☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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51-0263969
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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6901 Professional Pkwy. East, Suite 200
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Sarasota,
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Florida
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34240
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(Address of principal executive offices)
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(Zip Code)
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Title of Each Class
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Trading Symbol(s)
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Name of Each Exchange On Which Registered
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Common Stock, $0.01 Par Value
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ROP
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New York Stock Exchange
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☒
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Large accelerated filer
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☐
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Accelerated filer
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☐
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Non-accelerated filer (Do not check if a smaller reporting company)
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☐
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Smaller reporting company
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☐
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Emerging growth company
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Page
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Three months ended June 30,
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Six months ended June 30,
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||||||||||||
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2019
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2018
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2019
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2018
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||||||||
Net revenues
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$
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1,330.3
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$
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1,293.7
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$
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2,617.5
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$
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2,496.2
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Cost of sales
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480.3
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477.8
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956.9
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929.8
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Gross profit
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850.0
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815.9
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1,660.6
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1,566.4
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Selling, general and administrative expenses
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481.6
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461.6
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945.8
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911.9
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Income from operations
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368.4
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354.3
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714.8
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654.5
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Interest expense, net
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45.1
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43.2
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88.8
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86.4
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Other income (expense), net
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(1.0
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)
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2.3
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(4.1
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)
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0.6
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||||
Gain on disposal of business
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—
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—
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119.6
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—
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Earnings before income taxes
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322.3
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313.4
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741.5
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568.7
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Income taxes
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72.6
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85.0
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122.2
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129.0
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Net earnings
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$
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249.7
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$
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228.4
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$
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619.3
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$
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439.7
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Net earnings per share:
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Basic
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$
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2.40
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$
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2.21
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$
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5.97
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$
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4.26
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Diluted
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$
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2.38
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$
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2.19
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$
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5.90
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$
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4.22
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Weighted average common shares outstanding:
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Basic
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103.9
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103.2
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103.7
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103.1
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Diluted
|
105.1
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104.4
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104.9
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104.3
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Three months ended June 30,
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Six months ended June 30,
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||||||||||||
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2019
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2018
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2019
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2018
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||||||||
Net earnings
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$
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249.7
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$
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228.4
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$
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619.3
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$
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439.7
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Other comprehensive income, net of tax:
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||||||||
Foreign currency translation adjustments
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(28.6
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)
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(76.2
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)
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0.1
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(18.4
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)
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Total other comprehensive income, net of tax
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(28.6
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)
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(76.2
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)
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0.1
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(18.4
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)
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Comprehensive income
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$
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221.1
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$
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152.2
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$
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619.4
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$
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421.3
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June 30,
2019 |
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December 31,
2018 |
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ASSETS:
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Cash and cash equivalents
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$
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320.8
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$
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364.4
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Accounts receivable, net
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698.2
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700.8
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Inventories, net
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203.5
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190.8
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Income taxes receivable
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34.3
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21.7
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Unbilled receivables
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206.6
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169.4
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Other current assets
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88.9
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80.0
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Current assets held for sale
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50.0
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83.6
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Total current assets
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1,602.3
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1,610.7
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Property, plant and equipment, net
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134.2
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128.7
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Goodwill
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9,657.7
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9,346.8
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Other intangible assets, net
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3,943.1
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3,842.1
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Deferred taxes
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92.1
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52.2
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Other assets
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381.7
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101.1
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Assets held for sale
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97.2
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167.9
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Total assets
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$
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15,908.3
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$
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15,249.5
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LIABILITIES AND STOCKHOLDERS’ EQUITY:
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Accounts payable
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$
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162.2
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$
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165.3
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Accrued compensation
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186.8
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248.3
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Deferred revenue
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729.1
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677.9
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Other accrued liabilities
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288.1
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258.0
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Income taxes payable
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46.8
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58.3
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Current portion of long-term debt, net
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2.1
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1.5
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Current liabilities held for sale
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28.1
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38.9
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Total current liabilities
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1,443.2
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1,448.2
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Long-term debt, net of current portion
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4,718.9
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4,940.2
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Deferred taxes
|
948.9
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931.1
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Other liabilities
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425.8
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191.5
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Liabilities held for sale
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20.5
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—
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Total liabilities
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7,557.3
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7,511.0
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Commitments and contingencies (Note 9)
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Common stock
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1.1
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1.1
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Additional paid-in capital
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1,840.5
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1,751.5
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Retained earnings
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6,771.0
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6,247.7
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Accumulated other comprehensive loss
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(243.2
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)
|
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(243.3
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)
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Treasury stock
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(18.4
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)
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(18.5
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)
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Total stockholders’ equity
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8,351.0
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7,738.5
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Total liabilities and stockholders’ equity
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$
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15,908.3
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$
|
15,249.5
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Six months ended June 30,
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||||||
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2019
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|
2018
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net earnings
|
$
|
619.3
|
|
|
$
|
439.7
|
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Adjustments to reconcile net earnings to cash flows from operating activities:
|
|
|
|
||||
Depreciation and amortization of property, plant and equipment
|
23.4
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|
|
25.2
|
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Amortization of intangible assets
|
169.4
|
|
|
153.0
|
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Amortization of deferred financing costs
|
3.3
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|
|
3.2
|
|
||
Non-cash stock compensation
|
54.3
|
|
|
54.0
|
|
||
Gain on disposal of business, net of associated income tax
|
(88.5
|
)
|
|
—
|
|
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Changes in operating assets and liabilities, net of acquired businesses:
|
|
|
|
||||
Accounts receivable
|
38.5
|
|
|
(28.4
|
)
|
||
Unbilled receivables
|
(37.0
|
)
|
|
(24.0
|
)
|
||
Inventories
|
(18.4
|
)
|
|
(15.2
|
)
|
||
Accounts payable and accrued liabilities
|
(94.0
|
)
|
|
(30.8
|
)
|
||
Deferred revenue
|
51.2
|
|
|
39.5
|
|
||
Income taxes, excluding tax associated with gain on disposal of businesses
|
(77.6
|
)
|
|
(61.7
|
)
|
||
Cash tax paid for gain on disposal of businesses
|
(39.4
|
)
|
|
—
|
|
||
Other, net
|
(13.4
|
)
|
|
(6.7
|
)
|
||
Cash provided by operating activities
|
591.1
|
|
|
547.8
|
|
||
|
|
|
|
||||
Cash flows used in investing activities:
|
|
|
|
||||
Acquisitions of businesses, net of cash acquired
|
(539.2
|
)
|
|
(1,182.3
|
)
|
||
Capital expenditures
|
(27.9
|
)
|
|
(23.1
|
)
|
||
Capitalized software expenditures
|
(4.9
|
)
|
|
(4.4
|
)
|
||
Proceeds from disposal of business
|
220.5
|
|
|
—
|
|
||
Other, net
|
(2.6
|
)
|
|
(0.8
|
)
|
||
Cash used in investing activities
|
(354.1
|
)
|
|
(1,210.6
|
)
|
||
|
|
|
|
||||
Cash flows from (used in) financing activities:
|
|
|
|
||||
Borrowings (payments) under revolving line of credit, net
|
(225.0
|
)
|
|
465.0
|
|
||
Cash dividends to stockholders
|
(95.6
|
)
|
|
(84.5
|
)
|
||
Proceeds from stock-based compensation, net
|
33.0
|
|
|
32.7
|
|
||
Treasury stock sales
|
3.6
|
|
|
2.8
|
|
||
Other
|
1.1
|
|
|
0.4
|
|
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Cash provided by (used in) financing activities
|
(282.9
|
)
|
|
416.4
|
|
||
|
|
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|
||||
Effect of foreign currency exchange rate changes on cash
|
2.3
|
|
|
(3.1
|
)
|
||
|
|
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|
||||
Net decrease in cash and cash equivalents
|
(43.6
|
)
|
|
(249.5
|
)
|
||
|
|
|
|
||||
Cash and cash equivalents, beginning of period
|
364.4
|
|
|
671.3
|
|
||
|
|
|
|
||||
Cash and cash equivalents, end of period
|
$
|
320.8
|
|
|
$
|
421.8
|
|
|
Common
stock
|
|
Additional
paid-in
capital
|
|
Retained
earnings
|
|
Accumulated
other
comprehensive
loss
|
|
Treasury
stock
|
|
Total stockholders’ equity
|
||||||||||||
Balances at March 31, 2019
|
$
|
1.1
|
|
|
$
|
1,799.9
|
|
|
$
|
6,569.4
|
|
|
$
|
(214.6
|
)
|
|
$
|
(18.4
|
)
|
|
$
|
8,137.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net earnings
|
—
|
|
|
—
|
|
|
249.7
|
|
|
—
|
|
|
—
|
|
|
249.7
|
|
||||||
Stock option exercises
|
—
|
|
|
12.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12.3
|
|
||||||
Treasury stock sold
|
—
|
|
|
1.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.4
|
|
||||||
Currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
(28.6
|
)
|
|
—
|
|
|
(28.6
|
)
|
||||||
Stock based compensation
|
—
|
|
|
28.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28.2
|
|
||||||
Restricted stock activity
|
—
|
|
|
(1.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.3
|
)
|
||||||
Dividends declared ($0.4625 per share)
|
—
|
|
|
—
|
|
|
(48.1
|
)
|
|
—
|
|
|
—
|
|
|
(48.1
|
)
|
||||||
Balances at June 30, 2019
|
$
|
1.1
|
|
|
$
|
1,840.5
|
|
|
$
|
6,771.0
|
|
|
$
|
(243.2
|
)
|
|
$
|
(18.4
|
)
|
|
$
|
8,351.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balances at December 31, 2018
|
$
|
1.1
|
|
|
$
|
1,751.5
|
|
|
$
|
6,247.7
|
|
|
$
|
(243.3
|
)
|
|
$
|
(18.5
|
)
|
|
$
|
7,738.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net earnings
|
—
|
|
|
—
|
|
|
619.3
|
|
|
—
|
|
|
—
|
|
|
619.3
|
|
||||||
Stock option exercises
|
—
|
|
|
49.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
49.1
|
|
||||||
Treasury stock sold
|
—
|
|
|
3.5
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
3.6
|
|
||||||
Currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
||||||
Stock-based compensation
|
—
|
|
|
52.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
52.5
|
|
||||||
Restricted stock activity
|
—
|
|
|
(16.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16.1
|
)
|
||||||
Dividends declared ($0.4625 per share)
|
—
|
|
|
—
|
|
|
(96.0
|
)
|
|
—
|
|
|
—
|
|
|
(96.0
|
)
|
||||||
Balances at June 30, 2019
|
$
|
1.1
|
|
|
$
|
1,840.5
|
|
|
$
|
6,771.0
|
|
|
$
|
(243.2
|
)
|
|
$
|
(18.4
|
)
|
|
$
|
8,351.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balances at March 31, 2018
|
$
|
1.0
|
|
|
$
|
1,653.9
|
|
|
$
|
5,647.6
|
|
|
$
|
(128.4
|
)
|
|
$
|
(18.6
|
)
|
|
$
|
7,155.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net earnings
|
—
|
|
|
—
|
|
|
228.4
|
|
|
—
|
|
|
—
|
|
|
228.4
|
|
||||||
Stock option exercises
|
0.1
|
|
|
10.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.2
|
|
||||||
Treasury stock sold
|
—
|
|
|
1.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.2
|
|
||||||
Currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
(76.2
|
)
|
|
—
|
|
|
(76.2
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
27.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27.7
|
|
||||||
Restricted stock activity
|
—
|
|
|
(1.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.3
|
)
|
||||||
Dividends declared ($0.4125 per share)
|
—
|
|
|
—
|
|
|
(42.6
|
)
|
|
—
|
|
|
—
|
|
|
(42.6
|
)
|
||||||
Balances at June 30, 2018
|
$
|
1.1
|
|
|
$
|
1,691.6
|
|
|
$
|
5,833.4
|
|
|
$
|
(204.6
|
)
|
|
$
|
(18.6
|
)
|
|
$
|
7,302.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balances at December 31, 2017
|
$
|
1.0
|
|
|
$
|
1,602.9
|
|
|
$
|
5,464.6
|
|
|
$
|
(186.2
|
)
|
|
$
|
(18.7
|
)
|
|
$
|
6,863.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adoption of ASC 606
|
—
|
|
|
—
|
|
|
14.3
|
|
|
—
|
|
|
—
|
|
|
14.3
|
|
||||||
Net earnings
|
—
|
|
|
—
|
|
|
439.7
|
|
|
—
|
|
|
—
|
|
|
439.7
|
|
||||||
Stock option exercises
|
0.1
|
|
|
39.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
39.3
|
|
||||||
Treasury stock sold
|
—
|
|
|
2.7
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
2.8
|
|
||||||
Currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
(18.4
|
)
|
|
—
|
|
|
(18.4
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
53.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53.4
|
|
||||||
Restricted stock activity
|
—
|
|
|
(6.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6.6
|
)
|
||||||
Dividends declared ($0.4125 per share)
|
—
|
|
|
—
|
|
|
(85.2
|
)
|
|
—
|
|
|
—
|
|
|
(85.2
|
)
|
||||||
Balances at June 30, 2018
|
$
|
1.1
|
|
|
$
|
1,691.6
|
|
|
$
|
5,833.4
|
|
|
$
|
(204.6
|
)
|
|
$
|
(18.6
|
)
|
|
$
|
7,302.9
|
|
–
|
Application Software - Aderant, CBORD, CliniSys, Data Innovations, Deltek, Horizon, IntelliTrans, PowerPlan, Strata, Sunquest
|
–
|
Network Software & Systems - ConstructConnect, DAT, Foundry, 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
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Basic shares outstanding
|
103.9
|
|
|
103.2
|
|
|
103.7
|
|
|
103.1
|
|
Effect of potential common stock:
|
|
|
|
|
|
|
|
||||
Common stock awards
|
1.2
|
|
|
1.2
|
|
|
1.2
|
|
|
1.2
|
|
Diluted shares outstanding
|
105.1
|
|
|
104.4
|
|
|
104.9
|
|
|
104.3
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Stock-based compensation
|
$
|
29.0
|
|
|
$
|
28.0
|
|
|
$
|
54.3
|
|
|
$
|
54.0
|
|
Tax effect recognized in net earnings
|
6.1
|
|
|
5.9
|
|
|
11.4
|
|
|
11.3
|
|
|
Six months ended June 30,
|
||
|
2019
|
|
2018
|
Risk-free interest rate (%)
|
2.42
|
|
2.63
|
Expected option life (years)
|
5.41
|
|
5.32
|
Expected volatility (%)
|
19.23
|
|
18.02
|
Expected dividend yield (%)
|
0.58
|
|
0.59
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Raw materials and supplies
|
$
|
128.9
|
|
|
$
|
120.3
|
|
Work in process
|
29.0
|
|
|
26.2
|
|
||
Finished products
|
78.4
|
|
|
74.6
|
|
||
Inventory reserves
|
(32.8
|
)
|
|
(30.3
|
)
|
||
|
$
|
203.5
|
|
|
$
|
190.8
|
|
|
Application Software
|
|
Network Software & Systems
|
|
Measurement &Analytical Solutions
|
|
Process Technologies
|
|
Total
|
||||||||||
Balances at December 31, 2018
|
$
|
5,236.1
|
|
|
$
|
2,623.7
|
|
|
$
|
1,174.7
|
|
|
$
|
312.3
|
|
|
$
|
9,346.8
|
|
Additions
|
—
|
|
|
311.1
|
|
|
—
|
|
|
—
|
|
|
311.1
|
|
|||||
Other
|
0.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.8
|
|
|||||
Currency translation adjustments
|
2.2
|
|
|
(5.9
|
)
|
|
1.3
|
|
|
1.4
|
|
|
(1.0
|
)
|
|||||
Balances at June 30, 2019
|
$
|
5,239.1
|
|
|
$
|
2,928.9
|
|
|
$
|
1,176.0
|
|
|
$
|
313.7
|
|
|
$
|
9,657.7
|
|
|
Cost
|
|
Accumulated
amortization
|
|
Net book
value
|
||||||
Assets subject to amortization:
|
|
|
|
|
|
||||||
Customer related intangibles
|
$
|
3,926.8
|
|
|
$
|
(1,083.6
|
)
|
|
$
|
2,843.2
|
|
Unpatented technology
|
504.0
|
|
|
(199.5
|
)
|
|
304.5
|
|
|||
Software
|
172.0
|
|
|
(93.2
|
)
|
|
78.8
|
|
|||
Patents and other protective rights
|
9.7
|
|
|
(7.5
|
)
|
|
2.2
|
|
|||
Trade names
|
7.3
|
|
|
(2.8
|
)
|
|
4.5
|
|
|||
Assets not subject to amortization:
|
|
|
|
|
|
||||||
Trade names
|
608.9
|
|
|
—
|
|
|
608.9
|
|
|||
Balances at December 31, 2018
|
$
|
5,228.7
|
|
|
$
|
(1,386.6
|
)
|
|
$
|
3,842.1
|
|
|
|
|
|
|
|
||||||
Assets subject to amortization:
|
|
|
|
|
|
||||||
Customer related intangibles
|
$
|
4,140.8
|
|
|
$
|
(1,205.3
|
)
|
|
$
|
2,935.5
|
|
Unpatented technology
|
546.3
|
|
|
(237.6
|
)
|
|
308.7
|
|
|||
Software
|
172.1
|
|
|
(102.4
|
)
|
|
69.7
|
|
|||
Patents and other protective rights
|
12.1
|
|
|
(7.9
|
)
|
|
4.2
|
|
|||
Trade names
|
7.9
|
|
|
(3.4
|
)
|
|
4.5
|
|
|||
Assets not subject to amortization:
|
|
|
|
|
|
||||||
Trade names
|
620.5
|
|
|
—
|
|
|
620.5
|
|
|||
Balances at June 30, 2019
|
$
|
5,499.7
|
|
|
$
|
(1,556.6
|
)
|
|
$
|
3,943.1
|
|
$600 3.000% senior notes due 2020
|
604
|
|
$500 2.800% senior notes due 2021
|
504
|
|
$500 3.125% senior notes due 2022
|
509
|
|
$700 3.650% senior notes due 2023
|
729
|
|
$300 3.850% senior notes due 2025
|
317
|
|
$700 3.800% senior notes due 2026
|
730
|
|
$800 4.200% senior notes due 2028
|
856
|
|
|
Three months ended June 30,
|
|
|
|
Six months ended June 30,
|
|
|
||||||||||||||
|
2019
|
|
2018
|
|
Change %
|
|
2019
|
|
2018
|
|
Change %
|
||||||||||
Net revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Application Software
|
$
|
390.6
|
|
|
$
|
358.2
|
|
|
9.0
|
%
|
|
$
|
771.8
|
|
|
$
|
682.1
|
|
|
13.2
|
%
|
Network Software & Systems
|
366.8
|
|
|
333.9
|
|
|
9.9
|
%
|
|
712.5
|
|
|
647.8
|
|
|
10.0
|
%
|
||||
Measurement & Analytical Solutions
|
408.4
|
|
|
425.8
|
|
|
(4.1
|
)%
|
|
810.2
|
|
|
829.8
|
|
|
(2.4
|
)%
|
||||
Process Technologies
|
164.5
|
|
|
175.8
|
|
|
(6.4
|
)%
|
|
323.0
|
|
|
336.5
|
|
|
(4.0
|
)%
|
||||
Total
|
$
|
1,330.3
|
|
|
$
|
1,293.7
|
|
|
2.8
|
%
|
|
$
|
2,617.5
|
|
|
$
|
2,496.2
|
|
|
4.9
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Application Software
|
$
|
262.7
|
|
|
$
|
242.9
|
|
|
8.2
|
%
|
|
$
|
516.1
|
|
|
$
|
456.8
|
|
|
13.0
|
%
|
Network Software & Systems
|
252.7
|
|
|
225.4
|
|
|
12.1
|
%
|
|
491.7
|
|
|
438.1
|
|
|
12.2
|
%
|
||||
Measurement & Analytical Solutions
|
240.2
|
|
|
249.9
|
|
|
(3.9
|
)%
|
|
471.4
|
|
|
483.9
|
|
|
(2.6
|
)%
|
||||
Process Technologies
|
94.4
|
|
|
97.7
|
|
|
(3.4
|
)%
|
|
181.4
|
|
|
187.6
|
|
|
(3.3
|
)%
|
||||
Total
|
$
|
850.0
|
|
|
$
|
815.9
|
|
|
4.2
|
%
|
|
$
|
1,660.6
|
|
|
$
|
1,566.4
|
|
|
6.0
|
%
|
Operating profit*:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Application Software
|
$
|
98.4
|
|
|
$
|
97.7
|
|
|
0.7
|
%
|
|
$
|
189.8
|
|
|
$
|
167.9
|
|
|
13.0
|
%
|
Network Software & Systems
|
129.2
|
|
|
115.6
|
|
|
11.8
|
%
|
|
254.5
|
|
|
221.6
|
|
|
14.8
|
%
|
||||
Measurement & Analytical Solutions
|
130.3
|
|
|
128.3
|
|
|
1.6
|
%
|
|
248.4
|
|
|
243.7
|
|
|
1.9
|
%
|
||||
Process Technologies
|
57.2
|
|
|
57.6
|
|
|
(0.7
|
)%
|
|
107.3
|
|
|
107.9
|
|
|
(0.6
|
)%
|
||||
Total
|
$
|
415.1
|
|
|
$
|
399.2
|
|
|
4.0
|
%
|
|
$
|
800.0
|
|
|
$
|
741.1
|
|
|
7.9
|
%
|
Long-lived assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Application Software
|
$
|
83.3
|
|
|
$
|
80.2
|
|
|
3.9
|
%
|
|
|
|
|
|
|
|||||
Network Software & Systems
|
38.6
|
|
|
39.4
|
|
|
(2.0
|
)%
|
|
|
|
|
|
|
|||||||
Measurement & Analytical Solutions
|
41.7
|
|
|
38.8
|
|
|
7.5
|
%
|
|
|
|
|
|
|
|||||||
Process Technologies
|
21.8
|
|
|
21.3
|
|
|
2.3
|
%
|
|
|
|
|
|
|
|||||||
Total
|
$
|
185.4
|
|
|
$
|
179.7
|
|
|
3.2
|
%
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Software and related services
|
|
$
|
594.7
|
|
|
$
|
533.1
|
|
|
$
|
1,171.5
|
|
|
$
|
1,025.7
|
|
Engineered products and related services
|
|
735.6
|
|
|
760.6
|
|
|
1,446.0
|
|
|
1,470.5
|
|
||||
Net revenues
|
|
$
|
1,330.3
|
|
|
$
|
1,293.7
|
|
|
$
|
2,617.5
|
|
|
$
|
2,496.2
|
|
Balance Sheet Account
|
June 30, 2019
|
|
December 31, 2018
|
|
Change
|
||||||
Unbilled receivables
|
$
|
206.6
|
|
|
$
|
169.4
|
|
|
$
|
37.2
|
|
Contract liabilities - current (1)
|
(758.0
|
)
|
|
(714.1
|
)
|
|
(43.9
|
)
|
|||
Deferred revenue - non-current (2)
|
(36.5
|
)
|
|
(29.8
|
)
|
|
(6.7
|
)
|
|||
Net contract assets/(liabilities)
|
$
|
(587.9
|
)
|
|
$
|
(574.5
|
)
|
|
$
|
(13.4
|
)
|
Operating cash flows used for operating leases
|
$
|
32.9
|
|
Right-of-use assets obtained in exchange for operating lease obligations
|
38.4
|
|
Remainder of 2019
|
$
|
31.1
|
|
2020
|
58.0
|
|
|
2021
|
50.1
|
|
|
2022
|
38.0
|
|
|
2023
|
31.0
|
|
|
Thereafter
|
100.9
|
|
|
Total operating lease payments
|
309.1
|
|
|
Less: Imputed interest
|
29.4
|
|
|
Total operating lease liabilities
|
$
|
279.7
|
|
Weighted average remaining lease term - operating leases (years)
|
7
|
Weighted average discount rate (%)
|
2.9
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
general economic conditions;
|
•
|
difficulty making acquisitions and successfully integrating acquired businesses;
|
•
|
any unforeseen liabilities associated with future acquisitions;
|
•
|
limitations on our business imposed by our indebtedness;
|
•
|
unfavorable changes in foreign exchange rates;
|
•
|
failure to effectively mitigate cybersecurity threats;
|
•
|
difficulties associated with exports and imports (though minimal, as we think about escalating tariffs and the threat that occurred with Mexico, such could have an adverse impact on us);
|
•
|
risks and costs associated with our international sales and operations;
|
•
|
rising interest rates;
|
•
|
product liability and insurance risks;
|
•
|
increased warranty exposure;
|
•
|
future competition;
|
•
|
the cyclical nature of some of our markets;
|
•
|
reduction of business with large customers;
|
•
|
risks associated with government contracts;
|
•
|
changes in the supply of, or price for, raw materials, parts and components;
|
•
|
environmental compliance costs and liabilities;
|
•
|
risks and costs associated with asbestos-related litigation;
|
•
|
potential write-offs of our goodwill and other intangible assets;
|
•
|
our ability to successfully develop new products;
|
•
|
failure to protect our intellectual property;
|
•
|
the effect of, or change in, government regulations (including tax);
|
•
|
economic disruption caused by terrorist attacks, health crises or other unforeseen events; and
|
•
|
the factors discussed in other reports filed with the SEC.
|
–
|
Application Software - Aderant, CBORD, CliniSys, Data Innovations, Deltek, Horizon, IntelliTrans, PowerPlan, Strata, Sunquest
|
–
|
Network Software & Systems - ConstructConnect, DAT, Foundry, 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
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net revenues:
|
|
|
|
|
|
|
|
||||||||
Application Software
|
$
|
390.6
|
|
|
$
|
358.2
|
|
|
$
|
771.8
|
|
|
$
|
682.1
|
|
Network Software & Systems
|
366.8
|
|
|
333.9
|
|
|
712.5
|
|
|
647.8
|
|
||||
Measurement & Analytical Solutions
|
408.4
|
|
|
425.8
|
|
|
810.2
|
|
|
829.8
|
|
||||
Process Technologies
|
164.5
|
|
|
175.8
|
|
|
323.0
|
|
|
336.5
|
|
||||
Total
|
$
|
1,330.3
|
|
|
$
|
1,293.7
|
|
|
$
|
2,617.5
|
|
|
$
|
2,496.2
|
|
Gross margin:
|
|
|
|
|
|
|
|
||||||||
Application Software
|
67.3
|
%
|
|
67.8
|
%
|
|
66.9
|
%
|
|
67.0
|
%
|
||||
Network Software & Systems
|
68.9
|
|
|
67.5
|
|
|
69.0
|
|
|
67.6
|
|
||||
Measurement & Analytical Solutions
|
58.8
|
|
|
58.7
|
|
|
58.2
|
|
|
58.3
|
|
||||
Process Technologies
|
57.4
|
|
|
55.6
|
|
|
56.2
|
|
|
55.8
|
|
||||
Total
|
63.9
|
|
|
63.1
|
|
|
63.4
|
|
|
62.8
|
|
||||
Selling, general and administrative expenses:
|
|
|
|
|
|
|
|
||||||||
Application Software
|
42.0
|
%
|
|
40.5
|
%
|
|
42.3
|
%
|
|
42.4
|
%
|
||||
Network Software & Systems
|
33.7
|
|
|
32.9
|
|
|
33.3
|
|
|
33.4
|
|
||||
Measurement & Analytical Solutions
|
26.9
|
|
|
28.6
|
|
|
27.5
|
|
|
28.9
|
|
||||
Process Technologies
|
22.6
|
|
|
22.8
|
|
|
22.9
|
|
|
23.7
|
|
||||
Total
|
32.7
|
|
|
32.2
|
|
|
32.9
|
|
|
33.1
|
|
||||
Segment operating margin:
|
|
|
|
|
|
|
|
||||||||
Application Software
|
25.2
|
%
|
|
27.3
|
%
|
|
24.6
|
%
|
|
24.6
|
%
|
||||
Network Software & Systems
|
35.2
|
|
|
34.6
|
|
|
35.7
|
|
|
34.2
|
|
||||
Measurement & Analytical Solutions
|
31.9
|
|
|
30.1
|
|
|
30.7
|
|
|
29.4
|
|
||||
Process Technologies
|
34.8
|
|
|
32.8
|
|
|
33.2
|
|
|
32.1
|
|
||||
Total
|
31.2
|
|
|
30.9
|
|
|
30.6
|
|
|
29.7
|
|
||||
Corporate administrative expenses
|
(3.5
|
)
|
|
(3.5
|
)
|
|
(3.3
|
)
|
|
(3.5
|
)
|
||||
Income from operations
|
27.7
|
|
|
27.4
|
|
|
27.3
|
|
|
26.2
|
|
||||
Interest expense, net
|
(3.4
|
)
|
|
(3.3
|
)
|
|
(3.4
|
)
|
|
(3.5
|
)
|
||||
Other income (expense), net
|
(0.1
|
)
|
|
0.2
|
|
|
(0.2
|
)
|
|
—
|
|
||||
Gain on disposal of business
|
—
|
|
|
—
|
|
|
4.6
|
|
|
—
|
|
||||
Earnings before income taxes
|
24.2
|
|
|
24.2
|
|
|
28.3
|
|
|
22.8
|
|
||||
Income taxes
|
(5.5
|
)
|
|
(6.6
|
)
|
|
(4.7
|
)
|
|
(5.2
|
)
|
||||
Net earnings
|
18.8
|
%
|
|
17.7
|
%
|
|
23.7
|
%
|
|
17.6
|
%
|
|
Backlog as of
|
||||||
|
June 30,
|
||||||
|
2019
|
|
2018
|
||||
Application Software
|
$
|
804.1
|
|
|
$
|
743.6
|
|
Network Software & Systems
|
585.8
|
|
|
540.1
|
|
||
Measurement & Analytical Solutions
|
277.2
|
|
|
342.4
|
|
||
Process Technologies
|
121.9
|
|
|
131.0
|
|
||
Total
|
$
|
1,789.0
|
|
|
$
|
1,757.1
|
|
|
Six months ended June 30,
|
||||||
Cash provided by/(used in):
|
2019
|
|
2018
|
||||
Operating activities
|
$
|
591.1
|
|
|
$
|
547.8
|
|
Investing activities
|
(354.1
|
)
|
|
(1,210.6
|
)
|
||
Financing activities
|
(282.9
|
)
|
|
416.4
|
|
$600 3.000% senior notes due 2020
|
$
|
600.0
|
|
$500 2.800% senior notes due 2021
|
500.0
|
|
|
$500 3.125% senior notes due 2022
|
500.0
|
|
|
$700 3.650% senior notes due 2023
|
700.0
|
|
|
$300 3.850% senior notes due 2025
|
300.0
|
|
|
$700 3.800% senior notes due 2026
|
700.0
|
|
|
$800 4.200% senior notes due 2028
|
800.0
|
|
|
Unsecured credit facility
|
640.0
|
|
|
Deferred finance costs
|
(23.6
|
)
|
|
Other
|
4.6
|
|
|
Total debt, net of deferred finance costs
|
4,721.0
|
|
|
Less current portion
|
2.1
|
|
|
Long-term debt, net of deferred finance costs
|
$
|
4,718.9
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Total debt
|
$
|
4,721.0
|
|
|
$
|
4,941.7
|
|
Cash
|
(320.8
|
)
|
|
(364.4
|
)
|
||
Net debt
|
4,400.2
|
|
|
4,577.3
|
|
||
Stockholders’ equity
|
8,351.0
|
|
|
7,738.5
|
|
||
Total net capital
|
$
|
12,751.2
|
|
|
$
|
12,315.8
|
|
|
|
|
|
||||
Net debt / total net capital
|
34.5
|
%
|
|
37.2
|
%
|
10.1
|
|
|
|
|
|
|
|
31.1
|
|
|
|
|
|
|
|
31.2
|
|
|
|
|
|
|
|
32.1
|
|
|
|
|
|
|
|
101.INS
|
|
|
XBRL Instance Document, filed herewith.
|
|
|
|
|
101.SCH
|
|
|
XBRL Taxonomy Extension Schema Document, filed herewith.
|
|
|
|
|
101.CAL
|
|
|
XBRL Taxonomy Extension Calculation Linkbase Document, filed herewith.
|
|
|
|
|
101.DEF
|
|
|
XBRL Taxonomy Extension Definition Linkbase Document, filed herewith.
|
|
|
|
|
101.LAB
|
|
|
XBRL Taxonomy Extension Label Linkbase Document, filed herewith.
|
|
|
|
|
101.PRE
|
|
|
XBRL Taxonomy Extension Presentation Linkbase Document, filed herewith.
|
/S/ L. Neil Hunn
|
|
President and Chief Executive Officer
|
August 2, 2019
|
L. Neil Hunn
|
|
(Principal Executive Officer)
|
|
/S/ Robert C. Crisci
|
|
Executive Vice President and Chief Financial Officer
|
August 2, 2019
|
Robert C. Crisci
|
|
(Principal Financial Officer)
|
|
/S/ Jason Conley
|
|
Vice President and Controller
|
August 2, 2019
|
Jason Conley
|
|
(Principal Accounting Officer)
|
|
(1)
|
The first sentence of Section 5.2 of the Plan shall be amended and restated in its entirety to read as follows:
|
(2)
|
Schedule I of the Plan shall be deleted in its entirety and replaced with the following revised Schedule I:
|
(3)
|
All other terms and conditions of the Plan shall remain in full force and effect.
|
/S/ John K. Stipancich
|
John K. Stipancich
|
Corporate Secretary
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Roper Technologies, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: August 2, 2019
|
/S/ L. Neil Hunn
|
|
L. Neil Hunn
|
|
President and Chief Executive Officer
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Roper Technologies, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: August 2, 2019
|
/S/ Robert C. Crisci
|
|
Robert C. Crisci
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial Officer)
|
|
|
1.
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: August 2, 2019
|
/S/ L. Neil Hunn
|
|
L. Neil Hunn
|
|
President and Chief Executive Officer
|
|
(Principal Executive Officer)
|
|
|
|
/S/ Robert C. Crisci
|
|
Robert C. Crisci
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial Officer)
|