Brady Corporation · NYSE:BRC
Brady — Q2 FY2020 Earnings Presentation
15 slides from Brady's earnings presentation, Feb 20, 2020
Slide 1: Brady Corporation F'20 Q2 Financial Results
Brady Corporation F’20 Q2 Financial Results February 20, 2020
Slide 2: Forward-Looking Statements
Forward-Looking Statements 2 In this presentation, statements that are not reported financial results or other historic information are “forward-looking statements.” These forward-looking statements relate to, among other things, the Company's future financial position, business strategy, targets, p
Slide 3: Q2 F'20 Financial Summary
Q2 F’20 Financial Summary 3 • Sales were $276.7M in Q2 of F’20 compared with $282.4M in Q2 of F’19. – Organic sales declined 1.2%. – Foreign currency translation decreased sales 0.8%. • Gross profit margin of 50.3% in Q2 of F’20 compared with 49.5% in Q2 of F’19. • SG&A expense of $87.4M (31.6% of s
Slide 4: Sales Overview
Sales Overview 4 SALES (millions of USD) $305 $298 $297 $295 $295 $293 $290 $290 $288 $287 $285 $282 $277 $275 $265 $255 Q1 F'18 Q2 F'18 Q3 F'18 Q4 F'18 Q1 F'19 Q2 F'19 Q3 F'19 Q4 F'19 Q1 F'20 Q2 F'20 Organic Sales 1.7% 3.2% 3.2% 2.5% 4.7% 2.3% 2.4% 1.7% (0.4%) (1.2%) Q2 F’20 SALES: Q2 F’20 SALES CO
Slide 5: Gross Profit Margin
Gross Profit Margin 5 GROSS PROFIT & GPM% (millions of USD) 50.6% 50.3% 50.3% 50.3% 49.9% 50.0% 49.6% 49.5% 49.6% $151 49.3% 50% $147 $150 $146 $147 $146 $147 $144 $140 $141 $139 45% $125 $100 40% Q1 F'18 Q2 F'18 Q3 F'18 Q4 F'18 Q1 F'19 Q2 F'19 Q3 F'19 Q4 F'19 Q1 F'20 Q2 F'20 Q2 F’20 – GROSS PROFIT
Slide 6: SG&A Expense
SG&A Expense 6 SG&A EXPENSE AND SG&A EXPENSE AS A % of SALES (millions of USD) $110 34.5% 33.9% 34.1% 35% 32.8% 32.7% $102 32.3% $100 31.6% 33% $100 $98 30.6% 31.2% 30.2% $95 $95 $93 30% $91 $89 $90 $90 $87 28% $80 25% Q1 F'18 Q2 F'18 Q3 F'18 Q4 F'18 Q1 F'19 Q2 F'19 Q3 F'19 Q4 F'19 Q1 F'20 Q2 F'20 Q
Slide 7: R&D Expense
R&D Expense 7 R&D EXPENSE AND R&D EXPENSE AS A % of SALES (millions of USD) $14.0 3.9% 3.9% 3.9% 3.9% 3.9% 3.9% 4.0% 3.8% 3.8% 3.8% $12.0 3.6% $11.7 $11.7 $11.3 $11.3 $11.4 $11.3 $11.1 $11.0 $10.5 $10.5 3.5% $10.0 3.0% $8.0 $6.0 2.5% Q1 F'18 Q2 F'18 Q3 F'18 Q4 F'18 Q1 F'19 Q2 F'19 Q3 F'19 Q4 F'19 Q1
Slide 8: Income Before Income Taxes
Income Before Income Taxes 8 INCOME BEFORE INCOME TAXES (millions of USD) $50 $47.1 $45.2 $42.4 $41.0 $41.6 $39.9 $40 $37.0 $36.7 $34.8 $35.0 $30 $20 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 F'18 F'18 F'18 F'18 F'19 F'19 F'19 F'19 F'20 F'20 Year on Year Growth 12.2% 20.4% 20.7% 26.0% 14.8% 4.8% 10.8% 4.1% 4.2%
Slide 9: Net Income & Diluted EPS
Net Income & Diluted EPS 9 NET INCOME PER CLASS A DILUTED SHARE NET INCOME (millions of USD) $0.70 $0.66 $0.68 $0.65 $40 $36.6 $37.5 $0.62 $35.0 $34.8 $0.60 $0.58 $33.6 $0.55 $30.6 $0.49 $0.49 $29.2 $30 $25.8 $26.0 $0.40 $20 $0.20 $10 $0.08 $4.3 $0.00 $0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1
Slide 10: Cash Generation & Uses
Cash Generation & Uses 10 CASH FLOW FROM OPERATING ACTIVITIES (millions of USD) CASH FLOWS IN Q2 OF F’20: $70 $65.3 • Cash flow from operating activities was $14.3M in Q2 of F’20 compared to $25.4M in Q2 of F’19. $60 $53.8 $52.7 • Free cash flow* was $8.9M in Q2 of F’20 $50 $46.8 $38.8 compared to $
Slide 11: Net Cash
Net Cash 11 NET CASH (millions of USD) DEBT STRUCTURE (millions of USD) $300 $250 $245 $240 $229 Interest Jan. 31, 2020 July 31, 2019 Rate Balance Balance $200 $188 Private Placements: EUR-den. 2010 Series (10-yr.) 4.24% $ (49.6) $ (50.2) $151 $150 $138 TOTAL DEBT $ (49.6) $ (50.2) $129 Cash and Cas
Slide 12: Full-Year F'20 EPS Guidance
Full-Year F’20 EPS Guidance 12 F’20 Diluted EPS $2.55 to $2.65 F’20 Guidance Assumptions: • Approximately flat to slightly positive organic sales growth. • Depreciation and amortization expense of approximately $25M. • Income tax rate of approximately 20%. • Capital expenditures of approximately $35
Slide 13: Identification Solutions Q2 F'20 vs. Q2 F'19
Identification Solutions 13 Q2 F’20 vs. Q2 F’19 (millions of USD) Q2 F’20 SUMMARY: • Revenues decreased - (1.8%): Q2 F’20 Q2 F’19 Change • Organic = - (1.3%) Sales $ 205.4 $ 209.2 - 1.8% • Fx = - (0.5%) Segment Profit 40.7 37.9 + 7.4% • Organic sales decreased due to an overall slowdown in the indus
Slide 14: Workplace Safety Q2 F'20 vs. Q2 F'19
Workplace Safety 14 Q2 F’20 vs. Q2 F’19 (millions of USD) Q2 F’20 SUMMARY: • Revenues decreased - (2.6%): Q2 F’20 Q2 F’19 Change • Organic = - (1.0%) Sales $ 71.3 $ 73.2 - 2.6% • Fx = - (1.6%) Segment Profit 5.5 4.7 + 17.0% • Organic sales were effectively flat in Europe and Segment Profit % 7.7% 6.
Slide 15: Investor Relations
Investor Relations 15 Brady Contact: Ann Thornton Investor Relations 414-438-6887 Ann_Thornton@bradycorp.com See our web site at www.bradycorp.com