• Roper Technologies Announces Updated Segment Structure

    Source: Nasdaq GlobeNewswire / 30 Jun 2022 05:55:01   America/Chicago

    SARASOTA, Fla., June 30, 2022 (GLOBE NEWSWIRE) -- Roper Technologies, Inc. (NYSE: ROP) announced today that it has updated its reportable segments. The three updated reportable segments are as follows:

    • Application Software – Aderant, CBORD, CliniSys, Data Innovations, Deltek, IntelliTrans, PowerPlan, Strata, Vertafore
    • Network Software – ConstructConnect, DAT, Foundry, iPipeline, iTradeNetwork, Loadlink, MHA, SHP, SoftWriters
    • Technology Enabled Products – CIVCO Medical Solutions, FMI, Inovonics, IPA, Neptune, Northern Digital, rf IDEAS, Verathon

    Beginning with the second quarter of 2022, the Company will report its quarterly and full year financial statements under the new segment structure with prior periods recast to reflect the change.

    Discontinued Operations

    On June 1, 2022, Roper announced an agreement to sell a majority stake in its industrial businesses, including its entire historical Process Technologies reportable segment (AMOT, CCC, Cornell, FTI, Metrix, PAC, Roper Pump, and Viatran) and the industrial businesses within its historical Measurement & Analytical Solutions reportable segment (Alpha, Dynisco, Hansen, Hardy, Logitech, Struers, Technolog, and Uson). Beginning in the second quarter of 2022, Roper plans to report the results of these businesses as discontinued operations.

    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 recast to give effect to the new reportable segment structure.

    Table 1: GAAP Segment Financials ($M)                  
    (Unaudited)                  
     2019 A 2020
    		 2021
    		 2022
     FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1
                            
    Revenue                       
    Application Software$1,573 $402 $395 $444 $545 $1,786 $573 $588 $600 $605 $2,367 $628
    Network Software 889  263  257  266  283  1,069  287  298  316  323  1,224  338
    Technology Enabled Products 1,095  292  300  292  283  1,167  295  304  316  329  1,243  313
    Total$3,558 $957 $952 $1,002 $1,111 $4,022 $1,155 $1,190 $1,232 $1,257 $4,834 $1,280
                            
    Gross Profit                       
    Application Software$1,058 $269 $272 $306 $375 $1,222 $397 $407 $418 $420 $1,643 $435
    Network Software 764  218  213  221  236  888  239  250  267  272  1,029  285
    Technology Enabled Products 652  178  191  179  170  718  180  182  186  188  735  177
    Total$2,474 $664 $676 $707 $781 $2,828 $816 $839 $872 $880 $3,407 $897
                            
    Operating Profit B                         
    Application Software$406 $97 $113 $125 $132 $468 $154 $153 $164 $162 $633 $172
    Network Software 355  91  87  97  107  383  106  111  126  134  477  137
    Technology Enabled Products 370  101  114  105  92  412  106  102  104  103  415  100
    Total$1,131 $290 $314 $327 $331 $1,263 $365 $367 $395 $399 $1,525 $409


    Table 2: Adjusted Segment Financials ($M)                  
    (Unaudited)                  
     2019 A 2020
    		 2021
    		 2022
     FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1
                            
    Revenue                       
    Application Software$1,574 $402 $395 $447 $550 $1,794 $574 $588 $600 $605 $2,368 $628
    Network Software 899  266  258  266  283  1,073  287  298  316  323  1,224  338
    Technology Enabled Products 1,095  292  300  292  283  1,167  295  304  316  329  1,243  313
    Total$3,568 $959 $953 $1,006 $1,116 $4,034 $1,156 $1,190 $1,232 $1,257 $4,835 $1,280
                            
    Gross Profit                       
    Application Software$1,058 $269 $272 $309 $380 $1,230 $398 $407 $418 $420 $1,644 $435
    Network Software 774  220  214  221  236  892  239  250  267  272  1,029  285
    Technology Enabled Products 652  178  191  179  170  718  180  182  186  188  735  177
    Total$2,485 $667 $678 $710 $786 $2,840 $817 $839 $872 $880 $3,408 $897
                            
    Operating Profit B                    
    Application Software$406 $97 $113 $128 $135 $474 $153 $152 $163 $161 $628 $171
    Network Software 365  94  89  97  107  386  106  111  126  134  477  137
    Technology Enabled Products 370  101  114  105  92  412  106  102  104  103  415  100
    Total$1,141 $292 $315 $330 $334 $1,272 $364 $365 $393 $398 $1,521 $407
                            
    Segment EBITDA                    
    Application Software$633 $155 $171 $200 $241 $767 $258 $257 $267 $265 $1,047 $277
    Network Software 485  134  129  139  149  551  147  153  168  174  642  178
    Technology Enabled Products 408  110  122  114  100  445  114  110  112  111  448  107
    Total$1,526 $399 $422 $453 $490 $1,764 $519 $520 $547 $551 $2,136 $563


    Table 3: Adjusted Revenue Growth                
    (Unaudited)                     
                          
    Application Software                     
     2020
    		 2021 2022
     Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1
    Organic Growth5% 1% (1)% (2)% 1% 3% 9% 10% 10% 8% 9%
    Acquisitions/Divestitures2% 2% 12% 36% 13% 39% 38% 23% —% 23% 1%
    Foreign Exchange—% (1)% 1% 1% —% 1% 2% 1% —% 1% (1)%
    Total Revenue Growth6% 2% 11% 35% 14% 43% 49% 34% 10% 32% 9%
                          
    Network Software                  
     2020 2021 2022
     Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1
    Organic Growth3% 2% —% 4% 2% 3% 10% 16% 13% 11% 16%
    Acquisitions/Divestitures34% 24% 13% 3% 17% 4% 3% 1% —% 2% 2%
    Foreign Exchange—% —% —% —% —% 1% 2% 1% —% 1% —%
    Total Revenue Growth36% 26% 13% 8% 19% 8% 15% 19% 14% 14% 18%
                          
    Technology Enabled Products                
     2020 2021
    		 2022
     Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1
    Organic Growth10% 7% 6% 4% 7% —% —% 8% 16% 6% 7%
    Foreign Exchange—% (1)% —% 1% —% 1% 1% —% —% 1% —%
    Total Revenue Growth9% 6% 6% 5% 7% 1% 1% 8% 16% 7% 6%
                          
    Roper Consolidated                    
     2020
    		 2021
    		 2022
     Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1
    Organic Growth6% 3% 1% 2% 3% 2% 6% 11% 12% 8% 10%
    Acquisitions/Divestitures9% 6% 9% 16% 10% 17% 17% 11% —% 11% 1%
    Foreign Exchange—% (1)% —% 1% —% 1% 2% 1% —% 1% —%
    Total Revenue Growth14% 9% 10% 19% 13% 21% 25% 23% 13% 20% 11%


    Table 4: Adjusted Segment & Consolidated Financials Reconciliation          
    (Unaudited)                     
                            
    Application Software Reconciliation ($M)              
                            
     2019 2020
    		 2021
    		 2022
     FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1
                            
    GAAP Revenue$1,573  $402  $395  $444  $545  $1,786  $573  $588  $600  $605  $2,367  $628 
    Purchase accounting adjustment to acquired deferred revenue 1   —   —   3   5   8   1   —   —   —   1   — 
    Adjusted Revenue$1,574  $402  $395  $447  $550  $1,794  $574  $588  $600  $605  $2,368  $628 
                            
    GAAP Gross Profit$1,058  $269  $272  $306  $375  $1,222  $397  $407  $418  $420  $1,643  $435 
    Purchase accounting adjustment to acquired deferred revenue 1   —   —   3   5   8   1   —   —   —   1   — 
    Adjusted Gross Profit$1,058  $269  $272  $309  $380  $1,230  $398  $407  $418  $420  $1,644  $435 
    Adjusted Gross Margin 67.2%  66.9%  69.0%  69.1%  69.1%  68.6%  69.4%  69.3%  69.7%  69.4%  69.4%  69.3%
                            
    GAAP Operating Profit B$406  $97  $113  $125  $132  $468  $154  $153  $164  $162  $633  $172 
    Purchase accounting adjustment to acquired deferred revenue & commission expense —   —   —   3   3   6   —   (1)   (1)   (1)   (5)   (1) 
    Adjusted Operating Profit$406  $97  $113  $128  $135  $474  $153  $152  $163  $161  $628  $171 
    Adjusted Operating Margin 25.8%  24.2%  28.7%  28.6%  24.6%  26.4%  26.7%  25.9%  27.1%  26.5%  26.5%  27.2%
                            
    Adjusted Operating Profit$406  $97  $113  $128  $135  $474  $153  $152  $163  $161  $628  $171 
    Amortization 207   53   53   67   98   271   98   98   98   99   393   100 
    Depreciation 19   5   5   5   8   22   7   7   6   6   26   6 
    Adjusted EBITDA$633  $155  $171  $200  $241  $767  $258  $257  $267  $265  $1,047  $277 
    Adjusted EBITDA Margin 40.2%  38.7%  43.3%  44.7%  43.8%  42.8%  44.9%  43.7%  44.5%  43.8%  44.2%  44.1%
                            
    Network Software Reconciliation ($M)            
                            
     2019 2020
    		 2021
    		 2022
     FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1
                            
    GAAP Revenue$889  $263  $257  $266  $283  $1,069  $287  $298  $316  $323  $1,224  $338 
    Purchase accounting adjustment to acquired deferred revenue 10   2   1   —   —   4   —   —   —   —   —   — 
    Adjusted Revenue$899  $266  $258  $266  $283  $1,073  $287  $298  $316  $323  $1,224  $338 
                            
    GAAP Gross Profit$764  $218  $213  $221  $236  $888  $239  $250  $267  $272  $1,029  $285 
    Purchase accounting adjustment to acquired deferred revenue 10   2   1   —   —   4   —   —   —   —   —   — 
    Adjusted Gross Profit$774  $220  $214  $221  $236  $892  $239  $250  $267  $272  $1,029  $285 
    Adjusted Gross Margin 86.1%  82.9%  83.1%  83.1%  83.3%  83.1%  83.3%  84.0%  84.6%  84.4%  84.1%  84.2%
                            
    GAAP Operating Profit B$355  $91  $87  $97  $107  $383  $106  $111  $126  $134  $477  $137 
    Purchase accounting adjustment to acquired deferred revenue 10   2   1   —   —   4   —   —   —   —   —   — 
    Adjusted Operating Profit$365  $94  $89  $97  $107  $386  $106  $111  $126  $134  $477  $137 
    Adjusted Operating Margin 40.6%  35.2%  34.3%  36.3%  37.9%  36.0%  36.7%  37.3%  40.0%  41.4%  39.0%  40.4%
                            
    Adjusted Operating Profit$365  $94  $89  $97  $107  $386  $106  $111  $126  $134  $477  $137 
    Amortization 112   38   38   40   39   156   39   39   39   39   156   40 
    Depreciation 8   2   2   2   2   9   2   2   2   2   8   2 
    Adjusted EBITDA$485  $134  $129  $139  $149  $551  $147  $153  $168  $174  $642  $178 
    Adjusted EBITDA Margin 53.9%  50.5%  50.0%  52.1%  52.6%  51.4%  51.1%  51.3%  53.0%  54.1%  52.4%  52.7%
                            
    Technology Enabled Products Reconciliation ($M)             
                            
     2019 A 2020
    		 2021
    		 2022
     FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1
                            
    GAAP Revenue$1,095  $292  $300  $292  $283  $1,167  $295  $304  $316  $329  $1,243  $313 
    GAAP Gross Profit$652  $178  $191  $179  $170  $718  $180  $182  $186  $188  $735  $177 
    GAAP Gross Margin 59.5%  60.8%  63.6%  61.4%  60.1%  61.5%  60.9%  59.8%  58.8%  57.3%  59.1%  56.5%
                            
    GAAP Operating Profit B$370  $101  $114  $105  $92  $412  $106  $102  $104  $103  $415  $100 
    GAAP Operating Margin 33.8%  34.7%  37.8%  36.1%  32.4%  35.3%  35.8%  33.6%  33.0%  31.5%  33.4%  31.8%
                            
    GAAP Operating Profit$370  $101  $114  $105  $92  $412  $106  $102  $104  $103  $415  $100 
    Amortization 29   6   6   6   6   24   6   6   6   6   23   6 
    Depreciation 9   2   2   2   2   9   2   2   2   2   9   2 
    EBITDA$408  $110  $122  $114  $100  $445  $114  $110  $112  $111  $448  $107 
    EBITDA Margin 37.2%  37.6%  40.6%  39.0%  35.3%  38.2%  38.6%  36.3%  35.5%  33.9%  36.0%  34.3%
    1. For the year ended December 31, 2019, the Technology Enabled Products segment excludes the results of the divestitures completed in 2019 for (i) the Scientific Imaging businesses, sold to Teledyne on February 5, 2019 and (ii) Gatan, sold to AMETEK on October 29, 2019.
    2. Segment operating profit is before unallocated corporate general and administrative expenses.

    Note: Numbers may not foot due to rounding.

    About Roper Technologies

    Roper Technologies is a constituent of the S&P 500 and Fortune 500. Roper has a proven, long-term track record of compounding cash flow and shareholder value. The Company operates market leading businesses that design and develop vertical software and technology enabled products for a variety of defensible niche markets. Roper utilizes a disciplined, analytical, and process-driven approach to redeploy its excess free cash flow toward high-quality acquisitions. Additional information about Roper is available on the Company’s website at www.ropertech.com.

    Contact Information:
    Investor Relations
    941-556-2601
    investor-relations@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 any ongoing impacts of the COVID-19 pandemic on our business, operations, financial results and liquidity, which will depend on numerous evolving factors which we cannot accurately predict or assess, including: the duration and scope of the pandemic, new variants of the virus and the distribution and efficacy of vaccines; any negative impact on global and regional markets, economies and economic activity; actions governments, businesses and individuals take in response to the pandemic; the effects of the pandemic, including all of the foregoing, on our customers, suppliers, and business partners, and how quickly economies and demand for our products and services recover after the pandemic subsides. Such risks and uncertainties also 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, as well as complete any announced divestitures, including obtaining any required regulatory approvals with respect thereto. 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, cybersecurity and data privacy risks, including litigation resulting therefrom, risks related to political instability, armed hostilities, incidents of terrorism, public health crises (such as the COVID-19 pandemic) or natural disasters, increased product liability and insurance costs, increased warranty exposure, future competition, changes in the supply of, or price for, parts and components, including as a result of the current inflationary environment and ongoing supply chain constraints, environmental compliance costs and liabilities, risks and cost associated with 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.


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