In This Article:
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Total Revenue Growth: 12% increase in Q1.
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Organic Revenue Growth: 5% increase in Q1.
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Cash Flow Growth: 12% increase over the last 12 months.
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Revenue: $1.9 billion for Q1.
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EBITDA: $740 million, up over 9% in total.
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EBITDA Margin: 39.3%, down 90 basis points year-over-year.
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Diluted EPS: $4.78, above guidance range.
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Free Cash Flow: $507 million, down 1% versus prior year.
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Net Debt to EBITDA: 2.4 times, with a fully undrawn revolver.
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Application Software Segment Revenue Growth: 19% total, 6% organic.
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Network Software Segment Organic Revenue Growth: 1% in Q1.
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TEP Segment Revenue Growth: 6% total and organic.
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Full-Year Revenue Growth Outlook: Increased from 10% to 12%.
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Full-Year DEPS Outlook: Increased to $19.80 to $20.05.
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CentralReach Acquisition: $1.65 billion net of a $200 million tax benefit, expected to deliver $175 million in revenue and $75 million in EBITDA by June 2026.
Release Date: April 28, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Roper Technologies Inc (NASDAQ:ROP) reported a solid Q1 2025 with total revenue growth of 12% and organic revenue growth of 5%.
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The company successfully completed the acquisition of CentralReach, which is expected to contribute significantly to revenue and EBITDA growth.
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Roper Technologies Inc (NASDAQ:ROP) raised its full-year total revenue guidance and modestly increased its full-year DEPS outlook.
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The company has more than $5 billion available for capital deployment over the next 12 months, positioning it well for future acquisitions.
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Roper Technologies Inc (NASDAQ:ROP) maintains a strong financial position with a net debt to EBITDA ratio of 2.4 times and a fully undrawn revolver.
Negative Points
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Free cash flow for Q1 2025 was down 1% compared to the prior year, impacted by a legal settlement and bond coupon payments.
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The Network Software segment experienced only 1% organic revenue growth due to a difficult prior year comparison at MHA.
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Deltek's growth is expected to slow slightly due to uncertainty in the government contracting sector, impacting its organic growth rate.
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The company's EBITDA margin for Q1 2025 was down 90 basis points year-over-year, with core EBITDA margin showing only a modest expansion.
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There is ongoing macroeconomic uncertainty, which could impact future acquisition opportunities and organic growth.
Q & A Highlights
Q: Can you provide an overview of the current private equity (PE) landscape and its impact on Roper's acquisition strategy? A: L. Neil Hunn, President and CEO, explained that despite general macroeconomic uncertainty, Roper's acquisition pipeline remains robust. The company successfully completed the CentralReach acquisition and has $5 billion available for future acquisitions. Historically, times of uncertainty have presented unique opportunities for Roper to deploy capital effectively.