Slide 1: Q3 2023 Financial results
Q3 2023 Financial results October 25, 2023
Slide 2: Safe harbor statement
Safe harbor statement The information provided in this presentation 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,
Slide 3: Reg. G Disclosure
Reg. G Disclosure Today’s conference call will discuss results primarily on an adjusted (non-GAAP) and continuing operations basis. Q3 results adjusted for the following Items: 1. Amortization of acquisition-related intangible assets 2. Financial impacts associated with the minority investment in In
Slide 4: Agenda
Agenda Q3 enterprise highlights & financial results Segment detail & outlook Q4 & FY 2023 enterprise guidance Q&A 4
Slide 5: Q3 overview
Great quarterly results Total revenue +16%; organic revenue +6% HSD organic software recurring revenue growth Free cash flow +19% TTM Q3 overview Completed Syntellis & Replicon Enhanced portfolio acquisitions continues to perform well Increasing full year guidance Well positioned for capital deploym
Slide 6: Q3 financial highlights
Q3 financial highlights Excellent third quarter results Total revenue +16%; organic revenue +6% EBITDA +18%; EBITDA margin +60 bps to 41.7% DEPS +18% to $4.32 Free cash flow +77% to $625M; TTM +19% to $1.8B Revenue EBITDA TTM free cash flow +16% +17% +16% 3-year 3-year 3-year CAGR CAGR CAGR $1,006 $
Slide 7: Strong financial position
9/30/23 Cash $300 Strong financial Gross debt $6,878 position Net debt $6,579 TTM EBITDA $2,444 $4B+ capacity for capital deployment Gross debt-to-EBITDA (TTM) 2.8x Net debt-to-EBITDA (TTM) 2.7x Drawn on $3.5B revolver $910 In $ millions. Numbers may not foot due to rounding. Results are presented o
Slide 8: Segment detail & outlook
Segment detail & outlook
Slide 9: Syntellis acquisition
Syntellis acquisition Investment highlights Operational highlights Purchase price: Leadership team in place $1.25B (net of $135M tax benefit) ~14x 2024 estimated EBITDA Cost synergies better than expected Meets all acquisition criteria Integration workstreams in motion Expected 2024 financial impact
Slide 10: Application Software
Application Software Q3 highlights Revenue Revenue +25%; organic revenue +5% Deltek growth driven by continued SaaS momentum; completed Replicon acquisition Another great Aderant quarter highlighted by SaaS adoption & continued GenAI innovation $447 $600 $644 $803 ARR strength continued at Vertafore
Slide 11: Network Software
Network Software Q3 highlights Revenue Revenue +5%; organic revenue +5% DAT & Loadlink growth; challenging freight market conditions continued; network strengthened with GenAI-enabled features iPipeline excellent bookings & net retention; strengthening annuity market $266 $316 $347 $364 Q3'20 Q3'21
Slide 12: Technology Enabled Products
Technology Enabled Products Q3 highlights Revenue Revenue +10%; organic revenue +10% Another fantastic Neptune quarter; ultrasonic meter momentum continued; increasing adoption of meter data management software $292 $316 $360 $396 Verathon growth driven by single-use BFlex & Q3'20 Q3'21 Q3'22 Q3'23
Slide 13: 2023 enterprise guidance
2023 enterprise guidance
Slide 14: Raising full year 2023 guidance
Raising full year 2023 guidance Total revenue: 14%+ Previously ~13% Guidance Organic: 7%+ update Previously ~7% Adjusted DEPS: $16.62 - $16.66 Previously $16.36 - $16.50 Establishing Q4 2023 guidance Adjusted DEPS: $4.28 - $4.32 Guidance excludes impact of unannounced future acquisitions or divestit
Slide 15: Summary: Another great quarter
Another great quarter Total revenue +16%; organic revenue +6% HSD organic software recurring revenue growth Free cash flow +19% TTM Completed Syntellis & Replicon Summary acquisitions Simple ideas. Increasing full year guidance Powerful results. Great third quarter results Enhanced portfolio continu
Slide 16: Market-leading businesses in defensible niches
Market-leading businesses in defensible niches Decentralized Process-driven operating capital deployment environment 16
Slide 17: Appendix
Appendix
Slide 18: Q3 income statement metrics
Q3 income statement metrics Q3’22 Q3’23 Revenue $1,350 $1,563 +16%; organic +6% Gross profit $942 $1,096 Gross margin 69.7% 70.1% EBITDA $555 $652 +18% EBITDA margin 41.1% 41.7% Interest expense $41 $42 Tax rate 21.8% 21.9% Net earnings $392 $465 +19% DEPS $3.67 $4.32 +18% In $ millions, except DEPS
Slide 19: Roper's revenue composition
Roper’s revenue composition Disaggregated revenue reconciliation ($M) (from continuing operations) Technology Enabled Q3 2023 Application Software Network Software Products Roper Q3'22 Q3'23 Q3'22 Q3'23 Q3'22 Q3'23 Q3'22 Q3'23 Software related Recurring 471 631 248 263 3 4 722 898 Reoccurring 30 33
Slide 20: Reconciliations I
Reconciliations I Adjusted revenue and EBITDA reconciliation ($M) (from continuing operations) Q3 2020 Q3 2021 Q3 2022 Q3 2023 V% to '22 3-Year CAGR TTM 2023 GAAP revenue $ 1,002 $ 1,232 $ 1,350 $ 1,563 16% 16% $ 5,995 Purchase accounting adjustment to acquired deferred revenue 3 - - - - Adjusted re
Slide 21: Reconciliations II
Reconciliations II Revenue growth reconciliation (from continuing operations) Technology Q3 2023 Application Network Enabled Software Software Products Roper Organic 5% 5% 10% 6% Acquisitions/divestitures 20% - - 9% Foreign exchange 1% - - - Total revenue growth 25% 5% 10% 16% Adjusted segment recon
Slide 22: Reconciliations III
Reconciliations III Adjusted DEPS reconciliation (from continuing operations) Q3 2022 Q3 2023 V% GAAP DEPS $ 2.59 $ 3.21 24% Purchase accounting adjustment to acquired commission expense (0.01) - Restructuring-related expenses associated with the Syntellis acquisition - 0.06 Transaction-related expe
Slide 23: Footnotes
Footnotes A. Adjustments related to the financial impacts associated with the minority investment in Indicor as shown below ($M, except per share data). Forecasted results do not include any potential impacts associated with our minority investments in Indicor nor Certinia as these potential impacts
Slide 24: Roper Technologies
Roper TECHNOLOGIES