Slide 1: Brady Corporation F'16 Q3 Financial Results
May 19, 2016 Brady Corporation F’16 Q3 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: Q3 F'16 Financial Summary
3Q3 F’16 Financial Summary • Sales down 1.2% to $286.8M in Q3 of F’16 vs. $290.2M in Q3 of F’15. – Organic sales decreased 0.1%. Foreign currency translation reduced sales by 1.1%. • Gross profit margin of 50.7% in Q3 of F’16 compared with 48.6% in Q3 of F’15. • SG&A expense of $105.8M (36.9% of sal
Slide 4: Sales Overview
4Sales Overview • (0.1%) organic sales decline: • ID Solutions – Organic sales decline of (0.8%). • Workplace Safety – Organic sales increase of 1.2%. • (1.1%) decrease due to currency translation. Q3 F’16 SALES: • Our European businesses in both IDS and WPS performed well, with continued organic gr
Slide 5: Gross Profit Margin
Gross Profit Margin 5 • GPM of 50.7% in Q3 of F’16 compared with 48.6% in Q3 of F’15. • GPM in Q3 of F’15 was impacted by facility consolidation-related costs. • On-going operational improvements are positively impacting profitability. GROSS PROFIT MARGIN COMMENTARY: GROSS PROFIT & GPM% (millions of
Slide 6: SG&A Expense and G&A Expense
SG&A Expense and G&A Expense 6 • G&A expense was up $4.6M to $29.4M in Q3 of F’16 compared to $24.8M in Q3 of F’15. • G&A expense was up vs. the prior year due to a benefit of $4.3M pre-tax from the curtailment of a retiree medical plan in Q3 of F’15. • Excluding the prior year curtailment benefit,
Slide 7: Net Earnings & EPS From Continuing Operations
7Net Earnings & EPS From Continuing Operations * Non-GAAP Net Earnings from Continuing Operations and Non-GAAP Net Earnings from Continuing Operations Per Class A Diluted Nonvoting Share are non-GAAP measures. See appendix. • Q3 F’16 net earnings were $21.0M compared to Non- GAAP net earnings* of $1
Slide 8: Cash Generation & Uses
8Cash Generation & Uses • Cash flow from operating activities up nearly 40% to $40.3M in Q3 of F’16 compared to $28.8M in Q3 of F’15. • Free cash flow* of $36.8M in Q3 of F’16 compares to $23.1 in Q3 of F’15. • Returned $10.2M to our shareholders in the form of dividends in Q3 of F’16. • Repaid $13.
Slide 9: Net Debt & EBITDA
Net Debt & EBITDA 9 NET DEBT / TTM EBITDA* • April 30, 2016 Cash = $141.6M, Debt = $242.5M (net debt = $100.9M), and TTM EBITDA = $130.3M. • Net Debt/EBITDA* = 0.8 to 1. • Net debt declined by $67M from April 30, 2015 to April 30, 2016. • Balance sheet continues to provide flexibility for future cas
Slide 10: F'16 Guidance
10F’16 Guidance F’16 Diluted EPS $1.37 to $1.45 Guidance Assumptions: • Low single digit organic sales declines, which is reflective of economic challenges in certain industrial markets and geographies. • Exchange rates consistent with those as of April 30, 2016. • Full-year depreciation and amortiz
Slide 11: Identification Solutions Q3 F'16 vs. Q3 F'15 Performance
Q3 F’16 vs. Q3 F’15 PERFORMANCE (millions of USD) 11Identification Solutions • Revenues down (1.9%): • Organic = -(0.8%) • Fx = -(1.1)% • Organic sales growth in Europe-based business. • Organic sales down in the Americas and Asia. • Segment profit as a percent of sales increased as a result of oper
Slide 12: Workplace Safety Q3 F'16 vs. Q3 F'15 Performance
Q3 F’16 vs. Q3 F’15 PERFORMANCE (millions of USD) 12Workplace Safety • Revenues increased 0.5%: • Organic = + 1.2% • Fx = -(0.7)% • Continued increase in revenues in Europe, partially offset by low-single digit declines in the U.S. and Australia. • Digital sales are improving as we are starting to s
Slide 13: Investor Relations
13Investor Relations Brady Contact: Ann Thornton Investor Relations 414-438-6887 Ann_Thornton@bradycorp.com See our web site at www.bradycorp.com
Slide 14: Appendix
Appendix 14
Slide 15: Comparable Income Statements
COMPARABLE INCOME STATEMENTS (millions of USD) 15Comparable Income Statements
Slide 16: Debt Structure
(‘000s of USD) 16Debt Structure
Slide 17: EBITDA reconciliation
Brady is presenting EBITDA because it is used by many of our investors and lenders, and is presented as a convenience to them. EBITDA represents net earnings before interest expense, income taxes, depreciation, amortization and impairment charges. EBITDA is not a calculation based on generally accep
Slide 18: Non-GAAP Net Earnings Reconciliation
Brady is presenting the Non-GAAP measures "Net Earnings from Continuing Operations Excluding Certain Items“ and “Net Earnings from Continuing Operations Per Diluted Class A Nonvoting Common Share Excluding Certain Items.” These are not calculations based upon GAAP. The amounts included in these Non-