MILWAUKEE, Feb. 17 /PRNewswire-FirstCall/ -- Brady Corporation
(NYSE: BRC), a world leader in identification solutions, today announced a
record second quarter ended January 31, 2006.
Sales for the quarter were up 17.7 percent to $231.0 million, compared to
$196.2 million in the second quarter of fiscal 2005. Base business growth was
up 9.5 percent, acquisitions contributed 11.1 percent to sales, and currency
exchange was a negative 2.9 percent. Net income for the quarter increased
3.3 percent to $21.3 million or $0.43 per diluted Class A Common share,
compared to $20.6 million or $0.41 per share in the fiscal 2005 second
quarter.
Sales for the six months ended January 31, 2006, rose 16.9 percent to
$463.6 million, compared to $396.6 million in the same period last year. Net
income for the first six months of fiscal 2006 rose 25.7 percent to
$51.5 million or $1.03 per diluted Class A Common share compared to
$40.9 million or $0.83 per share for the first half of fiscal 2005.
"Strong organic sales growth and successful integration of acquisitions
contributed to our good performance in this quarter against the backdrop of an
exceptionally strong quarter in the prior year," said Frank M. Jaehnert,
Brady's president and chief executive officer.
"As a result of our continued strong performance in the first half of the
fiscal year, successful acquisitions, the completion of the recent private
placement of $200 million in ten-year notes at 5.3 percent to institutional
investors, and expectations of a stable economic environment, we are
increasing our guidance for fiscal 2006," said Brady Chief Financial Officer
David Mathieson. "We anticipate sales of $980 to $990 million, with net income
between $100 and $103 million and diluted earnings per share of $2.00 to
$2.06, up from previous guidance of sales of $910 to $920 million, net income
of $98 to $100 million and earnings per share of $1.96 to $2.00."
A webcast regarding fiscal 2006 second quarter results will be available
at http://www.investor.bradycorp.com beginning at 9:30 a.m. Central Standard
Time today.
Brady Corporation is an international manufacturer and marketer of
complete solutions that identify and protect premises, products and people.
Its products help customers increase safety, security, productivity
and performance and include high-performance labels and signs, safety devices,
printing systems and software, and precision die-cut materials. Founded in
1914, the company has more than 300,000 customers in electronics,
telecommunications, manufacturing, electrical, construction, education,
medical and a variety of other industries. Brady is headquartered in
Milwaukee and employs about 5,500 people in operations in the United States,
Europe, Asia/Pacific, Latin America and Canada. Brady's fiscal 2005 sales
were approximately $816 million. More information is available on the
Internet at http://www.bradycorp.com .
Information by regional segment for the three and six months ended
January 31, 2006 and 2005 is as follows:
Corporate and
(in Thousands) Americas Europe Asia Subtotals Eliminations Total
SALES TO
EXTERNAL
CUSTOMERS
Three months
ended:
January 31,
2006 $109,951 $76,284 $44,739 $230,974 - $230,974
January 31,
2005 95,255 70,886 30,075 196,216 - 196,216
Six months
ended:
January 31,
2006 $226,010 $150,046 $87,553 $463,609 - $463,609
January 31,
2005 200,704 135,413 60,518 396,635 - 396,635
SALES GROWTH
INFORMATION
Three months ended
January 31, 2006:
Base 5.2% 2.5% 39.4% 9.5% 0.0% 9.5%
Currency 1.3% -9.4% -0.7% -2.9% 0.0% -2.9%
Acquisitions 8.9% 14.5% 10.1% 11.1% 0.0% 11.1%
Total 15.4% 7.6% 48.8% 17.7% 0.0% 17.7%
Six months ended
January 31, 2006:
Base 4.4% 1.5% 35.8% 8.2% 8.2%
Currency 1.6% -5.5% 1.4% -0.9% -0.9%
Acquisitions 6.6% 14.8% 7.5% 9.6% 9.6%
Total 12.6% 10.8% 44.7% 16.9% 0.0% 16.9%
SEGMENT PROFIT (LOSS)
Three months ended:
January 31,
2006 $24,969 $19,989 $11,717 $56,675 ($2,631) $54,044
January 31,
2005 20,431 21,601 8,709 50,741 ($585) 50,156
Percentage
increase
(decrease) 22.2% -7.5% 34.5% 11.7% 349.7% 7.8%
Six months ended:
January 31,
2006 $57,163 $40,767 $24,727 $122,657 ($5,017) $117,640
January 31,
2005 45,811 39,733 17,619 103,163 ($2,010) 101,153
Percentage
increase 24.8% 2.6% 40.3% 18.9% 149.6% 16.3%
NET INCOME RECONCILIATION (in thousands)
Three months ended: Six months ended:
January 31, January 31, January 31, January 31,
2006 2005 2006 2005
Total profit for
reportable segments $56,675 $50,741 $122,657 $103,163
Corporate and
eliminations (2,631) (585) ($5,017) (2,010)
Unallocated amounts:
Administrative costs (22,279) (18,637) (40,938) (36,238)
Interest - net (2,239) (1,821) (3,910) (3,646)
Foreign exchange (75) 276 61 246
Other (522) (584) (1,392) (2,188)
Income before income
taxes 28,929 29,390 71,461 59,327
-----------------------------------------------
Income taxes (7,675) (8,811) (20,009) (18,391)
-----------------------------------------------
Net income $21,254 $20,579 $51,452 $40,936
===============================================
This news release contains "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995 - that is, statements
related to future, not past events. In this context forward-looking statements
often address our expected future business and financial performance, and
often contain certain words such as "expect, anticipate, intend, plan,
believe, seek, will, or may." Forward-looking statements by their nature
address matters that are, to different degrees uncertain. For us,
uncertainties arise from future financial performance of major markets we
serve which include, without limitation, telecommunications, manufacturing,
electrical, construction, laboratory, education, governmental, public utility,
computer, transportation; future integration of and performance of acquired
businesses; fluctuations in currency rates versus the US dollar; technology
changes; interruptions to sources of supply; business interruptions due to
implementing business systems; and numerous other matters of national,
regional and global scale, including those of a political, economic, business,
competitive and regulatory nature and those identified in reports we file with
the SEC. These uncertainties may cause our actual future results to be
materially different than those expressed in our forward-looking statements.
We do not undertake to update our forward-looking statements.
BRADY CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in Thousands)
(Unaudited)
-------------------------------------------------------------
Three Months Ended January 31, Six Months Ended January 31,
------------------------------- ----------------------------
Percentage Percentage
2006 2005 Change 2006 2005 Change
-------- -------- ---------- -------- -------- ----------
Net sales $230,974 $196,216 17.7% $463,609 $396,635 16.9%
Cost of
products
sold 113,869 91,260 24.8% 222,513 186,154 19.5%
Gross
margin 117,105 104,956 11.6% 241,096 210,481 14.5%
-------- -------- -------- --------
Operating expenses:
Research
and
development 6,829 6,099 12.0% 13,363 11,803 13.2%
Selling,
general and
admini-
strative 79,000 67,923 16.3% 152,328 135,951 12.0%
-------- -------- -------- --------
Total operating
expenses 85,829 74,022 16.0% 165,691 147,754 12.1%
Operating
income 31,276 30,934 1.1% 75,405 62,727 20.2%
Other income
and (expense):
Investment
and other
income 88 493 -82.2% 480 776 -38.1%
Interest
expense (2,435) (2,037) 19.5% (4,424) (4,176) 5.9%
-------- -------- -------- --------
Income before
income taxes 28,929 29,390 -1.6% 71,461 59,327 20.5%
Income taxes 7,675 8,811 -12.9% 20,009 18,391 8.8%
-------- -------- -------- --------
Net income $21,254 $20,579 3.3% $51,452 $40,936 25.7%
======== ======== ======== ========
Per Class A
Nonvoting Common
Share:
Basic net
income $0.43 $0.42 2.4% $1.05 $0.84 25.0%
Diluted net
income $0.43 $0.41 4.9% $1.03 $0.83 24.1%
Dividends $0.13 $0.11 18.2% $0.26 $0.22 18.2%
Per Class B
Voting Common
Share:
Basic net
income $0.43 $0.42 2.4% $1.03 $0.82 25.6%
Diluted net
income $0.43 $0.41 4.9% $1.02 $0.81 25.9%
Dividends $0.13 $0.11 18.2% $0.24 $0.20 20.0%
Weighted average
common shares
outstanding
(in Thousands):
Basic 48,994 49,060 49,098 48,773
Diluted 49,813 49,989 49,891 49,584
BRADY CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
(Unaudited)
------------------------------------
January 31, 2006 July 31, 2005
---------------- -------------
ASSETS
------
Current assets:
Cash and cash equivalents $50,742 $72,970
Short term investments - 7,100
Accounts receivable, less
allowance for losses ($3,820 and 145,794 123,453
$3,726, respectively)
Inventories:
Finished Products 42,706 38,827
Work-in-process 12,103 9,681
Raw materials and supplies 32,185 22,227
-------- --------
Total inventories 86,994 70,735
Prepaid expenses and other current assets 32,381 28,114
-------- --------
Total current assets 315,911 302,372
Other assets:
Goodwill 403,794 332,369
Other Intangible assets 87,554 71,647
Deferred Income Taxes 38,187 39,043
Other 7,903 6,305
-------- --------
Total other assets 537,438 449,364
Property, plant and equipment:
Cost:
Land 6,520 6,388
Buildings and improvements 71,625 65,007
Machinery and equipment 167,981 157,093
Construction in progress 8,811 6,510
-------- --------
254,937 234,998
Less accumulated depreciation 144,483 136,587
-------- --------
Net property, plant and equipment 110,454 98,411
-------- --------
Total $963,803 $850,147
======== ========
LIABILITIES AND STOCKHOLDERS' INVESTMENT
----------------------------------------
Current liabilities:
Accounts payable $54,886 $52,696
Wages and amounts withheld from employees 38,026 49,620
Taxes, other than income taxes 5,761 4,815
Accrued income taxes 14,546 24,028
Other current liabilities 26,712 29,649
Short-term borrowings and current
maturities on long-term debt 155 4
-------- --------
Total current liabilities 140,086 160,812
Long-term obligations, less current
maturities 250,217 150,026
Other liabilities 48,700 42,035
-------- --------
Total liabilities 439,003 352,873
Stockholders' investment:
Common stock:
Class A nonvoting common stock -
Issued 45,881,743 and 45,877,543
shares, respectively and outstanding
45,421,577 and 45,792,199 shares,
respectively 459 458
Class B voting common stock -
Issued and outstanding, 3,538,628
shares 35 35
Additional paid-in capital 100,160 99,029
Income retained in the business 421,622 382,880
Treasury Stock - 460,166 and 85,344
shares, respectively of Class A
nonvoting common stock, at cost (16,554) (1,575)
Accumulated other comprehensive income 20,865 17,497
Other (1,787) (1,050)
-------- --------
Total stockholders' investment 524,800 497,274
-------- --------
Total $963,803 $850,147
======== ========
BRADY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in Thousands) (Unaudited)
Six Months Ended
Jan-31
2006 2005
--------- --------
Operating activities:
Net income $51,452 $40,936
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 14,554 13,253
Income tax benefit from the
exercise of stock options - 3,740
Deferred Income taxes 712 1,492
Loss on sale or disposal of
property, plant & equipment 45 470
Provision for losses on accounts
receivable 623 618
Non-cash portion of stock-based
compensation expense 2,827 2,048
Changes in operating assets and
liabilities (net of effects of
business acquisitions):
Accounts receivable (11,250) 888
Inventories (11,537) (7,151)
Prepaid expenses and other assets (2,959) (1,715)
Accounts payable and accrued liabilities (17,512) (19,323)
Income taxes (10,127) 5,748
Other liabilities 3,970 2,732
--------- --------
Net cash provided by operating
activities 20,798 43,736
Investing activities:
Acquisition of businesses, net of
cash acquired (100,256) (34,428)
Purchases of short-term investments (3,800) (20,500)
Sales of short-term investments 10,900 22,300
Purchases of property, plant and
equipment (17,341) (9,648)
Proceeds from sale of property,
plant and equipment 66 262
Other (1,711) (2,364)
--------- --------
Net cash used in investing activities (112,142) (44,378)
Financing activities:
Payment of dividends (12,710) (10,473)
Proceeds from issuance of common stock 6,467 12,655
Principal payments on debt (829) (37)
Net proceeds from issuance of debt 100,000 -
Purchase of treasury stock (27,233) -
Income tax benefit from the
exercise of stock options 3,354 -
--------- --------
Net cash provided by
financing activities 69,049 2,145
Effect of exchange rate changes on cash 67 696
Net (decrease) increase in cash and
cash equivalents (22,228) 2,199
Cash and cash equivalents, beginning
of period 72,970 68,788
--------- --------
Cash and cash equivalents, end of period $50,742 $70,987
========= ========
Supplemental disclosures:
Cash paid during the period for:
Interest, net of capitalized interest $3,907 $4,051
Income taxes, net of refunds 24,510 6,122
Acquisitions:
Fair value of asset acquired, net of cash $39,422 $25,938
Liabilities assumed (9,326) (15,013)
Goodwill 70,160 23,503
--------- --------
Net cash paid for acquisitions $100,256 $34,428
========= ========
SOURCE Brady Corporation
 back to top
Related links:
http://www.bradycorp.com
Company News On-Call:
http://www.prnewswire.com/comp/952350.html
CONTACT:
Investors, Barbara Bolens, +1-414-438-6940,
or Media, Carole Herbstreit, +1-414-438-6882, both of Brady
Corporation
|
