All currency amounts are in millions unless specified



You should read the following discussion in conjunction with "Selected Financial
Data" and our Consolidated Financial Statements and related notes included in
this Annual Report, as well as Part II, "Item 7. Management's Discussion and
Analysis of Financial Condition and Results of Operations" of our Form 10-K for
the year ended December 31, 2018, which provides additional information on
comparisons of years 2018 and 2017 relating to any sections which remain
unchanged.

Overview



We are a diversified technology company. We operate businesses that design and
develop software (both license and SaaS) and engineered products and solutions
for a variety of niche end markets.

We pursue consistent and sustainable growth in earnings and cash flow by emphasizing continuous improvement in the operating performance of our existing businesses and by acquiring other carefully selected businesses. Our acquisitions have represented both new strategic platforms and additions to existing businesses.

Application of Critical Accounting Policies



Our Consolidated Financial Statements are prepared in conformity with generally
accepted accounting principles in the United States ("GAAP"). A discussion of
our significant accounting policies can also be found in the notes to our
Consolidated Financial Statements for the year ended December 31, 2019 included
in this Annual Report.

GAAP offers acceptable alternative methods for accounting for certain issues
affecting our financial results, such as determining inventory cost,
depreciating long-lived assets and recognizing revenue. We have not changed the
application of acceptable accounting methods or the significant estimates
affecting the application of these principles in the last three years in a
manner that had a material effect on our Consolidated Financial Statements.

The preparation of financial statements in accordance with GAAP requires the use
of estimates, assumptions, judgments and interpretations that can affect the
reported amounts of assets, liabilities, revenues and expenses, the disclosure
of contingent assets and liabilities and other supplemental disclosures.

The development of accounting estimates is the responsibility of our management.
Our management discusses those areas that require significant judgments with the
Audit Committee of our Board of Directors. The Audit Committee has reviewed all
financial disclosures in our annual filings with the SEC. Although we believe
the positions we have taken with regard to uncertainties are reasonable, others
might reach different conclusions and our positions can change over time as more
information becomes available. If an accounting estimate changes, its effects
are accounted for prospectively or through a cumulative catch up adjustment.

Our most significant accounting uncertainties are encountered in the areas of
accounts receivable collectibility, inventory valuation, future warranty
obligations, revenue recognition, income taxes, valuation of other intangible
assets and goodwill and indefinite-lived impairment analyses. These issues
affect each of our business segments and are evaluated using a combination of
historical experience, current conditions and relatively short-term forecasting.

Accounts receivable collectibility is based on the economic circumstances of
customers and credits given to customers after shipment of products, including
in certain cases credits for returned products. Accounts receivable are
regularly reviewed to determine customers who have not paid within agreed upon
terms, whether these amounts are consistent with past experiences, what
historical experience has been with amounts deemed uncollectible and the impact
that economic conditions might have on collection efforts in general and with
specific customers. The returns and other sales credit allowance is an estimate
of customer returns, exchanges, discounts or other forms of anticipated
concessions and is treated as a reduction in revenue. The returns and other
sales credits histories are analyzed to determine likely future rates for such
credits. At December 31, 2019, our allowance for doubtful accounts receivable
was $16.9 and our allowance for sales returns and sales credits was $3.4, for a
total of $20.3, or 2.5% of total gross accounts receivable, as compared to a
total of $23.1, or 3.2% of total gross accounts receivable, at December 31,
2018. This percentage is influenced by the risk profile of the underlying
receivables, and the timing of write-offs of accounts deemed uncollectible.

                                       17
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We regularly compare inventory quantities on hand against anticipated future
usage, which we determine as a function of historical usage or forecasts related
to specific items in order to evaluate obsolescence and excessive quantities.
When we use historical usage, this information is also qualitatively compared to
business trends to evaluate the reasonableness of using historical information
as an estimate of future usage. At December 31, 2019, inventory reserves for
excess and obsolete inventory were $33.4, or 14.4% of gross inventory cost, as
compared to $30.3, or 13.7% of gross inventory cost, at December 31, 2018. The
inventory reserve as a percent of gross inventory cost will continue to
fluctuate based upon specific identification of reserves needed based upon
changes in our business as well as the physical disposal of obsolete inventory.

Most of our product-based revenues are covered by warranty provisions that
generally provide for the repair or replacement of qualifying defective items
for a specified period after the time of sale, typically 12 to 24 months. Future
warranty obligations are evaluated using, among other factors, historical cost
experience, product evolution and customer feedback. Our expense for warranty
obligations was less than 1% of net revenues for each of the years ended
December 31, 2019, 2018 and 2017.

Revenues from our project-based businesses, including toll and traffic systems,
control systems and installations of large software application projects, are
generally recognized over time using the input method, primarily utilizing the
ratio of costs incurred to total estimated costs, as the measure of performance.
The Company recognized revenues of $247.8, $245.9 and $249.3 for the years ended
December 31, 2019, 2018 and 2017, respectively, using this method. There was
$401.6 and $241.6 of revenue related to unfinished percentage-of-completion
contracts had yet to be recognized at December 31, 2019, and 2018, respectively.
The primary driver in the increase was due to our TransCore business that was
awarded the contract for the New York Central Business District Tolling Program.

Income taxes can be affected by estimates of whether and within which
jurisdictions future earnings will occur and if, how and when cash is
repatriated to the U.S., combined with other aspects of an overall income tax
strategy. Additionally, taxing jurisdictions could retroactively disagree with
our tax treatment of certain items, and some historical transactions have income
tax effects going forward. Accounting rules require these future effects to be
evaluated using current laws, rules and regulations, each of which can change at
any time and in an unpredictable manner. During 2019, our effective income tax
rate was 20.6%, as compared to the 2018 rate of 21.2%. The decrease was due
primarily to the recognition of a discrete tax benefit of $41.0  in connection
with a foreign restructuring plan allowing the future realization of net
operating losses and the reversal of the deferred tax liability
of $10.0 originally recorded in the second quarter of 2018 associated with the
excess of Gatan's book basis over our tax basis in the shares during the third
quarter of 2019, partially offset by the higher income tax rate incurred on the
Imaging and Gatan gains. We expect the effective tax rate for 2020 to be between
21% and 23%.

We account for goodwill in a purchase business combination as the excess
purchase price over the fair value of the net identifiable assets acquired.
Goodwill, which is not amortized, is tested for impairment on an annual basis in
conjunction with our annual forecast process during the fourth quarter (or an
interim basis if an event occurs or circumstances change that would more likely
than not reduce the fair value of a reporting unit below its carrying value).

When testing goodwill for impairment, we have the option to first assess
qualitative factors to determine whether the existence of events or
circumstances leads to a determination that it is more likely than not that the
estimated fair value of a reporting unit is less than its carrying amount. If we
elect to perform a qualitative assessment and determine that an impairment is
more likely than not, we are then required to perform the quantitative
impairment test; otherwise, no further analysis is required. Under the
qualitative assessment, we consider various qualitative factors, including
macroeconomic conditions, relevant industry and market trends, cost factors,
overall financial performance, other entity-specific events and events affecting
the reporting unit that could indicate a potential change in the fair value of
our reporting unit or the composition of its carrying values. We also consider
the specific future outlook for the reporting unit.

We also may elect not to perform the qualitative assessment and, instead,
proceed directly to the quantitative impairment test. The quantitative
assessment utilizes both an income approach (discounted cash flows) and a market
approach (consisting of a comparable company earnings multiples methodology) to
estimate the fair value of a reporting unit. To determine the reasonableness of
the estimated fair values, we review the assumptions to ensure that neither the
income approach nor the market approach provides significantly different
valuations. If the estimated fair value exceeds the carrying value, no further
work is required and no impairment loss is recognized. If the carrying value
exceeds the estimated fair value, a non-cash impairment loss is recognized in
the amount of that excess.

Key assumptions used in the income and market approaches are updated when the
analysis is performed for each reporting unit. Various assumptions are utilized
including forecasted operating results, strategic plans, economic projections,
anticipated future cash flows, the weighted-average cost of capital, comparable
transactions, market data and earnings multiples. While we use reasonable and
timely information to prepare our cash flow and discount rate assumptions,
actual future cash flows or market conditions could differ significantly and
could result in future non-cash impairment charges related to recorded goodwill
balances.

                                       18
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Recently acquired reporting units generally represent a higher inherent risk of
impairment, which typically decreases as the businesses are integrated into our
enterprise. Negative industry or economic trends, disruptions to our business,
actual results significantly below projections, unexpected significant changes
or planned changes in the use of the assets, divestitures and market
capitalization declines may have a negative effect on the fair value of our
reporting units.

Roper has 35 reporting units with individual goodwill amounts ranging from zero
to $2.5 billion. In 2019, the Company performed its annual impairment test in
the fourth quarter for all reporting units. The Company conducted its analysis
qualitatively and assessed whether it was more likely than not that the
respective fair value of these reporting units was less than the carrying
amount. The Company determined that impairment of goodwill was not likely in 33
of its reporting units and thus was not required to perform a quantitative
assessment for these reporting units. For the remaining two reporting units, the
Company performed its quantitative assessment and concluded that the fair value
of each of these two reporting units was substantially in excess of its carrying
value, with no impairment indicated as of October 1, 2019.

Trade names that are determined to have an indefinite useful economic life are
not amortized, but separately tested for impairment during the fourth quarter of
the fiscal year or on an interim basis if an event occurs that indicates the
fair value is more likely than not below the carrying value. We first
qualitatively assess whether the existence of events or circumstances leads to a
determination that it is more likely than not that the estimated fair value of
the indefinite-lived trade name is less than its carrying amount. If necessary,
we conduct a quantitative assessment using the relief-from-royalty method, which
we believe to be an acceptable methodology due to its common use by valuation
specialists in determining the fair value of intangible assets. This methodology
assumes that, in lieu of ownership, a third-party would be willing to pay a
royalty in order to exploit the related benefits of these assets. The fair value
of each trade name is determined by applying a royalty rate to a projection of
net revenues discounted using a risk-adjusted rate of capital. Each royalty rate
is determined based on the profitability of the trade name to which it relates
and observed market royalty rates. Revenue growth rates are determined after
considering current and future economic conditions, recent sales trends,
discussions with customers, planned timing of new product launches or other
variables. Trade names resulting from recent acquisitions generally represent
the highest risk of impairment, which typically decreases as the businesses are
integrated into our enterprise and positioned for future sales growth.

The Company performed a quantitative analysis over the fair values of two of its
trade names and concluded that the fair value exceeded its carrying value, with
no impairment indicated as of October 1, 2019. Of those trade names subjected to
our quantitative analysis, one, associated with our lab software business, had a
fair value that approximated its carrying value, which was $100.4 as of October
1, 2019. Holding other assumptions constant, for the specific trade name
associated with our lab software business, a 50 basis point increase in the
discount rate would result in a $5.5 impairment and a 100 basis point decrease
in the terminal growth rate would result in an $9.7 impairment.

The assessment of fair value for impairment purposes requires significant
judgments to be made by management. Although our forecasts are based on
assumptions that are considered reasonable by management and consistent with the
plans and estimates management uses to operate the underlying businesses, there
is significant judgment in determining the expected results attributable to the
businesses and/or reporting units. Changes in estimates or the application of
alternative assumptions could produce significantly different results. No
impairment resulted from the annual reviews performed in 2019.

The most significant identifiable intangible assets with definite useful
economic lives recognized from our acquisitions are customer relationships. The
fair value for customer relationships is determined as of the acquisition date
using the excess earnings method. Under this methodology the fair value is
determined based on the estimated future after-tax cash flows arising from the
acquired customer relationships over their estimated lives after considering
customer attrition and contributory asset charges. When testing customer
relationship intangible assets for potential impairment, management considers
historical customer attrition rates and projected revenues and profitability
related to customers that existed at acquisition. In evaluating the amortizable
life for customer relationship intangible assets, management considers
historical customer attrition patterns.

We evaluate whether there has been an impairment of identifiable intangible
assets with definite useful economic lives, or of the remaining life of such
assets, when certain indicators of impairment are present. In the event that
facts and circumstances indicate that the cost or remaining period of
amortization of any asset may be impaired, an evaluation of recoverability would
be performed. If an evaluation is required, the estimated future gross,
undiscounted cash flows associated with the asset would be compared to the
asset's carrying amount to determine if a write-down to fair value or a revision
in the remaining amortization period is required.

                                       19
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Results of Operations
All currency amounts are in millions unless specified, percentages are net of
revenues

Percentages may not sum due to rounding.



The following table sets forth selected information for the years indicated.
                                                Years ended December 31,
                                           2019           2018           2017
Net revenues:
Application Software (1)               $ 1,588.0      $ 1,452.7      $ 1,222.2
Network Software & Systems (2)           1,529.5        1,345.2

1,254.1


Measurement & Analytical Solutions (3)   1,596.4        1,705.6        1,531.3
Process Technologies (4)                   652.9          687.7          599.9
Total                                  $ 5,366.8      $ 5,191.2      $ 4,607.5

Gross margin:
Application Software                        67.0  %        66.9  %        65.3  %
Network Software & Systems                  69.2           68.3           66.6
Measurement & Analytical Solutions          58.5           58.7           58.4
Process Technologies                        56.9           56.4           56.3
Total                                       63.9  %        63.2  %        62.2  %

Segment operating margin:
Application Software                        25.5  %        24.6  %        22.8  %
Network Software & Systems                  35.2           36.0           35.0
Measurement & Analytical Solutions          31.4           30.7           29.1
Process Technologies                        34.6           34.0           31.4
Total                                       31.1  %        30.8  %        29.3  %

Corporate administrative expenses           (3.2 )%        (3.9 )%        (3.1 )%
Income from operations                      27.9           26.9           26.3
Interest expense, net                       (3.5 )         (3.5 )         (3.9 )
Loss on debt extinguishment                    -           (0.3 )            -
Other income/(expense)                      (0.1 )            -            0.1
Gain on disposal of businesses              17.2              -

-


Earnings before income taxes                41.5           23.1           22.5
Income taxes                                (8.6 )         (4.9 )         (1.4 )

Net earnings                                32.9  %        18.2  %        21.1  %

(1) Includes results from the acquisitions of Handshake Software, Inc. from

August 4, 2017, Workbook Software A/S from September 15, 2017, Onvia, Inc.

from November 17, 2017, PowerPlan, Inc. from June 4, 2018, ConceptShare from

June 7, 2018, BillBlast from July 10, 2018 Avitru from December 31, 2018,

ComputerEase from August 19, 2019, and Bellefield from December 18, 2019.

(2) Includes results from the acquisitions of Quote Software from January 2,

2018, PlanSwift Software from March 28, 2018, Smartbid from May 8, 2018,

Foundry from April 18, 2019, and iPipeline from August 22, 2019.

(3) Includes the results from the Imaging businesses through February 5, 2019 and

Gatan through October 29, 2019.

(4) Includes results from the acquisition of Phase Technology from June 21, 2017.





                                       20
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Year Ended December 31, 2019 Compared to Year Ended December 31, 2018



Net revenues for the year ended December 31, 2019 were $5.37 billion as compared
to $5.19 billion for the year ended December 31, 2018, an increase of 3.4%. The
increase was the result of organic growth of 2.8% and a net effect from
acquisitions and divestitures of 1.4%, partially offset by a negative foreign
exchange impact of 0.8%.

In our Application Software segment, net revenues for the year ended
December 31, 2019 increased by $135.3 or 9% over the year ended December 31,
2018. Organic revenues increased by 5% and acquisitions accounted for 5% of our
growth, partially offset by a negative foreign exchange impact of 1%. The growth
in organic revenues was due primarily to broad-based revenue growth across the
segment, led by businesses serving government contracting, professional
services, legal and healthcare markets. Gross margin remained relatively flat at
67.0% for the year ended December 31, 2019 as compared to 66.9% for the year
ended December 31, 2018. Selling, general and administrative ("SG&A") expenses
as a percentage of revenues in the year ended December 31, 2019 decreased to
41.5%, as compared to 42.3% in the year ended December 31, 2018, due primarily
to operating leverage on higher organic revenues. The resulting operating margin
was 25.5% in the year ended December 31, 2019 as compared to 24.6% in the year
ended December 31, 2018.

Our Network Software & Systems segment reported a $184.3 or 14% increase in net
revenues for the year ended December 31, 2019 over the year ended December 31,
2018. Organic revenues increased by 5% and acquisitions accounted for 8% of our
growth. The growth in organic revenues was due to broad-based revenue growth
across the segment led by our network software businesses serving the
transportation, healthcare and food markets. Gross margin increased to 69.2% for
the year ended December 31, 2019 from 68.3% for the year ended December 31,
2018, due primarily to revenue mix. SG&A expenses as a percentage of net
revenues increased to 34.0% in the year ended December 31, 2019, as compared to
32.3% in the year ended December 31, 2018, due primarily to the acquisitions
completed in 2019, including amortization of acquired intangibles. The resulting
operating margin was 35.2% in the year ended December 31, 2019 as compared to
36.0% in the year ended December 31, 2018.

Net revenues for our Measurement & Analytical Solutions segment decreased by
$109.2 or 6% for the year ended December 31, 2019 from the year ended
December 31, 2018. Organic revenues increased 2%, more than offset by a decrease
in revenue of 8% attributable to the disposal of the Imaging businesses and
Gatan as discussed above, and a negative foreign exchange impact of 1%. The
growth in organic revenues was due primarily to our medical products and water
meter technology businesses, partially offset by industrial business
declines. Gross margin decreased to 58.5% in the year ended December 31, 2019,
as compared to 58.7% in the year ended December 31, 2018, due primarily to
revenue mix. SG&A expenses as a percentage of net revenues decreased to 27.1% in
the year ended December 31, 2019, as compared to 27.9% in the year ended
December 31, 2018, due primarily to operating leverage on higher organic
revenues and the sale of the Imaging businesses. The resulting operating margin
was 31.4% in the year ended December 31, 2019 as compared to 30.7% in the year
ended December 31, 2018.

In our Process Technologies segment, net revenues for the year ended
December 31, 2019 decreased by $34.8 or 5% from the year ended December 31,
2018. Organic sales decreased by 4% and the negative foreign exchange impact was
1%. The decrease in organic revenues was due primarily to lower demand at our
businesses serving upstream oil and gas end markets. Gross margin increased to
56.9% in the year ended December 31, 2019 as compared to 56.4% in the year ended
December 31, 2018, due primarily to revenue mix. SG&A expenses as a percentage
of net revenues decreased to 22.3% in the year ended December 31, 2019, as
compared to 22.5% in the year ended December 31, 2018, due primarily to lower
costs that are generally variable with revenue. As a result, operating margin
was 34.6% in the year ended December 31, 2019 as compared to 34.0% in the year
ended December 31, 2018.

Corporate expenses decreased by $31.1 to $172.4, or 3.2% of revenues, in 2019 as
compared to $203.5, or 3.9% of revenues, in 2018. The decrease was due primarily
to $35.0 of accelerated vesting associated with the passing of our former
executive chairman incurred in 2018, partially offset by higher
acquisition-related expenses.

Interest expense, net, increased $4.5, or 2.5%, for the year ended December 31,
2019 as compared to the year ended December 31, 2018. The increase was due to
higher weighted average interest rates, partially offset by lower weighted
average debt balances.

Loss on debt extinguishment of $15.9 for the year ended December 31, 2018, incurred in connection with the early redemption of the $500.0 aggregate principal amount of 6.25% senior unsecured notes due September 1, 2019, was composed of the early redemption premium and remaining unamortized deferred financing costs.

Other expense, net, of $5.1 for the year ended December 31, 2019 was composed primarily of foreign exchange losses at our non-U.S. based subsidiaries, partially offset by royalty income. Other income, net, of $0.0 for the year ended December 31, 2018 was composed primarily of royalty income, offset entirely by various other immaterial expenses.


                                       21
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Gain on disposal of businesses, resulted in a pretax gain of $920.7 for the year
ended December 31, 2019. The Company recognized $119.6 on the sale of the
Imaging businesses, which closed February 5, 2019, and $801.1 on the sale of
Gatan, which closed October 29, 2019.

During 2019, our effective income tax rate was 20.6% as compared to our 2018
rate of 21.2%. The decrease was due primarily to the recognition of a discrete
tax benefit of $41.0 in connection with a foreign restructuring plan allowing
the future realization of net operating losses and the reversal of the deferred
tax liability of $10.0 originally recorded in the second quarter of 2018
associated with the excess of Gatan's book basis over our tax basis in the
shares during the third quarter of 2019, partially offset by the higher income
tax rate incurred on the Imaging and Gatan gains.

Order backlog is equal to our remaining performance obligations expected to be recognized within the next 12 months as discussed in Note 1 of the Notes to Consolidated Financial Statements.



                                      2019         2018       change
Application Software               $   834.6    $   756.4     10.3  %
Network Software & Systems             848.5        501.0     69.4
Measurement & Analytical Solutions     188.5        305.6    (38.3 )
Process Technologies                   113.8        129.8    (12.3 )
Total                              $ 1,985.4    $ 1,692.8     17.3  %

Year Ended December 31, 2018 Compared to Year Ended December 31, 2017



Net revenues for the year ended December 31, 2018 were $5.19 billion as compared
to $4.61 billion for the year ended December 31, 2017, an increase of 12.7%. The
increase was the result of organic growth of 9.4%, a net effect from
acquisitions and divestitures of 2.9%, and foreign exchange benefit of 0.4%.

In our Application Software segment, net revenues for the year ended
December 31, 2018 increased by $230.5 or 19% over the year ended December 31,
2017. Organic revenues increased by 9% and acquisitions accounted for 9%. The
growth in organic revenues was due primarily to broad-based revenue growth
across the segment, led by businesses serving government contracting,
professional services, legal and healthcare markets, and the non-recurrence of
purchase accounting adjustments to acquired deferred revenues in the year ended
December 31, 2017 associated with our 2016 Deltek acquisition. Gross margin was
66.9% for the year ended December 31, 2018 as compared to 65.3% for the year
ended December 31, 2017, due primarily to operating leverage on higher revenues.
SG&A expenses were relatively flat as a percentage of revenues at 42.3% for the
year ended December 31, 2018 as compared to 42.4% for the year ended
December 31, 2017. The resulting operating margin was 24.6% in 2018 as compared
to 22.8% in 2017.

In our Network Software & Systems segment, net revenues for the year ended
December 31, 2018 increased by $91.1 or 7% over the year ended December 31,
2017. Organic revenues increased by 6% and acquisitions accounted for 1%. The
growth in organic revenues was due to broad-based revenue growth across the
segment led by our network software businesses serving the transportation
markets and the non-recurrence of purchase accounting adjustments to acquired
deferred revenues in the year ended December 31, 2017 associated with our 2016
ConstructConnect acquisition. Gross margin increased to 68.3% for the year ended
December 31, 2018 from 66.6% for the year ended December 31, 2017, due primarily
to operating leverage on higher revenues. SG&A expenses as a percentage of net
revenues increased to 32.3% in the year ended December 31, 2018, as compared to
31.6% in the year ended December 31, 2017, due primarily to the acquisitions
completed in 2018, including amortization of acquired intangibles. The resulting
operating margin was 36.0% in the year ended December 31, 2018 as compared to
35.0% in the year ended December 31, 2017.

In our Measurement & Analytical Solutions segment, net revenues for the year
ended December 31, 2018 increased by $174.3 or 11% over the year ended
December 31, 2017. Organic revenues increased by 11% and the foreign exchange
benefit was 1%. The growth in organic revenues was due to broad-based revenue
growth across the segment led by our scientific imaging, water meter technology
and medical products businesses. Gross margin increased to 58.7% for the year
ended December 31, 2018 from 58.4% for the year ended December 31, 2017 and SG&A
expenses as a percentage of net revenues decreased to 27.9% in the year ended
December 31, 2018, as compared to 29.3% in the year ended December 31, 2017, due
primarily to operating leverage on higher sales volume. The resulting operating
margin was 30.7% in the year ended December 31, 2018 as compared to 29.1% in the
year ended December 31, 2017.

                                       22
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In our Process Technologies segment, net revenues for the year ended
December 31, 2018 increased by $87.8 or 15% from the year ended December 31,
2017. Organic sales increased by 14% and the benefit from foreign exchange was
1%. The growth in organic revenues was due to broad-based growth in our
businesses serving energy and industrial end markets. Gross margin increased to
56.4% in the year ended December 31, 2018 as compared to 56.3% in the year ended
December 31, 2017 and SG&A expenses as a percentage of net revenues decreased to
22.5% in the year ended December 31, 2018, as compared to 24.9% in the year
ended December 31, 2017, both of which were due to operating leverage on higher
sales volume. As a result, operating margin was 34.0% in the year ended
December 31, 2018 as compared to 31.4% in the year ended December 31, 2017.

Order backlog is equal to our remaining performance obligations expected to be recognized within the next 12 months as discussed in Note 1 of the Notes to Consolidated Financial Statements.



                                      2018         2017      change
Application Software               $   756.4    $   679.8    11.3  %
Network Software & Systems             501.0        550.6    (9.0 )%
Measurement & Analytical Solutions     305.6        313.2    (2.4 )%
Process Technologies                   129.8        128.8     0.8  %
Total                              $ 1,692.8    $ 1,672.4     1.2  %

Financial Condition, Liquidity and Capital Resources All currency amounts are in millions unless specified

Selected cash flows for the years ended December 31, 2019, 2018 and 2017 are as follows:


                               2019          2018          2017
Cash provided by/(used in):
Operating activities        $ 1,461.8     $ 1,430.1     $ 1,234.5
Investing activities         (1,296.0 )    (1,335.1 )      (209.6 )
Financing activities            177.0        (388.1 )    (1,170.0 )



Operating activities - The growth in cash provided by operating activities in
2019 and in 2018 was primarily due to increased earnings net of non-cash
expenses, partially offset by higher cash taxes paid in 2019, most notably cash
taxes paid on the gain on sale of the Imaging businesses.

Investing activities - Cash used in investing activities during 2019 was
primarily for business acquisitions, most notably iPipeline and Foundry,
partially offset by proceeds from the disposal of the Gatan business and the
Imaging businesses. Cash used in investing activities during 2018 was primarily
for business acquisitions, most notably PowerPlan.

Financing activities - Cash provided by/(used in) financing activities in all
periods presented was primarily debt repayments/borrowings as well as dividends
paid to stockholders. Cash provided by financing activities during 2019 was
primarily from the issuance of $1.2 billion of senior notes partially offset by
$865.0 of revolving debt repayments and to a lesser extent dividend payments.
Cash used in financing activities during 2018 was primarily from the pay-down of
revolving debt borrowings of $405.0, partially offset by the net issuance of
senior notes of $200.0 and dividends paid to shareholders.

Net working capital (current assets, excluding cash, less total current
liabilities, excluding debt) was negative $505.4 at December 31, 2019 compared
to negative $200.4 at December 31, 2018, due primarily to increased income taxes
payable, deferred revenue, and the adoption of ASC 842, partially offset by
increased accounts receivable. The increase in income taxes payable is due
primarily to the approximately $200.0 of taxes incurred on the gain associated
with the divestiture of Gatan. We expect to pay these taxes in the second
quarter of 2020. The deferred revenue increase is due to a higher percentage of
revenue from software and subscription-based services.

Total debt excluding unamortized debt issuance costs was $5.3 billion at
December 31, 2019 (35.9% of total capital) compared to $5.0 billion at
December 31, 2018 (39.1% of total capital). Our increased total debt at
December 31, 2019 compared to December 31, 2018 was due primarily to the
issuance of $500.0 of 2.35% senior unsecured notes and $700.0 of 2.95% senior
unsecured notes, partially offset by the pay-down of revolving debt borrowings
of $865.0.

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On September 23, 2016, we entered into a five-year unsecured credit facility, as
amended as of December 2, 2016 (the "2016 Facility") with JPMorgan Chase Bank,
N.A., as administrative agent, and a syndicate of lenders, which replaced our
previous unsecured credit facility, dated as of July 27, 2012, as amended as of
October 28, 2015 (the "2012 Facility"). The 2016 Facility comprises a five year
$2.5 billion revolving credit facility, which includes availability of up to
$150.0 for letters of credit. We may also, subject to compliance with specified
conditions, request term loans or additional revolving credit commitments in an
aggregate amount not to exceed $500.0.

The 2016 Facility contains various affirmative and negative covenants which,
among other things, limit our ability to incur new debt, enter into certain
mergers and acquisitions, sell assets and grant liens, make restricted payments
(including the payment of dividends on our common stock) and capital
expenditures, or change our line of business. We also are subject to financial
covenants which require us to limit our consolidated total leverage ratio and to
maintain a consolidated interest coverage ratio. The most restrictive covenant
is the consolidated total leverage ratio which is limited to 3.5 to 1.

The 2016 Facility provides that the consolidated total leverage ratio may be
increased, no more than twice during the term of the 2016 Facility, to 4.00 to 1
for a consecutive four quarter fiscal period per increase (or, for any portion
of such four quarter fiscal period in which the maximum would be 4.25 to 1).  In
conjunction with the Deltek acquisition in December of 2016, we increased the
maximum consolidated total leverage ratio covenant to 4.25 to 1 through June 30,
2017 and 4.00 to 1 through December 31, 2017.

At December 31, 2019, we had $5.3 billion of senior unsecured notes and $0.0 of
outstanding revolver borrowings. In addition, we had $7.7 of other debt in the
form of finance leases and several smaller facilities that allow for borrowings
or the issuance of letters of credit in foreign locations to support our
non-U.S. businesses. We had $74.0 of outstanding letters of credit at
December 31, 2019, of which $35.8 was covered by our lending group, thereby
reducing our revolving credit capacity commensurately.

We may redeem some or all of our senior secured notes at any time or from time
to time, at 100% of their principal amount, plus a make-whole premium based on a
spread to U.S. Treasury securities.

We were in compliance with all debt covenants related to our credit facility throughout the years ended December 31, 2019 and 2018.

See Note 8 of the Notes to Consolidated Financial Statements included in this Annual Report for additional information regarding our credit facility and senior notes.



Cash and cash equivalents at our foreign subsidiaries at December 31, 2019
totaled $291.8 as compared to $339.0 at December 31, 2018, a decrease of
13.9%. The decrease was due primarily to the repatriation of $290.6 during the
year and cash used in the acquisition of Foundry, partially offset by cash
generated from foreign operations. We intend to repatriate substantially all
historical and future earnings subject to the deemed repatriation tax.

Capital expenditures of $52.7, $49.1 and $48.8 were incurred during 2019, 2018
and 2017, respectively. Capitalized software expenditures of $10.2, $9.5 and
$10.8 were incurred during 2019, 2018 and 2017, respectively. Capital
expenditures and capitalized software expenditures were relatively consistent in
2019 as compared to 2018 and 2017. In the future, we expect the aggregate of
capital expenditures and capitalized software expenditures as a percentage of
annual net revenues to be between 1.0% and 1.5%.

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Contractual Cash Obligations and Other Commercial Commitments and Contingencies All currency amounts are in millions

The following tables quantify our contractual cash obligations and commercial commitments at December 31, 2019.


                                                      Payments Due in Fiscal Year
     Contractual
 Cash Obligations 1    Total        2020       2021       2022       2023       2024      Thereafter
Total debt           $ 5,307.7    $ 603.1    $ 502.3    $ 502.3    $ 700.0    $ 500.0    $    2,500.0
Senior note interest     986.9      176.6      158.8      143.4      122.3      100.7           285.1

Operating leases 305.1 63.7 55.9 42.8 35.3 

      29.9            77.5
Total                $ 6,599.7    $ 843.4    $ 717.0    $ 688.5    $ 857.6    $ 630.6    $    2,862.6



                                                        Amounts Expiring in Fiscal Year
    Other         Total
 Commercial      Amount
 Commitments    Committed        2020          2021          2022          2023          2024         Thereafter
Standby
letters of
credit and
bank
guarantees    $      74.0     $    24.7     $    40.7     $     7.5     $     0.4     $     0.2     $        0.5



1 We have excluded the liability for uncertain tax positions and certain other
tax liabilities as we are not able to reasonably estimate the timing of the
payments. See Note 7 of the Notes to Consolidated Financial Statements included
in this Annual Report.

As of December 31, 2019, we had $732.7 of outstanding surety bonds. Certain contracts, primarily those involving public sector customers, require us to provide a surety bond as a guarantee of our performance of contractual obligations.



We believe that internally generated cash flows and the remaining availability
under our credit facility will be adequate to finance normal operating
requirements. Although we maintain an active acquisition program, any future
acquisitions will be dependent on numerous factors and it is not feasible to
reasonably estimate if or when any such acquisitions will occur and what the
impact will be on our activities, financial condition and results of operations.
We may also explore alternatives to attract additional capital resources.

We anticipate that our businesses will generate positive cash flows from
operating activities, and that these cash flows will permit the reduction of
currently outstanding debt in accordance with the repayment schedule. However,
the rate at which we can reduce our debt during 2020 (and reduce the associated
interest expense) will be affected by, among other things, the financing and
operating requirements of any new acquisitions and the financial performance of
our existing companies. None of these factors can be predicted with certainty.

Off-Balance Sheet Arrangements



At December 31, 2019 and 2018, we did not have any relationships with
unconsolidated entities or financial partnerships, such as entities often
referred to as structured finance or special purpose entities, which would have
been established for the purpose of facilitating off-balance sheet arrangements
or other contractually narrow or limited purposes.

Recently Issued Accounting Standards

See Note 1 of the Notes to Consolidated Financial Statements included in this Annual Report for information regarding the effect of new accounting pronouncements on our Consolidated Financial Statements.


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