rop-20230331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023.


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number 1-12273

ROPER TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)


Delaware		51-0263969
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

6901 Professional Parkway, Suite 200
Sarasota,	Florida	34240
(Address of principal executive offices)		(Zip Code)

(941) 556-2601

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

Title of Each Class

Trading Symbol(s)

Name of Each Exchange On Which Registered

Common Stock, $0.01 Par Value

ROP

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


☒	Large accelerated filer	☐	Accelerated filer

☐	Non-accelerated filer	☐	Smaller reporting company

		☐	Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

The number of shares outstanding of the registrant’s common stock as of April 28, 2023 was 106,592,234.

ROPER TECHNOLOGIES, INC.

REPORT ON FORM 10-Q FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2023

TABLE OF CONTENTS


		Page
PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited):

	Condensed Consolidated Statements of Earnings	3

	Condensed Consolidated Statements of Comprehensive Income	4

	Condensed Consolidated Balance Sheets	5

	Condensed Consolidated Statements of Cash Flows	6

	Condensed Consolidated Statements of Changes in Stockholders' Equity	8

	Notes to Condensed Consolidated Financial Statements	9

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	18

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	25

Item 4.	Controls and Procedures	25

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings	26

Item 1A.	Risk Factors	26

Item 6.	Exhibits	27

	Signatures	28

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Roper Technologies, Inc. and Subsidiaries

Condensed Consolidated Statements of Earnings (unaudited)

(in millions, except per share data)


	Three months ended March 31,
		2023		2022
Net revenues		$	1,469.7	$	1,279.8
Cost of sales		451.1		382.6
Gross profit		1,018.6		897.2

Selling, general and administrative expenses		617.6		541.3
Income from operations		401.0		355.9

Interest expense, net		37.4		52.6
Equity investment activity, net		(1.2)		—
Other expense, net		(2.3)		(2.1)


Earnings before income taxes		360.1		301.2

Income taxes		75.8		64.8

Net earnings from continuing operations		284.3		236.4

Earnings (loss) from discontinued operations, net of tax		(1.2)		66.8
Gain on disposition of discontinued operations, net of tax		—		1,717.3
Net earnings (loss) from discontinued operations		(1.2)		1,784.1

Net earnings		$	283.1	$	2,020.5

Net earnings per share from continuing operations:
Basic		$	2.67	$	2.24
Diluted		$	2.66	$	2.22

Net earnings (loss) per share from discontinued operations:
Basic		$	(0.01)	$	16.89
Diluted		$	(0.01)	$	16.72

Net earnings per share:
Basic		$	2.66	$	19.13
Diluted		$	2.65	$	18.94

Weighted average common shares outstanding:
Basic		106.3		105.6
Diluted		107.0		106.7

See accompanying notes to Condensed Consolidated Financial Statements.

Roper Technologies, Inc. and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income (unaudited)

(in millions)


	Three months ended March 31,
		2023		2022
Net earnings		$	283.1	$	2,020.5

Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		24.1		(22.9)
Total other comprehensive income (loss), net of tax		24.1		(22.9)

Comprehensive income		$	307.2	$	1,997.6

See accompanying notes to Condensed Consolidated Financial Statements.

Roper Technologies, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets (unaudited)

(in millions)


	March 31, 2023		December 31, 2022
ASSETS:

Cash and cash equivalents	$	1,181.6	$	792.8
Accounts receivable, net	629.1		724.5
Inventories, net	115.0		111.3
Income taxes receivable	25.5		61.0
Unbilled receivables	100.9		91.5
Other current assets	180.1		151.3

Total current assets	2,232.2		1,932.4

Property, plant and equipment, net	86.3		85.3
Goodwill	15,962.8		15,946.1
Other intangible assets, net	7,871.7		8,030.7
Deferred taxes	59.3		55.9
Equity investment	535.0		535.0
Other assets	387.5		395.4

Total assets	$	27,134.8	$	26,980.8

LIABILITIES AND STOCKHOLDERS' EQUITY:

Accounts payable	$	134.0	$	122.6
Accrued compensation	154.2		228.8
Deferred revenue	1,303.8		1,370.7
Other accrued liabilities	413.4		454.6
Income taxes payable	70.5		16.6
Current portion of long-term debt, net	699.5		699.2

Total current liabilities	2,775.4		2,892.5

Long-term debt, net of current portion	5,964.4		5,962.5
Deferred taxes	1,652.9		1,676.8
Other liabilities	409.4		411.2

Total liabilities	10,802.1		10,943.0

Commitments and contingencies (Note 9)

Common stock	1.1		1.1
Additional paid-in capital	2,570.4		2,510.2
Retained earnings	13,941.2		13,730.7
Accumulated other comprehensive loss	(162.9)		(187.0)
Treasury stock	(17.1)		(17.2)
Total stockholders' equity	16,332.7		16,037.8

Total liabilities and stockholders' equity	$	27,134.8	$	26,980.8

See accompanying notes to Condensed Consolidated Financial Statements.

Roper Technologies, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (unaudited)

(in millions)


	Three months ended March 31,
	2023		2022
Cash flows from operating activities:
Net earnings from continuing operations	$	284.3	$	236.4
Adjustments to reconcile net earnings from continuing operations to cash flows from operating activities:
Depreciation and amortization of property, plant and equipment	8.6		9.6
Amortization of intangible assets	175.1		145.7
Amortization of deferred financing costs	2.6		3.1
Non-cash stock compensation	29.6		33.0


Income tax provision, excluding tax associated with gain on sale of assets	75.8		64.8
Changes in operating assets and liabilities, net of acquired businesses:
Accounts receivable	98.0		85.6
Unbilled receivables	(8.7)		(10.4)
Inventories	(3.8)		(13.0)
Accounts payable	11.2		10.1
Other accrued liabilities	(103.7)		(106.6)
Deferred revenue	(61.4)		28.4

Cash income taxes paid	(16.0)		(22.3)
Other, net	(26.7)		(23.1)
Cash provided by operating activities from continuing operations	464.9		441.3
Cash provided by (used in) operating activities from discontinued operations	(1.2)		34.0
Cash provided by operating activities	463.7		475.3

Cash flows from (used in) investing activities:
Acquisitions of businesses, net of cash acquired	(1.1)		(53.2)
Capital expenditures	(9.8)		(5.4)
Capitalized software expenditures	(9.9)		(7.5)


Other, net	(2.8)		—
Cash used in investing activities from continuing operations	(23.6)		(66.1)
Proceeds from (used in) disposition of discontinued operations	(3.2)		3,006.2
Cash used in investing activities from discontinued operations	—		(1.9)
Cash provided by (used in) investing activities	(26.8)		2,938.2

Cash flows from (used in) financing activities:


Borrowings (payments) under revolving line of credit, net	—		(470.0)


Cash dividends to stockholders	(72.3)		(65.3)
Proceeds from stock-based compensation, net	15.1		21.0
Treasury stock sales	4.7		5.5


Cash flows used in financing activities from continuing operations	(52.5)		(508.8)
Cash flows used in financing activities from discontinued operations	—		(11.4)
Cash flows used in financing activities	(52.5)		(520.2)
(Continued)

Roper Technologies, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (unaudited) - Continued

(in millions)


	Three months ended March 31,
	2023		2022

Effect of foreign currency exchange rate changes on cash	4.4		(7.3)

Net increase in cash and cash equivalents	388.8		2,886.0

Cash and cash equivalents, beginning of period	792.8		351.5

Cash and cash equivalents, end of period	$	1,181.6	$	3,237.5

See accompanying notes to Condensed Consolidated Financial Statements.

Roper Technologies, Inc. and Subsidiaries

Condensed Consolidated Statements of Changes in Stockholders’ Equity (unaudited)

(in millions)


	Common stock		Additional paid-in capital		Retained earnings		Accumulated other comprehensive loss		Treasury stock		Total stockholders’ equity











Balances at December 31, 2022	$	1.1	$	2,510.2	$	13,730.7	$	(187.0)	$	(17.2)	$	16,037.8

Net earnings	—		—		283.1		—		—		283.1
Stock option exercises	—		33.7		—		—		—		33.7

Treasury stock sold	—		4.6		—		—		0.1		4.7
Currency translation adjustments	—		—		—		24.1		—		24.1
Stock-based compensation	—		31.4		—		—		—		31.4
Restricted stock activity	—		(9.5)		—		—		—		(9.5)
Dividends declared ($0.6825 per share)	—		—		(72.6)		—		—		(72.6)
Balances at March 31, 2023	$	1.1	$	2,570.4	$	13,941.2	$	(162.9)	$	(17.1)	$	16,332.7













Balances at December 31, 2021	$	1.1	$	2,307.8	$	9,455.6	$	(183.1)	$	(17.6)	$	11,563.8


Net earnings	—		—		2,020.5		—		—		2,020.5
Stock option exercises	—		38.7		—		—		—		38.7
Cash settlement of share-based awards in connection with disposition of discontinued operations	—		(11.1)		—		—		—		(11.1)
Treasury stock sold	—		5.4		—		—		0.1		5.5
Currency translation adjustments	—		—		—		(22.9)		—		(22.9)
Stock-based compensation	—		40.8		—		—		—		40.8
Restricted stock activity	—		(17.7)		—		—		—		(17.7)
Dividends declared ($0.62 per share)	—		—		(65.7)		—		—		(65.7)
Balances at March 31, 2022	$	1.1	$	2,363.9	$	11,410.4	$	(206.0)	$	(17.5)	$	13,551.9

See accompanying notes to Condensed Consolidated Financial Statements.

Roper Technologies, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited)

All currency and share amounts are in millions, except per share data

1. Basis of Presentation

The accompanying Condensed Consolidated Financial Statements for the three months ended March 31, 2023 and 2022 are unaudited. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements reflect all adjustments, which include only normal recurring adjustments, necessary to state fairly the financial position, results of operations, comprehensive income and cash flows of Roper Technologies, Inc. and its subsidiaries (“Roper,” the “Company,” “we,” “our” or “us”) for all periods presented. The December 31, 2022 financial position data included herein was derived from the audited consolidated financial statements included in the Company’s 2022 Annual Report on Form 10-K (“Annual Report”) filed on February 27, 2023 with the Securities and Exchange Commission (“SEC”) but does not include all disclosures required by U.S. generally accepted accounting principles (“GAAP”).

Roper’s management has made estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these Condensed Consolidated Financial Statements in conformity with GAAP. Actual results could differ from those estimates.

The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the full year. You should read these unaudited Condensed Consolidated Financial Statements in conjunction with Roper’s audited consolidated financial statements and the notes thereto included in its Annual Report. Certain prior period amounts have been reclassified to conform to current period presentation.

Discontinued Operations

Roper has completed the divestitures of TransCore, Zetec, CIVCO Radiotherapy (“2021 Divestitures”), and the majority stake in its industrial businesses (“Indicor”). The financial results for these businesses are reported as discontinued operations for all periods presented. Unless otherwise noted, discussion within these notes to the Condensed Consolidated Financial Statements relates to continuing operations. Refer to Note 4 for additional information on discontinued operations.

2. Recent Accounting Pronouncements

The Financial Accounting Standards Board (“FASB”) establishes changes to accounting principles under GAAP in the form of accounting standards updates (“ASUs”) to the Accounting Standards Codification (“ASC”). The Company considers the applicability and impact of all ASUs. Any recent ASUs were assessed and determined to be either not applicable or are expected to have an immaterial impact on the Company’s results of operations, financial position or cash flows.

3. Weighted Average Shares Outstanding

SEC Form 10-Q filed by Roper Technologies Inc.