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UNITED STATES
\nSECURITIES AND EXCHANGE COMMISSION\n
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Washington, D.C. 20549\n
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FORM 8-K\n
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CURRENT REPORT
\nPursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934\n
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Date of Report (Date of earliest event reported): May 20, 2009
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BRADY CORPORATION\n
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(Exact name of registrant as specified in its charter)
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Commission File Number 1-14959
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Wisconsin\n 39-0971239
(State of Incorporation)\n (IRS Employer Identification No.)
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6555 West Good Hope Road
\nMilwaukee, Wisconsin 53223
\n(Address of Principal Executive Offices and Zip Code)
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(414) 358-6600
\n(Registrant’s Telephone Number)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the\nfiling obligation of the registrant under any of the following provisions:\n
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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))
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Item 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION\n
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     On May 20, 2009, Brady Corporation (the “Corporation”) issued a press release announcing its\nfiscal 2009 third quarter financial results. A copy of the press release is being furnished to the\nSecurities and Exchange Commission as Exhibit 99.1 attached herewith and is incorporated herein by\nreference.\n
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Item 9.01 FINANCIAL STATEMENTS AND EXHIBITS.\n
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(d) Exhibits.\n\n
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The following is filed as an Exhibit to this Report.\n
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Exhibit No. Description of Exhibit
 
99.1\n
 Press Release of Brady Corporation, dated May 20, 2009, relating to the Corporation’s\nfiscal 2009 third quarter financial results
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SIGNATURE\n
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Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused\nthis report to be signed on its behalf by the undersigned hereunto duly authorized.\n
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 BRADY CORPORATION
\n 		 
Date: May 22, 2009 /s/ Thomas J. Felmer\n  
 Thomas J. Felmer  
 Senior Vice President &
\n\nChief Financial Officer 		 
 
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EXHIBIT INDEX\n
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Exhibit No. Description of Exhibit
 
99.1\n
 Press Release of Brady Corporation, dated May 20, 2009, relating to the Corporation’s\nfiscal 2009 third quarter financial results
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\n\nexv99w1\n\n\n\n
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Exhibit 99.1\n
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For More Information:
\nInvestor contact: Barbara Bolens 414-438-6940
\nMedia contact: Carole Herbstreit 414-438-6882\n\n
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For Immediate Release\n
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Brady reports F’09 third-quarter sales and earnings\n\n
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MILWAUKEE (May 20, 2009)—Brady Corporation (NYSE: BRC), a world leader in identification\nsolutions, today announced third quarter sales and earnings for its fiscal quarter ended April 30,\n2009.\n
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          Sales for the quarter were $276.7 million compared to sales of $381.9 million in the fiscal\n2008 third quarter, down 27.5 percent. Organic sales were down 19.9 percent compared to the prior\nyear, and currency exchange had a negative impact of 7.7 percent on sales results in the quarter.\nRegionally, organic sales declined 22.2 percent in the Americas, 22.8 percent in Europe and 10.8\npercent in Asia/Pacific.\n
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          Net income for the quarter was $18.0 million compared to $34.4 million in the same quarter\nlast year, down 47.7 percent. Earnings per diluted Class A Common Share were $0.34 compared to\n$0.63 in the prior year. 2009 results include after-tax restructuring charges of $1.6 million or\n$0.03 per share in the quarter.\n
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          Sales for the nine months ended April 30, 2009 were $921.5 million compared to $1.126 billion\nin the same period last year, down 18.2 percent. Net income for the nine-month period was $50.9\nmillion compared to $97.4 million in the prior year, down 47.7 percent. Nine-month earnings per\nshare were $0.96 compared to $1.77 per share in the period last year. Results include after-tax\nrestructuring charges of $16.8 million or $0.32 per share year-to-date.\n
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          “Business in the quarter continued to be weak across all geographies and all product lines.\nOur business seems to be stabilizing for now, however global economic conditions remain uncertain\nand our visibility is limited,” said Brady President and Chief Executive Officer Frank M. Jaehnert.\n“We continue to take actions to reduce cost while investing in key initiatives that will drive\ngrowth when the economy improves.”\n
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          “Brady continues to maneuver through this challenging economy by aggressively managing costs\nand improving on our already strong financial position. Cash flow from operations was $55 million\nin the quarter and we increased our cash position to $233 million. This cash, along with our\nuntapped bank revolver, allows us to maintain flexibility for future opportunities,” said Brady\nChief Financial Officer Thomas J. Felmer. “Based on current economic conditions and currency\nexchange rates, our guidance remains unchanged at net income of between $65 and $75 million,\nincluding after-tax restructuring charges of approximately $20 million; and earnings per diluted\nshare guidance of between $1.23 and $1.42. Excluding restructuring charges, we expect net income\nof between $85 and $95 million and earnings per diluted share of between $1.61 and $1.80.”\n
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          A Web cast of a conference call regarding the company’s fiscal 2009 third quarter results will\nbe available at www.investor.bradycorp.com beginning at 7:00 a.m. Central Time today.\n
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          Brady Corporation is an international manufacturer and marketer of complete solutions that\nidentify and protect premises, products and people. Its products help customers increase safety,\nsecurity, productivity and performance and include high-performance labels and signs, safety\ndevices, printing systems and software, and precision die-cut materials. Founded in 1914, the\ncompany has more than 500,000 customers in electronics, telecommunications, manufacturing,\nelectrical, construction, education, medical and a variety of other industries. Brady is\nheadquartered in Milwaukee and employs about 7,000 people at operations in the Americas, Europe and\nAsia/Pacific.\n
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          More information is available on the Internet at www.bradycorp.com.\n
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Brady believes that certain statements in this Form 10-Q are “forward-looking statements” within\nthe meaning of the Private Securities Litigation Reform Act of 1995. All statements related to\nfuture, not past, events included in this Form 10-Q, including, without limitation, statements\nregarding Brady’s future financial position, business strategy, targets, projected sales, costs,\nearnings, capital expenditures, debt levels and cash flows, and plans and objectives of management\nfor future operations are forward-looking statements. When used in this Form 10-Q, words such as\n“may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “should,” “project” or\n“plan” or similar terminology are generally intended to identify forward-looking statements. These\nforward-looking statements by their nature address matters that are, to different degrees,\nuncertain and are subject to risks, assumptions and other factors, some of which are beyond Brady’s\ncontrol, that could cause actual results to differ materially from those expressed or implied by\nsuch forward-looking statements. For Brady, uncertainties arise from the length or severity of the\ncurrent worldwide economic downturn or timing or strength of a subsequent recovery; future\nfinancial performance of major markets Brady serves, which include, without limitation,\ntelecommunications, manufacturing, electrical, construction, laboratory, education, governmental,\npublic utility, computer, transportation; difficulties in making and integrating acquisitions;\nrisks associated with newly acquired businesses; Brady’s ability to retain significant contracts\nand customers; future competition; Brady’s ability to develop and successfully market new products;\nchanges in the supply of, or price for, parts and components; increased price pressure from\nsuppliers and customers; interruptions to sources of supply; environmental, health and safety\ncompliance costs and liabilities; Brady’s ability to realize cost savings from operating\ninitiatives; Brady’s ability to attract and retain key talent; difficulties associated with\nexports; risks associated with international operations; fluctuations in currency rates versus the\nUS dollar; technology changes; potential write-offs of Brady’s substantial intangible assets;\nBrady’s ability to maintain its debt covenants; unforeseen tax consequences; risks associated with\nobtaining governmental approvals and maintaining regulatory compliance for new and existing\nproducts; business interruptions due to implementing business systems; and numerous other matters\nof national, regional and global scale, including those of a political, economic, business,\ncompetitive and regulatory nature contained from time to time in Brady’s U.S. Securities and\nExchange Commission filings, including, but not limited to, those factors listed in the “Risk\nFactors” section located in Item 1A of Part I of Brady’s Form 10-K for the year ended July 31,\n2008. These uncertainties may cause Brady’s actual future results to be materially different than\nthose expressed in its forward-looking statements. Brady does not undertake to update its\nforward-looking statements.\n
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BRADY CORPORATION AND SUBSIDIARIES
\nCONDENSED CONSOLIDATED STATEMENTS OF INCOME\n\n
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(Dollars in Thousands)\n\n
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\n\n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n\n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n
                         
  (Unaudited) 
  Three Months Ended April 30,  Nine Months Ended April 30, 
          Percentage          Percentage 
  2009  2008  Change  2009  2008  Change 
Net sales
 $276,733  $381,909   -27.5% $921,499  $1,126,167   -18.2%
Cost of products sold
  142,560   192,333   -25.9%  480,038   573,901   -16.4%
 
                    
Gross margin
  134,173   189,576   -29.2%  441,461   552,266   -20.1%
 
                        
Operating expenses:
                        
Research and development
  7,766   10,274   -24.4%  25,325   29,323   -13.6%
Selling, general and administrative
  94,906   126,720   -25.1%  302,776   369,579   -18.1%
Restructuring charge
  2,229   —   —   23,276   —   — 
 
                    
Total operating expenses
  104,901   136,994   -23.4%  351,377   398,902   -11.9%
 
                        
Operating income
  29,272   52,582   -44.3%  90,084   153,364   -41.3%
 
                        
Other income and (expense):
                        
Investment and other income
  989   920   7.5%  1,143   3,307   -65.4%
Interest expense
  (6,307)  (6,962)  -9.4%  (18,982)  (20,429)  -7.1%
 
                    
 
                        
Income before income taxes
  23,954   46,540   -48.5%  72,245   136,242   -47.0%
 
                        
Income taxes
  5,994   12,187   -50.8%  21,325   38,829   -45.1%
 
                    
 
                        
Net income
 $17,960  $34,353   -47.7% $50,920  $97,413   -47.7%
 
                    
 
                        
Per Class A Nonvoting Common Share:
                        
Basic net income
 $0.34  $0.64   -46.9% $0.97  $1.79   -45.8%
Diluted net income
 $0.34  $0.63   -46.0% $0.96  $1.77   -45.8%
Dividends
 $0.17  $0.15   13.3% $0.51  $0.45   13.3%
 
                        
Per Class B Voting Common Share:
                        
Basic net income
 $0.34  $0.64   -46.9% $0.95  $1.78   -46.6%
Diluted net income
 $0.34  $0.63   -46.0% $0.95  $1.76   -46.0%
Dividends
 $0.17  $0.15   13.3% $0.49  $0.43   14.0%
 
                        
Weighted average common shares\noutstanding (in Thousands):
                        
Basic
  52,286   54,021       52,642   54,294     
Diluted
  52,594   54,627       52,961   54,992     
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BRADY CORPORATION AND SUBSIDIARIES
\nCONDENSED CONSOLIDATED BALANCE SHEETS\n\n
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(IN THOUSANDS)\n\n
\n
\n\n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n\n\n\n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n
         
  (Unaudited) 
  April 30, 2009  July 31, 2008 
ASSETS
Current assets:
        
Cash and cash equivalents
 $232,901  $258,355 
Accounts receivable, less allowance for losses ($8,138 and\n$10,059, respectively)
  183,287   262,461 
Inventories:
        
Finished products
  58,417   75,665 
Work-in-process
  15,569   21,187 
Raw materials and supplies
  32,201   37,767 
 
      
Total inventories
  106,187   134,619 
Prepaid expenses and other current assets
  42,167   43,650 
 
      
 
        
Total current assets
  564,542   699,085 
Other assets:
        
Goodwill
  726,944   789,107 
Other intangible assets, net
  116,275   144,791 
Deferred income taxes
  26,145   25,943 
Other
  16,555   21,381 
 
      
 
        
Total other assets
  885,919   981,222 
 
        
Property, plant and equipment:
        
Cost:
        
Land
  6,215   6,490 
Buildings and improvements
  93,584   98,646 
Machinery and equipment
  274,091   282,232 
Construction in progress
  7,301   6,040 
 
      
 
        
 
  381,191   393,408 
Less accumulated depreciation
  232,035   223,202 
 
      
 
        
Net property, plant and equipment
  149,156   170,206 
 
      
 
        
Total
 $1,599,617  $1,850,513 
 
      
 
        
LIABILITIES AND STOCKHOLDERS’ INVESTMENT
 
        
Current liabilities:
        
Accounts payable
 $79,129  $118,209 
Wages and amounts withheld from employees
  40,722   82,354 
Taxes, other than income taxes
  6,190   10,234 
Accrued income taxes
  2,533   21,523 
Other current liabilities
  43,413   54,810 
Current maturities on long-term debt
  50,000   21,431 
 
      
 
        
Total current liabilities
  221,987   308,561 
 
        
Long-term obligations, less current maturities
  428,572   457,143 
 
        
Other liabilities
  57,359   63,001 
 
      
 
        
Total liabilities
  707,918   828,705 
 
        
Stockholders’ investment:
        
Common stock:
        
Class A\nnonvoting common stock — Issued 51,261,487 and 51,261,487\nshares, respectively and outstanding 48,747,494 and 50,005,296\nshares, respectively
  513   513 
 
        
Class B voting common stock — Issued and outstanding, 3,538,628 shares
  35   35 
Additional paid-in capital
  298,172   292,769 
Earnings retained in the business
  663,069   639,059 
Treasury stock — 2,303,993 and 1,046,191 shares, respectively of Class A\nnonvoting common stock, at cost
  (70,841)  (33,234)
Accumulated other comprehensive income
  5,480   128,161 
Other
  (4,729)  (5,495)
 
      
 
        
Total stockholders’ investment
  891,699   1,021,808 
 
      
 
        
Total
 $1,599,617  $1,850,513 
 
      
\n
\n\n\n\n

 \n

\n\n\n\n\n\n

\n

 

\n

\n\n\n
BRADY CORPORATION AND SUBSIDIARIES
\nCONSOLIDATED STATEMENTS OF CASH FLOWS
\n(Dollars in Thousands)\n\n
\n
\n\n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n\n\n \n \n \n \n\n\n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n\n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n\n\n
         
  (Unaudited) 
  Nine Months Ended 
  April 30, 
  2009  2008 
Operating activities:
        
Net income
 $50,920  $97,413 
Adjustments to reconcile net income to net cash provided by operating activities:
        
Depreciation and amortization
  40,672   45,682 
Non-cash portion of restructuring charges
  2,229   — 
Non-cash portion of stock-based compensation expense
  6,281   7,797 
Other
  1,495   (234)
Changes in operating assets and liabilities (net of effects of business acquisitions):
        
Accounts receivable
  52,276   4,014 
Inventories
  16,793   15,012 
Prepaid expenses and other assets
  (3,593)  (6,193)
Accounts payable and accrued liabilities
  (73,381)  (6,175)
Income taxes
  (17,571)  (6,358)
Other liabilities
  908   1,157 
 
      
Net cash provided by operating activities
  77,029   152,115 
 
        
Investing activities:
        
Acquisition of businesses, net of cash acquired
  —   (28,871)
Purchase price adjustment
  3,514   — 
Payments of contingent consideration
  (1,405)  (5,798)
Purchases of short-term investments
  —   (10,350)
Sales of short-term investments
  —   29,550 
Purchases of property, plant and equipment
  (16,035)  (19,029)
Other
  2,893   1,808 
 
      
Net cash used in investing activities
  (11,033)  (32,690)
 
        
Financing activities:
        
Payment of dividends
  (26,910)  (24,341)
Proceeds from issuance of common stock
  1,321   9,517 
Principal payments on debt
  (3)  (14)
Purchase of treasury stock
  (40,267)  (28,531)
Income tax benefit from the exercise of stock options and deferred\ncompensation distribution
  860   4,620 
 
      
Net cash used in financing activities
  (64,999)  (38,749)
Effect of exchange rate changes on cash
  (26,451)  3,837 
 
        
Net (decrease) increase in cash and cash equivalents
  (25,454)  84,513 
Cash and cash equivalents, beginning of period
  258,355   142,846 
 
      
 
        
Cash and cash equivalents, end of period
  232,901   227,359 
 
      
 
        
Supplemental disclosures:
        
Cash paid during the period for:
        
Interest, net of capitalized interest
 $21,899  $22,450 
Income taxes, net of refunds
  32,995   39,505 
Acquisitions:
        
Fair value of assets acquired, net of cash
 $—  $18,547 
Liabilities assumed
  —   (6,566)
Goodwill
  —   16,890 
 
      
Net cash paid for acquisitions
 $—  $28,871 
 
      
\n
\n\n\n

 \n

\n\n\n

\n

 

\n\n

\n\n
Information by regional segment for the three and nine months ended April 30, 2009 and 2008 is as\nfollows:\n
\n\n
\n\n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n\n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n
                         
                  Corporate and  
(in thousands) Americas Europe Asia-Pacific Subtotals Eliminations Total
SALES TO EXTERNAL CUSTOMERS
                        
Three months ended:
                        
April 30, 2009
 $125,688  $85,172  $65,873  $276,733   —  $276,733 
April 30, 2008
 $166,407  $133,422  $82,080  $381,909   —  $381,909 
 
                        
Nine months ended:
                        
April 30, 2009
 $409,573  $280,589  $231,337  $921,499   —  $921,499 
April 30, 2008
 $497,803  $364,951  $263,413  $1,126,167   —  $1,126,167 
 
                        
SALES GROWTH INFORMATION
                        
Three months ended April 30, 2009:
                        
Base
  -22.2%  -22.8%  -10.8%  -19.9%  —   -19.9%
Currency
  -2.4%  -13.4%  -8.9%  -7.7%  —   -7.7%
Acquisitions
  0.1%  0.0%  0.0%  0.1%  —   0.1%
Total
  -24.5%  -36.2%  -19.7%  -27.5%  —   -27.5%
 
                        
Nine months ended April 30, 2009:
                        
Base
  -16.4%  -15.6%  -8.7%  -14.3%  —   -14.3%
Currency
  -1.7%  -9.4%  -3.5%  -4.7%  —   -4.7%
Acquisitions
  0.4%  1.9%  0.0%  0.8%  —   0.8%
Total
  -17.7%  -23.1%  -12.2%  -18.2%  —   -18.2%
 
                        
SEGMENT PROFIT
                        
Three months ended:
                        
April 30, 2009
 $28,540  $23,773  $6,979  $59,292  $(1,717) $57,575 
April 30, 2008
 $40,169  $36,245  $11,055  $87,469  $(1,816) $85,653 
Percentage (decrease)
  -29.0%  -34.4%  -36.9%  -32.2%  -5.5%  -32.8%
 
                        
Nine months ended:
                        
April 30, 2009
 $86,104  $77,857  $33,502  $197,463  $(6,631) $190,832 
April 30, 2008
 $116,312  $97,212  $43,105  $256,629  $(6,400) $250,229 
Percentage (decrease) increase
  -26.0%  -19.9%  -22.3%  -23.1%  3.6%  -23.7%
\n
\n\n\n
NET INCOME RECONCILIATION (in thousands)\n
\n\n
\n\n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n\n\n\n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n
                 
  Three months ended: Nine months ended:
  April 30, April 30, April 30, April 30,
  2009 2008 2009 2008
Total profit for reportable\nsegments
 $59,292  $87,469  $197,463  $256,629 
Corporate and eliminations
  (1,717)  (1,816) $(6,631)  (6,400)
Unallocated amounts:
                
Administrative costs
  (26,074)  (33,071)  (77,472)  (96,865)
Restructuring costs
  (2,229)  —   (23,276)  — 
Investment and other income
  989   920   1,143   3,307 
Interest expense
  (6,307)  (6,962)  (18,982)  (20,429)
             
Income before income taxes
  23,954   46,540   72,245   136,242 
Income taxes
  (5,994)  (12,187)  (21,325)  (38,829)
             
Net income
 $17,960  $34,353  $50,920  $97,413 
             
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RECONCILIATION OF GAAP MEASURES TO NON-GAAP MEASURES
\n(in thousands)\n\n
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\n\n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n\n\n\n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n
                     
  Fiscal 2008
  Q1 Q2 Q3 Q4 Total
EBITDA (1)
                    
Net income
 $36,370  $26,690  $34,353      $97,413 
Interest expense
  6,720   6,747   6,962       20,429 
Income taxes
  15,366   11,276   12,187       38,829 
Depreciation and\namortization
  14,168   15,501   16,013       45,682 
   
 
                    
EBITDA (non-GAAP measure)
 $72,624  $60,214  $69,515  $—  $202,353 
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\n\n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n\n\n\n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n\n
                     
  Fiscal 2009
  Q1 Q2 Q3 Q4 Total
EBITDA (1)
                    
Net income (loss)
 $37,110  $(4,150) $17,960      $50,920 
Interest expense
  6,361   6,314   6,307       18,982 
Income taxes
  14,575   756   5,994       21,325 
Depreciation and\namortization
  13,712   13,481   13,479       40,672 
   
 
                    
EBITDA (non-GAAP measure)
 $71,758  $16,401  $43,740  $—  $131,899 
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(1) Brady is presenting EBITDA because it is used by many of our investors and lenders, and is\npresented as a convenience to them. EBITDA represents net income before interest expense, income\ntaxes and depreciation and amortization. EBITDA is not a calculation based on generally accepted\naccounting principles (GAAP). The amounts included in the EBITDA calculation, however, are\nderived from amounts included in the Condensed Consolidated Statements of Income data. EBITDA\nshould not be considered as an alternative to net income or operating income as an indicator of\nthe company’s operating performance, or as an alternative to operating cash flows as a measure of\nliquidity. The EBITDA measure presented may not always be comparable to similarly titled measures\nreported by other companies due to differences in the components of the calculation.
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