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Brady Corp. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: June 7, 2011 04:53PM

Brady Corp. (BRC) filed Quarterly Report for the period ended 2011-04-30. Brady Corp. has a market cap of $1.76 billion; its shares were traded at around $33.34 with a P/E ratio of 16.2 and P/S ratio of 1.4. The dividend yield of Brady Corp. stocks is 2.2%. Brady Corp. had an annual average earning growth of 14.6% over the past 10 years.



Highlight of Business Operations:

Sales for the quarter ended April 30, 2011, increased 4.9% to $337.9 million, compared to $321.9 million in the same period of fiscal 2010. Of the increase in sales, organic sales increased 1.0%, acquisitions net of divestitures added 0.4% and the effects of fluctuations in the exchange rates used to translate financial results into the United States dollar increased sales by 3.5%. Net income for the quarter ended April 30, 2011, was $28.6 million or $0.54 per diluted Class A Nonvoting Common Share, up 20.7% and 20.0%, respectively, from $23.7 million or $0.45 per diluted Class A Nonvoting Common Share reported in the third quarter of last fiscal year. Net income before restructuring-related expenses for the quarter ended April 30, 2011 was $29.5 million, or $0.55 per diluted Class A Nonvoting Common Share, an increase of 16.1% from $25.4 million, or $0.48 per diluted Class A Nonvoting Common Share for the quarter ended April 30, 2010.

Sales for the nine months ended April 30, 2011, increased 6.4% to $996.5 million, compared to $936.2 million in the same period of fiscal 2010. Of the increase in sales, organic sales increased 4.1%, acquisitions net of divestitures added 1.4% and the effects of fluctuations in the exchange rates used to translate financial results into the United States dollar increased sales 0.9%. Net income for the nine months ended April 30, 2011, was $79.1 million or $1.49 per diluted Class A Nonvoting Common Share, up 31.0% and 30.7%, respectively, from $60.4 million or $1.14 per diluted Class A Nonvoting Common Share reported in the same period of the prior fiscal year. Net income before restructuring-related expenses for the nine months ended April 30, 2011 was $84.1 million or $1.58 per diluted Class A Nonvoting Common Share, an increase of 25.0% from $67.3 million or $1.27 per diluted Class A Nonvoting Common Share, for the nine months ended April 30, 2010.

Restructuring expenses decreased to $1.2 million from $2.3 million for the three months ended April 30, 2011, as compared to the same period in the prior year, and decreased to $7.0 million from $9.6 million for the nine months ended April 30, 2011 as compared to the same period in the prior year. In fiscal 2009, in response to the global recession, the Company took several measures to address its cost structure. The Company continued to incur costs related to the reduction of its workforce and facilities consolidations during the nine months ended April 30, 2011. The Company expects to incur $8 to $10 million of restructuring charges in fiscal 2011.

Net income for the three months ended April 30, 2011, increased 20.7% to $28.6 million, compared to $23.7 million for the same quarter of the previous year. Net income as a percentage of sales increased to 8.5% from 7.4% for the quarter ended April 30, 2011, compared to the same period in the prior year. Net income before restructuring-related expenses for the quarter ended April 30, 2011 was $29.5 million, an increase of 16.1% from $25.4 million, for the same period in the previous year. For the nine months ended April 30, 2011, net income increased 31.0% to $79.1 million, compared to $60.4 million for the same period in the previous year. As a percentage of sales, net income increased to 7.9% from 6.4% for the nine months ended April 30, 2011, compared to the same period in the previous year. Net income before restructuring-related expenses for the nine months ended April 30, 2011 was $84.1 million, an increase of 25.0% from $67.3 million, for the nine months ended April 30, 2010. The improved earnings for the nine months ended April 30, 2011, was primarily driven by the organic growth, which included organic growth in all three segments along with the impacts of the Company’s on-going process improvement activities.

Cash used for acquisitions totaled $8.0 million for the nine months ended April 30, 2011 due to the acquisition of ID Warehouse. The Company used $30.4 million for acquisitions of Welco, Stickolor, and Securimed during the nine months ended April 30, 2010; the net cash paid for Welco, Stickolor, and Securimed was $1.8 million, $18.5 million, and $10.1 million, respectively. Cash received from divestiture was $13.0 million during the nine months ended April 30, 2011 as a result of the sale of the Teklynx business.

Capital expenditures were $13.7 million for the nine months ended April 30, 2011, compared to $20.9 million in the same period last year. The decrease was mainly due to the expenditures related to the new coater in the Americas segment and the increased tooling required for new products in fiscal 2010. Capital expenditures were $26.3 million during the twelve months ended July 31, 2010. The Company expects the capital expenditures to be between $18.0 million and $20.0 million for the twelve months ending July 31, 2011. Net cash used in financing activities was $62.8 million for the nine months ended April 30, 2011, due primarily to the payment of dividends of $28.5 million and the principal debt payments of $42.5 million, partially offset by the proceeds from the issuance of the common stock related to stock option exercises.

Read the The complete Report



Stocks Discussed: BRC,
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