Wisconsin | 1-14959 | 39-0971239 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
6555 West Good Hope Road Milwaukee, Wisconsin |
53223 |
|
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 | RESULTS OF OPERATIONS AND FINANCIAL CONDITION |
Item 5.07 | SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS |
Item 8.01 | OTHER EVENTS |
Item 9.01 | FINANCIAL STATEMENTS AND EXHIBITS |
Exhibit No. | Description of Exhibit | |||
99.1 | Press Release of Brady Corporation, dated November 18, 2011, relating to first quarter fiscal
2012 financial results. |
BRADY CORPORATION |
||||
Date: November 23, 2011 |
||||
/s/ THOMAS J. FELMER
Senior Vice President & Chief Financial Officer |
EXHIBIT | ||||
NUMBER | DESCRIPTION | |||
99.1 | Press Release of Brady Corporation, dated November 18, 2011, relating to first quarter
fiscal 2012 financial results. |
(Unaudited) | ||||||||||||
Three Months Ended October 31, | ||||||||||||
Percentage | ||||||||||||
2011 | 2010 | Change | ||||||||||
Net sales |
$ | 349,508 | $ | 329,588 | 6.0 | % | ||||||
Cost of products sold |
181,677 | 165,076 | 10.1 | % | ||||||||
Gross margin |
167,831 | 164,512 | 2.0 | % | ||||||||
Operating expenses: |
||||||||||||
Research and development |
9,809 | 9,944 | -1.4 | % | ||||||||
Selling, general and administrative |
108,932 | 109,324 | -0.4 | % | ||||||||
Restructuring charges |
| 3,641 | -100.0 | % | ||||||||
Total operating expenses |
118,741 | 122,909 | -3.4 | % | ||||||||
Operating income |
49,090 | 41,603 | 18.0 | % | ||||||||
Other income and (expense): |
||||||||||||
Investment and other income (expense) |
(202 | ) | 290 | -169.7 | % | |||||||
Interest expense |
(5,047 | ) | (5,687 | ) | -11.3 | % | ||||||
Income before income taxes |
43,841 | 36,206 | 21.1 | % | ||||||||
Income taxes |
11,109 | 9,925 | 11.9 | % | ||||||||
Net income |
$ | 32,732 | $ | 26,281 | 24.5 | % | ||||||
Per Class A Nonvoting Common Share: |
||||||||||||
Basic net income |
$ | 0.62 | $ | 0.50 | 24.0 | % | ||||||
Diluted net income |
$ | 0.62 | $ | 0.50 | 24.0 | % | ||||||
Dividends |
$ | 0.185 | $ | 0.18 | 2.8 | % | ||||||
Per Class B Voting Common Share: |
||||||||||||
Basic net income |
$ | 0.60 | $ | 0.48 | 25.0 | % | ||||||
Diluted net income |
$ | 0.60 | $ | 0.48 | 25.0 | % | ||||||
Dividends |
$ | 0.168 | $ | 0.163 | 3.1 | % | ||||||
Weighted average common shares outstanding (in thousands): |
||||||||||||
Basic |
52,657 | 52,448 | ||||||||||
Diluted |
52,954 | 52,810 |
(Unaudited) | ||||||||
October 31, 2011 | July 31, 2011 | |||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 371,594 | $ | 389,971 | ||||
Accounts receivable net |
232,837 | 228,483 | ||||||
Inventories: |
||||||||
Finished products |
64,652 | 62,152 | ||||||
Work-in-process |
16,259 | 14,550 | ||||||
Raw materials and supplies |
28,752 | 27,484 | ||||||
Total inventories |
109,663 | 104,186 | ||||||
Prepaid expenses and other current assets |
42,120 | 35,647 | ||||||
Total current assets |
756,214 | 758,287 | ||||||
Other assets: |
||||||||
Goodwill |
792,303 | 800,343 | ||||||
Other intangible assets |
84,461 | 89,961 | ||||||
Deferred income taxes |
50,676 | 53,755 | ||||||
Other |
19,444 | 19,244 | ||||||
Property, plant and equipment: |
||||||||
Cost: |
||||||||
Land |
6,360 | 6,406 | ||||||
Buildings and improvements |
103,683 | 104,644 | ||||||
Machinery and equipment |
303,493 | 305,557 | ||||||
Construction in progress |
13,431 | 11,226 | ||||||
426,967 | 427,833 | |||||||
Less accumulated depreciation |
290,704 | 287,918 | ||||||
Property, plant and equipment net |
136,263 | 139,915 | ||||||
Total |
$ | 1,839,361 | $ | 1,861,505 | ||||
LIABILITIES AND STOCKHOLDERS INVESTMENT |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 96,237 | $ | 98,847 | ||||
Wages and amounts withheld from employees |
46,221 | 69,798 | ||||||
Taxes, other than income taxes |
8,963 | 7,612 | ||||||
Accrued income taxes |
16,170 | 9,954 | ||||||
Other current liabilities |
57,717 | 54,406 | ||||||
Current maturities on long-term debt |
61,264 | 61,264 | ||||||
Total current liabilities |
286,572 | 301,881 | ||||||
Long-term obligations, less current maturities |
330,054 | 331,914 | ||||||
Other liabilities |
68,200 | 71,518 | ||||||
Total liabilities |
684,826 | 705,313 | ||||||
Stockholders investment: |
||||||||
Common stock: |
||||||||
Class A nonvoting common stock Issued 51,261,487 and 51,261,487 shares,
respectively and outstanding 48,862,485 and 49,284,252 shares, respectively |
513 | 513 | ||||||
Class B voting common stock Issued and outstanding, 3,538,628 shares |
35 | 35 | ||||||
Additional paid-in capital |
310,602 | 307,527 | ||||||
Earnings retained in the business |
812,142 | 789,100 | ||||||
Treasury stock - 2,082,801 and 1,667,235 shares, respectively of Class A
nonvoting common stock, at cost |
(61,015 | ) | (50,017 | ) | ||||
Accumulated other comprehensive income |
96,778 | 113,898 | ||||||
Other |
(4,520 | ) | (4,864 | ) | ||||
Total stockholders investment |
1,154,535 | 1,156,192 | ||||||
Total |
$ | 1,839,361 | $ | 1,861,505 | ||||
(Unaudited) | ||||||||
Three Months Ended | ||||||||
October 31, | ||||||||
2011 | 2010 | |||||||
Operating activities: |
||||||||
Net income |
$ | 32,732 | $ | 26,281 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
Depreciation and amortization |
11,241 | 12,594 | ||||||
Deferred income taxes |
4,399 | (4,849 | ) | |||||
Non-cash portion of stock-based compensation expense |
3,591 | 4,069 | ||||||
Non-cash portion of restructuring charges |
| 951 | ||||||
Changes in operating assets and liabilities
(net of effects of business acquisitions/divestitures): |
||||||||
Accounts receivable |
(7,798 | ) | (13,614 | ) | ||||
Inventories |
(7,156 | ) | (3,689 | ) | ||||
Prepaid expenses and other assets |
(7,384 | ) | 1,078 | |||||
Accounts payable and accrued liabilities |
(21,814 | ) | (16,909 | ) | ||||
Income taxes |
7,470 | 10,245 | ||||||
Net cash provided by operating activities |
15,281 | 16,157 | ||||||
Investing activities: |
||||||||
Purchases of property, plant and equipment |
(5,817 | ) | (2,810 | ) | ||||
Settlement of net investment hedges |
(958 | ) | | |||||
Other |
(233 | ) | (908 | ) | ||||
Net cash used in investing activities |
(7,008 | ) | (3,718 | ) | ||||
Financing activities: |
||||||||
Payment of dividends |
(9,690 | ) | (9,424 | ) | ||||
Proceeds from issuance of common stock |
683 | 2,105 | ||||||
Purchase of treasury stock |
(12,309 | ) | | |||||
Income tax benefit from the exercise of stock options and deferred
compensation distribution, and other |
456 | (146 | ) | |||||
Net cash used in financing activities |
(20,860 | ) | (7,465 | ) | ||||
Effect of exchange rate changes on cash |
(5,790 | ) | 6,286 | |||||
Net (decrease) increase in cash and cash equivalents |
(18,377 | ) | 11,260 | |||||
Cash and cash equivalents, beginning of period |
389,971 | 314,840 | ||||||
Cash and cash equivalents, end of period |
$ | 371,594 | $ | 326,100 | ||||
Supplemental disclosures: |
||||||||
Cash paid during the period for: |
||||||||
Interest, net of capitalized interest |
$ | 6,082 | $ | 7,211 | ||||
Income taxes, net of refunds |
5,825 | 5,907 |
Corporate | ||||||||||||||||||||||||
and | ||||||||||||||||||||||||
(in thousands) | Americas | Europe | Asia-Pacific | Total Region | Eliminations | Total | ||||||||||||||||||
SALES TO EXTERNAL CUSTOMERS |
||||||||||||||||||||||||
Three months ended: |
||||||||||||||||||||||||
October 31, 2011 |
$ | 153,863 | $ | 97,356 | $ | 98,289 | $ | 349,508 | | $ | 349,508 | |||||||||||||
October 31, 2010 |
$ | 145,988 | $ | 92,050 | $ | 91,550 | $ | 329,588 | | $ | 329,588 | |||||||||||||
SALES GROWTH INFORMATION |
||||||||||||||||||||||||
Three months ended October 31, 2011: |
||||||||||||||||||||||||
Base |
5.7 | % | 3.7 | % | -0.2 | % | 3.5 | % | | 3.5 | % | |||||||||||||
Currency |
0.4 | % | 3.7 | % | 5.5 | % | 2.7 | % | | 2.7 | % | |||||||||||||
Acquisitions/Divestitures |
-0.7 | % | -1.6 | % | 2.1 | % | -0.2 | % | | -0.2 | % | |||||||||||||
Total |
5.4 | % | 5.8 | % | 7.4 | % | 6.0 | % | | 6.0 | % | |||||||||||||
Three months ended October 31, 2010: |
||||||||||||||||||||||||
Base |
4.3 | % | 0.7 | % | -0.3 | % | 2.0 | % | | 2.0 | % | |||||||||||||
Currency |
0.7 | % | -6.9 | % | 4.4 | % | -0.5 | % | | -0.5 | % | |||||||||||||
Acquisitions/Divestitures |
2.2 | % | 3.8 | % | 0.0 | % | 2.0 | % | | 2.0 | % | |||||||||||||
Total |
7.2 | % | -2.4 | % | 4.1 | % | 3.5 | % | | 3.5 | % | |||||||||||||
SEGMENT PROFIT (LOSS) |
||||||||||||||||||||||||
Three months ended: |
||||||||||||||||||||||||
October 31, 2011 |
$ | 43,230 | $ | 26,299 | $ | 13,304 | $ | 82,833 | $ | (3,263 | ) | $ | 79,570 | |||||||||||
October 31, 2010 |
$ | 39,359 | $ | 24,061 | $ | 16,829 | $ | 80,249 | $ | (3,436 | ) | $ | 76,813 | |||||||||||
Percentage increase (decrease) |
9.8 | % | 9.3 | % | -20.9 | % | 3.2 | % | 3.6 | % |
Three months ended: | ||||||||
October 31, | October 31, | |||||||
2011 | 2010 | |||||||
Total profit for reportable segments |
$ | 82,833 | $ | 80,249 | ||||
Corporate and eliminations |
(3,263 | ) | (3,436 | ) | ||||
Unallocated amounts: |
||||||||
Administrative costs |
(30,480 | ) | (31,569 | ) | ||||
Restructuring costs |
| (3,641 | ) | |||||
Investment and other income (expense) |
(202 | ) | 290 | |||||
Interest expense |
(5,047 | ) | (5,687 | ) | ||||
Income before income taxes |
43,841 | 36,206 | ||||||
Income taxes |
(11,109 | ) | (9,925 | ) | ||||
Net income |
$ | 32,732 | $ | 26,281 | ||||
Fiscal 2012 | ||||||||||||||||||||
Q1 | Q2 | Q3 | Q4 | Total | ||||||||||||||||
EBITDA (1) |
||||||||||||||||||||
Net income |
$ | 32,732 | $ | 32,732 | ||||||||||||||||
Interest expense |
5,047 | 5,047 | ||||||||||||||||||
Income taxes |
11,109 | 11,109 | ||||||||||||||||||
Depreciation and amortization |
11,241 | 11,241 | ||||||||||||||||||
EBITDA (non-GAAP measure) |
$ | 60,129 | $ | | $ | | $ | | $ | 60,129 | ||||||||||
Fiscal 2011 | ||||||||||||||||||||
Q1 | Q2 | Q3 | Q4 | Total | ||||||||||||||||
EBITDA (1) |
||||||||||||||||||||
Net income |
$ | 26,281 | $ | 24,199 | $ | 28,589 | $ | 29,583 | $ | 108,652 | ||||||||||
Interest expense |
5,687 | 5,850 | 5,103 | 5,484 | 22,124 | |||||||||||||||
Income taxes |
9,925 | 8,205 | 8,607 | 8,669 | 35,406 | |||||||||||||||
Depreciation and amortization |
12,594 | 12,908 | 12,020 | 11,305 | 48,827 | |||||||||||||||
EBITDA (non-GAAP measure) |
$ | 54,487 | $ | 51,162 | $ | 54,319 | $ | 55,041 | $ | 215,009 | ||||||||||
(1) | 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 and 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 companys operating performance, or as an alternative to operating cash flows 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. |