Good morning. The Roper Technologies conference call will now begin. Today's call is being recorded. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing star and then zero using a touch-tone telephone. At this time, I'd like to turn the conference call over to Zack Moxcey, Vice President of Investor Relations. Please go ahead. Good morning, and thank you all for joining us as we discuss our acquisition of Frontline Education. Joining me on the call this morning are Neil Hunn, President and Chief Executive Officer, Rob Crisci, Executive Vice President and Chief Financial Officer, Jason Conley, Vice President and Chief Accounting Officer, and Shannon O'Callaghan, Vice President of Finance. Earlier this morning, we issued a press release announcing our definitive agreement to acquire Frontline. The press release also includes replay information for today's call. We have prepared a short presentation to accompany today's call, which is available through the webcast and is also available on our website. Now, if you'll please turn to slide two. We begin with our safe harbor statement. During the course of today's call, we will make forward-looking statements, which are subject to risks and uncertainties as described on this page, in our press release, and in our SEC filings. You should listen to today's call in the context of that information. Now, if you please turn to slide three, I will turn the call over to Neil. After his prepared remarks, we will take questions from our telephone participants. Neil? Thanks, Zach, and good morning, everyone. Thanks for joining us on short notice. This morning, we're excited to share with you the details of our most recent acquisition, Frontline Education. Briefly, Frontline is a leading provider of SaaS software solutions targeted to the U.S. K-12 education market. We're buying the business for $3.725 billion from Thoma Bravo. As part of the transaction, we receive an approximate $350 million net present value tax benefit, which yields a net purchase price of $3.375 billion or about 19x their 2023 EBITDA. Frontline is an exceptional business. The business is characterized by having high single-digit organic growth with north of 90% of their revenues being recurring in nature. This business has a great net working capital profile at negative 40% as a percentage of revenue. Given this networking capital profile and the 15-year tax benefit, Frontline will have unlevered free cash flow equal to roughly that of EBITDA. Really exciting growth and cash conversion characteristics here. Importantly, Frontline has built a very capable bolt-on acquisition capability, a capability we expect to invest behind going forward. For calendar 2023, we expect this business to have revenue in the $370 million range and EBITDA around $175 million, yielding EBITDA margins north of 47%. We'll finance this transaction with a combination of cash on hand and the use of our revolving credit facility, the magnitude of which will depend on the timing of the closing of our industrial divestiture to CD&R. Pro forma for the Frontline and industrial transactions, our net leverage will be around 2.5 times. We expect the deal to close in the fourth quarter and be recorded in our application software segment. Not surprisingly, Frontline meets all our acquisition criteria. To name a few, Frontline is a leader in the resilient K-12 education software market. This market, like so many others, is one that is undergoing significant digital transformation. Frontline serves an important role helping school systems operate more efficiently. We very much like the fact that Frontline has multiple durable growth drivers. They have very high gross retention rates in the mid-90% range and net retention rates in the 107%-108% zip code. We love the stickiness of their solutions and the durable, diversified growth drivers. They have north of 90% recurring revenue, significantly negative networking capital which yields very strong cash conversion, and a dedicated, seasoned, and passionate leadership team and employee base that comes to work every day excited to help improve the country's education system and develop the next generation of learners. This is just another perfect fit relative to our capital deployment and corporate strategy. Let's turn to the next page four, and outline what Frontline does. Next slide, please. Frontline is a leading provider of mission-critical K-12 administrative software. Their comprehensive K-12 administrative software is highly trusted and widely used that delivers real impact to school districts across the United States. Frontline has a national footprint with 10,000 K-12 districts, serves millions of educators, and has a product portfolio comprised of 30 products. The company's products are bundled into three categories: human capital management or HCM, business operations management, and student management. As we look to their HCM offerings, which represents about half of their ARR, Frontline has a comprehensive state-by-state compliance set of offerings that helps districts recruit, hire, train, and develop staff, as well as the leading tool that helps with absence or substitute teacher management. For instance, last year, Frontline's tech offerings helped place about 29 million substitutes. Relative to business operations, Frontline offers purpose-built ERP for state and school district needs, including capabilities to manage the increasingly complex landscape of district assets. This product category is about 20% of the company's ARR. Next is Frontline Student Management segment, about 30% of ARR. The company offers special program management solutions and student information systems. Finally, the company has invested in and is launching a powerful suite of data and analytical solutions with more to come on this in the future. The secular trend that cuts across all that Frontline offers is that K-12 districts are in the early stages of automating their workflows and processes. As we wrap up and turn to your questions, Frontline is purpose-built for the K-12 education market, a market that is highly regulated on a state-by-state basis. Frontline has a national footprint of customers and a national distribution capability. They have high single-digit organic growth profile that is underpinned with fantastic retention rates, 90% plus recurring revenues, and long-term secular demand. Finally, they have a tremendous working capital and cash conversion profile. We're delighted to welcome Frontline to the Roper family, where we will be their permanent home going forward. Now let's turn to your questions. We will now go to our question-and-answer portion of the call. We request that our callers limit their questions to one main question and one follow-up. If you would like to ask a question, you may do so by pressing the star key followed by the digit one on your touch-tone telephones. If you are using a speakerphone, we do ask you please pick up your handset before pressing the keys to ensure the best sound quality. To withdraw your questions, you may press star and then the digit two. Again, we request all callers to please limit themselves to one question and one follow-up. Our first question today comes from Deane Dray from RBC Capital Markets. Please go ahead with your question. Thank you. Good morning, everyone. Good morning, Deane. Morning. Hey, it isn't often that you get an acquisition that does overlap, at least in end markets, with an existing business. You know, we've seen it with Clinisys. Here there is potentially some overlap with CBORD, which has a bit more exposure to the college market. Just, you know, are there overlaps with CBORD? Are there any synergies, any scale there? Very minimal. It's really the Horizon part, the K-12 part of CBORD, where there's potentially a little bit of cross-selling opportunity for us. It's something that we very lightly explored in the diligence process, something that both CBORD and Frontline are excited to explore. As you know, in the Roper way, that'll only happen if they're in their own self-interest for their company's benefit, they agree to do it. It'll be nothing that's forced from the center. There is potential to push the Horizon, or if you will, to the sell-through the Horizon capability through the large national footprint of Frontline. That's helpful. Just as the follow-up, since the K-12 is a very highly regulated environment, as you said, are there any like certifications at a state level, regulations that Frontline has to meet? For Rob, just anything about that tax benefit, and the tax horizon for that would be helpful. Thanks. Sure. I'll take the state regulatory one, and obviously Rob on the tax benefit. It's one of the characteristics we like is the fact that the company told us, they told us once in the diligence process, they told us 100 times that states are like countries. Education in this country is regulated state by state. It is something that the software portfolio that Frontline has deals with the complexity of that regulation that's ever-changing. It's also an enormous barrier to entry for the more horizontal players or that sort of prevents them from coming into the K-12 education space. Yeah, on the tax benefit, it is over 15 years. It's about $35 million a year on average for the first 10 years, and then it's less so sort of for the last five. Really, the first five years may be a touch higher than that, so maybe in the $35 million-$40 million dollar range for the first five years. Thank you. Thank you. Thank you, Deane. Our next question comes from Christopher Glynn from Oppenheimer. Please go ahead with your question. Thank you. Good morning, and congrats. Thank you very much, Chris. On the free cash flow conversion of EBIT, I don't recall any other deals kinda hovering in the 100% range. I'm curious just to affirm that's the long-term profile and, you know, what's particularly different from the other deals you've done that, you know, may be 80%-90% free cash conversion in terms of their flows and how that works. Yeah. It is over the long term. There are two good guys here, if you will, right? One is the tax benefit I just mentioned, as the answer with Deane, that $35 million-$40 million a year. The second one is because of the very negative net working capital that Neil mentioned. You get, you know, as the business is growing high single digits, you sort of get an extra $15 million-$20 million a year in cash from that sort of change in deferred revenue line where you're getting the cash in advance. That helps sort of, you know, drive this, the faster cash flow compounding, if you will. Great. Just curious on the competition, the relative leadership of this position. Is it an absolute pole position or kinda, you know, more out by a nose? Well, there's many categories of education software. I mean, there's the categories that Frontline has, but there's other categories that are in the classroom, you know, the content, the classroom software. In terms of, so there's a wide array of types of software that are sold. As a general matter, it's a very fragmented ecosystem, but less than half the market is vended. As we go to the tech enablement of the entire K-12 system, there is a long runway of tech enablement to occur. As it relates to the areas that Frontline plays in, the administrative piece there, and they're the leader in that part. Thank you. Our next question comes from Julian Mitchell from Barclays. Please go ahead with your question. Thanks a lot, and congratulations. Maybe just my first question would be around what's been the sort of recent historical organic sales rate? Is it consistent with the high single-digit pro forma projection? Maybe to help us understand the underpinnings of that growth, do you have a sense for how automated the K-12 market is today and how much sort of penetration uptake there is left? Then also kind of help us understand a little bit more clearly what are Frontline's competitive advantages? It's sort of hard from the outside to have a sense of that. Okay, I'll try to tick through each of those. If we miss one, certainly, come back or hit us in the after call. Yes, the short answer, the first question is their historic organic growth rate over the last, you know, five or so years, has been equal to that of what we're projecting going forward, sort of in the high single digit space, maybe a touch higher. In terms of the growth algorithm, I talked about in the prepared remarks that there are many growth drivers that have durability. That's where we spent, as we do with most of our acquisitions, of the vast preponderance of our diligence effort is on not just what the growth drivers are, but the durability of each. As I talked about in the prepared remarks, they have mid-90% gross retention, 107%-108% net. If they're gonna grow high single digits, you see that roughly 80% of their new bookings, if you will, come from cross-selling of their customer base, which has been a decided part of their strategy over the last, you know, four or five years, as the number of apps per customer have gone from just around two to just about three today, again, against a cohort of 30 products that they sell. In terms of the market, it's, you know, depending on if there's a lot of different cuts of the size of the market. Roughly ±$6 billion is the opportunity. Less than half of that is vended today. The company reports that 85% of their deals are, quote-unquote, "not competitive." They're not in RFP situations, and they're just sort of chewing up the tech enablement for their customers. That's helpful, thank you. Just a more brief follow-up question. The EBITDA margins are in the high 40s% today. Maybe help us understand kind of where have they moved, you know, from under Thoma Bravo ownership, and where do you think the sort of long-term margin rate should settle out at this point? Yeah. Those have been pretty steady EBITDA margins over the past several years. I mean, the business invests a lot. I mean, R&D is mid-teens% of revenue. Those are very stable margins for a high single-digit% organic growth business in this segment. You know, our goal under ownership, as always, will be to see what we can do to accelerate that growth and continue to have strong margin performance. Great. Thank you. Thank you. Our next question comes from Joe Giordano from TD Cowen. Please go ahead with your question. Hey, guys. Good morning. Good morning. Morning. You talked about growth into this. Like, what has COVID done for the business in terms of changes? Has it kind of raised awareness of, for this type of technology? Has it changed anything strategically that Frontline has had to do? The short answer is not really. I mean, there has been obviously a lot of COVID funding that has gone federal funding that's gone to the states. It's, and those dollars are still there. The vast majority of that funding has been used by the K-12 systems on one-time type items, the principal item being getting devices to be one-to-one, one device to one student. Something like 95% of school districts now are one-to-one. So there's been no discernible historical boost to the demand or the bookings trend for Frontline from COVID funding, and we don't expect there to be a tailwind sort of for the last couple of years of the remaining funding. There has been more front of classroom benefit from that funding. Yeah. I would just add, you know, the availability of teachers, you know, certainly teacher shortages as we've gone through COVID and the, you know, the importance of finding great teachers for all these districts, and that's part of what our software enables. Can you talk about the ability to drive price? I mean, you talked about net retention is higher, significantly higher than growth, so obviously there is some ability. I'm just curious if that's like on a like for like basis or if it's getting more programs per person into that. Like, just into a, you know, more budget-constrained environment, what's the ability to consistently look at price there? Yeah. Certainly price is part of that algorithm. Historically, been in sort of the 4-ish% range, and that's where we expect it to be going forward, maybe a touch more in the next couple of years 'cause their ability to move price and their contracts lags inflation. The company will have a little bit higher pricing for the next year or two and then revert back in the 4% range. That's the sense on pricing and value capture. If I get a sneak one in, you mentioned like the M&A environment, they have their own bolt-on capabilities. Like what kind of areas have they historically looked at and are looking at now? Thank you. Yeah, it's as most companies' M&A function, they look at two different avenues. One is essentially how do they find product categories to continue opening up TAM, if you will. That's been a decided focus of their capability. The other one is just how do you find opportunities to buy products and push through the national distribution capability of the company. Our next question comes from Steve Tusa from J.P. Morgan. Please go ahead with your question. Hi, good morning. Good morning. Congrats. Thank you. What's the employee base for these guys? It's a little bit north of 1,000. They have, you know, and it's quite national, and they have offshore development capability. Okay, when you were talking about the organic growth being high single digit, I mean, and a touch above that, I mean, should we think like 7%-8%? Is that kind of the right, you know, framework? High single digit can be, you know, I don't know, 9%-10% maybe or something like that. What is a little more precision on what they did in the last couple years? Yeah. You know, we think of an HSD as seven to nine. Yeah. Okay. That makes sense. In the last couple of years, what's the biggest deal that they've done? I mean, they've done a bunch of deals. Any of them more sizable than the other? In the Thoma Bravo ownership, they completed six acquisitions. They were all small-ish. I mean, to give you a sense, Thoma Bravo's, at least as I believe, did not put any equity into those deals, so they're all funded off the company's balance sheet, so they were bolt-on size for the company. Okay. Got it. One last question. Have you been looking at these guys for a while? I know in prior deals, you know, you kind of looked at some of these transactions for a little while. How long have you been cultivating these guys? We saw the book in 2017 when Thoma bought the business, but did not engage at any level of depth given where our balance sheet was coming off the Deltek and ConstructConnect deals. Yeah, we had the historical information, but no real intimacy with the company until a handful of months ago. Awesome. Thank you. Thank you. Our next question comes from Rob Mason from Baird. Please go ahead with your question. Yeah, good morning. Thanks for taking the question. I wanted to go back to the three main buckets that you identified, Neil, that they participate in. My understanding is maybe the legacy of the business originally is more in the human capital management. Could you just speak to the relative level of penetration you think each of those three buckets are in? Sure. Delighted to do it. You're right. The legacy of the business is in the HCM space. Still a long way to go there. You know, they have, you know, 8,000-ish customers in that space, two of 10 apps. They have 10 apps in human capital management. The average penetration is two. In business operations, it's a little over two of eight, for instance. Student management, it's a little under two of 12. There's a lot of runway inside of each product silo and then across the product silos. Fine. Fine. Just to go back to the competition question, again, you know, there's several public comparables out there as well. I guess, is it my understanding maybe PowerSchool is the most comparable. I'm just curious if you know, would agree with that. If that's the case, you know, how do you draw any kind of distinctions between, you know, their direct competitors? Sure. The PowerSchool is maybe the most direct investor comparable, but not really from a competitive point of view. There is a little bit of overlap competitively, but in a decidedly small minority of the deals that Frontline competes into, they actually compete against PowerSchool. PowerSchool, think of them more student information system, classroom-ish oriented, and Frontline is more administrative back office oriented. Very good. Thank you. Thank you. This concludes our question and answer session. We will now turn the call back over to Zack Moxcey for any closing remarks. Thank you everyone for joining us this morning. We look forward to speaking with you during our next earnings call. The conference has now concluded. We do thank you for joining today's presentation. You may now disconnect your lines.