Slide 1: F'13 Q4 Financial Results
F’13 Q4 Financial Results September 12, 2013 1 WE IDENTIFY AND PROTECT PREMISES, PRODUCTS, AND PEOPLE. BRADY – FISCAL 2013 Q4 FINANCIAL RESULTS
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS BRADY – FISCAL 2013 Q4 FINANCIAL RESULTS 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 financia
Slide 3: Summary Comments
SUMMARY COMMENTS F’13 – A Year of Unprecedented Change: • Reorganized around global business platforms. • Sold 3 businesses and announced plans to sell Die-Cut. • Purchased PDC in Q2 of F’13. • Executed business simplification. F’14 – Priorities: • Return WPS business to organic sales growth. • Driv
Slide 4: Diluted EPS from Continuing Operations
DILUTED EPS FROM CONTINUING OPERATIONS 4 * Diluted EPS, excluding restructuring charges and non-routine items are non-GAAP measures. See slides #19 and #20. 4 * Net Earnings from Continuing Operations Per Class A Diluted Nonvoting Share Excluding Certain Items is a non-GAAP measure. See slide #21. 3
Slide 5: Q4 F'13 - Financial Summary
Q4 F’13 - FINANCIAL SUMMARY Sales up 14.9% to $309.1M vs. $269.1M in Q4 of F’12. • Organic sales down 2.3%, acquisitions increased sales by 16.9%, and foreign currency increased sales by 0.3%. Gross Profit Margin of 50.8% in Q4 of F’13 compared with 54.8% in Q4 of F’12. SG&A expense of $106.9M
Slide 6: F'14 Guidance – Continuing Operations
F’14 GUIDANCE – CONTINUING OPERATIONS 6 F’14 Diluted EPS from Continuing Operations $1.80 to $2.00 (excluding restructuring charges and certain other items). Material Items Impacting F’14 EPS from Continuing Operations Guidance: 6 BRADY – FISCAL 2013 Q4 FINANCIAL RESULTS Guidance Assumptions – Conti
Slide 7: Sales Overview
SALES OVERVIEW $273 $255 $271 $269 $271 $271 $301 $309 $150 $200 $250 $300 $350 Q1 F'12 Q2 F'12 Q3 F'12 Q4 F'12 Q1 F'13 Q2 F'13 Q3 F'13 Q4 F'13 Organic Sales 5.1% (0.9%) 0.6% 1.5% (1.1%) (2.2%) (5.0%) (2.3%) 7 Q4 F’13 Sales up 14.9%: • (2.3%) organic sales decline. • 16.9% growth from acquisitions
Slide 8: Gross Profit Margin and SG&A
GROSS PROFIT MARGIN AND SG&A 8 $99 $95 $98 $100 $99 $110 $112 $107 36.3% 37.3% 36.2% 37.3% 36.6% 40.5% 37.2% 34.6% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% $50 $100 $150 $200 Q1 F'12 Q2 F'12 Q3 F'12 Q4 F'12 Q1 F'13 Q2 F'13 Q3 F'13 Q4 F'13 GROSS PROFIT & GPM% (Millions of USD) SG&A & SG&A as % of SALES (M
Slide 9: Net Earnings & EPS from Continuing Operations – Non-GAAP
NET EARNINGS & EPS FROM CONTINUING OPERATIONS – Non-GAAP* Q4 F’13 net earnings from continuing operations, excluding certain items* of $27.9M compared to $29.3M in Q4 of F’12. Both Q4 of F’12 and Q4 of F’13 benefited from low income tax rates of 14% and 17%, respectively. Q4 F’13 diluted EPS f
Slide 10: Cash Generation
3 Mos. Ended July 31, 2013 Year-Ended July 31, 2013 Cash Balance - Beginning of Period 77.0$ 305.9$ Cash Flow from Operating Activities 53.9 143.5 Capital Expenditures (9.6) (35.7) Proceeds from Sales of Businesses - 10.2 Acquisition of Businesses - (301.2) Repurchase of Stock - (5.1) Proceeds from
Slide 11: Debt & EBITDA
DEBT & EBITDA 2.3 2.2 2.0 1.8 1.8 1.8 1.6 1.6 1.6 2.0 1.7 1.7 1.0x 1.5x 2.0x 2.5x Q 1 F'1 1 Q 3 F'1 1 Q 1 F'1 2 Q 3 F'1 2 Q 1 F'1 3 Q 3 F'1 3 GROSS DEBT / TTM EBITDA* July 31, 2013 Cash = $91M and Debt = $313M Gross Debt/EBITDA = 1.7x Net Debt/EBITDA = 1.2x STRONG BALANCE SHEET: 11 GROSS DEBT
Slide 12: Identification Solutions
IDENTIFICATION SOLUTIONS 12 12 Fiscal 2012 Quarters Fiscal 2013 Quarters FULL YEARS Q1F’12 Q2 F’12 Q3 F’12 Q4 F’12 Q1 F’13 Q2 F’13 Q3 F’13 Q4 F’13 F’12 F’13 Sales $ 164.0 $ 149.0 $ 160.5 $ 160.3 $ 161.2 $ 166.7 $ 195.9 $ 209.6 $ 633.8 $ 733.4 Organic Sales % 5.5% (0.8%) 2.1% 3.8% 0.4% 1.3% (2.3%) 2.
Slide 13: Workplace Safety Historical Financial Performance
WORKPLACE SAFETY 13 HISTORICAL FINANCIAL PERFORMANCE (Millions of USD) 13 Fiscal 2012 Quarters Fiscal 2013 Quarters FULL YEARS Q1F’12 Q2 F’12 Q3 F’12 Q4 F’12 Q1 F’13 Q2 F’13 Q3 F’13 Q4 F’13 F’12 F’13 Sales $ 109.4 $ 106.0 $ 110.7 $ 108.8 $ 109.6 $ 104.5 $ 105.1 $ 99.5 $ 434.9 $ 418.7 Organic Sales %
Slide 14: WPS Strategies to Return to Sales Growth
WPS STRATEGIES TO RETURN TO SALES GROWTH WPS is a profitable business with hundreds of thousands of customers. WPS strategies to return to sales growth: 1. Build best-in-class online / digital 2. Enhanced product offerings 3. Enhanced industry-specific expertise for workplace safety critical industr
Slide 15: Investor Relations
INVESTOR RELATIONS Brady Contact: Aaron Pearce Investor Relations 414-438-6895 Aaron_Pearce@Bradycorp.com See our web site at www.investor.bradycorp.com 15 15 BRADY – FISCAL 2013 Q4 FINANCIAL RESULTS
Slide 16: Sales & Segment Profit %
SALES & SEGMENT PROFIT % 16 ID SOLUTIONS (Millions of USD) $164 $149 $160 $160 $161 $167 $196 $210 25.5% 24.7% 25.4% 25.0% 27.3% 20.3% 23.5% 22.7% 0% 10% 20% 30% $0 $50 $100 $150 $200 $250 Q1 F'12 Q2 F'12 Q3 F'12 Q4 F'12 Q1 F'13 Q2 F'13 Q3 F'13 Q4 F'13 16 BRADY – FISCAL 2013 Q4 FINANCIAL RESULTS WOR
Slide 17: Q4 Income Statement Comparison
2013 2012 Change Sales 309.1$ 269.1$ 40.0$ Gross Margin 157.0 147.5 9.5 % of Sales 50.8% 54.8% (4.0) pts Research and Development (9.4) (9.0) (0.4) Selling, General and Admin. (106.9) (100.3) (6.6) % of Sales (34.6%) (37.3%) (2.7) pts Impairment Charges (204.4) - (204.4) Restructuring Expense (15.6)
Slide 18: Debt Structure
DEBT STRUCTURE 18 18 BRADY – FISCAL 2013 Q4 FINANCIAL RESULTS (Thousands of USD) Int. Rate Fixed vs. Variable July 31, 2013 Balance July 31, 2012 Balance Revolver Borrowings (due Feb. 2017): USD-denominated (L+1.125) 1.28% Variable 39,000$ -$ EUR-denominated (L+1.125) - Variable - - GBP-denominated
Slide 19: EBITDA Reconciliation - Total Company
19 EBITDA - Total Company (‘000s of USD) 19 BRADY – FISCAL 2013 Q4 FINANCIAL RESULTS EBITDA RECONCILIATION Q1 Q2 Q3 Q4 Total 27,188$ (8,684)$ 4,232$ (177,271)$ (154,535)$ Interest expense 4,163 4,406 4,186 3,886 16,641 Income taxes 13,481 30,625 7,595 (4,417) 47,284 Depreciation and amortization 10,
Slide 20: Net Earnings from Continuing Operations, Excluding Certain Items
NET EARNINGS FROM CONTINUING OPERATIONS, EXCLUDING CERTAIN ITEMS 20 Reconciliation of Net Earnings from Continuing Operations Excluding Certain Items (‘000s of USD): 20 BRADY – FISCAL 2013 Q4 FINANCIAL RESULTS 2013 2012 2013 2012 (176,234)$ 20,869$ (140,816)$ 102,471$ — — 949 — PDC acquisition-relat
Slide 21: Net Earnings per Diluted Class A Nonvoting Share, Excluding Items
NET EARNINGS FROM CONTINUING OPERATIONS PER DILUTED CLASS A NONVOTING SHARE, EXCLUDING ITEMS 21 Reconciliation of Net Earnings from Continuing Operations per Diluted Class A Nonvoting Share Excluding Certain Items: 21 BRADY – FISCAL 2013 Q4 FINANCIAL RESULTS 2013 2012 2013 2012 Nonvoting Share (GAAP
Slide 22: Quarterly Financial Statements
QUARTERLY FINANCIAL STATEMENTS 22 22 Reconciliation of Net Earnings from Continuing Operations per Diluted Class A Nonvoting Share Excluding Certain Items (in millions of USD, except per share amounts): BRADY – FISCAL 2013 Q4 FINANCIAL RESULTS Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Sales 273.4$ 255.1$ 271.2$ 269.1