Brady Corporation · NYSE:BRC
Brady — Q2 2021 Earnings Presentation
16 slides from Brady's earnings presentation, Feb 18, 2021
Slide 1: Brady Corporation F'21 Q2 Financial Results
February 18, 2021 Brady Corporation F’21 Q2 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: Managing Through the Pandemic
3Managing Through the Pandemic Managing Through the Pandemic: • Thank you to all of the Brady employees and front- line workers. • Brady’s products are helping in the fight of COVID- 19. Key Messages: • Workplace Safety is growing its customer base, but gross margins were impacted by mix. • ID Solut
Slide 4: Q2 F'21 Financial Summary
4Q2 F’21 Financial Summary • Sales were $265.8M in Q2 of F’21 compared with $276.7M in Q2 of F’20. – Organic sales declined 6.3%. – Foreign currency translation increased sales 2.4%. • Gross profit margin of 48.7% in Q2 of F’21 compared with 50.3% in Q2 of F’20. • SG&A expense of $82.2M (30.9% of sa
Slide 5: Sales Overview
5Sales Overview • Total sales declined 3.9%. • Organic sales declined 6.3%: • ID Solutions – Organic sales decline of 6.9%. • Workplace Safety – Organic sales decline of 4.8%. • 2.4% increase due to foreign currency translation. Q2 F’21 SALES: • ID Solutions – Decrease in rate of organic sales decli
Slide 6: Gross Profit Margin
Gross Profit Margin 6 • Gross profit margin of 48.7% compared to 50.3% in Q2 of F’20. • We continue to invest in automation and manufacturing efficiencies. • Gross profit margin was negatively impacted by reduced sales volumes in our ID Solutions business along with product mix in our Workplace Safe
Slide 7: SG&A Expense
SG&A Expense 7 • The $5.1M reduction in SG&A expense compared to Q2 of F’20 was due to ongoing benefits from efficiency actions combined with a reduction in discretionary spend. • Sequentially, SG&A expense was down $0.8M compared to the first quarter of this year. This decrease was primarily due to
Slide 8: R&D Expense
R&D Expense 8 $10.5 $11.3 $11.7 $11.7 $11.3 $11.1 $11.4 $11.3 $11.0 $10.5 $9.8 $9.4 $10.2 $9.9 3.6% 3.9% 3.9% 3.9% 3.9% 3.9% 3.9% 3.8% 3.8% 3.8% 3.7% 3.7% 3.7% 3.7% 2.5% 3.0% 3.5% 4.0% $6.0 $8.0 $10.0 $12.0 $14.0 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 Q3 F'20
Slide 9: Income Before Income Taxes
9Income Before Income Taxes • Income before income taxes and losses of unconsolidated affiliate decreased 7.0% to $39.4M in Q2 of F’21 compared to $42.4M in Q2 of F’20. Q2 F’21 - INCOME BEFORE INCOME TAXES AND LOSSES OF UNCONSOLIDATED AFFILIATE: INCOME BEFORE INCOME TAXES AND LOSSES OF UNCONSOLIDATE
Slide 10: Net Income & Diluted EPS
10Net Income & Diluted EPS • Net income was $30.9M in Q2 of F’21 compared to $33.6M in Q2 of F’20. • Diluted EPS was $0.59 in Q2 of F’21 compared to $0.62 in Q2 of F’20. Q2 F’21 – NET INCOME & DILUTED EPS: $0.49 $0.08 $0.49 $0.66 $0.58 $0.55 $0.65 $0.68 $0.70 $0.62 $0.26 $0.53 $0.64 $0.59 $0.00 $0.2
Slide 11: Cash Generation & Uses
11Cash Generation & Uses • Cash flow from operating activities was $36.1M in Q2 of F’21 compared to $14.3M in Q2 of F’20. • Free cash flow* was $30.9M in Q2 of F’21 compared to $8.9M in Q2 of F’20. • Cash flow from operating activities and free cash flow* were impacted by the payment of annual incen
Slide 12: Net Cash
Net Cash 12 • January 31, 2021 cash = $277.6M. • Brady has no outstanding debt. • Balance sheet provides flexibility for future organic and inorganic investments. STRONG BALANCE SHEET: $48 $44 $73 $129 $138 $151 $188 $229 $245 $240 $190 $218 $256 $278 $0 $50 $100 $150 $200 $250 $300 $350 Q1 F'18 Q2
Slide 13: F'21 Diluted EPS Guidance
13F’21 Diluted EPS Guidance Diluted EPS Guidance for the Year Ending July 31, 2021 $2.48 to $2.58 Diluted EPS Guidance for the Second $1.25 to $1.35 Half of the Year Ending July 31, 2021 (compares to $0.79 in second half of F’20) Guidance Assumptions: • Continued economic improvement and the success
Slide 14: Identification Solutions
Q2 F’21 vs. Q2 F’20 (millions of USD) 14Identification Solutions • Revenues declined - (5.4%): • Organic = - (6.9%). • Fx = + 1.5%. • Organic sales performed better in Asia than in North America and Europe. • Expenses are down due to sustainable efficiency activities as well as cost containment acti
Slide 15: Workplace Safety
Q2 F’21 vs. Q2 F’20 (millions of USD) 15Workplace Safety • Revenues increased + 0.4%: • Organic = - (4.8%). • Fx = + 5.2%. • Organic sales declined due to the North American business and Australia. • Europe experienced low-single digit organic sales growth in the quarter. • Segment profit and segmen
Slide 16: Investor Relations
16Investor Relations Brady Contact: Ann Thornton Investor Relations 414-438-6887 Ann_Thornton@bradycorp.com See our web site at www.bradycorp.com/investors