Brady Corporation (NYSE: BRC) (“Brady”), a world leader in
identification solutions, today reported its financial results for the
fiscal 2013 third quarter ended April 30, 2013.
Quarter Ended April 30, 2013 Financial Results:
The company continued its portfolio realignment process by announcing
plans to sell its Asia-based Die-Cut business which was outlined in a
separate press release on May 16, 2013. Accordingly, the company has
recast its financial statements to report the financial results of the
Die-Cut business on one line item in the accompanying condensed
consolidated statements of income.
Sales from continuing operations for the fiscal 2013 third quarter were
up 11.0 percent to $305.7 million compared to $275.4 million in the
third quarter of fiscal 2012. Organic sales were down 4.7 percent,
acquisitions added 16.8 percent, and the impact of foreign currency
translation decreased sales by 1.1 percent. By segment, organic sales
decreased 2.9 percent in the Americas, 4.8 percent in EMEA and 11.6
percent in the Asia-Pacific region.
Net earnings from continuing operations in the fiscal 2013 third quarter
were $21.8 million compared to $28.0 million in the same quarter last
year. Non-GAAP net earnings from continuing operations* were $28.7
million in the third quarter of fiscal 2013, compared to $29.9 million
in the third quarter of fiscal 2012.
Earnings from continuing operations per diluted Class A Nonvoting Common
Share were $0.42 in the third quarter of fiscal 2013 compared to $0.53
in the same quarter last year. Non-GAAP earnings from continuing
operations per diluted Class A Nonvoting Common Share* were $0.55 in the
third quarter of fiscal 2013, compared to $0.56 in the same quarter of
fiscal 2012.
Nine Months Ended April 30, 2013 Financial Results:
Sales for the nine-month period ended April 30, 2013 were up 5.3 percent
to $856.4 million compared to $813.6 million in the same period last
year. Organic sales were down 2.7 percent, acquisitions added 9.3
percent to sales and the impact of foreign currency translation
decreased sales by 1.3 percent. By segment, organic sales decreased 0.7
percent in the Americas, 4.2 percent in EMEA and 6.8 percent in the
Asia-Pacific region.
Net earnings from continuing operations for the nine-month period ended
April 30, 2013 were $37.7 million compared to $84.3 million in the same
period in fiscal 2012. Non-GAAP net earnings from continuing operations*
were $75.1 million in the nine-month period ended April 30, 2013
compared to $86.1 million in the same period of fiscal 2012.
Earnings from continuing operations per diluted Class A Nonvoting Common
Share were $0.73 for the nine-month period ended April 30, 2013 compared
to $1.59 in the same period of fiscal 2012. Non-GAAP earnings from
continuing operations per diluted Class A Nonvoting Common Share* were
$1.45 for the nine-month period ended April 30, 2013, compared to $1.62
in the same period of fiscal 2012.
Commentary and Guidance:
“In the face of a challenging economy, we continue to position Brady for
long-term success by optimizing our portfolio of businesses, aligning
our organization with growth opportunities and reducing our
infrastructure costs. This morning we announced our intention to sell
our Die-Cut business which will continue the process of portfolio
realignment as we have already divested three businesses and acquired
Precision Dynamics Corporation, a business serving the healthcare space.
These portfolio adjustments will allow us to focus more on our
continuing businesses of Identification Solutions and Workplace Safety,”
stated Brady’s President and Chief Executive Officer, Frank M. Jaehnert.
“As part of our previously announced strategy to improve organic growth
and profitability, effective May 1, 2013, we are changing our
organizational structure from geographically-based to an organization
structured around global business platforms. We are also targeting
expansion in faster-growing geographies such as Central Europe, the
Middle East, Africa and selected markets in Asia; and focusing on
industries such as food and beverage, chemical, oil, and gas and
healthcare.
“In addition to improving organic growth, we believe that our
reorganization around global business platforms will yield approximately
$25 million to $30 million of annual pre-tax savings, approximately half
of which will be reinvested into growth initiatives. We also continue to
review our facility footprint and believe that we have further
opportunities for rationalization as we move forward with our business
reorganization and simplification.”
Brady’s Chief Financial Officer, Thomas J. Felmer said, “Our balance
sheet remains strong. Having repaid much of the debt incurred to finance
the PDC acquisition, Brady is in a solid financial position to fund
future organic and inorganic growth opportunities. We expect earnings
from continuing operations per diluted Class A Nonvoting Common Share to
range from between $0.45 and $0.55, exclusive of restructuring charges
and certain other items during our fiscal 2013 fourth quarter ending
July 31, 2013.”
A webcast regarding Brady’s fiscal 2013 third quarter financial results
will be available at www.bradycorp.com
beginning at 9:30 a.m. Central Time today.
Brady Corporation is an international manufacturer and marketer of
complete solutions that identify and protect premises, products and
people. Brady’s products help customers increase safety, security,
productivity and performance and include high-performance labels, signs,
safety devices, printing systems and software, and precision die-cut
materials. Founded in 1914, the company has millions of customers in
electronics, telecommunications, manufacturing, electrical,
construction, education, medical and a variety of other industries.
Brady is headquartered in Milwaukee, Wisconsin and as of January 31,
2013 employed approximately 8,200 people at operations in the Americas,
EMEA and Asia-Pacific. Brady’s fiscal 2012 sales were approximately
$1.32 billion. Brady stock trades on the New York Stock Exchange under
the symbol BRC. More information is available on the Internet at www.bradycorp.com.
* See accompanying notes for Non-GAAP measures.
Brady believes that certain statements in this news release are
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements related to
future, not past, events included in this news release, including,
without limitation, statements regarding Brady’s future financial
position, business strategy, targets, projected sales, costs, earnings,
capital expenditures, debt levels and cash flows, and plans and
objectives of management for future operations are forward-looking
statements. When used in this news release, words such as “may,” “will,”
“expect,” “intend,” “estimate,” “anticipate,” “believe,” “should,”
“project” or “plan” or similar terminology are generally intended to
identify forward-looking statements. These forward-looking statements by
their nature address matters that are, to different degrees, uncertain
and are subject to risks, assumptions and other factors, some of which
are beyond Brady’s control, that could cause actual results to differ
materially from those expressed or implied by such forward-looking
statements. For Brady, uncertainties arise from the length or severity
of the current worldwide economic downturn or timing or strength of a
subsequent recovery; future financial performance of major markets Brady
serves, which include, without limitation, telecommunications,
manufacturing, electrical, construction, laboratory, education,
governmental, public utility, computer, transportation; difficulties in
making and integrating acquisitions; risks associated with newly
acquired businesses; Brady’s ability to develop and successfully market
new products; changes in the supply of, or price for, parts and
components; increased price pressure from suppliers and customers;
fluctuations in currency rates versus the US dollar; unforeseen tax
consequences; potential write-offs of Brady’s substantial intangible
assets; Brady’s ability to retain significant contracts and customers;
risks associated with international operations; Brady’s ability to
maintain compliance with its debt covenants; technology changes;
business interruptions due to implementing business systems;
environmental, health and safety compliance costs and liabilities;
future competition; interruptions to sources of supply; Brady’s ability
to realize cost savings from operating initiatives; difficulties
associated with exports; risks associated with restructuring plans;
risks associated with obtaining governmental approvals and maintaining
regulatory compliance; and numerous other matters of national, regional
and global scale, including those of a political, economic, business,
competitive and regulatory nature contained from time to time in Brady’s
U.S. Securities and Exchange Commission filings, including, but not
limited to, those factors listed in the “Risk Factors” section located
in Item 1A of Part I of Brady’s Form 10-K for the year ended July 31,
2012. These uncertainties may cause Brady’s actual future results to be
materially different than those expressed in its forward-looking
statements. Brady does not undertake to update its forward-looking
statements.
|
BRADY CORPORATION AND SUBSIDIARIES
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
|
(Dollars in Thousands, Except Per Share Data)
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
Three Months Ended April 30,
|
|
Nine Months Ended April 30,
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
2012
|
|
Net sales
|
|
$
|
305,737
|
|
|
$
|
275,388
|
|
|
$
|
856,408
|
|
|
$
|
813,573
|
|
Cost of products sold
|
|
|
146,031
|
|
|
|
123,641
|
|
|
|
403,888
|
|
|
|
367,330
|
|
Gross margin
|
|
|
159,706
|
|
|
|
151,747
|
|
|
|
452,520
|
|
|
|
446,243
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
8,062
|
|
|
|
8,200
|
|
|
|
24,162
|
|
|
|
25,657
|
|
Selling, general and administrative
|
|
|
112,148
|
|
|
|
98,614
|
|
|
|
321,909
|
|
|
|
293,518
|
|
Restructuring charges
|
|
|
8,540
|
|
|
|
1,977
|
|
|
|
10,487
|
|
|
|
1,977
|
|
Total operating expenses
|
|
|
128,750
|
|
|
|
108,791
|
|
|
|
356,558
|
|
|
|
321,152
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
30,956
|
|
|
|
42,956
|
|
|
|
95,962
|
|
|
|
125,091
|
|
|
|
|
|
|
|
|
|
|
Other income and (expense):
|
|
|
|
|
|
|
|
|
Investment and other income
|
|
|
1,131
|
|
|
|
1,108
|
|
|
|
2,427
|
|
|
|
1,719
|
|
Interest expense
|
|
|
(4,185
|
)
|
|
|
(4,735
|
)
|
|
|
(12,755
|
)
|
|
|
(14,715
|
)
|
|
|
|
|
|
|
|
|
|
Earnings from continuing operations before income taxes
|
|
|
27,902
|
|
|
|
39,329
|
|
|
|
85,634
|
|
|
|
112,095
|
|
|
|
|
|
|
|
|
|
|
Income taxes
|
|
|
6,064
|
|
|
|
11,290
|
|
|
|
47,965
|
|
|
|
27,767
|
|
|
|
|
|
|
|
|
|
|
Net earnings from continuing operations
|
|
$
|
21,838
|
|
|
$
|
28,039
|
|
|
$
|
37,669
|
|
|
$
|
84,328
|
|
|
|
|
|
|
|
|
|
|
(Loss) from discontinued operations, net of income taxes
|
|
|
(17,605
|
)
|
|
|
(387
|
)
|
|
|
(14,933
|
)
|
|
|
(113,898
|
)
|
|
|
|
|
|
|
|
|
|
Net earnings (loss)
|
|
$
|
4,233
|
|
|
$
|
27,652
|
|
|
$
|
22,736
|
|
|
$
|
(29,570
|
)
|
|
|
|
|
|
|
|
|
|
Earnings from continuing operations per Class A Nonvoting Common
Share:
|
|
|
|
|
|
|
Basic
|
|
$
|
0.42
|
|
|
$
|
0.53
|
|
|
$
|
0.73
|
|
|
$
|
1.60
|
|
Diluted
|
|
$
|
0.42
|
|
|
$
|
0.53
|
|
|
$
|
0.73
|
|
|
$
|
1.59
|
|
|
|
|
|
|
|
|
|
|
Earnings from continuing operations per Class B Voting Common Share:
|
|
|
|
|
|
|
Basic
|
|
$
|
0.42
|
|
|
$
|
0.53
|
|
|
$
|
0.72
|
|
|
$
|
1.59
|
|
Diluted
|
|
$
|
0.42
|
|
|
$
|
0.53
|
|
|
$
|
0.71
|
|
|
$
|
1.57
|
|
|
|
|
|
|
|
|
|
|
(Loss) from discontinued operations per Class A Nonvoting Common
Share:
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.34
|
)
|
|
$
|
—
|
|
|
$
|
(0.29
|
)
|
|
$
|
(2.17
|
)
|
Diluted
|
|
$
|
(0.34
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(2.16
|
)
|
|
|
|
|
|
|
|
|
|
(Loss) from discontinued operations per Class B Voting Common Share:
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.34
|
)
|
|
$
|
—
|
|
|
$
|
(0.30
|
)
|
|
$
|
(2.17
|
)
|
Diluted
|
|
$
|
(0.34
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(2.15
|
)
|
|
|
|
|
|
|
|
|
|
Earnings per Class A Nonvoting Common Share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.08
|
|
|
$
|
0.53
|
|
|
$
|
0.44
|
|
|
$
|
(0.57
|
)
|
Diluted
|
|
$
|
0.08
|
|
|
$
|
0.52
|
|
|
$
|
0.44
|
|
|
$
|
(0.57
|
)
|
Dividends
|
|
$
|
0.19
|
|
|
$
|
0.185
|
|
|
$
|
0.57
|
|
|
$
|
0.555
|
|
|
|
|
|
|
|
|
|
|
Earnings per Class B Voting Common Share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.08
|
|
|
$
|
0.53
|
|
|
$
|
0.42
|
|
|
$
|
(0.58
|
)
|
Diluted
|
|
$
|
0.08
|
|
|
$
|
0.52
|
|
|
$
|
0.42
|
|
|
$
|
(0.58
|
)
|
Dividends
|
|
$
|
0.19
|
|
|
$
|
0.185
|
|
|
$
|
0.553
|
|
|
$
|
0.538
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding (in thousands):
|
|
|
|
|
|
|
|
|
Basic
|
|
|
51,415
|
|
|
|
52,513
|
|
|
|
51,210
|
|
|
|
52,539
|
|
Diluted
|
|
|
52,041
|
|
|
|
53,003
|
|
|
|
51,685
|
|
|
|
52,946
|
|
|
BRADY CORPORATION AND SUBSIDIARIES
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(Dollars in Thousands)
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
April 30, 2013
|
|
|
July 31, 2012
|
ASSETS
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
77,034
|
|
|
|
$
|
305,900
|
|
Accounts receivable—net
|
|
|
177,343
|
|
|
|
|
199,006
|
|
Inventories:
|
|
|
|
|
|
Finished products
|
|
|
62,995
|
|
|
|
|
64,740
|
|
Work-in-process
|
|
|
14,908
|
|
|
|
|
15,377
|
|
Raw materials and supplies
|
|
|
21,703
|
|
|
|
|
25,407
|
|
Total inventories
|
|
|
99,606
|
|
|
|
|
105,524
|
|
Assets held for sale
|
|
|
108,623
|
|
|
|
|
—
|
|
Prepaid expenses and other current assets
|
|
|
41,461
|
|
|
|
|
40,424
|
|
Total current assets
|
|
|
504,067
|
|
|
|
|
650,854
|
|
Other assets:
|
|
|
|
|
|
Goodwill
|
|
|
841,449
|
|
|
|
|
676,791
|
|
Other intangible assets
|
|
|
174,583
|
|
|
|
|
84,119
|
|
Deferred income taxes
|
|
|
6,305
|
|
|
|
|
45,356
|
|
Other
|
|
|
20,915
|
|
|
|
|
20,584
|
|
Property, plant and equipment:
|
|
|
|
|
|
Cost:
|
|
|
|
|
|
Land
|
|
|
9,081
|
|
|
|
|
8,651
|
|
Buildings and improvements
|
|
|
100,504
|
|
|
|
|
101,962
|
|
Machinery and equipment
|
|
|
278,233
|
|
|
|
|
292,130
|
|
Construction in progress
|
|
|
9,358
|
|
|
|
|
10,417
|
|
|
|
|
397,176
|
|
|
|
|
413,160
|
|
Less accumulated depreciation
|
|
|
263,527
|
|
|
|
|
283,145
|
|
Property, plant and equipment—net
|
|
|
133,649
|
|
|
|
|
130,015
|
|
Total
|
|
$
|
1,680,968
|
|
|
|
$
|
1,607,719
|
|
LIABILITIES AND STOCKHOLDERS’ INVESTMENT
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Notes payable
|
|
$
|
58,658
|
|
|
|
$
|
—
|
|
Accounts payable
|
|
|
75,204
|
|
|
|
|
86,646
|
|
Wages and amounts withheld from employees
|
|
|
36,840
|
|
|
|
|
54,629
|
|
Liabilities held for sale
|
|
|
34,684
|
|
|
|
|
—
|
|
Taxes, other than income taxes
|
|
|
7,603
|
|
|
|
|
9,307
|
|
Accrued income taxes
|
|
|
10,650
|
|
|
|
|
14,357
|
|
Other current liabilities
|
|
|
34,396
|
|
|
|
|
40,815
|
|
Current maturities on long-term debt
|
|
|
61,265
|
|
|
|
|
61,264
|
|
Total current liabilities
|
|
|
319,300
|
|
|
|
|
267,018
|
|
Long-term obligations, less current maturities
|
|
|
218,378
|
|
|
|
|
254,944
|
|
Other liabilities
|
|
|
109,635
|
|
|
|
|
76,404
|
|
Total liabilities
|
|
|
647,313
|
|
|
|
|
598,366
|
|
Stockholders’ investment:
|
|
|
|
|
|
Common stock:
|
|
|
|
|
|
Class A nonvoting common stock—Issued 51,261,487 and 51,261,487
shares, respectively and outstanding 47,972,270 and 47,630,926
shares, respectively
|
|
|
513
|
|
|
|
|
513
|
|
Class B voting common stock—Issued and outstanding, 3,538,628 shares
|
|
|
35
|
|
|
|
|
35
|
|
Additional paid-in capital
|
|
|
312,905
|
|
|
|
|
313,008
|
|
Earnings retained in the business
|
|
|
725,682
|
|
|
|
|
732,290
|
|
Treasury stock—2,974,218 and 3,245,561 shares, respectively of Class
A nonvoting common stock, at cost
|
|
|
(79,996
|
)
|
|
|
|
(92,600
|
)
|
Accumulated other comprehensive income
|
|
|
76,439
|
|
|
|
|
59,411
|
|
Other
|
|
|
(1,923
|
)
|
|
|
|
(3,304
|
)
|
Total stockholders’ investment
|
|
|
1,033,655
|
|
|
|
|
1,009,353
|
|
Total
|
|
$
|
1,680,968
|
|
|
|
$
|
1,607,719
|
|
|
|
|
|
|
|
|
|
|
|
BRADY CORPORATION AND SUBSIDIARIES
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(Dollars in Thousands)
|
|
|
|
|
|
(Unaudited)
Nine Months Ended April 30,
|
|
|
2013
|
|
|
2012
|
Operating activities:
|
|
|
|
|
|
Net income (loss)
|
|
$
|
22,736
|
|
|
|
$
|
(29,570
|
)
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
Depreciation and amortization
|
|
|
36,037
|
|
|
|
|
32,921
|
|
Non-cash portion of restructuring charges
|
|
|
3,701
|
|
|
|
|
458
|
|
Non-cash portion of stock-based compensation expense
|
|
|
6,964
|
|
|
|
|
7,592
|
|
Impairment charge
|
|
|
—
|
|
|
|
|
115,688
|
|
Loss on write-down of assets held for sale
|
|
|
15,658
|
|
|
|
|
—
|
|
Loss (gain) on sales of businesses
|
|
|
3,138
|
|
|
|
|
—
|
|
Deferred income taxes
|
|
|
33,780
|
|
|
|
|
(3,192
|
)
|
|
Changes in operating assets and liabilities (net of effects of
business acquisitions/divestitures):
|
Accounts receivable
|
|
|
(6,410
|
)
|
|
|
|
11,050
|
|
Inventories
|
|
|
(91
|
)
|
|
|
|
(5,595
|
)
|
Prepaid expenses and other assets
|
|
|
541
|
|
|
|
|
(4,386
|
)
|
Accounts payable and accrued liabilities
|
|
|
(22,226
|
)
|
|
|
|
(39,472
|
)
|
Income taxes
|
|
|
(4,198
|
)
|
|
|
|
15,101
|
|
Net cash provided by operating activities
|
|
|
89,630
|
|
|
|
|
100,595
|
|
|
|
|
|
|
|
Investing activities:
|
|
|
|
|
|
Purchases of property, plant and equipment
|
|
|
(26,082
|
)
|
|
|
|
(14,498
|
)
|
Payments of contingent consideration
|
|
|
—
|
|
|
|
|
(2,580
|
)
|
Settlement of net investment hedges
|
|
|
—
|
|
|
|
|
(797
|
)
|
Acquisition of business, net of cash acquired
|
|
|
(301,157
|
)
|
|
|
|
(3,039
|
)
|
Sales of businesses, net of cash retained
|
|
|
10,178
|
|
|
|
|
—
|
|
Other
|
|
|
(1,245
|
)
|
|
|
|
(1,536
|
)
|
Net cash used in investing activities
|
|
|
(318,306
|
)
|
|
|
|
(22,450
|
)
|
|
|
|
|
|
|
Financing activities:
|
|
|
|
|
|
Payment of dividends
|
|
|
(29,344
|
)
|
|
|
|
(29,235
|
)
|
Proceeds from issuance of common stock
|
|
|
10,246
|
|
|
|
|
3,624
|
|
Purchase of treasury stock
|
|
|
(5,121
|
)
|
|
|
|
(12,309
|
)
|
Proceeds from borrowings on notes payable
|
|
|
220,000
|
|
|
|
|
—
|
|
Repayment of borrowings on notes payable
|
|
|
(173,000
|
)
|
|
|
|
—
|
|
Proceeds from borrowings on line of credit
|
|
|
11,491
|
|
|
|
|
—
|
|
Principal payments on debt
|
|
|
(42,514
|
)
|
|
|
|
(42,514
|
)
|
Debt issuance costs
|
|
|
—
|
|
|
|
|
(961
|
)
|
Income tax benefit from the exercise of stock options and deferred
compensation distribution, and other
|
|
|
1,794
|
|
|
|
|
754
|
|
Net cash provided by (used in) financing activities
|
|
|
(6,448
|
)
|
|
|
|
(80,641
|
)
|
|
|
|
|
|
|
Effect of exchange rate changes on cash
|
|
|
6,258
|
|
|
|
|
(13,050
|
)
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents
|
|
|
(228,866
|
)
|
|
|
|
(15,546
|
)
|
Cash and cash equivalents, beginning of period
|
|
|
305,900
|
|
|
|
|
389,971
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period
|
|
$
|
77,034
|
|
|
|
$
|
374,425
|
|
|
|
|
|
|
|
Supplemental disclosures:
|
|
|
|
|
|
Cash paid during the period for:
|
|
|
|
|
|
Interest, net of capitalized interest
|
|
$
|
13,194
|
|
|
|
$
|
15,746
|
|
Income taxes, net of refunds
|
|
|
26,786
|
|
|
|
|
19,959
|
|
Acquisitions:
|
|
|
|
|
|
Fair value of assets acquired, net of cash
|
|
$
|
168,675
|
|
|
|
$
|
2,395
|
|
Liabilities assumed
|
|
|
(57,860
|
)
|
|
|
|
(583
|
)
|
Goodwill
|
|
|
190,342
|
|
|
|
|
1,227
|
|
Net cash paid for acquisitions
|
|
$
|
301,157
|
|
|
|
$
|
3,039
|
|
|
|
|
|
|
|
|
|
|
|
Information by regional segment for the three and nine months ended
April 30, 2013 and 2012 is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in Thousands)
|
|
Americas
|
|
EMEA
|
|
Asia-Pacific
|
|
Total Region
|
|
Corporate and Eliminations
|
|
Total
|
SALES TO EXTERNAL CUSTOMERS
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
April 30, 2013
|
|
$
|
178,559
|
|
|
$
|
94,044
|
|
|
$
|
33,134
|
|
|
$
|
305,737
|
|
|
|
—
|
|
|
$
|
305,737
|
|
April 30, 2012
|
|
$
|
143,083
|
|
|
$
|
94,136
|
|
|
$
|
38,169
|
|
|
$
|
275,388
|
|
|
|
—
|
|
|
$
|
275,388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
April 30, 2013
|
|
$
|
470,418
|
|
|
$
|
279,420
|
|
|
$
|
106,570
|
|
|
$
|
856,408
|
|
|
|
—
|
|
|
$
|
856,408
|
|
April 30, 2012
|
|
$
|
419,862
|
|
|
$
|
279,506
|
|
|
$
|
114,205
|
|
|
$
|
813,573
|
|
|
|
—
|
|
|
$
|
813,573
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SALES INFORMATION
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended April 30, 2013:
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic
|
|
|
(2.9
|
)%
|
|
|
(4.8
|
)%
|
|
|
(11.6
|
)%
|
|
|
(4.7
|
)%
|
|
|
—
|
%
|
|
|
(4.7
|
)%
|
Currency
|
|
|
(0.7
|
)%
|
|
|
(1.3
|
)%
|
|
|
(1.6
|
)%
|
|
|
(1.1
|
)%
|
|
|
—
|
%
|
|
|
(1.1
|
)%
|
Acquisitions
|
|
|
28.4
|
%
|
|
|
6.0
|
%
|
|
|
—
|
%
|
|
|
16.8
|
%
|
|
|
—
|
%
|
|
|
16.8
|
%
|
Total
|
|
|
24.8
|
%
|
|
|
(0.1
|
)%
|
|
|
(13.2
|
)%
|
|
|
11.0
|
%
|
|
|
—
|
%
|
|
|
11.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended April 30, 2013:
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic
|
|
|
(0.7
|
)%
|
|
|
(4.2
|
)%
|
|
|
(6.8
|
)%
|
|
|
(2.7
|
)%
|
|
|
—
|
%
|
|
|
(2.7
|
)%
|
Currency
|
|
|
(0.8
|
)%
|
|
|
(2.5
|
)%
|
|
|
0.1
|
%
|
|
|
(1.3
|
)%
|
|
|
—
|
%
|
|
|
(1.3
|
)%
|
Acquisitions
|
|
|
13.5
|
%
|
|
|
6.7
|
%
|
|
|
—
|
%
|
|
|
9.3
|
%
|
|
|
—
|
%
|
|
|
9.3
|
%
|
Total
|
|
|
12.0
|
%
|
|
|
—
|
%
|
|
|
(6.7
|
)%
|
|
|
5.3
|
%
|
|
|
—
|
%
|
|
|
5.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT PROFIT
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
April 30, 2013
|
|
$
|
42,942
|
|
|
$
|
22,993
|
|
|
$
|
5,485
|
|
|
$
|
71,420
|
|
|
$
|
(1,282
|
)
|
|
$
|
70,138
|
|
April 30, 2012
|
|
$
|
39,181
|
|
|
$
|
25,566
|
|
|
$
|
6,080
|
|
|
$
|
70,827
|
|
|
$
|
(388
|
)
|
|
$
|
70,439
|
|
Percentage change
|
|
|
9.6
|
%
|
|
|
(10.1
|
)%
|
|
|
(9.8
|
)%
|
|
|
0.8
|
%
|
|
|
|
|
(0.4
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
April 30, 2013
|
|
$
|
119,179
|
|
|
$
|
70,568
|
|
|
$
|
15,793
|
|
|
$
|
205,540
|
|
|
$
|
(5,049
|
)
|
|
$
|
200,491
|
|
April 30, 2012
|
|
$
|
118,871
|
|
|
$
|
78,432
|
|
|
$
|
18,411
|
|
|
$
|
215,714
|
|
|
$
|
(6,010
|
)
|
|
$
|
209,704
|
|
Percentage change
|
|
|
0.3
|
%
|
|
|
(10.0
|
)%
|
|
|
(14.2
|
)%
|
|
|
(4.7
|
)%
|
|
|
|
|
(4.4
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME RECONCILIATION (in thousands)
|
|
|
|
|
|
|
|
Three Months Ended April 30,
|
|
Nine Months Ended April 30,
|
|
|
2013
|
|
|
2012
|
|
|
2013
|
|
|
2012
|
Total profit for reportable segments
|
|
$
|
71,420
|
|
|
|
$
|
70,827
|
|
|
|
$
|
205,540
|
|
|
|
$
|
215,714
|
|
Corporate and eliminations
|
|
|
(1,282
|
)
|
|
|
|
(388
|
)
|
|
|
|
(5,049
|
)
|
|
|
|
(6,010
|
)
|
Unallocated amounts:
|
|
|
|
|
|
|
|
|
|
|
|
Administrative costs
|
|
|
(30,642
|
)
|
|
|
|
(25,506
|
)
|
|
|
|
(94,042
|
)
|
|
|
|
(82,636
|
)
|
Restructuring charges
|
|
|
(8,540
|
)
|
|
|
|
(1,977
|
)
|
|
|
|
(10,487
|
)
|
|
|
|
(1,977
|
)
|
Investment and other income
|
|
|
1,131
|
|
|
|
|
1,108
|
|
|
|
|
2,427
|
|
|
|
|
1,719
|
|
Interest expense
|
|
|
(4,185
|
)
|
|
|
|
(4,735
|
)
|
|
|
|
(12,755
|
)
|
|
|
|
(14,715
|
)
|
Earnings from continuing operations before income taxes
|
|
|
27,902
|
|
|
|
|
39,329
|
|
|
|
|
85,634
|
|
|
|
|
112,095
|
|
Income taxes
|
|
|
6,064
|
|
|
|
|
11,290
|
|
|
|
|
47,965
|
|
|
|
|
27,767
|
|
Net earnings from continuing operations
|
|
|
21,838
|
|
|
|
|
28,039
|
|
|
|
|
37,669
|
|
|
|
|
84,328
|
|
(Loss) from discontinued operations, net of tax
|
|
|
(17,605
|
)
|
|
|
|
(387
|
)
|
|
|
|
(14,933
|
)
|
|
|
|
(113,898
|
)
|
Net earnings (loss)
|
|
$
|
4,233
|
|
|
|
$
|
27,652
|
|
|
|
$
|
22,736
|
|
|
|
$
|
(29,570
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
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 income before interest expense, income taxes,
depreciation and amortization. EBITDA is not a calculation based on
generally accepted accounting principles ("GAAP"). The amounts
included in the EBITDA calculation, however, are derived from
amounts included in the Condensed Consolidated Statements of Income
data. EBITDA should not be considered as an alternative to net
income or operating income as an indicator of the Company's
operating performance, or as an alternative to net cash provided by
operating activities as a measure of liquidity. The EBITDA measure
presented may not always be comparable to similarly titled measures
reported by other companies due to differences in the components of
the calculation.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Total
|
EBITDA:
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
27,188
|
|
$
|
(8,684
|
)
|
|
$
|
4,233
|
|
|
|
$
|
22,737
|
|
Interest expense
|
|
|
4,163
|
|
|
4,406
|
|
|
|
4,185
|
|
|
|
|
12,754
|
|
Income taxes
|
|
|
13,482
|
|
|
30,625
|
|
|
|
7,595
|
|
|
|
|
51,702
|
|
Depreciation and amortization
|
|
|
10,675
|
|
|
11,371
|
|
|
|
13,991
|
|
|
|
|
36,037
|
|
Intangible asset write-down in restructuring charges
|
|
—
|
|
|
—
|
|
|
|
3,207
|
|
|
|
|
3,207
|
|
Loss on write-down of assets held for sale
|
|
|
—
|
|
|
—
|
|
|
|
15,658
|
|
|
|
|
15,658
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA (non-GAAP measure)
|
|
$
|
55,508
|
|
$
|
37,718
|
|
|
$
|
48,869
|
|
|
|
$
|
142,095
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Total
|
EBITDA:
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
32,732
|
|
$
|
(89,954
|
)
|
|
$
|
27,652
|
|
$
|
11,659
|
|
|
$
|
(17,911
|
)
|
Interest expense
|
|
|
5,047
|
|
|
4,933
|
|
|
|
4,735
|
|
|
4,375
|
|
|
|
19,090
|
|
Income taxes
|
|
|
11,109
|
|
|
8,635
|
|
|
|
9,676
|
|
|
11,241
|
|
|
|
40,661
|
|
Depreciation and amortization
|
|
|
11,241
|
|
|
10,935
|
|
|
|
10,745
|
|
|
11,066
|
|
|
|
43,987
|
|
Impairment charge
|
|
|
—
|
|
|
115,688
|
|
|
|
—
|
|
|
—
|
|
|
|
115,688
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA (non-GAAP measure)
|
|
$
|
60,129
|
|
$
|
50,237
|
|
|
$
|
52,808
|
|
$
|
38,341
|
|
|
$
|
201,515
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from Continuing Operations Before Income Taxes Excluding
Certain Items:
|
Brady is presenting the Non-GAAP measure "Earnings from Continuing
Operations Before Income Taxes Excluding Certain Items." This is not
a calculation based upon GAAP. The amounts included in this Non-GAAP
measure are derived from amounts included in the Condensed
Consolidated Statements of Income data. We do not view these items
to be part of our sustainable results. We believe this profit
measure provides an important perspective of underlying business
trends and results and provides a more comparable measure from year
to year. The table below provides a reconciliation of Earnings from
Continuing Operations Before Income Taxes to Earnings from
Continuing Operations Before Income Taxes Excluding Certain Items":
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended April 30,
|
|
Nine Months Ended April 30,
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Earnings from Continuing Operations Before Income Taxes (GAAP
measure)
|
|
$
|
27,902
|
|
|
$
|
39,329
|
|
$
|
85,634
|
|
|
$
|
112,095
|
|
Cost of goods sold
|
|
|
|
|
|
|
|
|
|
|
Purchase accounting expense related to inventory
|
|
|
—
|
|
|
|
—
|
|
|
1,530
|
|
|
|
—
|
|
Selling, general and administrative
|
|
|
|
|
|
|
|
|
|
|
PDC acquisition-related expenses
|
|
|
|
|
—
|
|
|
|
—
|
|
|
3,600
|
|
|
|
—
|
|
Restructuring charges
|
|
|
|
|
8,540
|
|
|
|
1,977
|
|
|
10,487
|
|
|
|
1,977
|
|
Non-cash income tax charge
|
|
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from Continuing Operations Before Income Taxes Excluding
Certain
|
|
|
|
|
|
|
|
|
Certain Items (non-GAAP measure)
|
|
|
|
$
|
36,442
|
|
|
$
|
41,306
|
|
$
|
101,251
|
|
|
$
|
114,072
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Taxes on Continuing Operations Excluding Certain Items:
|
Brady is presenting the Non-GAAP measure "Income Taxes on Continuing
Operations Excluding Certain Items." This is not a calculation based
upon GAAP. The amounts included in this Non-GAAP measure are derived
from amounts included in the Condensed Consolidated Statements of
Income data. We do not view these items to be part of our
sustainable results. We believe this measure provides an important
perspective of underlying business trends and results and provides a
more comparable measure from year to year. The table below provides
a reconciliation of Income Taxes on Continuing Operations to Income
Taxes on Continuing Operations Excluding Certain Items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended April 30,
|
|
Nine Months Ended April 30,
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Income Taxes on Continuing Operations (GAAP measure)
|
|
$
|
6,064
|
|
|
$
|
11,290
|
|
$
|
47,965
|
|
|
$
|
27,767
|
|
Cost of goods sold
|
|
|
|
|
|
|
|
|
|
|
Purchase accounting expense related to inventory
|
|
|
—
|
|
|
|
—
|
|
|
581
|
|
|
|
—
|
|
Selling, general and administrative
|
|
|
|
|
|
|
|
|
|
|
PDC acquisition-related expenses
|
|
|
|
|
—
|
|
|
|
—
|
|
|
641
|
|
|
|
—
|
|
Restructuring charges
|
|
|
|
|
1,691
|
|
|
|
162
|
|
|
2,003
|
|
|
|
162
|
|
Non-cash income tax charge
|
|
|
|
|
—
|
|
|
|
—
|
|
|
(25,000
|
)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Taxes on Continuing Operations Excluding Certain Items
|
|
|
|
|
|
|
|
|
(non-GAAP measure)
|
|
|
|
$
|
7,755
|
|
|
$
|
11,452
|
|
$
|
26,190
|
|
|
$
|
27,929
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings from Continuing Operations Excluding Certain Items:
|
Brady is presenting the Non-GAAP measure "Net Earnings from
Continuing Operations Excluding Certain Items." This is not a
calculation based upon GAAP. The amounts included in this Non-GAAP
measure are derived from amounts included in the Condensed
Consolidated Statements of Income data. We do not view these items
to be part of our sustainable results. We believe this measure
provides an important perspective of underlying business trends and
results and provides a more comparable measure from year to year.
The table below provides a reconciliation of Net Earnings from
Continuing Operations to Net Earnings from Continuing Operations
Excluding Certain Items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended April 30,
|
|
Nine Months Ended April 30,
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Net Earnings from Continuing Operations (GAAP measure)
|
|
$
|
21,838
|
|
|
$
|
28,039
|
|
$
|
37,669
|
|
|
$
|
84,328
|
|
Cost of goods sold
|
|
|
|
|
|
|
|
|
|
|
Purchase accounting expense related to inventory
|
|
|
—
|
|
|
|
—
|
|
|
949
|
|
|
|
—
|
|
Selling, general and administrative
|
|
|
|
|
|
|
|
|
|
|
PDC acquisition-related expenses
|
|
|
|
|
—
|
|
|
|
—
|
|
|
2,959
|
|
|
|
—
|
|
Restructuring charges
|
|
|
|
|
6,849
|
|
|
|
1,815
|
|
|
8,484
|
|
|
|
1,815
|
|
Non-cash income tax charge
|
|
|
|
|
—
|
|
|
|
—
|
|
|
25,000
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings from Continuing Operations Excluding Certain Items
|
|
|
|
|
|
|
|
|
(non-GAAP measure)
|
|
|
|
$
|
28,687
|
|
|
$
|
29,854
|
|
$
|
75,061
|
|
|
$
|
86,143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings from Continuing Operations Per Diluted Class A
Diluted Nonvoting Common Share Excluding Certain Items:
|
Brady is presenting the Non-GAAP measure "Net Earnings from
Continuing Operations Per Diluted Class A Nonvoting Common Share
Excluding Certain Items." This is not a calculation based upon GAAP.
The amounts included in this Non-GAAP measure are derived from
amounts included in the Condensed Consolidated Statements of Income
data. We do not view these items to be part of our sustainable
results. We believe this measure provides an important perspective
of underlying business trends and results and provides a more
comparable measure from year to year. The table below provides a
reconciliation of Net Earnings from Continuing Operations Per
Diluted Class A Nonvoting Common Share to Net Earnings from
Continuing Operations Per Diluted Class A Nonvoting Common Share
Excluding Certain Items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended April 30,
|
|
Nine Months Ended April 30,
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Net Earnings from Continuing Operations Per Class A Diluted
Nonvoting Share
|
|
$
|
0.42
|
|
|
$
|
0.53
|
|
$
|
0.73
|
|
|
$
|
1.59
|
|
(GAAP measure)
|
|
|
|
|
|
|
|
|
|
|
Cost of goods sold
|
|
|
|
|
|
|
|
|
|
|
Purchase accounting expense related to inventory
|
|
|
—
|
|
|
|
—
|
|
|
0.02
|
|
|
|
—
|
|
Selling, general and administrative
|
|
|
|
|
|
|
|
|
|
|
PDC acquisition-related expenses
|
|
|
|
|
—
|
|
|
|
—
|
|
|
0.06
|
|
|
|
—
|
|
Restructuring charges
|
|
|
|
|
0.13
|
|
|
|
0.03
|
|
|
0.16
|
|
|
|
0.03
|
|
Non-cash income tax charge
|
|
|
|
|
—
|
|
|
|
—
|
|
|
0.49
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings from Continuing Operations Per Class A Diluted
Nonvoting
|
|
|
|
|
|
|
|
|
Share Excluding Certain Items (non-GAAP measure)
|
|
$
|
0.55
|
|
|
$
|
0.56
|
|
$
|
1.45
|
|
|
$
|
1.62
|
|
<div class="copyright">
Copyright Business Wire 2013
</div>