Brady Corporation Reports Fiscal 2011 Fourth Quarter Results and Announces Share Buyback Program

Brady Corporation (NYSE:BRC), a world leader in identification solutions, today reported its full year fiscal 2011 financial results and financial results for the fourth quarter ended July 31, 2011. The company also announced that its Board of Directors authorized a share buyback program for up to two million shares of the company’s Class A Common Stock.

Year Ended July 31, 2011:

Net income for the year ended July 31, 2011 was up 32.6 percent to $108.7 million compared to $82.0 million for the year ended July 31, 2010. Excluding $6.6 million of after-tax restructuring charges for the year-ended July 31, 2011 and $11.4 million of after-tax restructuring charges for the year ended July 31, 2010, net income was up 23.4 percent to $115.3 million for the year ended July 31, 2011 compared to $93.4 million for the year ended July 31, 2010.

Earnings per diluted Class A Common Share were up 31.6 percent to $2.04 for the year ended July 31, 2011 compared to $1.55 for the year ended July 31, 2010. Excluding after-tax restructuring charges, earnings per diluted Class A Common Share increased 22.7 percent to $2.16 for the year ended July 31, 2011 compared to $1.76 per share for the year ended July 31, 2010.

Sales for the year-ended July 31, 2011 were up 6.4 percent to $1.34 billion compared to $1.26 billion for the year ended July 31, 2010. Organic sales growth was 2.9 percent, acquisitions net of divestitures contributed 1.0 percent to sales growth, and the impact of foreign currency translation increased sales by 2.5 percent during the year ended July 31, 2011. By segment, organic sales increased 3.2 percent in the Americas, 4.7 percent in Europe and 0.4 percent in the Asia-Pacific region.

Fourth Quarter Ended July 31, 2011:

Net income for the quarter ended July 31, 2011 was up 37.0 percent to $29.6 million compared to $21.6 million in the same quarter last year. Excluding $1.6 million of after-tax restructuring charges in the fourth quarter of fiscal 2011 and $4.6 million of after-tax restructuring charges in the same quarter last year, net income was up 19.1 percent to $31.2 million compared to $26.2 million in the same quarter last year.

Earnings per diluted Class A Common Share were up 34.1 percent to $0.55 in the fourth quarter of fiscal 2011 compared to $0.41 in the fourth quarter of fiscal 2010. Excluding after-tax restructuring charges, earnings per diluted Class A Common Share increased 18.4 percent to $0.58 in the fourth quarter of fiscal 2011 compared to $0.49 per share in the same quarter of fiscal 2010.

Sales for the fiscal 2011 fourth quarter were up 6.3 percent to $343.1 million compared to $322.9 million in the fourth quarter of fiscal 2010. Organic sales declined 0.6 percent, divestitures, net of acquisitions reduced sales by 0.2 percent, and the impact of foreign currency translation increased sales by 7.1 percent. By segment, organic sales increased 2.0 percent in Europe and 0.4 percent in the Asia-Pacific region and decreased 2.7 percent in the Americas’ region.

Share Buyback Program:

Brady’s Board of Directors has authorized a share buyback program for up to two million shares of the Company’s common stock. The share repurchase plan may be implemented from time to time on the open market or in privately negotiated transactions.

Commentary and Guidance:

"I am pleased with our strong earnings and cash flow both in the fourth quarter and the full fiscal year in light of a still challenging economy and relative moderate organic growth for the company. This is a testament to the positive impact BBPS is having on efficiency and productivity. During fiscal 2011, we returned $38.1 million of cash to our shareholders in the form of dividends, repaid $61.3 million of debt while increasing our cash position by $75.1 million; ending with $390 million of cash on hand at July 31, 2011,” said Frank M. Jaehnert, Brady’s President and Chief Executive Officer. "I’m also happy to report that our Board of Directors authorized a share buyback program for up to 2 million shares and approved an increase in the dividend to our shareholders for the 26^th straight year.”

"We remain focused on putting our cash to work through investment in organic growth opportunities as well as strategic acquisitions,” said Brady Chief Financial Officer Thomas J. Felmer. "As we look into fiscal 2012, we remain cautious about the health of the overall global economy. We believe that the pace of economic growth will be modest. Accordingly, we anticipate low-single-digit organic sales growth in fiscal 2012. For fiscal 2012, we expect earnings per diluted Class A Common Share of between $2.30 and $2.50, exclusive of after-tax restructuring charges. This guidance is based on current exchange rates, a full-year tax rate in the mid-20 percent range, capital expenditures of approximately $25 million, and depreciation and amortization of $45 million.”

A webcast regarding Brady’s fiscal 2011 fourth quarter financial results will be available at www.investor.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 and 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 employs approximately 6,500 people at operations in the Americas, Europe and Asia-Pacific. Brady’s fiscal 2011 sales were approximately $1.34 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.

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, 2010. 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.