Roper (ROP) 27 Jan 232022 Q4 Earnings call transcript

Good morning. The Roper Technologies Conference Call will now begin. Today's call is being recorded. [Operator Instructions].

I would now like to turn the call over to Zack Moxcey, Vice President, Investor Relations. ahead. go Please

thank discuss and results for us joining Roper Good fourth you quarter we the financial and as Technologies. morning, all full for year

Finance. and morning Joining Vice Vice Executive President Cross, Officer; and Chief Crisci, Accounting Neil call Chief on Rob and Officer; and this and Officer; Vice Vice me Hunn, Conley, Principal the President President President Shannon Incoming Executive Chief Financial Incoming Financial Executive Jason Brandon of are O'Callaghan, President Officer;

morning, a also financial replay issued this results. The information call. our Earlier release announcing we press today's press includes release for

prepared accompany also available available have call, are through website. our which We are slides to on and the webcast today's

Page turn you Now We if to X. with our begin please safe statement. harbor

today's are we statements, filings. as call, forward-looking press in uncertainties and SEC of subject risks on and make which this described page, release our will the During our to in course

the X. operations today's You noted, guidance information. Page to results continuing adjusted our in should on And to turn and an context non-GAAP listen Unless will of discuss and please that basis. call we otherwise now

Boral acquisition-related legal the assets; to to related the difference between of results XXXX XXXX, Verathon there consists through accounting matter. the The our future purchase For of charge a of from related products the obligations fourth case matter. versus for litigation to of Verathon commission patent sale are items: settlement amortization Verathon related to results expense; and adjustments certain the following this financial no GAAP quarter, adjusted intangible the

After to Reconciliations in hand And related Page cash even our be exclude these our call from press adjusted the telephone over acquisitions, questions please classified activity. GAAP of be will to we presentation if divestitures. the can prepared appendix to requires expenses now though related the statement for as to remarks, X, our in take to completed cash release divestiture website. have I'll transaction-related Neil. this we Next, our and to our Neil? are items operating our you found lastly, cash on participants. they flow taxes paid payments flow and turn

Zack, everyone. Thanks, morning, good and

turn we most and initiation followed full our for the highlights each quarter year-end guidance. we'll agenda, by to walk As Page segments the and through recent color usual XXXX year, for of our commentary X, of our then

get started. and go Let's

please. slide, Next

As main takeaways concluded we for call X, heard and portfolio, strategic, great another of was which and multiyear progress. we less on program, this financial quality on more the we improving the businesses. emphasizing of higher-growth First, divestiture are year today's end, centered To remaining Page delivered operational asset-light our cyclical, namely

of successfully application-specific but deployed later, billion improving shy billion. north grew software substantial we of towards just More M&A on $X have firepower addition, $X.X In the well also the we underlying businesses. Organically, this XX% of market-leading simultaneously for to while the continue enterprise. we and year quality

positioned well a second we're which During of another innovating for businesses to performance the our our share, year of the in capturing and solid of takeaway call for today's did terrific leads XXXX. main course job year, us that

cyclical less nature will recurring XXXX. during and quality, higher Our us serve more of well our portfolio highly

Roper our contributor and including portfolio significant our insights moment with member to take important of team contributions success of Conley, call a Rob me Now to executive has me. and over he's as repositioning. most across and all topics, for variety let our a and done meaningful for the been CFO, for I recent Incoming hand a Crisci Jason thank an our Rob

MHA those then not, Chief years. you of for been or Roper's welcome and in FP&A, He Accounting most Officer. CFO IR our as know, you who one Jason, excited serving his do Jason of XX corporate role. started at with new recently and of We're to has to Jason businesses for Many the Roper operating

of are team evolution. the a leg returned with he been has to capital our Jason team corporate, allocation I excited and our he and next to partner Board of has Since for has member meeting. attended The every

with that, Jason, through fourth to all forward full you, So, can year to Jason? partnership, let Roper done looking than and to you summary. make thank the call you joined. over financial Jason, the and quarter of you, the the for Rob, better turn when walk me

work awesome grateful And for partnership together. Thanks, role. you Neil. this am great Rob, It's very team the for course, mentorship over been excited I your a and to the just years. and with the incredibly working new and opportunity of in thanks, experience

So about integration five first, He Officer. and has Roper and our Brandon to like joined our Cross more to introduce our years Accounting and experience. audit as recently, Brandon led function. Controller Principal M&A I'd has progressing transformed Assistant services significant ago, new

So new role. this working Brandon, is a natural in forward together your and for well-earned I to promotion him. look

Thanks, Jason.

a underpinned is on seconds. guide evolution North And performance. as of are Star to Roper been XXXX, measure for indulge the our you Technologies, rip best Roper that by best our has few of years I'll help which I've belief execute been me, to If ahead we blessed from us. and enter our Roper Industries cash

flow and businesses cash of drivers family a durable have market-leading terrific with margins. free We growth

capacity quite a disciplined company's at in history. been the Further, I teams have finally, years. our I've our being anticipate year. talent strategy execute are on part road M&A the the significant of for businesses we processes that many proven the to active leadership best this And and and

in you the So I months. for to call, or either the those on coming meeting look reconnecting forward

right. All

get the Let's into financials.

by off growth, headwind. closed quick across was was to added Acquisitions of Organic revenue Frontline We $X.X by and over We'll software X% was points October, performance. solid of our QX of with currency a XX% year was two-point a strength billion, of a portfolio, in our revenue XX% business recurring X. capped prior the over enhanced eight which which led growth. that do early with year. growth review Turning higher Slide growth

was our finish to year. million, leverage $X.XX, over the against gross out the the was DEPS prior the $X.XX strong operating year year. $XXX across at segment of margins up range. above enterprise of midpoint TEP which experienced XX% came XX% prior our improving in and We guidance EBITDA and in

free Free prior cash look Next, of down cash free we'll the cash $XXX flow flow. over year. flow. at million was X%

a repeat, Excluding the X% impact, X%. XXXX doesn't to we XXX up Section quarter. the in X% were out And factoring in down tax that million about benefit Vertafore we're $XX

broader headwind, for cash a view, over forward. double-digit a compounded cash the despite we compounding going we're you well see four-year and positioned XXX Taking XX% Section can period, flow

of to as Neil We'll X. segment segments. do detail three year results, great unpack across the on had more later. quick full overview our Turning bit QX a a now year finish a a Slide nice We will to the

had For in Application increased We revenue the recurring margin naturally quarter. quarter. year, EBITDA growth solid to is was the SaaS revenue Software, the and XX% of growth in which to up XX.X% throughout through net overall rolling X%. bookings million, $XXX with strong just organic retention

incentive-based the Growth quarter. broad-based costs, space in was On some Deltek. medical across some government had in from the we aside margin, within delayed so favorability and lower employee SG&A large the in contract segment, decision-making

to where If we expect you about margin full horizon. look longer XX%, at the over that's a be would year of

of was X% up segment as to by X% Our Growth to from EBITDA expected. driving also Network or moderating higher up our XX% million Software with $XXX we nicely activity businesses, million quarter, matching offerings to revenue. freight $XXX grew revenue offset in which and led ARPU continued the premium carry

didn't or X% over organically and with grew products strong end was price QX. prior $XXX we revenue cost delivered operating which get EBITDA grew resulting and benefit of strong, remained in was quarter. in XXX points basis in leverage quarter, orders million, million as that $XXX year, some the X% Tech-enabled margin will quarter. dynamic of neutralized to the the Demand toward EBITDA the XX.X% the had

profile, full XXXX to and prior million revenue P&L Notably, the million reflected higher, leverage with XX% than on the was over better financial $X.X performance $XXX $XXX organic Slide growth. year while X. was XX% against to prior higher. to is coming revenue about EBITDA $X.X $XX.XX, with XX% compared higher margin of in nearly pre-divestiture Revenue to The our EBITDA at EBITDA strong growth. our XX.X%. nearly XXXX was X% year billion, year XX% billion, is Turning

So, through divesting going despite and capital grown our deployment, organic And most and we've us a our XX% revenue. for combination durable composition more the portfolio today growth about of of forward. XXXX of growth importantly, higher positions

of the in $XXX came of as XXXX about so $XXX with million X% year. It's Section XXXX flow at down nonrepeating fourth Free same situation the tax bit of versus headwinds nearly both Vertafore benefit the and the quarter billion, a of $X.X million. of our XXX cash prior

had If an we more our free a improve is and X%. cash build we inventory available. normalize new become XXXX. to a not grew of in has those that for about segment normal, bit tech flow within expect This items, certainly as supply We've

we we've If the we XX% over convert to view, be from and look up or cash XX% expect we to impact see as plus of compounded And kind will a four-year can Section flow. take you at neutral, multiyear a this fairly period. of minus XXX forward,

for positioned growth. well clearly we're double-digit So,

to Turning Slide X.

the businesses, the name our look our on related had upfront majority $XXX taxes On which November Let's in representing paid going We million, majority take due at in QX. a sale. now and Indicor a of completed received in operating billion lot we we are quarter, position. industrial the under the proceeds. to certainly financial XX, Also, all $X.X sale

here this very So, over a billion, good indeed. net outcome of yielded us proceeds $X.X

Related investment appearing an to balance on our is sheet. as Indicor, our this stake in equity now

of value non-GAAP forward. We provide a To related of for to accounting investment. going will this be this tax our adjustment updating fair will provide quarter investment continuing fair a value equity operations, and clearer the each any picture expense the we

at was even our $X.X billion debt-to-EBITDA at acquisition, stands X.X completed net October, looking just in So our Frontline ratio balance which after sheet, times. our

So, us XXXX. an our $X for billion disciplined plus very of solid positioned profile, strong we with M&A leverage gives revolver cash billion, free deployment generation and Clearly, well are flow $X.X capacity. in capital of undrawn coupled

that, with our will the Neil call I to turn go Neil? through to over And details. back segment

Thanks, Jason, and done. well

were XX.X%. our segment. Revenues our and billion, EBITDA XX turn were XXXX Performance XXXX. segment across Let's basis, and in Application was organic margins to an Software through just for on up this X% highlights solid here walk $X.XX Page

software that led our their class enterprise casualty in and agencies property strength by their segment. tech continued business insurance accelerated growth, Vertafore, enables

two the In point, are integrated addition, strategically bolt-on Vertafore well. on performing acquisitions and

mentioned, theme As years, nicely grew both discussing, continued based Jason adds did and in their we've bookings us Deltek as the and XXXX for to solid a their sector customer and key no momentum was Aderant enterprise over specific their strong slower on markets. different. was SaaS and strong have particularly the end been Deltek new Both solutions. Deltek in segment retention. been see past some for migration migrations private GovCon few SaaS But decision-making

Investor XX at March in winning upcoming they're directly Day, you'll the competing our Vertafore, about opportunity get leaders consistently At Aderant Deltek and market. the to an and how from hear

it was Plant, year. As we combined we last narrowed and given highly refocused strategy saw relates strong what to team. with liked a their PowerPlan Power aligned

a milestone, crossed product, solution great PowerPlan fixed a more great looking for team a to result, meaningful tax a the in their XXXX. to flagship XXXX things assets. SaaS and for launching forward Congrats As

and year ahead a the complete EPSI deal of the has conversions upsell, XXXX EPSI, integration and for meaningfully cross-sell both our as very care been has great. The good are combination well. expectations. with Strata businesses of number application just Strata's is health IT is

facto Innovations it to is rejuvenated Clinisys share to has which marketplace. Sunquest enabling energized internal and win of win their and Data culture, and continues business Innovations in in as more gain the Middleware. marketplace. to become relates Lab de combination The to Clinisys effectively to continue and compete and Data evolve the the high-performance the standard

to sharing Finally, in is off cornerstone and acquisition look success of Frontline, business strategic We the forward years come. our a XXXX start. quarters this solid the to to and financial

proud just started great strategically, reiterate I'd was and XXXX. to and Very here with performance. of thanks. what the in Congrats the Performance operationally team and we like with. financially

in Looking in we mid-single-digit the area growth to XXXX, revenues. the and organic outlook expect to based for on see our growth positions recurring market

organic up Turning our at Software Page XX.X%. and XXXX billion, XX. Revenues strong basis, on segment $X.XX in margins to EBITDA an for were were XX% Network

dig we U.S. in were and our business-specific Canadian As matching great businesses freight into XXXX. performance,

and on many based strong having value and more as that iTrade but is Their exceptional network. conditions, iPipeline XXXX narrowed is tech-enabling stellar and continued product growth having network and and market the as annuity certainly product focused well and throughout distribution that and innovations favorable from for namely from network package insurance strategy, participants. were like PowerPlan factors, terrific drove also network designs performers renewal a expansion the benefited life a activity. iPipeline increased benefiting

which Moving market-leading another Roper. to as software part had media postproduction to Foundry in year of continues be Foundry, great entertainment. the

with During XXXX, subscription for new Starting automation. in flagship will impressive were begin front. several progress innovations looking product product that on features forward Foundry's on so transition, XXXX, focused its Nuke Foundry's ML-based solid

Broadly, that for care was of alternate the our and this in MHA importantly, by health segment Growth across performance Congrats businesses focus terrific retention SoftWriters on this great. the remained rates and performance. site SHP SHP, SoftWriters teams extremely high. across led was and financial to year

XXXX. for Turning to the outlook

across growth for and and the see We organic mid-single-digit based sustained applications. of expect market conditions for broad on segment growth logistics normalization a freight group this to and

Page Products this XX% year. on basis. EBITDA billion, to in organic revenues we Tech-enabled our the were were XX.X% XXXX up margins for As turn for $X.XX an XX, for segment segment

margins expected, of half EBITDA in supply and flow the As the expanded as second through. chain improvements year pricing

Let's just strong terrific share based conditions, very of was with gains with This strong growth Neptune, ultrasonic margin static and past technology. adoption water technology and strong meter our meter their product year start business. on strong

In addition, their of large their a Neptune, their Spectacular and and connectivity did you your migrating a cellular to congrats team. fantastic Neptune base chunk newest customer solution. solution management data job job launched

benefits terrific from on continued which that procedures optical life-saving demand a tech an globe. Digital, daily in health unmatched care across our capability having R&D EM laser-focused is is NDI tech precision on NDI's and strategy a Northern solutions. is see applications that and industry. basis their company, using the is for measurement countless to core the

across single-use turned growth XXXX momentum and performance bronchoscope year video on innovation Verathon is lines. The as in another well. based in solid their product

innovation opportunity their press most the is the we concepts the of Verathon mistake, exceptional, did Make in short cannot nothing saw take more release, capability clean dispute. about you be no a As new the pipeline. product patent the up development confident to and recent legacy we in launches and at

one in it number space, see Verathon capture relates the the to market to we America in rock hope As XXXX. position single-use North

as backlog growth Our year the Neptune outlook and businesses. this based as at high is the our product for strength across single-digit in is in area segment continued well in on continued medical

have a to Specific the year ago. easier versus first do quarter, comps we

XX, let's and QX our Now guidance. and review please Page turn to XXXX

organic guidance and XXXX, we're guidance quarter, For in establishing initiating DEPS be in this our DEPS $X.XX Underpinning the is Specific to $XX.XX. tax $X.XX to to the $XX.XX expected area. range the XX% the our to a we're X% range. to of in XX% be X% first guidance growth to and of rate

Page with us turn our XX. final please page, Now to

As started. we page, the we we leave to with turn to which this with you key want points same

on revenue quality enterprise. First, our organic this underlying a XXXX we of while X% XX%, the continuing teams an base. grew was for great of our and And our increase did to year revenue accomplishment We basis.

delivered Software fact, in during organic In we our increases revenue recurring XXXX. double-digit

EBITDA grew XX%.

multiyear expanded concluded we margins capital EBITDA and Also, strategy, our $X.X to deployment program basis Our successfully divestiture XX headlined billion points by XX.X%. against Education. Frontline deployed long-standing our

XXXX our well contributions revenue based second key that To of in flow markets. this organic be compounding active the billion having well we growth outlook, to we're positioned $X and capacity. our acquisition from The is XXXX of cash on M&A very end, north for in continue takeaway M&A double-digit cohort

remain available of and to as capital. and you disciplined saw our patient we as XXXX optimal will ensure super always, But deployment highly during

becoming enterprise. most excited future evident, never increasingly we've perhaps more and quality Roper the the about new higher portfolio more of and been important, is the Finally,

like everyone Tuesday, As this remind New you up many on in your hosting that we York. XX, to questions, to an we're look We open we'd to take forward of opportunity Day to seeing there. March Investor

your So with questions. up let’s to it open that,

comes Please from question ahead. Today's Capital Dray Instructions] RBC at [Operator first Deane go Markets.

Good morning, everyone. you. Thank

as you. the Rob. all with him he when the Investor remember was professional just Thank wishes wish best. start Relations best and to a a Just I rookie starting

Thank you, appreciate great been Deane, it. a It's decade. I

then, It's callbacks our every been fabulous. on one XX I you've years. And think Jason, the of for

know who -- you're are experience. So we and absolutely you exactly your

on new And congrats role. the so

Appreciated. Thanks, Deane.

All right.

that start kind that customer a logos? business? question, new So point don't you that maybe of like sensitivity just reading typically, called of much for pace new macroeconomic to there but the in you pace Anything through migration, a this decision-making, because would we of the with perhaps of economic of is Deltek in is change or bit can a the out see there any some within the Neil, you sensitivity delayed adds Roper,

Yes.

I highest obviously, level, are we've guiding I to take -- last organic. little years, bit been for the it a below if think The of couple that X% at XX% the XXXX.

you see it matter. through reading model as So I think a in guidance general our

the If Software retention businesses, very high. stay rates you take will our

expect the to our the criticality applications. of that intimacy and We as

very So high. rates to be retention

expansion But markets, across slowdown, I of going businesses so little as bit maybe They'll to mean, or little The bit we grow be net there's mean, they're headwinds customers, then these be slower. a slowed sure, to of little but will for sort a be to customer affected our some a expect Software bit. I all great. new end macroeconomic if degree, activity

levels staffing and generally transportation that a should inside in economic bit out That number hospitals should a and ConstructConnect also those an help volume business hedges we're There's Patient businesses. and come market From environment the as slower little businesses be medical easier. But good the some little our call. product markets back should the that there's obviously, insensitive. a on our portfolio. gets is that slower. of we end bit, are called bit little perspective, end be in macro in a will

And through has then product, gigantic amount got from them backlog, of carry much of will a a Neptune year. this which

up. we're doesn't that completely insensitive insensitive. to macro, relatively pretty feel So we mean well It set but

And a and conversion lag know That's of touched on remarks, let's I'll just then the free accused elite, contribution cash here, Anything But the I the the cash flow million it cash collection. The flow and quarter five-year there Section some maybe tax benefit last switch tilt dynamics side year. them or there's XXX And quibbling. third real in they're of because and on is is the from over more the Frontline change maybe free working school on comparison a be capital helpful. any your year, average. the but that maybe on so did seasonal free different to $XXX flow conversion? still you in

Yes, question. Deane, good

I on. spot you're think

So an that, we -- XXs. in are If typically convert Section cash from be we will free adjust we on typically to XXX. XXs flow for in and EBITDA the the

And very of seasonal so you're Frontline cadence. cash right. a has collection sort

all when quarter. quarters third third the comes renewals so the their upsells and most cash the in So happen, of

So won't to in fourth, from the converting EBITDA. you cash see that

So that's exactly you saw. what

forward third to than bit the and in will year a next normal. So quarter especially be we're little weighted more looking

exactly That’s we’re Thanks. looking for. what great. That’s

today question Scott from comes go next Our Research. ahead. Davis of Melius Please

Congrats, you to Good with wish but more Jason, Neil. well, you [indiscernible]. I cetera. get Jason Good a work morning, luck, good luck. few guys. et Rob, and guys years

enough. Fair

you. Thank

and I particular narrower huge the talk little way. you anyways, asset I one I I in no walk PowerPlan? a But I can know minutia say there's needle But about that but to moves the product bit don't can back want climb we in focus. a mentioned guess. mean a here, that,

the drives can business? -- we again the that didn't behind. heard understand say, back explain if you -- just is And think, like leave that rollout, to there maybe it what leave relevant you but And of And is which I us what I'll kind cloud PowerPlan? how just to it I and go and meant. again, really that

been PowerPlan. I we've appreciate to double-click a talk to our it's do been the since on opportunity about, businesses, anyway able a while

has look perfectly you have public right? system static, they're remind financial view utilities, of So these our assets of and the tracking investor-owned like a the software not right? when what utilities. base. PowerPlan you these so And PowerPlan and software And between services When the you large inside that's they system updated do, perfectly for curated the and being the have and why customer asset live curated changed, two to view what just constantly assets live at and these systems. So intersection that are

And the that. we assets it also reaching benefits what view accounting the bought you the lease tax this with places, The of doing that, looking financial sort of all I will. core of other associated wrong for most was series We have described, you perfectly get are, appropriate growth the customer base appropriate and business a outside most can, curated the then but you and in the was core business. products its just if treatment

many year, what them -- did core they what for is opportunity inside do ago work did the we support thesis years back then the was when we years come. strategy going our And with X.X a of growth of large we to enough probably amount to the

just it's the theme. about back a core. That's refocusing talked We common on that. So

I far think core increasingly that of work, So and strategy Ropers away do distracted. the more inside we getting too our from right? not as getting see you'll

they've done. So what that's

you opportunity, SaaS for and just on-premise and fixed assets by solution that we're is now shift as principal customer growth the this an value some And there's cloud XXX% a The business. it excited capture that tremendous have released product base impact because their will they first a to from unlock your for of QX. solution, lift in

process? you the retention? just Or And can get this is pricing more about in

features. we're No, just right? customers it. we're right? There's more with value unlock, solution, our So for doing not that's So SaaS hosting more the the

certainly, our ourselves release, better operate how parties. latest to than the software where we third on know You're

our $XXX all price. a it's about revenue roughly that, is as so We'll get base. maintenance and in million legacy the we do result you see the uptime in efficiency And And there's higher. on-premise of talked

should the over X and $X north the latent to that's time, of there's a of as times, and we that And right? lifting to inside that maintenance of lift shifting growth long portfolio arc and that billion the shift lift as So shift on-premise cloud is cloud.

going forward Analyst Okay. to I it on good year. another Analyst See I'm on pass to guys. Day. Thanks, on. you look Day. Congrats the

next today Julian Mitchell at And from comes question our Barclays.

Jason. you, Rob. Thank morning. look to good And you, forward with I Hi, working

of first bit in to non-recurring, macro So on I sort and a and us my try or maybe is those talk. specifically, cyclical just of little framework so that? of Software more what guide. more home your of question, maybe sort Maybe just aggregate Maybe kind the about of flavor of you're remind dialing XXXX in the think what in the year revenue organic reoccurring last XX% and two any growth was for in

specifically, freight, finer I growth transport And Software your of revenue. the means was then point you're what on this exactly within think, And in, last? Maybe that normalization versus phrase. dialing Network X.XX you year it's any mentioned just almost and of

Yes.

in those So I take take Jason, let take let's those, -- sequence. me

I'll you're Jason between set reoccurring up then difference recurring tackle about what growth DAT we'll the let revenue the question rate, base. freight in and raising. I'll talk So is our the relative

is, goes network So of set percentage principally and the our highly what spend contractual recurring it's recurring, MHA if We level take reoccurring technically recurring the business. a to just is is not revenue everybody located so that we at it's revenue subscription, and revenue, to have food reoccurring. drug a

care, food lack It's So and of parts a right? most better word. consuming portfolio, our one the So stable it's of not a of health pharmaceuticals, and the buildings, highly most of care, macroeconomic relative it's and not secure -- residents probably for to -- transactional long-term sort situation. that's

growth the framing take terms I'll Jason So reoccurring. versus I'll stop in just question. recurring rate let relative of

Yes, to. sure, glad

-- mentioned, pharmacies, and of businesses think the Neil customer being those the have about standpoint. it's little next low business So bottom MHA, end And that's the We year. in from we're the purchases maybe experienced maybe for drug about bit singles. mid-single in as the retention sort baking always kind at what of of digits, of from they strong this that's very year, sort really we and at a what a

Great.

Okay.

around your to DAT let's specifically. Now take logistics freight and

So and to to a this cyclical DAT's freight. more a spot DAT market push efficient customers you, secular there's experiencing and a freight between the are benefit place tension or the to remind becoming relative that dynamic place secular

tension between those So there's two.

and a cyclical recession. and reduce have course to -- And year. we expect little the get DAT smaller the or network XXXX carrier grew seen view, From a point of reduce little side expected through we shrink over a freight the over of course it bit. it's bit or this of the the

I since XXXX. think every has DAT grown year

the and It about does more not at DAT, business talking be growth the rate of to So is that. expand contract. than it tends much stickier

next number that timing of if call going there's an of seeing in, large of there's I queuing is actually be bit might we'll out. be of better. a a play couple sort to read, quarters the season, like triggered have to the bit a and the carriers this the January As early to mostly that freight the bleed a sort is actually in spring by but recession, a start little January flattish freight see and industry produce. And I And through network mean shipping how of not -- we for declining. in around think the people little

difference That's within the between major of Xtwo is what flavor or Neptune minimal Any very rate recurring of helpful. kind visibility you'd Thank the sort XXXX, you're any in you the just the color. the expected? in product-related. understand versus TEP, for growth XX% medical I us give in its for then seeing there on And piece

Yes.

flow. volume the to The continues orders continues the we order most have The Neptune. meaning visibility flow. to So right. we've ever had That's duration, longer date at order

how we so And feel shaping is comfortable quite Neptune. good XXXX for and

the consumable pull-through There's there's I the zip Northern in [ph]. that a of stream. -- revenue consumables pulled equipment amount Verathon that actually the few talked a reoccurring largest elements are has products, of part the medical there. quarters of we've lot ago, high capital think about For became code through decently of Digital a

a our said case. it's is patient more And set minutes like were well so not but there, and I few in feel driven. that up procedure it base we ago, decently we And

So staffing we be staff to And all up to the patient in areas to declines able patient prior and tied we see market levels. the in hospitals which saw able X% hospital solution, labor we're levels. service X% in that volumes pick the to be back optimistic as volumes XXXX, in cautiously

Great. Thank you.

comes from Our at next today question Tusa JPMorgan. go ahead. Please Steve

Good you. morning. and Jason, Congrats I'm with working forward to Rob all. to looking

macro have the you concerns around color you Maybe will 'XX? big of bit can 'XX, around be mean been volatile follow-up in EBITDA. a I bit Obviously, then or deferred flow number Just of a just of variable. plus decent think just free between be XX%? give think, a looking on you items. on Maybe a XX% benefit are Or did revenue the to cash, color the mentioned I on be a around kind you going minus on pretty 'XX, conversion the to XX% little cash last into had bit year that and all you and in around adjusted what of these that more in years I with next statement. a But in free I 'XX the of have Frontline. tax cash, couple us

bit that the good had I going hearing have XX% Our this felt Yes, get -- to And said think on our sequentially, the was we're about strong we'll from how next then good expect our No, about build a inventory I feel some year. what it think we good we moved of We this up little And year-over-year. ratios very year. businesses, we're on -- revenue, our of at improvement happy end really we're the how renewals we just and to. the up call renewals. feeling I quarter, were deferred

with capital help certainly will all Frontline our They're the in negative that said, I at working will XX%. place. negative take third quarter profile. Like when of renewals hit the most

XXX Of a year, banking course, this will for be home that on now. but if not we're run repealed, Section gets

range for cash So like something for in the $X.X year? free billion next

you your math that. let come I'll to on

Okay.

We will.

roughly $XX that quarter. this Frontline, right? And revenues just million about then Is

beginning of the knocked had we the days No. quarter a somewhere off They closed the because in on We the were Xth. few at 'XXs.

on learning Okay. to the this all I Investor portfolio. businesses and really forward By the looking the the on discussion way, more Day, appreciate

helpful all businesses. the parts of on very detail different So the moving

from Allison And our ahead. next today Please with Wells Fargo. comes Poliniak question go

Good morning.

you of through on know retention entrants, should about been Is but historically some of an rate stabilization can't unusual Just the spot it cycles, that those growing new circle certainly I in one. in A back terms here. lot guess, I of not hold risk any survive? to want rate to it's there DAT. entrants talked new

that thoughts offering, in to any I does guess drive uncertain And with interest then offering of there? market? type premium this more increase that that gain here Just premium that, an uncertainty, or maybe visibility in in along versus some just

Yes.

carriers, the boom entrants. just referring a of the couple in you're So tremendous a a things network is are I it competitive the on to Relative is entrants, the number there it's been and are or the yes, driven of which the the entry competitive and in the then the which of no assume -- sort terms tailwind talked liquidity the number mean, years, to obviously, to by for fluidity piece. of a huge new last new new a in was of you we've spot couple that years, say market, cyclical about I -- when as carriers really opposed because secular

it -- carriers by than take that peak will in or it decline early at was But when our historically, planned you -- this. We up the conservatively have We the some we XX%. unprecedented. carriers look carrier outlook, because We've January. in weeks plus more in model cycle, ramp couple to by the guidance it's minus unprecedented up buildup do that leading through think trough declines sort of in this sort to but of assumed carriers count like our confidence -- that's first we of so of goes

want the to declines continuing together. take a handful certainly fact that only see we're versus So see of points we flattish but some it's is to data encouraging,

designs more are of more for all premium and participants. ARPU participants value terms because increases a drive In has some product getting. the tremendous network done value It's the there's the DAT just that that I job package mean, creating helped offering, have

different they've that So features upsold. different functionality and packages,

right. That's

is Have under new And other I have, there? I And in your if thoughts Great. are just metric looking new the any you primarily expanded CRI you then are still guess that No, providing that's here? it? -- your But are know opportunities maybe some portfolio, terms Just you foundation. is if your controls of you with any out pipeline, you there? the helpful. M&A opportunities of PE source

Yes.

in small that from meaningful One been here, But sort private pod in from obviously was fish. founder, which of We've my looked that's business time markets. think -- from sourced always equity. all. I or anything But we're founder just compelling value one has historically that's we of deal in activities right. the a You're public been going We where found We'll yet. point to we continue not look development there. view a on. exclusively We've and haven't have

little bit cycle. the bit a private equity get earlier try with us in see more could half to in life cycle and a company's little the earlier compete click of You a sort

So Vertafore of when we many bought said, when our you and the from from the it. didn't investors why first bought firm, bought buy it equity private did Frontline transaction, you a it you it transaction the

of private sort explore you going -- recurring in still, businesses of risk to see And what the all software highly But that's what done XX is predominance right last which the years, application that the something we're do equity. could we've being from us of lower for software so said, is that situations.

Thank you. Great.

Brent comes And go Wolfe Research. Hewitt ahead. our next from with question today Please

Hi, thank And you. good morning.

wondering and Just not not include interest But what that fair noted and would growing the your is you logical that, positive downside why Indicor. EPS contribution impact shouldn't accounting include it tax value adjusted of be the will as a the You including minority well? calculation contribution?

that's about economics the Well, outcome reflection better the an what return there. that's mainly to upon playing for worked think are going CD&R at it's of the They exit. a see several good it's to accounting rather that's look many exit. what be. We've and going what going look do with We be investment, we We a -- think multiples we'd that's feel based don't that like. to calculation when exercise. we're going typically We strategy the on right? on to variables, on It's of really

Okay. That's And your XXXX in guidance? price QX, that helpful. then embedded like? of look in also contribution And how Great. terms what then did much is in pricing

So forward years lever much years. price mean, very, companies difficult specifically up a how for Teasing an it across to just prior very is a I to our growth price but meaningful. is that algorithm, 'XX, us, and and not 'XX is all out important rolling for all thing XX our it's number and

a not specific we're number so going to that regard. share in And

do, and what tell with the criticality the that that, do, power different we've have, there's of we the Do given capture pricing had we always you you value that. to and want anything I'll value nothing pricing, what we add pricing Jason? to capture

to Perhaps, we the next go question?

Our Please next Brendan Luke today comes go from question Bernstein. with ahead.

Good morning.

be end exposure I'd any to Just into And markets? on specifically, your your around Deltek, here. color look well. was ConstructConnect Neptune FY macro, curious And and expectations take guess, if playing 'XX. wanted I construction as wondering at offer growth to for that's I question how a could you quick

Yes.

appreciate the opportunity So there. I

it So let's take just three. those by

what commercial perfect planning remind of database America. all projects it to construction phase construction so -- across North the you are right, have near is, that ConstructConnect, So a the we in

it. bit when of countercyclical result, it As -- a attached a has demand to

to a contract when everywhere, what general and don't to product of next. then hard amount you manufacturing and look projects a is too new from and is flowing have going you're business for So you're building do there subcontractor tremendous

coming you you fewer try subscribe to to for projects subscription win. bid the to ConstructConnect what can there's are that down you then want of When identify service projects, and so the pipe

ConstructConnect performer the years. been for good so over the a us has modestly And

We good as result. expect in 'XX have run to it a a actually here

have it's XX% Deltek. we we The Deltek. that large does focus in fully is sector side contracting, softening the on private -- private of is the do. in That we very Deltek software prepared what was sell and expect Deltek contractors. strong smallest our our been Deltek XXXX, a business, and sector. and in have talked sliver construction That's construction about -- to in guidance. government We and we comments, strategic XX% some we we for do anticipate covered sector how for would QX private think

Neptune, not a strongly business. then cyclical Neptune is we believe And

meters. stays they then retrofits the percentage a and to the As and residential have construction, goes they new is technology a fleet budget meters there you tend meter same, when When of When there's new budget sell large the starts, to higher of water they're they water aging meters municipalities and for to budget and -- the install a new the outs but the fewer do meters. take the infrastructure. trade new

general of a view Neptune, of So that is cross-cycle sort

buoyed we're then But -- have further further the XXXX. this we at just backlog Neptune our is of that confidence fact for by amount unprecedented

year. well Neptune us will So for that we perform this think

you. Very useful. Thank

next And Please Baird. today at comes Rob go from our question Mason ahead.

stick just morning. Rob. on And Jason well technology-enabled Maybe to as and good Yes, congrats the area. products

some think the got I pushed. of in didn't quarter there was maybe products mention ship the a --

impact update of us around quarter? kind you are in fourth step might shipments then your just think businesses? supply had I'm the curious chain back, And those maybe product the that where deferral to Just what on you in side have

just set hand me up, to over Let I'll and it Jason. it

So quarter The Neptune, brutal and chain in There's a [indiscernible] wise TEP, product small about we RF supply about talk we of process. also Ideas. RF particularly RF product those medical talk obviously on -- businesses. cohort businesses was fourth

I'll to Jason And through to. you'd so with it anything like that, of give talk to sort

to of in a it $X was significant. It businesses. million and range, across $XX number Yes. the million wasn't It was probably

of TEP we of first the expect the bit be that think the some year to So comps. easier I more up than because quarter of for because little rest a the and of

that's low range. of So maybe double in sort but the quarter, first the digits

a is lot in this yes, So of rearview. the

Of not we're and of sort there, but in meaningful much do here up impact quarters. the course, hearing pop as things

not issues shortage -- issues. only we're general a We is globally there's just supply supply ones as But we're not generally, -- matter, us. you're a the as hearing And just abate but not just the -- chip and essentially improving think and that chain from There's of chain more 'XX. Jason that. said, this do the over is chip

your a several be you on just done, you've the how share move I'm Neil, the gains that there? adoption backlog. broader you've effort of a share that's What And made to whether and is relates could little introduction cellular? expound bit call that? to where this ultrasonic that strength dramatically. Neptune around or at a to sure. tends -- the references and what's Neptune Sure, going in Or through business driving doesn't on just it

been mean, time are starts here, right? a product manifold, consistent with, share with And the for has been reasons a whole made steady existing and that but they their for the have I strand decade. technology. a I've just customers never Neptune gainer that they want to orientation

roaming for you and communication manual the for customer points what to have the data can instance, some if of fixed piece you're to proprietary software, totality the pick of can to one they back but management has don't a So protocols master and between strand where have data have reads this point, that prior and package iteration solution of mobile a software a municipality fixed still goes the and point, in having ingest do. all you and Neptune technology Neptune

orientation comes it So starts from that a flexibility. product with

to just are the the products long thing what out the well do. The wants arc is second of customer thought for

commercial instance, read to have flow be you do meters on For low able equally high products for and flow the to our ultrasonic, large accurate that.

a a the precision. to the the meter to the and have takes the the morning high focused flow morning, for So their or on low that our hotel showers one in ultrasonic in tend the be flow perfectly big products other flow and application, about happened trickle competitive the read will think versus high X

drop it's battery, -- the out case, to so technology that that More a ultrasonic competitors In cut meter. and to drives replaced. in ultrasonic the meter replace the application when battery for have our essentially you the the be needs the

So long a that time. help arc it's share small -- over small gains things market things drive it's that, of like seemingly

availability the Final it beneficial in we say, would particularly I product because had for totality was XXXX, throughout thing year. us the of

some our plus quoting competitors of year so lead were times. And

to XX I think our like went weeks. times lead X from

accounts opportunity typically in any have we account. need some presence compete they a have to of just meters, deliver had all sudden, the and that so you meters, can we And in, not presence that

some helped share that's gain the So market relative short in term.

Great. That’s you. Thank very helpful.

question Alex Blanton next Asset from Management. our today And Please Clear comes Harbor ahead. go

morning. Thank you. Good

it. I It's for you I this to think I slide really ever. presentation say probably stick should want that First, with think the your is presentation. just format And the best a time great

Noted.

one the across but Now they participants most ones. saying the on starting on that regarding yesterday, the CEO CNBC the his gone who's and will hold commercial in board business came plans. have Barry of really complete up, of off the been questions up in as business from my something people Sternick, other new of construction, was but have, construction that And projects have answered, rates accumulates Starwood commercial interest

why the drop commercial he's second projects Do construction of big looking in see your a statistics? in for are because this year And in half sliding. you new so that's that

it's So interesting.

to I can that read want read send point publishes, planning -- Zack that Zach of add look that a can what can I from construction and I seeing the of they're quarterly, view, for quarterly So macro at ConstructConnect have I you. not you. comment so the I've to we recent have not on -- don't its the most report personally, yet, to content, but

would new numbers, if that seem in it? construction projects wouldn't those would it it are being implementation, up Because show put not into Okay.

the that. nature of here's countercyclical So

of And hundred you thousand have thousands subcontracting firms tens if has of customers. construction, small ConstructConnect construction so several workers,

observe percentage hundreds it been countercyclical what's growth with customer that a takes able become only in of to looking for small the thousands behavior, happened which every work, are as history that those to cohort of So is we've exhibit of in slowdown prior a to ours ConstructConnect.

Okay.

of So that business trend market and talking than the rather about you're your market. share really overall

Correct.

Yes.

you. Okay, thank

And session. our gentlemen, ladies this question-and-answer concludes and

Moxcey will return for to closing remarks. Zack We back now any

all our and we March Day at you, us York. XX today, in Thank joining Investor for hope see on you New to everyone,

you concluded. Thank conference for you. Thank has The now attending today's presentation.

and your wonderful disconnect now have a may lines, day. You