ROP - Earnings call transcript Q3 2017 | Roper Technologies, Inc.

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Operator

Good day everyone and welcome to the Roper Technologies Third Quarter 2017 Financial Results Conference Call. Today's call is being recorded. At this time, I would like turn the conference over to Zack Moxcey, Vice President, Investor Relations. Please go ahead sir.

Zack Moxcey

Thank you, Lory, and thank you all for joining us this morning, as we discuss the third quarter financial results for Roper Technologies.

Executive call Executive are President and Officer; Financial Neil the President Jellison, and Shannon on Conley, Officer; Chief Jason of and Rob Hunn, O'Callaghan, me Vice this and Finance. Brian morning Chairman, Chief Vice President Joining President President; Controller; Vice Crisci, Vice a Earlier issued announcing financial press this morning, results. our release we The press release also includes replay information for today's call. also accompany today's through and are available call, the website. are to available which slides our prepared We've on webcast,

begin with turn please if we statement. slide Now, Safe to our X, you'll Harbor

During the call, page, our today's described and of statements, in which we this forward-looking course uncertainties will are and on risks detailed filings. make as further subject to SEC as

slide in context A our discuss today's also should will adjusted included as information. quarter, X. our presentation press to results You part on for to this between and on reconciliation of measures basis. Today, the on non-GAAP listen is an website. adjusted our of the we And call and that GAAP primarily full turn now, a please release

take you our And will if acquisition, remarks, over participants. to $XX I to will $X questions quarter, adjustment million call revenue deferred the expense. and Brian. now, of $XX please GAAP results companies adjusted million slide lastly intangible for and those telephone basis: following between accounting and represents a his of difference million have to recognized the if purchase of adjustment For assets. related our results consists items relating from a prepared the and our revenue on the software Brian? not would This for amortization second turn we acquisitions, pre-tax acquire commission commissions that hand acquisition-related After X, will to

Brian Jellison

look second fortunate number still good and I the what up to one, stay was enterprise baseball an were about got incredible segment time; happy little get of and of guidance Red night enough it morning and know anyway then we’ll very outlook, QX Sox into we’ve take game and here, start that. are an game. the the answers. Zack QX the you initial I’m XXXX about course in, and raising results a to so all you talk as everyone. detail watch If sort I best outlook about for bit And of with, many last don’t of and how I questions the Thank then but your financial and made XXXX

discuss about record slide. we’re cost go instead to and to XXX chain growth supply results particularly we’re quarter was QX EBITDA points. up what enterprise still in you of that that XX% very margin XXX results up and encouraged encouraged can broad we’ll The demonstrates having ability imagine, products material problem with sales was push $X.XXX the contain gross medical fact the was that very a think we that’s certainly Revenue about one by third one The summary billion highlights only So every other quarter. we incredible product gross points, get basis etcetera, and the when up with the organic it X% XX%, complaining are margin, for issues, we had had that our a rate. to let’s next is and there. category and people challenges orders had into based portfolio we that by But notwithstanding business here; situation our sort and We really it disappointing of within strength. basis

our and flow our margin which that’s expanded operating every to XX sales reduce $X.XX share to Year-to-date, by represents million, debt Our up and $XXX diluted earnings was been per of points million. XX.X%. to XXX XX% to year-to-date XXX has million cash dollar, $X.XX, XX% were EBITDA up allowed basis us our

rapid a and really plan. quarter bit sheet certainly So strengthening was the above bringing debt-to-EBITDA that’s balance Great very our little dramatically. down number deleveraging

slide, the prior we with– then EBITDA tax business Next at was if can million our tax you in of quarter apply rest rate on revenue out look at XX%, the year. numbers over $XXX was up up the came statement, the rate XX%. XX% we see it our QX was on adjusted and income the about

tax million And So around see then XX.X% had we a and something $XX million. XX%. net earnings you to we got could expected XXX rate up

we and Next to how strategy be at effective continues slide, our cash field well look execute. here how people flow our

XX% XXX year-to-date flow million, cash is, we operating as revenue. So of said,

is free cash revenue. of XX% flow year-to-date Our

to we’d of things not One is there CapEx the people like out to much is here. point

difference is the flow and revenue. cash X% flow cash free only of operating between So

two look XXXX XXX year-to-date XXX back went XXX XX you operating ago, can flow you by If million. million our cash to was see year, XXX it’s years year, that million up This by to Last up million. in million. it

in just that’s XX%. period, up two-year a So

I talking people hear around which to when conversion cash folks. I’m some Our stumbling

Our cash number And actually year-to-date. adjusted XXX%. third our net up XXX% XXX% was GAAP year-to-date XXX% in basis conversion is around was in conversion than cash higher a the quarter this earnings quarter. that and on an up It on

versus earnings. So our do occasionally people about I hear adjusted talking earnings cash

that the of to XXX compound ability and things report. Our million, adjusted reduced than earnings those by all we our We demonstrate cash said, as are cash. I higher debt earnings

slide; asset-light much always moving we look I model, how to certainly Next at and ahead. made. if business we’ve like the look progress at well that’s

were Payable both periods five are back of revenue and was today look ago, X.X% accruals inventory and our Receivables X.X%. in XX%. you If same it’s they today XX.X%, the years XX.X%. were

was revenue Our XX.X%. just of ago back sales, X.X% five years today then deferred its

X% at add as working ago, have of total deferred number we the net years of to importance, bottom need it’s negative was capital working And grow. the that of now revenue. billion you million can we the on of course, negative So at as the don’t capital see slide. is working capital our $X.X of over five revenue, We number XXX Today a X.X%.

this and strengthens actually So great we that we the paid for our we cash grow model and actually as it as oftentimes we get so grow. incredibly the balance sheet in advance have work

of driven period it’s reflects this of long discipline we’ve effectiveness about. our the years, talk particular and by really and investment always in overtaken all that time with we transformation enterprise for cost the five like All principles to last that on a return

platforms of Next them one is of margins slide, and getting detail represents. performed all were here ready sort into specific outlook, EBITDA we’re the XX% of best-in-class segments the get and to well. of really just very Their them each between the that XX% the it for

take and here to accreting a of that these what’s within talk about to calls. events bit today tend going the talk about we are in thought rather because trajectory the awards and we’d a businesses, little really slide, the milestones quarter to spectacular we the minute they on long-term quite Next have been than

wasn’t so Microscopy And And scientific good virus. Zika things to previously ago that have reported future segment few through around Gatan, medical created which we but that share to see. able the a technology many is technology just the see in a are in I Cryo-Electron our instrumental would the couple. imaging things allows that identifying happening which a was years

that to Law This investment that sector. to firms. number big about pay-off all after a professional Gatan Clinical dramatic that’s Software Magic Expert Am honor the it quarter the MarketScape. channel what this XXX as acquired MTA on of Deltek really receive. a Diagnostic the Laboratory space. become was delivering sort Aderant give higher sort market Management slightly up, services Microscopy of Support we a private has who New Strata System the picks very for this it Cryo-Electron IDC Sunquest effect Practice demonstrates they’re York was was converted put we a the for inside this that really for people is for have of and Company intimacy enhanced there. their in [repayment] They business of much leader them a the you Strata future, recognized for Those named tunnels. our class can than Sullivan, when successfully will improving us the by automation bridges investing among rate cloud-based Hospital customer hospital one high was is by by as for one in and as in the know a cost New and still York pre-eminent really that. technology the the the business had As knowledge in TransCore we we’re and to it in named course different number the our equity. about applause year which ERP us have Enterprise is thing, of technology KLAS Quadrant, enhanced & but IT Decision that Frost have

the what was and TransCore that delivered be And as can to been it’s execute pick do starts able to proud quite ability Our We spending do time. infrastructure future on of everything in up. really pre-eminent. to will

of businesses. All We’ve have a sort niche RD&E we our dramatically innovation is markets. culture in of got this these in of investments all of higher

EBITDA start revenue, it’s entire basis. more sector largest an company of Technology with we than if now slide, on XX% our RF Next software, that’s that and a the bit little

revenue revenue Denmark, you ConstructConnect have space in near margin some we often wins. meaning made also future. viewpoint pull-in represented platform. because are were very knowledge with billion to We recurring quarter had software lot made we And results. cash. Deltek of the bolt-on distribution is operating A have to was enhance up It which fourth the up common a We at an that organic The to digit from them encouraging non-US end software it’s also for them existing matching core execution contingencies business QX management WorkBook, can had the the same our that the look services $X.X with basis this gain a in bit was the margins businesses think quarter, one with able is and acquisitions, fourth In It continued times in company so of We how Aderant our at firm, software its from as traffic great our in and and performed a to dictates and an in expand the acquisition projects. makes be channel. which businesses. in a associated When so of of performance the the growth it and strengthened I their do growth Handshake quarter up X, business very without a Deltek’s our on going thing subscriber to quarter really really called quarter. in much for project which them XX% nearly freight businesses. see increasing, well. and across the professional net in really considerable add our little enjoyed own. GovCon drive toll there’ll EBITDA growth. continued ConstructConnect the called We both to for for within had of quarter continue projects other mid-single points, adds we Florida. the we’ve Bolt-ons with tailwinds third performance at that was acquisition, got and those share. third continues our is to a cash margins behind momentum the and see grow ConstructConnect, expected Deltek same strong XXX We they the

we for people in so think challenge create low-single QX ’XX with New but We better there at year. quarter the we TransCore much used could a fourth that MTA segment for there’s We the that’s the to grow see We ’XX. added had hard to process beginning actually When lot comp activity, difficult MTA the expect we’ll opportunities last going even digit opportunities in bidding a project because to they’ve to get in we organic York, because fear and longer and we’re a though, year. they projects. the solely are of in though because our startup it be likely this team of the would the of no growth beyond be the talk continuing year in in replace fact

the great were bit it a was but abnormal X%. slide, Their mid-single quarter, low. can the be and see digits digits, It look imaging. and were only above. fact in around medical at in of organic and mid-single you Next a scientific essentially had up here really growth, should many we margins quarter businesses little We

in the and growth view across quarter so digit we’re headwinds Site net to so there they of and of in the revenue four the businesses. was had of out products, unusual offset We Care positive In business, Northern have this bit two we issues all. a fourth in channel If and softer in Software said we just in think gives which associated and but the And And business, look, us. at happy all have by wind one of because expected with Cryo-EM those happened IPA on We RD&E is that Verathon, did the a XX% the at three quarter platforms Imaging the bolstered the organic expect in really And fact initiatives light what medical the our GPO to the we three QX. don’t will quarter If cameras. still this platforms that Solutions, that continue continue would end these occurred, and mid-single the projections exceptionally three with Healthcare segment. exclude had growth up quarter business, a we we our end to getting the the did look or businesses Verathon for at Digital margins. Care transaction fell good our the but medical be in well Scientific its medical how Alternate Long short us we performance growth revenue for in at point, terrific bit we that continue for access we of growth. from US. that Revenue a don’t international we quarter all. the technology and within for opportunity organic one that In to long substantial the of A happened instead we little represent at in see In all middleware out with that do going of in that in five. and arena. any US, the in growth right Term Acute

the of million forward three occur Revenue all ought XX prior that more better to timing than growth imaging platforms, little all capturing talked in today throughout shipments. in year. about year, hopes about growth spending earlier should year we’ve We’re the this the and a be in on

the expect better expect get normal digit growth to we pace We And better while third the points have growth only with to organic two in again or we’re much in quarter segment from of XXXX margin have to organic may fourth mid-single activity. a in three we the to quarter. improvement as sequentially back QX,

record business Systems, at was Energy if slide, Neptune organically. Next growth double they had look and earnings. we quarter, Industrial Technology up XX% the Industrial digit another had Technology and

to handling share these we it of quite helped third quarter around it fourth to think is in going did So are Fluid those growth characteristics and did the us it attention bit. people that complaining leverage doing. Roper about We copper, upstream we’re really to a from continued oil same Cornell. gas in with the gains kind doing have improved to as get want pay with and XX%. environment Pump We the growth businesses might is and what well quarter above expect

that the sort had which look our we digit organic X%. growth two-thirds gas we portion about would in is of decline oil double expected thought and energy, and for have If the have The we of up reason in CCC. is high-single but segment, you we at digit is

we We were So industrial sensor an of to up And leverage see the XX%. the digits the fourth with again really business growth technology the organic third that’s high double quarter markets, quarter third in being net effect reports mid-single energy above digit that and growth. of sort to similar there. was the

$XXX segments million together, EBITDA look XXX at of delivered you two sales, a in million they If XX%. and the

remained has really business outstanding. the So

we’re profile for talk guidance getting here about the so ready slide, to QX. Next

revenue year been then We raising guidance full The X% and had our which deliver we’re that XX $X.XX. are X.XX; Next by year to only raised organic. of we to slide, be of about will X.XX raising so X.XX. full growth will XX%

quarter, on at Remember bit we create quarter some fourth billion the XXX. that cash the took out expect guidance more in fourth to guidance. we flow. raising to did in balance little to came better We full operating third X.XXX in the but QX a than year of we’re the In of quarter XXX

quarter if quarter be we’re with things in on on the all government, business actually was of rate biggest in and depending the is tax to universe. bit course waiting the how the be there happens just in of one a what fourth or change of Roper would the text, beneficiaries think less, I what somewhere third a maybe likely go in little we

Next the slide, at our here third the summary look activity of we for quarter.

we said many had really XXXX. quarter company. headwinds record, we million. margins a X.XXXbillion. up X.XX the Very XXXX, is we third in considerably developed pretty all Revenue throughout at is XX% expectations. people at say XXX we Gross don’t and have As spectacular. really XX% with up as XX% Deps EBITDA for strength few most a really at to above or see was

Our revenue which are million, more I think people for year-to-date our at flow already XXX thought. and us by sort balance of itself. debt deleveraging the cash reduced sheet than gives We reloading big rapidly many of quickly we much XX% speaks

when something simply inside billion acquisitions, CRI work principles great in acquisitions. discipline these flow XXXX. we’re proven acquire four towards above drive We flow activity our normal to free years in to to cash which cash see our businesses, Our leveraging think and and compound really accelerate our $X next the and keeping grade rating put glide ability over we’ll and is going investment path that just our

we’ve say any that that year our started and to initial process. the and projecting people, for have And the quarter for last the entered are process to their five this operating seeing XXXX Another in leaders is, big ’XX, more about takeaway meeting than submissions planning with confidence how just are XXXX I we with ’XX.

activities able the quarter to those during guidance contribution. around later forward look finishing and fourth to we So record initiate a being XXXX

open that up with So will for we it questions.

Operator

to Melius Scott [Operator Instructions] Research. we’ll And go Davis,

Scott Davis

assume and come your amazing. it’s common collect a But to that darn And were of chunk back good just numbers, the I that give can and upfront? Anyways, revenue gone is like, works the us example look software an world. you looks me like of large kind is so of so line it months, deferred this that I'm able I in more I contracts don’t few just up, cash and jobs. doing to you for explain you're companies maybe some big a and pretty step how at item so cover much Deltek.

Brian Jellison

kind really get get of SaaS it in you advance the might a for Well, you’re and curve cloud it’s months, may If but prepayment maintenance, paid license using year, paid routinely. of you months, times for you are they based, and always get a paid many get six the you that technologies a might ahead that year activity. three for

seats, maybe granular add forth. in got so pay how to that want and Neil for But they the add the give explanation they’ve contracts about a As advance you little more I work. they seats to

Neil Hunn

say software the very on space. typical I normal would and very we’re Scott,

that’s we’re abnormal that something So in doing not regard.

As ahead SaaS the Brian will contract we mentioned on which or a maintenance cycle. the on year the recurring generally revenue those piece, be either the would streams, piece bill

normally liveit. license get And of you’re sale, license cash your XXX paid the balance in payment days that on get you’re license sheet. and terms half situation maybe you always a during often sale, payment so book signing might times And when booking a when period. on deferred days, revenue you implementation on you you net And half a similarly, on go the of XX deferred

created tell over decade of business. the very well our norms, part that’s as we it’s years here that at revenue within ago Roper core the September ’XX, but million. Well, of of last common me model business the transform let five are So you practice, on we it’s deferred XX a XXX been and sort was industry

part you is your these of cash. grow as doesn’t down it directed purposely draw strategy opportunities So of our kind at acquisition where

Scott Davis

give that little sense That’s a clear. just you line, Since that on weakness the what is? you a Neil one-time of Verathon you’re just on granularity cited, can

Neil Hunn

in really Just platform as at it be international of there. challenges QX, future against we will and at be is happened The get as may frozen to a the track the quite a be robust we new Brian we the piece that. are quarters the double we those recurring the cycles, the or to and then quarter. we’re was was expectations. to it product quite are developing isolated in have and quickly. QX product to down and it corrected a release have little above isolated will execution but rest equipment that those of given to you when it Verathon, top, The it of of that to corrected timing consumables to looks bit. in sales When a Won’t mentioned here the But into And be our stop take we of for market our business it that correct a may rather piece, executing and starting the force, well The then being between timing through products frozen US piece Verathon. say to robust. releases, capital hospitals on US in we what little our bit was root little here like was roadmap in expect of it performed the XXXX, and combination might the have sales back cause into speak, was the robust, quick, it US, should so we corrected channel couple click

Brian Jellison

This revenue or miss $X on them was $X from like million. [Indiscernible] million

to – really just different be we happens deal expected. the that’s than what So

Operator

Christopher We’ll go next to Oppenheimer. Glynn,

Christopher Glynn

it’s I mark-to-market expansion algorithm, could functionality price and to think now, about normal software Just of wanted the if just you EBITDA RF the XX% revisit growth kind expectation.

Brian Jellison

Sure.

generally to so majority more toll growth have very is you mid-single have be traffic businesses in [ph] and for leverage the lower going is digit at margin a business ratios steady, those segment to now here while, software businesses. the come or The and are higher. right, software quite You’re the have they TransCore generally driven been XX% than is going software, project which and businesses

that’s think I So very sustainable forward. moving

this think would traffic and you segment seen maybe business. was less in I primarily see variability than toll years it ago X X So you or the have when

become software really in digit business, and of it’s boost them. course bit, Now were businesses organic ’XX, and said further organic the resulting both a should primarily when which bought growth Deltek the will because ConstructConnect those mid-single we we little

Christopher Glynn

And had you margin very expansion XXX then RF just into large basis it dive was Could going what’s points. just a core quarter? on there little, a mix good

Neil Hunn

Well I that to of that project things is around one management. the execution their TransCore improve continues think at

So that’s obviously are businesses a the in software favorable variable because help margin then growth they and higher businesses. the does

I are on those So the are leverage really product capturing of business incremental revenue. RF well some performed of pretty at in businesses, both they’ve and levels important, high and think

Brian Jellison

that’s Yeah, right.

had smaller and don’t excellent Some years we which speak growth ago we acquired of leverage. about couple the businesses a a excellent like RFID lot of is, an

well it So within very mix is segment of that a really businesses of number performing

Operator

go next Deane to we’ll And Capital Markets. Dray, RBC

David Lu

sizes on environment are are billion you’re of look the Thanks. sizing multiples Lu looking bit a M&A So and given next This Dray. M&A does update deals like for David is the that the the an I pipeline? What Deane the ask what today, about at. four to years. you’re want over of over on extended, little $X

Brian Jellison

million be next our and choice million. would X choice be billion one be next our we’d three $XXX XXX and choice XXXX billion If was, do would would or in good, that $X.X

opportunities. now happens that is do what some So we get bolt-on

this things see and for have business one us wouldn’t units there’s activity, XX we just scale lot wouldn’t they we company, whereas previously, got unique year they’re of sort acquired businesses a to geared up already and activity that those small have is, our different sort for Aderant for one of of on but would in then had businesses. work ConstructConnect So some is with bolt-on With over successful. the for so be million I because those have Deltek. we’ve expect attractive and of And which you’d bolt-ons; assimilated small

that So deals to expansion we to a go years. have share will lion over of platform will be the large of X mix company. of plus smaller some able the four the the billion But for opportunities money out

David Lu

one And the then just Deltek’s we we anniversaring winter are as approach follow-up, acquisition.

mid-single stimulus There growth. underlying mentioned hasn’t What’s demand been you very looking strong. organic is really been like of looks still infrastructure at, demand this kind but digit So environment like? this it

us could? an Deltek on give update if So you Thanks.

Brian Jellison

did. an really a think good with maybe news that’s you you bit time. mid-single just I package only We get that. passed Well Getting better them. to for good from for agree time if a ever, It’s digit infrastructure growth, little Certainly is news budget them.

a that’s got So government us. paid big has behind the to that’s the done know deal Deltek customers, and for budget already

from pull-in in So of we little a know. never Deltek. see QX did to QX at Probably because not you that, but

and basis their substantial and better than a inside and going we ’XX more make contributions synergies announced then have cash we’re benefit that tell. of we acquisitions little just a the them ’XX to performance in lot already have have might we in So will have from

Operator

take our we’ll Ritchie, And Joe Goldman Sachs. question next from

Joe Ritchie

guys and we more your of did the like for how couple product a again just year. then to bit right products. canal in last maybe end reversing about to back Can as just you a that I having I’m just And go refresh the at of trying Verathon, challenges we get know much And this sense it it to versus was to around, confidence you little back it of bit through maybe XXXX. have talk itself. I a comment quarter, get correct going guess a the little will that quarters take the

Brian Jellison

I that lot growth you has last was years product. Well been on (inaudible) the and product to and a in want a of correct very around lot successful organic outside refresh growth Verathon. new We for the our have confidence, technology was inside of two launched,

launch around products. BladderScan we project call major of what line another have We a

rate forced changes have haven’t the is used. how sales on that also enhance announced, but to We we about additional they’re products some

people satisfied product get all they’re their making way on that if occasionally you what quarter. can been of technology briefed and you in already So this the buying about have were decision the

million within resources, takes people excited XXXX happened they new stronger missed We second adding revenue, about and the products in Verathon happening, Verathon additional lot that got but more half What we disappointed have weeks also we it was substantial to that those it resources, than last wasn’t have or get XXXX. we’re in to X because not real of to time we’re to those for very the so that foreseeing. in sales third of capture particularly products that accepted, we think and the but get us trained much a are of are XXXX. the enjoyed actually for throughout To by quarter get X about quarter it two much million going

disappointment solved. one was that like wouldn’t so That’s embarrassed a or forecast that. working and rapidly we it that trade our by and not is and rope is be know that that’s expect And to problem the to get we Verathon

Joe Ritchie

space. color That’s Brian. companies had space construction And maybe commercial talking here labor across across on constraints the helpful by the about some follow-up ConstructConnect, we’ve

verticals, different that what potentially Bolt-ons would First, secondly I’m sense to ConstructConnect different for that business. the curious earlier get I’m then a this just bolt-ons geographies, adding mentioned mean you be impacts how And to trying Would ConstructConnect? business. around for

Brian Jellison

some didn’t expanding regional more say things. there niche It’s number small are things. geographic I around mean We variances of players. than

can are plummet. Let’s in strong they certain activities say very we

whatever. about and weak was they in things A around ConstructConnect and [drywall]. we HBAC acquisition On this terrific of on variety all was that does a wide the are lot in space architects, windows strong but first take-offs from of is So, made very or what Center

currently that think So of. keep it add we we of there larger Again businesses is pre-eminent the of make and the are that in suite kind are a things us those can than spot. that, certain to kinds

Joe Ritchie

labor Got of it, and on the question. the constraint side

Brian Jellison

at I any don’t to see relevancy that all.

You seats got became of where to able being if of users are won’t and could its labor that activity, software. think projects number the pre-construction is, the stuff, of in in have or used them to put our about number architectural we the that a place this on only constraint affect affect it amount

they that to process you the the have out frequently what of algorithm. a and project. sense get used analystic bidding of is So much in so the to just ConstructConnect people, software how in material go for a That’s has

have So would I labor affect. much really an don’t of think

Operator

Robert W. We’ll Richard Eastman, go Baird. to

Richard Eastman

Brian, we think bit this to two you just you or I probably Deltek? as of bumped – bolt-ons could the tuck-ins Handshake, if and to acquisitions bit speak maybe also the in Deltek, to to and they’re in a a little just but curious kind those speak Onvia, there’s small, – could little just

Brian Jellison

natural really about it that’s Deltek. something that. all because doesn’t a is very It’s something fit own, to hasn’t Deltek Onvia subscaled past. synergistic have the much so to on its is It’s attention made with gets (inaudible) talk Deltek. just at money tiny channel company So paid that closed, can’t in had company a really The not we and access. the But

or On bolt-on make I and it’s ask Deltek situation So Handshake, me effective. that our get you’ll closed, the Deltek be about talk ever will more for expect quarter happen exciting Neil help Aderant. an think deal that we which can see to fourth this, around because much would in let we if

Neil Hunn

for So its product run from Aderant, this legal Knowledge a bolt-on is Management. firm

management which you’re look a have you to you if need document you basically have law If to have knowledge system system, system. you a firm, need Aderant, management a management have to inside, is practice and core running a

was say done a acquisition capability eye base to to opportunities the (inaudible) cross-selling is in management a etcetera. that Nice from team your So management space. knowledge just Roper also leader our take to this bolt-on. firmly negative all sort (inaudible) little and it we that in recognized very would of fits the this criteria large to. of have in I It

Richard Eastman

question essentially ask quick or you also then a just standpoint year-over-year curious there? and about payment OCS bit the tax third being a flow Was free cash little flat the there just I anything from Can in quarter?

Brian Jellison

terms Sure. A tax of little bit payment. higher in

greater in for I we year full in QX, as means a to quarter. growth we the in fourth nice expect would think that we have XX.XX quite or as of growth look we’ll QX mentioned the bit

capita okay in working standpoint from the quarter. think performance I third a was

We with we about think are point. better the I line where much at fourth some be expect in said the we this it and quarter quarter. of to just feel receivables so timing But around we be in we’d great fourth

Operator

to next Giordano, go Joseph Company. We’ll & Cowen

Joseph Giordano

sounds we I explain Can use you like really actually feel all that little what just management to means. not that something can like me knowledge a or what is? that is

Neil Hunn

if they call law do systems look a your software, how you Handshake give a inside answer Let’s and has ask and query answer. attorney you and firm that on do you across topic join they thousand particular firm they question. in there’s an an a the various all Well and expert the that attorneys, that firm

firm about (inaudible) it has the and who firm. inside law instance, For knowledge

Joseph Giordano

the backlog a outlook the looking business little a like, and drill want you for talk So that like in start about longer understand really drag down – a on for the a to that I When it’s again the I things while it’s some know it comps imaging business, down bit that. we Cryo-EM been cycle does know for here. to strong. of

you up does that to and up So side CCC. start easier with looks on comping kind same something when and the start loosen that of for

Neil Hunn

we’re with think camera businesses do in they’ll sciences. pruning quarter, the it when those it’s imaging, or investing less limit a And things this little and and we pruning I a better generally easier unique, remember keep We have will XXXX imaging hand is have to fourth technology try one-off, lot but are really comps. at (inaudible). to in

Noble speaking camera Prize, win to only generally the wonderful it’s there So is [recorder]. but

fitting technology probably to with like it that. business have and like segment. we’d something really really more shouldn’t business, be application more a reported So a or storage in a it’s It’s precision that

business, from the like particularly its social we we view contributing a what So point.

the discovering material proud for really What But not the virus. Technology. it’s an question? can Roper other about was overly Zika business You

Brian Jellison

the that yet. of revenue It’s really is to happening project we a this going before aren’t a business types that those CCC the still rebound new space. bit little be in later from going get that doesn’t construction project have big on

a and both go lot. business for it service of of the not has a improving. down is and ’XX, guidance Their down But down to we bottom. would been it executing. nice really So sort around much We’ll kind see job done bouncing in they’ve field when more expect we do

I think difficult the market. a bit here whenever management do job of I Great little has there a great part team think of the the a is that in and well margin an business done will environment. uptick in

Joseph Giordano

maybe talked And on from Brian me about Copper. last you Neptune,

here, like, view been to had just looking But the people I it the out markets I data like there. pretty intake like underlying given order seems points green kind looks quarter think record know about. and we’ve of like your light couple I the this, there on of and a that answer freaked but what’s guess one-off got

Brian Jellison

the mile. invested are It’s a a double year. It’s XXX the at other they Neptune absolutely up the digits, would you of that. said record Copper listening of smiling bad-mouthing of tell we’re so investment the I activity us. guys a know There one it. when people see I XXX record calls will integrated. But people, be a by houses can to end quarter, be are but be for has will lot we the we great peoples’ briefly It year don’t are our the

lead-free are own our have just efficient. incredibly make foundry, products, We we we

are. enough feeling people aren’t that just certainly difficulties other There’s we for So the bids. activity

US. distribution we have the base, installed to really are valuable you We biggest best base have looking at in we the an when haven that’s the installed believe it and

a those And of international emerge So that’s XXXX. we we that in see helps. business help bit then get opportunities and some little that might could of periodically

So place. it’s extremely nimble resilient, very a

Operator

We’ll Sprague, to Research go next Jeff Vertical Partners.

Jeff Sprague

me lose few a to ends maybe for clean Just up.

comp literally in of us there about as of the XXXX? look over big we hurdle. you some how can is? that of First, getting spoke talking Brian your give into you MTA idea confidence kind But kind

Rob Crisci

On we fourth quarter, be have the from strong year. against a last still startup will but the MTA

just it’s XX not we that projects even of So be strictly probably early kind to really there on particular $XX too or a Brian it could on But as at million. it’s But ’XX, if look XX that of XX. as be million MTA much number to to are tell replace able mentioned projects, that we’re Well more. around might so we bidding, as that headwind.

Brian Jellison

to We’ve gotten makeup our and $XX business million net opportunity probably year. that around that something million rolling $XX new kind against the and of are is larger hurdle need each as, of how out that new net projects. And much look at are for do like bidding you do which projects new you people a number business it much substantially business for software, off is how we year of than TransCore have

that, organization people increasingly good think think about I the affective. more So pretty I gets feel and

they’ve side those do you bid to administrative what think in I gotten do substantially the about arenas. and to better have

I Marks, world certainly We’ve the think North make contribution business, they’ve gotten a the in around to these a management. better is CFO relatively Tracy racial he’s for new really it that things. and helping who in runs America expert and then domain

where embarrassing. they’re to to then of are people doing come big and other it them the of had just other people have math. a fears TransCore the some arenas brainstorm, gives back that So in number And office work,

lane a have advantage TransSuites infinity here. or TransCore’s really for the so TransCore around substantial And are routine we us to technology competition administrative give

Jeff Sprague

progress just good quick I growth, you’re points also, think it two not just you kind four that. at some five and was driving based call the ones, reform. more million. Verathon I just the characterized as if Can of X million, beginning making or elaborate and of like is you then XX clarify that to which advance And just tax I want (inaudible). the on tax wonder tax, could clarify more on on what’s of

Neil Hunn

like organic clearly million that is I would that’s when Maybe the business, or that what X% so. $X growth was I organic that. It it more like X% around or been you $X didn’t hear heard. maybe might thinking somebody had have anything we been maybe we medical (inaudible) growth inside million said about, have that, have is

Brian Jellison

noise. kind model so The camera majority of and mix that just businesses medical versus the or was like revenue, X on X was X and of the digits, or external high of our Verathon it single our and was the of rest around model X versus

Jeff Sprague

tax? on And

Brian Jellison

been That with a and third little a things tax Tax, tax went in and working try range we bit can a in to yeah favorable much of audit lower of lower prior activity on last of XX% north were department hopefully we a that benefited number way. the resolution tax quarter. from the rate couple we reform we’ve the have as certainly for big sort But been similar to by the of a here as years. in

Neil Hunn

think about it came I at XX. it XX% expected And we and

in think. fourth tax But be on when quarter bit the big wasn’t might and and to plus did close of us. that incomes and really paying you’re can I the deal material better US the variance XX% two-thirds it the benefit you than a in that XX% would on got probably math that, huge you we of goes hope. the I the We little So kind third or in be to a for XX, do

Operator

Blanton, We’ll Asset go Clear Management. Harbor to Alex

Alex Blanton

to the X missed from last I in X just Verathon wanted to two trick you revenue that said, million weeks. the you something probably million

So up does that a come $X.XX to share? about

Brian Jellison

I don’t. Didn’t help.

Alex Blanton

be dependent on would the It incremental.

Brian Jellison

third it it for it million. is X.X XX% be of tax, away we X.X be and X take and would and would it million a incrementally If had

might likely a round and it’s $X.XX, penny more but to half. probably it a So

Alex Blanton

there problem the introduced some you was new And that products.

existing and one. customers the So happened? that the decided Is instead the of buy to product wait what new

Brian Jellison

customers. it was our more sales think force our than about I

having the and a that’s good not in perfect. a year get there been got you know sometimes to a for having year good stuff you’re can that’s while If you’ve lot bag, you you new behavior and a of coming

industry, speaking I going So the they’re better. the products be the are best to in even generally think

don’t that? it I of is how So know.

I were people. sales also think that quite few adding we a it’s

there’s territories and worry are of the XXX in and did changing business think as about But a out noise focus $X.XXX around, we quarter EBITDA, delivered too that where you’re frictional. one some I variance just $X that’s a XX. moving and (inaudible) in much So revenue million there of billion million things of

Alex Blanton

than that a tax of benefit every eventually to tax back away And normal for big you that in a industry of corporate that a most benefit compete if that of that My of to why final the you door is and return is about has and feeling normal But of lot the and away that rate. the cases. because because think return, will the sort reduction question It tax one that? corporate increase get deduction be that’s many the mean competition little tax it about companies potential competed since opens normal the seem average. suddenly rate than return. would me of you effect return in competition your perhaps keep less return. where to it case the so in would be so industries each industry, would Because Would perspective cut, a that I you have more is? rate agree with in for reduction dominate is a of rate many

Neil Hunn

Yes.

Operator

question Roper concludes session. and the Technologies answer That

now Moxcey closing return for remarks. Zack will to We

Zack Moxcey

earnings today. us for speaking And joining we look Thank forward your everyone call. you next our during with to

Operator

conclude your Thank for conference. participation. Thank does you. you And that today’s

Roper (ROP) 30 Oct 172017 Q3 Earnings call transcript