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Roper Technologies Announces New Segment Structure

Globe Newswire 4-Mar-2019 7:30 AM

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 (NYSE: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 (NYSE: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 (NYSE: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 (NYSE: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 (NYSE: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 (NYSE: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 (NYSE: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 Relations
941-556-2601 
investor-relations@ropertech.com

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