  RF Technology
    
112,490
      
53.9
%
    
105,936
      
51.8
%
    Total
  
$
421,576
      
57.2
%
  
$
391,193
      
55.0
%
 
                                
 
                                
Operating profit*:
                                
  Industrial Technology
  
$
52,945
      
29.1
%
  
$
57,507
      
29.5
%
  Energy Systems & Controls
    
35,722
      
24.5
%
    
35,657
      
24.0
%
  Medical & Scientific Imaging
    
59,928
      
29.9
%
    
43,362
      
26.6
%
  RF Technology
    
56,630
      
27.1
%
    
50,353
      
24.6
%
    Total
  
$
205,225
      
27.8
%
  
$
186,879
      
26.3
%
 
                                
 
                                
Net Orders:
                                
  Industrial Technology
  
$
179,807
            
$
204,002
          
  Energy Systems & Controls
    
157,537
              
153,376
          
  Medical & Scientific Imaging
    
216,121
              
168,336
          
  RF Technology
    
240,118
              
203,672
          
    Total
  
$
793,583
            
$
729,386
          
 
                                
 
                                
 
                                
* Operating profit is before unallocated corporate general and administrative expenses. These expenses
  
were $20,048 and $16,575 for the three months ended March 31, 2013 and 2012, respectively.
          
 
 
 
 
Roper Industries, Inc. and Subsidiaries
  
   
 
Condensed Consolidated Statements of Cash Flows (unaudited)
    
 
(Amounts in thousands)
  
   
 
 
  
   
 
 
  
   
 
 
  
Three months ended
  
 
  
March 31,
  
 
  
2013
    
2012
  
 
  
   
 
Net earnings
  
$
124,914
    
$
108,309
  
Non-cash items:
                
Depreciation
    
9,342
      
9,449
  
Amortization
    
34,099
      
26,018
  
Stock-based compensation expense
    
12,969
      
9,954
  
Income taxes
    
16,348
      
13,720
  
Changes in assets and liabilities:
                
Receivables
    
14,454
      
15,968
  
Inventory
    
(11,687
)
    
(7,462
)
Accounts payable
    
1,760
      
(3,774
)
Accrued liabilities
    
(27,262
)
    
(32,162
)
Other, net
    
(3,669
)
    
1,437
  
  Cash provided by operating activities
    
171,268
      
141,457
  
 
                
Business acquisitions, net of cash acquired
    
(2,240
)
    
(19,007
)
Capital expenditures
    
(11,205
)
    
(10,008
)
Other, net
    
235
      
219
  
  Cash used by investing activities
    
(13,210
)
    
(28,796
)
 
                
Principal debt payments
    
(52
)
    
(6,297
)
Revolver payments, net
    
(100,000
)
    
-
  
Dividends
    
-
      
(13,290
)
Excess tax benefit from share-based payment
    
4,364
      
7,505
  
Proceeds from stock-based compensation, net
    
6,229
      
10,297
  
Premium on convertible debt conversions
    
(109
)
    
-
  
Other, net
    
764
      
(489
)
  Cash used by financing activities
    
(88,804
)
    
(2,274
)
 
                
Effect of exchange rate changes on cash
    
(9,822
)
    
3,230
  
 
                
Net increase in cash and equivalents
    
59,432
      
113,617
  
Cash and equivalents, beginning of period
    
370,590
      
338,101
  
 
                
Cash and equivalents, end of period
  
$
430,022
    
$
451,718
  
 
 
 
ROPER INDUSTRIES INC.
  
   
   
 
CONDENSED CONSOLIDATED STATEMENT OF EARNINGS - RECONCILIATION OF GAAP TO NON-GAAP
  
(Amounts in thousands, except per share data)
  
   
   
 
 
  
   
   
 
 
  
   
Adjustment
    
 
 
  
2013
1st Quarter
GAAP
    
Fair Value Adjustment
to Acquired Deferred Revenue
    
2013
1st Quarter
Non-GAAP
  
Net Sales
  
$
737,135
    
$
3,593
    
$
740,728
  
Cost of Sales
    
315,559
      
-
      
315,559
  
Gross Profit
    
421,576
      
3,593
      
425,169
  
Selling, general and administrative expenses
    
216,351
      
-
      
216,351
  
Segment income from operations
    
205,225
      
3,593
      
208,818
  
Corporate general and administrative expenses
    
20,048
      
-
      
20,048
  
Income from operations
    
185,177
      
3,593
      
188,770
  
Interest Expense
    
20,858
      
-
      
20,858
  
Other income (expense)
    
(2,492
)
    
-
      
(2,492
)
Earnings from continuing operations before income taxes
    
161,827
      
3,593
      
165,420
  
IncomeTaxes (1)
    
36,913
      
1,258
      
38,171
  
  Tax Rate
    
22.8
%
    
35.0
%
    
23.1
%
 
                        
Net Earnings
  
$
124,914
    
$
2,335
    
$
127,249
  
 
                        
Weighted average common shares outstanding
    
99,986
              
99,986
  
 
                        
Diluted earnings per share
  
$
1.25
            
$
1.27
  
 
                        
 
                        
(1) For the adjustment, the company used a 35% tax rate, as this adjustment is a US-based item and 35% is the statutory tax rate in the United States