Skip to content
AnalystLens

Roper Technologies Annual Report, Year Ended Dec 31, 2005

Filing Date
Filed March 16, 2006
Period End
December 31, 2005
Security
ROP
In the record · 2016–202610-K1110-Q338-K114

ROP filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 114 current reports (8-K) between 2016 and 2026.

  1. FY2016 annual report10-K · Feb ’17Feb ’17
  2. Deal closed8-K · Aug ’19Aug ’19
  3. Leadership change8-K · Jun ’21Jun ’21
  4. Leadership change8-K · Apr ’25Apr ’25

01—Abstract

Summary

Summary of the 10-K filed March 16, 2006. Cited figures are marked; the original filing is the authoritative source.

Roper Industries, Inc. reported net sales of $1.45 billiona for 2005, up from $969.8 million in 2004, and net earnings of $153.2 million, or $1.74 per diluted share, compared with $93.8 million ($1.24 per diluted share) in 2004.

The filing attributes the growth to acquired companies and strong internal growth: acquisitions contributed approximately $413 millionb of the sales increase, with other business growth accounting for the remaining $71 million. The company is a diversified industrial company organized into five segments: Instrumentation, Industrial Technology, Energy Systems and Controls, Scientific and Industrial Imaging, and RF Technology. RF Technology, established through the December 2004 TransCore acquisition, contributed $396.6 million of 2005 net sales.

During 2005 the company acquired Inovonics, CIVCO and MEDTEC for cash, with the acquisitions financed through borrowings under its credit agreement and cash from operations. Balance sheet leverage rose meaningfully. Total debt was $894.3 millionc at December 31, 2005, or 41.7% of total capital, and the company reported a working capital deficit of $7.4 million, reflecting $230 million of senior subordinated convertible notes reclassified to short-term debt after their conversion feature was triggered by the stock price.

Cash provided by operating activities was $281.3 milliond in 2005, and capital expenditures were $24.8 million. Management expects the 2006 effective tax rate to rise to approximately 33.8% from 30.6% in 2005, as the company does not expect a recurrence of the 2005 benefit from repatriating foreign earnings.

The filing also highlights risk factors tied to indebtedness, currency exposure (about 25% of 2005 net sales came from operations with non-dollar functional currencies), acquisition integration, and goodwill of $1.35 billion, which represented about 54% of total assets of $2.52 billion. The company paid a quarterly dividend of $0.05875 per share beginning January 31, 2006, an increase of 11%.

02—Key points

Key Highlights

  1. Net sales rose to $1,453.7 million in 2005 from $969.8 million in 2004, with acquisitions contributing about $413 million of the increase.
  2. Net earnings were $153.2 million ($1.74 diluted EPS) in 2005, compared with $93.9 million ($1.24 diluted EPS) in 2004.
  3. RF Technology segment net sales were $396.6 million in 2005, driven by the full-year contribution of TransCore, acquired December 13, 2004.
  4. Total debt was $894.3 million at year-end 2005 (41.7% of total capital), with $315 million of undrawn availability under the senior secured credit facility.
  5. Working capital was a deficit of $7.4 million at year-end 2005, due to $230 million of convertible notes classified as short-term debt after the conversion feature was triggered.
  6. Cash provided by operating activities was $281.3 million in 2005, up from $164.8 million in 2004.
  7. Goodwill totaled $1.35 billion at December 31, 2005, about 54% of total assets of $2.52 billion, creating potential impairment risk.

03—Questions

Frequently Asked Questions

  1. How did Roper Industries fund its 2005 acquisitions?

    The filing states that Inovonics, CIVCO and MEDTEC were purchased for cash and financed through borrowings under the company's credit agreement and cash generated from operations. Total debt rose to $894.3 million at year-end 2005 from $891.9 million at year-end 2004.

  2. Why did the company report a working capital deficit at year-end 2005?

    The $230 million of senior subordinated convertible notes were reclassified from long-term to short-term debt because they became convertible on October 1, 2005, after the common stock traded above the trigger price for at least 20 trading days. The filing notes that management does not expect note holders to exercise their conversion rights within the next 12 months.

  3. What drove the tax rate outlook for 2006?

    The company's 2005 effective tax rate of 30.6% included a $6.6 million reduction in tax expense from repatriating about $82 million of foreign sourced earnings under Section 965. Management expects the 2006 tax rate to increase to approximately 33.8% because it does not expect a recurrence of that benefit.

  4. How exposed is Roper to foreign currency and export risks?

    Sales by operating companies with non-U.S. dollar functional currencies were about 25% of 2005 total net sales, compared with 31% in 2004. Sales to customers outside the U.S. by U.S.-based businesses were about 16% of net sales in 2005. The company does not hedge foreign currency risks, and a 10% change in exchange rates would have affected expected net earnings by about $2.5 million.

04—Continue

← View all 10-K filings