MILWAUKEE, Nov. 16 /PRNewswire-FirstCall/ -- Brady Corporation (NYSE: BRC)
reports record sales and earnings for its fiscal 2006 first quarter ended
October 31, 2005.
Sales for the quarter rose 16.1 percent to $232.6 million compared to
$200.4 million in the first quarter of fiscal 2005. Base business increased
7.0 percent, acquisitions added 8.0 percent to sales, and the impact of
currency exchange contributed 1.1 percent to sales results.
Net income increased 48.3 percent in the fiscal 2006 first quarter to
$30.2 million or $0.60 per diluted Class A Common Share, compared to $20.4
million or $0.41 per diluted share in the same quarter last year.
"While we had set ambitious goals for ourselves, our expectations were
exceeded in the first quarter. We were pleased to see total base business
growth of 7.0 percent on tough comparables with the prior year. Our base
sales in Asia Pacific grew 32.2 percent driven largely by a seasonally strong
electronics business in China," said Frank M. Jaehnert, Brady's president and
chief executive officer. "Acquisitions also continue to contribute positively
to both our top and bottom lines. In fact, we've made four acquisitions this
quarter to give us greater capability and global reach. And we continue to
have a robust pipeline of potential acquisition candidates going forward."
"We continued to improve the profitability of all regions as we maintain
our discipline on cost control and successfully integrate acquisitions," said
David Mathieson, Brady's chief financial officer. "As a result of our strong
first quarter, and acquisitions previously announced this fiscal year, we are
revising our outlook for the full year. For fiscal 2006 we anticipate sales
of between $910 and $920 million, up from our previous guidance of $870 to
$880 million; net income between $98 and $100 million, up from $89 to $91
million; and earnings per share of $1.96 to $2.00, up from $1.78 to $1.82."
A webcast regarding fiscal 2006 first quarter results will be available at
http://www.investor.bradycorp.com beginning at 7:30 a.m. Central Standard Time
Thursday, November 17, followed by Brady's annual meeting of shareholders at
9:00 a.m. at Brady's Corporate Headquarters in Milwaukee.
Brady is an international manufacturer and marketer of identification and
materials solutions, with products including labels, signs, precision die-cut
materials, printing systems, software, and label-application and data-
collection systems for electronics, telecommunications, manufacturing,
electrical, and a variety of other markets. Founded in 1914, Brady is
headquartered in Milwaukee and employs about 4,700 people in operations in the
United States, Europe, Asia/Pacific, Latin America and Canada. The company
had sales of $816 million in fiscal 2005. Brady stock trades on the New York
Stock Exchange under the symbol BRC. More information is available on the
Internet at http://www.bradycorp.com , which includes an interactive version
of the 2005 Annual Report to Shareholders.
Information by regional segment for the three months ended October 31,
2005 and 2004 is as follows:
(in Thousands)
Corporate and
Americas Europe Asia Subtotals Eliminations Total
SALES TO EXTERNAL CUSTOMERS
Three months ended:
October 31,
2005 $116,059 $73,762 $42,814 $232,635 $232,635
October 31,
2004 105,449 64,527 30,443 200,419 200,419
SALES GROWTH INFORMATION
Three months ended
October 31, 2005:
Base 3.7% 0.5% 32.2% 7.0% 7.0%
Currency 1.9% -1.2% 3.4% 1.1% 1.1%
Acquisitions 4.5% 15.0% 5.0% 8.0% 8.0%
Total 10.1% 14.3% 40.6% 16.1% 16.1%
SEGMENT PROFIT (LOSS)
Three months ended:
October 31,
2005 $32,194 $20,778 $13,010 $65,982 ($2,386) $63,596
October 31,
2004 25,380 18,132 8,910 52,422 (1,425) 50,997
Percentage
increase 26.8% 14.6% 46.0% 25.9% 67.4% 24.7%
SEGMENT PROFIT RECONCILIATION (Dollars in thousands)
Three months ended:
October 31, 2005 October 31, 2004
Total profit for reportable segments $65,982 $52,422
Corporate and eliminations (2,386) (1,425)
Unallocated amounts:
Administrative costs (18,659) (17,601)
Interest - net (1,671) (1,825)
Foreign exchange 136 (30)
Other (870) (1,604)
-------- --------
Income before income taxes 42,532 29,937
Income taxes (12,334) (9,580)
-------- --------
Net income $30,198 $20,357
======== ========
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
(in Thousands)
(Unaudited)
--------------------------------------
Three Months Ended October 31,
--------------------------------------
Percentage
2005 2004 Change
---------- ------------ -----------
Net sales $232,635 $200,419 16.1%
Cost of products sold 108,644 94,894 14.5%
---------- ------------
Gross margin 123,991 105,525 17.5%
Operating expenses:
Research and development 6,534 5,704 14.6%
Selling, general and
administrative 73,328 68,028 7.8%
---------- ------------
Total operating expenses 79,862 73,732 8.3%
Operating income 44,129 31,793 38.8%
Other income and (expense):
Investment and other income 392 283 38.5%
Interest expense (1,989) (2,139) -7.0%
---------- ------------
Income before income taxes 42,532 29,937 42.1%
Income taxes 12,334 9,580 28.7%
Net income $30,198 $20,357 48.3%
========== ============
Per Class A Nonvoting Common Share (1):
Basic net income $0.61 $0.42 45.2%
Diluted net income $0.60 $0.41 46.3%
Dividends $0.13 $0.11 18.2%
Per Class B Voting Common Share (1):
Basic net income $0.60 $0.41 46.3%
Diluted net income $0.59 $0.40 47.5%
Dividends $0.11 $0.09 22.2%
Weighted average common shares
outstanding (in Thousands) (1):
Basic 49,250 48,475
Diluted 50,206 49,158
(1) Adjusted 2004 for two-for-one stock split in the form of a 100%
dividend, effective December 31, 2004.
BRADY CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
(Unaudited)
--------------------------------
October 31, 2005 July 31, 2005
---------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $53,128 $72,970
Short term investments - 7,100
Accounts receivable, less
allowance for losses ($3,875 and
$3,726, respectively) 136,490 123,453
Inventories:
Finished Products 42,743 38,827
Work-in-process 11,487 9,681
Raw materials and supplies 27,254 22,227
---------------- -------------
Total inventories 81,484 70,735
Prepaid expenses and other current
assets 28,014 28,114
---------------- -------------
Total current assets 299,116 302,372
Other assets:
Goodwill 345,244 332,369
Other Intangible assets 74,328 71,647
Deferred Income Taxes 38,585 39,043
Other 7,459 6,305
---------------- -------------
Total other assets 465,616 449,364
Property, plant and equipment:
Cost:
Land 6,494 6,388
Buildings and improvements 65,589 65,007
Machinery and equipment 161,115 157,093
Construction in progress 12,493 6,510
---------------- -------------
245,691 234,998
Less accumulated depreciation 142,085 136,587
---------------- -------------
Net property, plant and equipment 103,606 98,411
---------------- -------------
Total $868,338 $850,147
================ =============
LIABILITIES AND STOCKHOLDERS' INVESTMENT
Current liabilities:
Accounts payable $50,546 $52,696
Wages and amounts withheld from employees 29,408 49,620
Taxes, other than income taxes 6,401 4,815
Accrued income taxes 30,392 24,028
Other current liabilities 34,071 29,649
Short-term borrowings and current
maturities on long-term debt - 4
---------------- -------------
Total current liabilities 150,818 160,812
Long-term obligations, less current
maturities 161,023 150,026
Other liabilities 44,706 42,035
---------------- -------------
Total liabilities 356,547 352,873
Stockholders' investment:
Common stock:
Class A nonvoting common stock -
Issued and outstanding, 45,519,065
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 100,048 99,029
Income retained in the business 406,739 382,880
Treasury Stock - 362,678 and 85,344
shares, respectively of Class A
nonvoting common stock, at cost (10,025) (1,575)
Accumulated other comprehensive income 16,273 17,497
Other (1,738) (1,050)
---------------- -------------
Total stockholders' investment 511,791 497,274
---------------- -------------
Total $868,338 $850,147
================ =============
BRADY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in Thousands) (Unaudited)
Three Months Ended
October 31
2005 2004
--------- ---------
Operating activities:
Net income $30,198 $20,357
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 7,360 6,775
Income tax benefit from the exercise of
stock options - 2,184
Deferred Income taxes 187 (68)
Loss on sale or disposal of property, plant
& equipment 33 158
Provision for losses on accounts receivable 366 381
Non-cash portion of stock-based compensation
expense 924 1,193
Changes in operating assets and liabilities
(net of effects of business acquisitions):
Accounts receivable (10,391) (5,151)
Inventories (8,613) (3,536)
Prepaid expenses and other assets 468 2,644
Accounts payable and accrued liabilities (20,465) (16,725)
Income taxes 5,999 7,111
Other liabilities 1,990 1,001
--------- ---------
Net cash provided by operating
activities 8,056 16,324
Investing activities:
Acquisition of businesses, net of cash
acquired (20,217) (34,394)
Purchases of short-term investments (3,800) (8,700)
Sales of short-term investments 10,900 7,100
Purchases of property, plant and equipment (8,537) (2,819)
Proceeds from sale of property, plant and
equipment 21 298
Other (1,126) (407)
--------- ---------
Net cash used in investing activities (22,759) (38,922)
Financing activities:
Payment of dividends (5,938) (5,178)
Proceeds from issuance of common stock 374 5,643
Principal payments on debt (885) (30)
Net proceeds from debt 11,000 -
Purchase of treasury stock (9,416) -
--------- ---------
Net cash (used in) provided by financing
activities (4,865) 435
Effect of exchange rate changes on cash (274) 141
Net decrease in cash and cash equivalents (19,842) (22,022)
Cash and cash equivalents, beginning
of period 72,970 68,788
--------- ---------
Cash and cash equivalents, end of period $53,128 $46,766
========= =========
Supplemental disclosures:
Cash paid during the period for:
Interest, net of capitalized interest $(43) $78
Income taxes, net of refunds 4,956 489
Acquisitions:
Fair value of asset acquired, net of cash $12,300 $30,337
Liabilities assumed (6,390) (17,019)
Goodwill 14,307 21,076
--------- ---------
Net cash paid for acquisitions $20,217 $34,394
========= =========
SOURCE Brady Corporation
 back to top
Related links:
http://www.bradycorp.com
CONTACT:
Investors, Barbara Bolens, +1-414-438-6940,
or Media, Carole Herbstreit, +1-414-438-6882, both of Brady
Corporation
|
