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 | |
