Brady Corporation · NYSE:BRC
Brady — Q1 2018 Earnings Presentation
14 slides from Brady's earnings presentation, Nov 16, 2017
Slide 1: Brady Corporation F'18 Q1 Financial Results
November 16, 2017 Brady Corporation F’18 Q1 Financial Results
Slide 2: Forward-Looking Statements
2Forward-Looking Statements 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, pr
Slide 3: Q1 F'18 Financial Summary
3Q1 F’18 Financial Summary • Sales increased 3.6% to $290.2M in Q1 of F’18 vs. $280.2M in Q1 of F’17. – Organic sales increased 1.7%. – Foreign currency translation increased sales by 1.9%. • Gross profit margin of 50.3% in Q1 of F’18 compared with 50.1% in Q1 of F’17. • SG&A expense of $100.1M (34.
Slide 4: Sales Overview
4Sales Overview • 1.7% increase in organic sales: • ID Solutions – Organic sales increase of 2.9%. • Workplace Safety – Organic sales decline of (1.4%). • 1.9% increase due to currency translation. Q1 F’18 SALES: • ID Solutions - Organic sales increased in EMEA and Asia and were approximately flat i
Slide 5: Gross Profit Margin
Gross Profit Margin 5 • GPM of 50.3% in Q1 of F’18 compared with 50.1% in Q1 of F’17. • GPM improved in ID Solutions businesses due to operational efficiency gains, offset by declines in the Workplace Safety business due to pricing pressures in certain product categories. Q1 F’18 – GROSS PROFIT MARG
Slide 6: SG&A Expense
SG&A Expense 6 • SG&A expense was $100.1M (34.5% of sales) in Q1 of F’18 compared to $98.0M (35.0% of sales) in Q1 of F’17. • The increase in SG&A expense was driven by foreign currency translation and investments in additional sales generating activities, partially offset by continuing efficiency g
Slide 7: R&D Expense
R&D Expense 7 $8.6 $9.1 $8.9 $9.3 $9.1 $9.5 $10.0 $11.0 $10.5 3.0% 3.4% 3.1% 3.3% 3.3% 3.5% 3.6% 3.8% 3.6% 2.0% 2.5% 3.0% 3.5% 4.0% $5.0 $7.0 $9.0 $11.0 $13.0 $15.0 Q1 F'16 Q2 F'16 Q3 F'16 Q4 F'16 Q1 F'17 Q2 F'17 Q3 F'17 Q4 F'17 Q1 F'18 R&D EXPENSE AND R&D EXPENSE AS A % of SALES (millions of USD) •
Slide 8: Net Earnings & Earnings per Share
8Net Earnings & Earnings per Share • Q1 F’18 net earnings increased 14.6% to $25.8M compared to $22.6M in Q1 of F’17. • Earnings before income taxes increased 12.2% to $34.8M in Q1 of F’18 compared to $31.0M in Q1 of F’17. • The increase in pre-tax earnings was driven by organic sales growth and eff
Slide 9: Cash Generation & Uses
9Cash Generation & Uses • Cash flow from operating activities was $34.7M in Q1 of F’18 compared to $34.0M in Q1 of F’17. • Cash flow from operating activities was impacted by the timing of certain payments in Q4 of F’17 and in Q1 of F’18. • Free cash flow* was $30.9M in Q1 of F’18 compared to $30.0M
Slide 10: Net Cash (Debt)
Net Cash (Debt) 10 • October 31, 2017 cash = $142.2M and debt = $94.5M. • Net cash increased $21.5M during Q1 of F’18. • Balance sheet provides flexibility for future cash uses. STRONG BALANCE SHEET: $(140) $(132) $(101) $(76) $(50) $(38) $(9) $26 $48 -$200 -$150 -$100 -$50 $0 $50 Q1 F'16 Q2 F'16 Q3
Slide 11: Full Year F'18 Guidance Unchanged
11Full Year F’18 Guidance Unchanged F’18 Diluted EPS $1.85 to $1.95 Guidance Assumptions: • Low-single digit organic sales growth. • Full-year depreciation and amortization expense of approximately $26M. • Full-year income tax rate of 27% to 29%. • Full-year capital expenditures of approximately $30
Slide 12: Identification Solutions
Q1 F’18 vs. Q1 F’17 PERFORMANCE (millions of USD) 12Identification Solutions • Revenues increased 4.2%: • Organic = + 2.9% • Fx = + 1.3% • Organic sales increased in the mid-single digits in EMEA and Asia and were approximately flat in the Americas. • R&D expenses up due to increased investments to
Slide 13: Workplace Safety
Q1 F’18 vs. Q1 F’17 PERFORMANCE (millions of USD) 13Workplace Safety • Revenues increased 1.9%: • Organic = - (1.4)% • Fx = + 3.3% • Organic sales declined in the mid-single digits in the WPS North America business, partially offset by low- single digit growth in Europe and Australia. • North Americ
Slide 14: Investor Relations
14Investor Relations Brady Contact: Ann Thornton Investor Relations 414-438-6887 Ann_Thornton@bradycorp.com See our web site at www.bradycorp.com