Brady Corporation · NYSE:BRC
Brady — Shareholder Meeting (November 2018)
28 slides from Brady's shareholder meeting presentation, Nov 14, 2018
Slide 1: F'18 Annual Shareholders' Meeting
Brady Corporation F’18 Annual Shareholders’ Meeting November 14, 2018
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: Agenda
3 Agenda • Election of Board of Directors • President’s Report • Financial Report • Questions & Answers
Slide 4: Election of the Board of Directors
4 Election of the Board of Directors Patrick W. Allender Nancy Lee Gioia Bradley C. Richardson Executive Vice Director, Global Executive Vice President President and Chief Connectivity, Electrical and Chief Financial Officer, Financial Officer (ret.), and User Experience (ret.), PolyOne Corporation
Slide 5: Election of the Board Of Directors
5 Election of the Board Of Directors Shareholders of 100% of the Class B Common Voting Stock vote in favor of the election of the director nominees and they are therefore elected to a one-year term.
Slide 6: President's Report
6 President’s Report J. Michael Nauman President and Chief Executive Officer
Slide 7: Click to View the Video
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Slide 8: Strategic Vision Statement
Strategic Vision Statement 8 Brady will strive to be the expert in safety, identification, and compliance in a diverse range of workplaces. We will possess deep expertise and knowledge in our industries, resulting in trusted partnerships with our customers. We will provide market leading, innovative
Slide 9: Recap of F'18
RECAP OF F’18 9 Achieved our twelfth consecutive quarter of earnings growth. $143M in operating cash generation. Foundational improvements in all manufacturing metrics including improved quality, reduced errors, and decreased shipping time. Increased sales across all channels. Driving local ownershi
Slide 10: Capturing the Spirit of Innovation
10 CAPTURING THE SPIRIT OF INNOVATION New products Continuous New First company- Launched an are a direct evolution of proprietary wide innovation result of BradyID.com to products in Innovation incubator to customer input. allow for a better Workplace Challenge. grow new buying and Safety division.
Slide 11: Leading the Printer Market
11 LEADING THE PRINTER MARKET i5100 Industrial i7100 Industrial S3100 Sign and Label Printer Label Printer Label Printer Integrates high-volume Prints on a wide range Easy to use stand-alone performance and of high-performance printer. smart printing label materials. technology. On-the-spot printing
Slide 12: Responding to Customers' Needs
12 RESPONDING TO CUSTOMERS’ NEEDS PRODUCTS INSPIRED BY THE PEOPLE WHO USE THEM Seton Speed Bump Time Alert IV label First proprietary product from WPS Easy-to-use, visual time-indicating division. label to help hospital technicians determine when an IV bag needs to be replaced. Easy-to-install, high
Slide 13: Investing in Our Future
13 INVESTING IN OUR FUTURE Automation New or renovated New equipment Digital presses, voice- facilities New printers and slitters directed picking and 36,000 square foot in Milwaukee, Tijuana, other technologies help facility in India has and Singapore. accelerate productivity become a showcase for
Slide 14: Our Continued Focus: F'19
OUR CONTINUED FOCUS: 14 F’19 Product Innovation Customer Interaction Operational Excellence Facility Optimization Employee Engagement Service Excellence
Slide 15: Financial Report
15 Financial Report Aaron Pearce Chief Financial Officer
Slide 16: Revenue & Earnings Trends
Revenue & Earnings Trends 16 SALES (millions of USD) EARNINGS BEFORE INCOME TAXES* (millions of USD) $1,250 $1,225 +20% $1,172 $1,174 $152 $150 $1,121 $1,113 $127 $125 $110 $109 $1,000 $100 $92 $75 $750 $50 F'14 F'15 F'16 F'17 F'18 F'14 F'15 F'16 F'17 F'18 Organic Growth 0.2% 1.0% (0.7%) 0.5% 2.6% F
Slide 17: GPM & SG&A Expense
GPM & SG&A Expense 17 GROSS PROFIT MARGIN GROSS PROFIT MARGIN: 51.0% 50.1% 50.1% 49.8% 49.9% 50.0% • Inflationary forces. 49.0% • Investments in machinery and equipment increasing capabilities and driving 48.0% 47.7% efficiency gains. 47.0% • Operational improvements are positively impacting our gro
Slide 18: Increasing our Investment in R&D
Increasing our Investment in R&D 18 RESEARCH & DEVELOPMENT EXPENSE (Millions of USD) $45 $45 $40 $40 $37 $35 $36 $35 $30 $25 F'14 F'15 F'16 F'17 F'18 INCREASING OUR INVESTMENT IN RESEARCH & DEVELOPMENT: • Investing in R&D to drive future organic sales growth. • R&D expenses were up 14% in F’18. • In
Slide 19: Segment Financial Results
Segment Financial Results (Sales & Segment Profit %) 19 IDENTIFICATION SOLUTIONS (millions of USD) IDENTIFICATION SOLUTIONS: $900 30.0% $846 • Organic sales growth of 3.4%. $796 $800 25.0% • Segment profit increased 9.8% from $800 $130.6M to $143.4M. 16.9% 20.0% 16.3% • Sales and profitability grew
Slide 20: Cash Generation
Cash Generation 20 CASH FLOW FROM OPERATING ACTIVITIES (Millions of USD) $144 $143 $150 $139 $93 $93 $100 $50 F'14 F'15 F'16 F'17 F'18 What did we do with our cash in F’18? Drive Future Organic Growth: Research & Development $ 45M Capital Expenditures 22M Strengthen our Balance Sheet: Repaid Debt 55
Slide 21: History of Increasing Dividends
History of Increasing Dividends 21 ANNUAL DIVIDENDS (Annual dividends per share) ANNUAL DIVIDENDS • Increased annual dividends for 33 consecutive years. • F’19 annual dividend of $0.85/share.
Slide 22: Net Cash (Debt)
Net Cash (Debt) 22 NET CASH (DEBT) (millions of USD) DEBT STRUCTURE (millions of USD) $129 Interest July 31, 2018 July 31, 2017 $125 Rate Balance Balance Revolver Borrowings: $75 USD-denominated 1.94% $ - $ (17.0) $26 EUR-denominated 0.75% - (34.3) $25 China Borrowings: -$25 USD & CNY-denominated 3.
Slide 23: Financial Summary
Financial Summary 23 • Investing in R&D to Drive Long-Term Sales Growth. • Investing in Cap. Ex. to drive Automation and Increase Capabilities. • Driving Sustainable Efficiency Gains throughout the Organization. • Increasing Organic Sales Growth. • Improving Profitability and Cash Flow. • Strong Bal
Slide 24: Questions?
24 Questions?
Slide 25: Thank You
25 Thank You
Slide 26: Investor Relations
Investor Relations 26 Brady Contact: Ann Thornton 414-438-6887 Ann_Thornton@Bradycorp.com See our web site at www.investor.bradycorp.com
Slide 27: Appendix - Non-GAAP Reconciliation
27 Appendix - Non-GAAP Reconciliation
Slide 28: Non-GAAP Earnings Before Income Taxes
Non-GAAP Earnings Before Income Taxes 28 Reconciliation of Non-GAAP Earnings Before Income Taxes (‘000s of USD) Brady is presenting the Non-GAAP measure “Earnings from Continuing Operations Before Income Taxes.” This is not a calculation based upon GAAP. The amounts included in this Non-GAAP measure