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Roper Technologies 8-K Report, Financial Results (Jul 24, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed July 24, 2024
Period End
July 24, 2024
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. Deal closed8-K · Jan ’17Jan ’17
  2. Deal closed8-K · Sep ’20Sep ’20
  3. Leadership change8-K · Jan ’23Jan ’23
  4. Leadership change8-K · Oct ’26Oct ’26

01—Abstract

Summary

Summary of the 8-K filed July 24, 2024. Cited figures are marked; the original filing is the authoritative source.

Roper Technologies, Inc. furnished a press release (Exhibit 99.1) reporting results for the second quarter ended June 30, 2024, on a continuing operations basis.

Net revenues rose 12% to $1.72 billiona, with organic revenue up 4%. GAAP net earnings declined 7% to $337 million (GAAP diluted EPS of $3.12, down 7%), while adjusted net earnings increased 9% to $483 million and adjusted DEPS increased 9% to $4.48. Adjusted EBITDA grew 13% to $695 million, and operating cash flow rose 20% to $384 million.

CEO Neil Hunn cited improving demand for enterprise software, partially offset by production timing at Neptune, and said second-quarter free cash flow of $367 millionb brought trailing-twelve-month adjusted free cash flow to $2.1 billion, or 32% of revenue. Roper raised the low end of its full-year 2024 adjusted DEPS guidance to $18.10 - $18.25, from $18.05 - $18.25. The company continues to expect full-year total revenue growth of approximately 12% and organic revenue growth of approximately 6%, and it guides third-quarter adjusted DEPS to $4.50 - $4.54.

Guidance excludes unannounced future acquisitions or divestitures. The filing also notes that GAAP results in the quarter were affected by the minority investments in Indicor and Certinia, which were reported in equity investments (gain) loss, net; in Q2 2023 that line was a $66.0 millionc gain, versus a $0.8 million loss in Q2 2024. Balance sheet activity over the first half of 2024 shows goodwill rising to $18.31 billion and total long-term debt, net of current portion, increasing to $6.92 billion from $5.83 billion at year-end 2023.

Cash flow statements show $1.86 billiond spent on acquisitions of businesses in the six months ended June 30, 2024, funded in part by $1.09 billion of net revolving line of credit borrowings. Management stated it has a robust acquisition pipeline and substantial M&A capacity.

02—Key points

Key Highlights

  1. Revenue rose 12% to $1.72 billion in Q2 2024, with organic growth of 4% and acquisitions contributing 8%.
  2. GAAP diluted EPS fell 7% to $3.12 and GAAP net earnings declined 7% to $337 million, while adjusted DEPS rose 9% to $4.48.
  3. Adjusted EBITDA increased 13% to $695 million, with the adjusted EBITDA margin at 40.5% of revenue.
  4. Operating cash flow increased 20% to $384 million; adjusted free cash flow was $367 million, up 24%, and trailing-twelve-month adjusted free cash flow reached $2.1 billion.
  5. Full-year 2024 adjusted DEPS guidance low end raised to $18.10 (range $18.10 - $18.25); total revenue growth expected at about 12% and organic growth at about 6%.
  6. Third-quarter 2024 adjusted DEPS guidance set at $4.50 - $4.54.
  7. Goodwill rose to $18.31 billion and long-term debt to $6.92 billion at June 30, 2024, following $1.86 billion of acquisition spending in the first half.

03—Questions

Frequently Asked Questions

  1. How did Roper perform in the second quarter of 2024?

    Revenue grew 12% to $1.72 billion, with organic revenue up 4%. Adjusted EBITDA rose 13% to $695 million and adjusted DEPS rose 9% to $4.48. GAAP net earnings fell 7% to $337 million, and GAAP diluted EPS fell 7% to $3.12.

  2. Why did GAAP earnings decline while adjusted earnings grew?

    The filing shows a $66.0 million equity investment gain in Q2 2023 tied to the minority investments in Indicor and Certinia, which is excluded from adjusted results. Q2 2024 included a $0.8 million equity investment loss. Adjusted results also exclude amortization of acquisition-related intangible assets, which was $146 million after tax in Q2 2024 versus $135 million in Q2 2023.

  3. Did Roper change its full-year 2024 outlook?

    Roper raised the low end of its full-year 2024 adjusted DEPS guidance to $18.10 from $18.05, keeping the high end at $18.25. It continues to expect total revenue growth of approximately 12% and organic revenue growth of approximately 6%. Guidance excludes unannounced acquisitions or divestitures.

  4. What is driving Roper's cash flow and capital deployment?

    Second-quarter operating cash flow was $384 million and adjusted free cash flow was $367 million. For the six months ended June 30, 2024, the company spent $1.86 billion on acquisitions and borrowed a net $1.09 billion under its revolving credit line. Management said it has a robust acquisition pipeline and substantial M&A capacity.

  5. What did management say about segment performance?

    CEO Neil Hunn said demand for enterprise software improved during the quarter, partially offset by production timing at Neptune. Application Software revenue was $931.8 million in Q2 2024 versus $770.3 million a year earlier, and Network Software revenue was $364.2 million versus $358.1 million.

04—Continue

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