Roper Technologies Announces New Segment Structure

Published

SARASOTA, Fla., March 04, 2019 (GLOBE NEWSWIRE) -- Roper Technologies, Inc. (NYSE:ROP), a leading diversified technology company, announced today that it has realigned its reportable segments.

The four new reportable segments are as follows:

  • Application Software - Aderant, CBORD, CliniSys, Data Innovations, Deltek, Horizon, IntelliTrans, PowerPlan, Strata, Sunquest

  • Network Software & Systems - ConstructConnect, DAT, Inovonics, iTradeNetwork, Link Logistics, MHA, RF IDeas, SHP, SoftWriters, TransCore

  • Measurement & Analytical Solutions - Alpha, CIVCO Medical Solutions, CIVCO Radiotherapy, Dynisco, FMI, Gatan, Hansen, Hardy, IPA, Logitech, Neptune, Northern Digital, Struers, Technolog, Uson, Verathon

  • Process Technologies - AMOT, CCC, Cornell, FTI, Metrix, PAC, Roper Pump, Viatran, Zetec

"Our new segments reinforce Roper's diversified, niche market strategy by emphasizing business models instead of end markets," said Neil Hunn, Roper's President and CEO. "The day-to-day operations of our businesses, our organizational structure, and our strategy remain unchanged. We look forward to reporting our results using these new segments."

Beginning with the first quarter of 2019, the Company will report its quarterly and full year financial statements under the new segment structure with prior periods recast to reflect the change.

The Company will present at two investor conferences later this week and will discuss the new reportable segments as part of those presentations. Links to the webcast presentations will be available in the "Investors" section of the Company's website at www.ropertech.com.

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.

Unaudited Historical Financial Information

The Company has included below unaudited historical financial segment information for the four quarters 2017 and 2018, and full years 2016, 2017 and 2018 recast to give effect to the new reportable segment structure. Roper's historical consolidated results remain unchanged.

Table 1: GAAP Segment Financials ($M)
(Unaudited)
2016 2017 2018
FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
Revenue
Application Software $ 699 $ 284 $ 300 $ 311 $ 327 $ 1,222 $ 324 $ 358 $ 378 $ 392 $ 1,453
Network Software & Systems 1,104 297 313 325 320 1,254 314 334 342 355 1,345
Measurement & Analytical Solutions A 1,456 371 379 373 408 1,531 404 426 430 446 1,706
Process Technologies 530 134 143 151 173 600 161 176 169 182 688
Total $ 3,790 $ 1,086 $ 1,135 $ 1,160 $ 1,227 $ 4,607 $ 1,203 $ 1,294 $ 1,319 $ 1,376 $ 5,191
Gross Profit
Application Software $ 466 $ 180 $ 197 $ 206 $ 214 $ 798 $ 214 $ 243 $ 256 $ 259 $ 972
Network Software & Systems 707 194 205 218 218 835 213 225 237 244 919
Measurement & Analytical Solutions A 864 219 224 216 235 894 234 250 253 263 1,001
Process Technologies 295 75 79 86 98 338 90 98 94 106 388
Total $ 2,332 $ 668 $ 706 $ 726 $ 765 $ 2,865 $ 750 $ 816 $ 840 $ 873 $ 3,280
Operating Profit
Application Software $ 210 $ 51 $ 72 $ 76 $ 79 $ 279 $ 70 $ 98 $ 98 $ 92 $ 358
Network Software & Systems 403 96 105 118 120 439 106 116 128 135 484
Measurement & Analytical Solutions A 419 107 111 105 123 446 115 128 136 144 524
Process Technologies 150 39 43 49 57 188 50 58 57 69 234
Corporate (128 ) (34 ) (38 ) (38 ) (32 ) (142 ) (42 ) (45 ) (41 ) (75 ) (204 )
Total $ 1,055 $ 258 $ 294 $ 311 $ 347 $ 1,210 $ 300 $ 354 $ 378 $ 364 $ 1,396

Table 2: Adjusted Segment Financials ($M)
(Unaudited)
2016 2017 2018
FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
Revenue
Application Software $ 707 $ 301 $ 313 $ 321 $ 334 $ 1,269 $ 326 $ 360 $ 380 $ 394 $ 1,461
Network Software & Systems 1,111 303 316 326 321 1,265 314 334 342 355 1,345
Measurement & Analytical Solutions A 1,456 371 379 373 408 1,531 404 426 430 446 1,706
Process Technologies 530 134 143 151 173 600 161 176 169 182 688
Total $ 3,805 $ 1,108 $ 1,151 $ 1,171 $ 1,235 $ 4,665 $ 1,205 $ 1,296 $ 1,321 $ 1,378 $ 5,199
Gross Profit
Application Software $ 475 $ 196 $ 210 $ 217 $ 221 $ 845 $ 216 $ 245 $ 258 $ 261 $ 980
Network Software & Systems 714 200 208 219 219 846 213 225 237 244 919
Measurement & Analytical Solutions A 864 219 224 216 235 894 234 250 253 263 1,001
Process Technologies 295 75 79 86 98 338 90 98 94 106 388
Total $ 2,348 $ 689 $ 722 $ 738 $ 773 $ 2,922 $ 753 $ 818 $ 842 $ 874 $ 3,287
Operating Profit
Application Software $ 218 $ 66 $ 84 $ 85 $ 86 $ 321 $ 73 $ 100 $ 100 $ 93 $ 365
Network Software & Systems 410 101 108 119 120 449 106 116 128 135 484
Measurement & Analytical Solutions A 419 107 111 105 123 446 115 128 136 144 524
Process Technologies 150 39 43 49 57 188 50 58 57 69 234
Corporate (121 ) (34 ) (38 ) (38 ) (32 ) (142 ) (42 ) (45 ) (41 ) (40 ) (169 )
Total $ 1,076 $ 278 $ 309 $ 321 $ 354 $ 1,262 $ 303 $ 356 $ 379 $ 401 $ 1,439
EBITDA
Application Software $ 305 $ 110 $ 129 $ 132 $ 133 $ 504 $ 121 $ 151 $ 156 $ 150 $ 578
Network Software & Systems 494 127 134 144 144 549 130 140 153 159 582
Measurement & Analytical Solutions A 474 119 123 117 135 494 127 139 146 154 567
Process Technologies 165 42 46 53 61 202 54 61 60 72 246
Corporate (121 ) (34 ) (38 ) (37 ) (32 ) (141 ) (41 ) (45 ) (41 ) (40 ) (168 )
Other Income / (Expense) (1 ) (1 ) (1 ) (1 ) (3 ) (2 ) 2 (2 ) 1
Total $ 1,315 $ 362 $ 394 $ 407 $ 441 $ 1,605 $ 389 $ 449 $ 473 $ 496 $ 1,806

Table 3: Adjusted Revenue Growth
(Unaudited)
Application Software
2017 2018
Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
Organic Growth 6 % 4 % 3 % 1 % 4 % 3 % 7 % 4 % 7 % 5 %
Acquisitions/Divestitures 73 % 77 % 77 % 77 % 76 % 4 % 7 % 15 % 11 % 9 %
Foreign Exchange (1 )% (1 )% % 1 % % 2 % 1 % % (1 )% %
Total Revenue Growth 78 % 79 % 81 % 80 % 79 % 9 % 15 % 18 % 18 % 15 %

Network Software & Systems
2017 2018
Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
Organic Growth 2 % 6 % 4 % (1 )% 3 % 3 % 4 % 3 % 9 % 5 %
Acquisitions/Divestitures 14 % 14 % 14 % 4 % 11 % % 2 % 2 % 2 % 2 %
Foreign Exchange % % % % % % % % % %
Total Revenue Growth 16 % 20 % 17 % 3 % 14 % 4 % 6 % 5 % 11 % 6 %

Measurement & Analytical Solutions A
2017 2018
Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
Organic Growth 7 % 4 % 2 % 6 % 5 % 6 % 11 % 16 % 10 % 11 %
Acquisitions/Divestitures 1 % % % % % % % % % %
Foreign Exchange (1 )% (1 )% 1 % 2 % % 3 % 2 % % (1 )% 1 %
Total Revenue Growth 6 % 3 % 3 % 8 % 5 % 9 % 12 % 15 % 9 % 11 %

Process Technologies
2017 2018
Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
Organic Growth 5 % 13 % 15 % 16 % 13 % 16 % 20 % 13 % 7 % 14 %
Acquisitions/Divestitures % % 1 % 1 % % 1 % 1 % % % %
Foreign Exchange (1 )% (1 )% 1 % 2 % % 3 % 2 % (1 )% (1 )% 1 %
Total Revenue Growth 4 % 12 % 17 % 19 % 13 % 20 % 23 % 12 % 6 % 15 %

Roper Consolidated A
2017 2018
Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
Organic Growth 5 % 6 % 5 % 5 % 5 % 6 % 9 % 9 % 9 % 8 %
Acquisitions/Divestitures 18 % 18 % 19 % 15 % 18 % 1 % 2 % 5 % 4 % 3 %
Foreign Exchange (1 )% (1 )% 1 % 1 % % 2 % 1 % % (1 )% %
Total Revenue Growth 22 % 23 % 24 % 21 % 23 % 9 % 13 % 13 % 12 % 11 %

Table 4: Adjusted Segment & Consolidated Financials Reconciliation
(Unaudited)
Application Software Reconciliation ($M)
2016 2017 2018
FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
GAAP Revenue $ 699 $ 284 $ 300 $ 311 $ 327 $ 1,222 $ 324 $ 358 $ 378 $ 392 $ 1,453
Purchase accounting adjustment to acquired deferred revenue 8 16 13 10 7 47 2 2 2 1 8
Adjusted Revenue 707 301 313 321 334 1,269 326 360 380 394 1,461
GAAP Gross Profit 466 180 197 206 214 798 214 243 256 259 972
Purchase accounting adjustment to acquired deferred revenue 8 16 13 10 7 47 2 2 2 1 8
Adjusted Gross Profit 475 196 210 217 221 845 216 245 258 261 980
Adjusted Gross Margin 67.1 % 65.3 % 67.1 % 67.4 % 66.3 % 66.5 % 66.3 % 68.0 % 67.8 % 66.2 % 67.1 %
GAAP Operating Profit 210 51 72 76 79 279 70 98 98 92 358
Purchase accounting adjustment to acquired deferred revenue & commission expense 8 15 12 9 7 42 2 2 2 1 7
Adjusted Operating Profit 218 66 84 85 86 321 73 100 100 93 365
Adjusted Operating Margin 30.8 % 22.0 % 26.7 % 26.5 % 25.7 % 25.3 % 22.3 % 27.7 % 26.2 % 23.7 % 25.0 %
Amortization 81 39 41 42 42 165 44 46 52 51 193
Depreciation 6 5 4 5 5 19 5 5 5 5 20
Adjusted EBITDA 305 110 129 132 133 504 121 151 156 150 578
Adjusted EBITDA Margin 43.1 % 36.6 % 41.2 % 41.1 % 39.8 % 39.7 % 37.2 % 41.8 % 41.0 % 38.1 % 39.6 %

Network Software & Systems Reconciliation ($M)
2016 2017 2018
FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
GAAP Revenue $ 1,104 $ 297 $ 313 $ 325 $ 320 $ 1,254 $ 314 $ 334 $ 342 $ 355 $ 1,345
Purchase accounting adjustment to acquired deferred revenue 7 5 3 1 1 10
Adjusted Revenue 1,111 303 316 326 321 1,265 314 334 342 355 1,345
GAAP Gross Profit 707 194 205 218 218 835 213 225 237 244 919
Purchase accounting adjustment to acquired deferred revenue 7 5 3 1 1 10
Adjusted Gross Profit 714 200 208 219 219 846 213 225 237 244 919
Adjusted Gross Margin 64.3 % 65.9 % 66.0 % 67.3 % 68.3 % 66.9 % 67.8 % 67.5 % 69.2 % 68.7 % 68.3 %
GAAP Operating Profit 403 96 105 118 120 439 106 116 128 135 484
Purchase accounting adjustment to acquired deferred revenue 7 5 3 1 1 10
Adjusted Operating Profit 410 101 108 119 120 449 106 116 128 135 484
Adjusted Operating Margin 36.9 % 33.5 % 34.4 % 36.5 % 37.5 % 35.5 % 33.8 % 34.6 % 37.4 % 37.9 % 36.0 %
Amortization 75 23 23 22 21 89 22 22 22 22 87
Depreciation 9 3 3 3 3 11 3 3 3 3 11
Adjusted EBITDA 494 127 134 144 144 549 130 140 153 159 582
Adjusted EBITDA Margin 44.5 % 41.9 % 42.5 % 44.1 % 45.1 % 43.4 % 41.5 % 42.0 % 44.7 % 44.7 % 43.3 %

Measurement & Analytical Solutions Reconciliation ($M) A
2016 2017 2018
FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
GAAP Revenue 1,456 371 379 373 408 1,531 404 426 430 446 1,706
GAAP Gross Profit 864 219 224 216 235 894 234 250 253 263 1,001
GAAP Gross Margin 59.3 % 58.9 % 59.0 % 58.0 % 57.7 % 58.4 % 57.9 % 58.7 % 59.0 % 59.0 % 58.7 %
GAAP Operating Profit 419 107 111 105 123 446 115 128 136 144 524
GAAP Operating Margin 28.8 % 28.7 % 29.3 % 28.2 % 30.2 % 29.1 % 28.6 % 30.1 % 31.7 % 32.3 % 30.7 %
Amortization 39 9 8 8 8 33 8 8 7 7 29
Depreciation 15 4 3 3 3 14 4 4 3 3 13
EBITDA 474 119 123 117 135 494 127 139 146 154 567
EBITDA Margin 32.5 % 32.0 % 32.5 % 31.4 % 33.0 % 32.2 % 31.4 % 32.8 % 34.1 % 34.5 % 33.2 %

Process Technologies Reconciliation ($M)
2016 2017 2018
FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
GAAP Revenue 530 134 143 151 173 600 161 176 169 182 688
GAAP Gross Profit 295 75 79 86 98 338 90 98 94 106 388
GAAP Gross Margin 55.6 % 56.0 % 55.6 % 56.8 % 56.5 % 56.3 % 56.0 % 55.6 % 55.9 % 58.3 % 56.4 %
GAAP Operating Profit 150 39 43 49 57 188 50 58 57 69 234
GAAP Operating Margin 28.3 % 28.9 % 30.3 % 32.5 % 33.3 % 31.4 % 31.3 % 32.8 % 33.7 % 37.7 % 34.0 %
Amortization 9 2 2 2 2 8 2 2 2 2 9
Depreciation 6 1 1 1 1 5 1 1 1 1 4
EBITDA 165 42 46 53 61 202 54 61 60 72 246
EBITDA Margin 31.2 % 31.5 % 32.5 % 34.8 % 35.3 % 33.6 % 33.4 % 34.6 % 35.6 % 39.4 % 35.8 %

Roper Consolidated Reconciliation ($M) A
2016 2017 2018
FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
GAAP Revenue $ 3,790 $ 1,086 $ 1,135 $ 1,160 $ 1,227 $ 4,607 $ 1,203 $ 1,294 $ 1,319 $ 1,376 $ 5,191
Purchase accounting adjustment to acquired deferred revenue 15 22 16 12 8 57 2 2 2 1 8
Adjusted Revenue 3,805 1,108 1,151 1,171 1,235 4,665 1,205 1,296 1,321 1,378 5,199
GAAP Gross Profit 2,332 668 706 726 765 2,865 750 816 840 873 3,280
Purchase accounting adjustment to acquired deferred revenue 15 22 16 12 8 57 2 2 2 1 8
Adjusted Gross Profit 2,348 689 722 738 773 2,922 753 818 842 874 3,287
Adjusted Gross Margin 61.7 % 62.2 % 62.7 % 63.0 % 62.6 % 62.6 % 62.5 % 63.1 % 63.8 % 63.5 % 63.2 %
GAAP Operating Profit 1,055 258 294 311 347 1,210 300 354 378 364 1,396
Purchase accounting adjustment to acquired deferred revenue & commission expense 15 20 15 10 7 52 2 2 2 1 7
One-time accelerated vesting charge & significant acquisition-related expenses 6 35 35
Adjusted Operating Profit 1,076 278 309 321 354 1,262 303 356 379 401 1,439
Adjusted Operating Margin 28.3 % 25.1 % 26.8 % 27.4 % 28.7 % 27.1 % 25.1 % 27.5 % 28.7 % 29.1 % 27.7 %
Amortization 203 73 74 74 74 295 75 78 83 82 318
Depreciation 37 12 12 12 13 50 13 13 12 12 50
GAAP Other Income / (Expense) (2 ) (1 ) 7 (1 ) 5 (2 ) 2 (18 ) 1 (16 )
Debt extinguishment charge 1 16 16
Gain on sale of divested energy product line, net of impairment on minority investment (8 ) (8 )
Adjusted EBITDA 1,315 362 394 407 441 1,605 389 449 473 496 1,806
Adjusted EBITDA Margin 34.6 % 32.7 % 34.3 % 34.8 % 35.7 % 34.4 % 32.3 % 34.6 % 35.8 % 36.0 % 34.7 %

A. All periods include the results of Princeton Instruments, Photometrics and Lumenera, as well as other brands (collectively the "Scientific Imaging" businesses). The Company closed on its sale of the Scientific Imaging businesses to Teledyne Technologies Incorporated on February 5, 2019.

Note: Numbers may not foot due to rounding.

About Roper Technologies

Roper Technologies is a constituent of the S&P 500, Fortune 1000, and the Russell 1000 indices. Roper operates businesses that design and develop software (both license and software-as-a-service) and engineered products and solutions for a variety of niche end markets. 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 identify and complete acquisitions consistent with our business strategies, integrate acquisitions that have been completed, realize expected benefits and synergies from, and manage other risks associated with, the newly acquired businesses. We also face other general risks, including our ability to realize cost savings from our operating initiatives, general economic conditions and the conditions of the specific markets in which we operate, changes in foreign exchange rates, difficulties associated with exports, risks associated with our international operations, 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.

Contact Information:Investor Relations941-556-2601investor-relations@ropertech.com

Source: Roper Technologies, Inc.

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