Document

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 23, 2019

(Exact name of registrant as specified in its charter)

Commission File Number 1-14959




Wisconsin		39-0971239
(State of Incorporation)		(IRS Employer Identification No.)

6555 West Good Hope Road

Milwaukee, Wisconsin 53223

(Address of Principal Executive Offices and Zip Code)

(Registrant’s Telephone Number)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:



¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)



¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)



¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))



¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol	Name of each exchange on which registered
Class A Nonvoting Common Stock, par value $0.01 per share	BRC	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 or the Securities Exchange Act of 1934 (17 CFR 240.12b-2).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨



Item 2.02	RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On May 23, 2019, Brady Corporation (the “Company”) issued a press release announcing its fiscal 2019 third quarter financial results. A copy of the press release is being furnished to the Securities and Exchange Commission as Exhibit 99.1 attached hereto and is incorporated herein by reference.



Item 7.01	REGULATION FD DISCLOSURE

On May 23, 2019, the Company hosted a conference call related to its fiscal 2019 third quarter financial results. A copy of the slides referenced in the conference call, which is also posted on the Corporation’s website, is being furnished to the Securities and Exchange Commission as Exhibit 99.2 attached hereto and is incorporated herein by reference.



Item 9.01	FINANCIAL STATEMENTS AND EXHIBITS

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.



		BRADY CORPORATION


Date: May 23, 2019		/s/ AARON J. PEARCE
		Aaron J. Pearce
		Chief Financial Officer and Treasurer

For More Information:

Investor contact: Ann Thornton 414-438-6887

Media contact: Kate Venne 414-358-5176

Brady Corporation Reports Fiscal 2019 Third Quarter Results and Increases its Fiscal 2019 EPS Guidance

Diluted EPS increased 32.7 percent to $0.65 in the third quarter of fiscal 2019 compared to $0.49 in the same quarter of the prior year.

Income before income taxes increased 10.8 percent to $41.0 million in the third quarter of fiscal 2019 compared to $37.0 million in the third quarter of fiscal 2018.

Sales for the quarter ended April 30, 2019 decreased 2.9 percent. Organic revenues increased 2.4 percent in the third quarter of fiscal 2019.

Diluted EPS guidance for the full year ending July 31, 2019 was increased to a range of $2.35 to $2.40 from the previous range of $2.25 to $2.35.

MILWAUKEE (May 23, 2019)--Brady Corporation (NYSE: BRC) (“Brady” or “Company”), a world leader in identification solutions, today reported its financial results for its fiscal 2019 third quarter ended April 30, 2019.

Quarter Ended April 30, 2019 Financial Results:

Income before income taxes increased 10.8 percent, finishing at $41.0 million for the third quarter of fiscal 2019 compared to $37.0 million for the third quarter of fiscal 2018.

Net income for the quarter ended April 30, 2019, was $34.8 million compared to $26.0 million in the same quarter last year. Net income was impacted by a reduced income tax rate of 15.1 percent primarily due to certain audit settlements in the current quarter.

Earnings per diluted Class A Nonvoting Common Share were $0.65 for the third quarter of fiscal 2019, compared to $0.49 in the same quarter last year.

Sales for the quarter ended April 30, 2019 decreased 2.9 percent, which consisted of organic sales growth of 2.4 percent, a decrease in sales of 3.8 percent from foreign currency translation, and a decline in sales of 1.5 percent from the divestiture of a business during the fourth quarter of fiscal 2018. Sales for the quarter ended April 30, 2019 were $289.7 million compared to $298.4 million in the same quarter last year. By segment, sales increased 0.9 percent in Identification Solutions and decreased 12.2 percent in Workplace Safety, which consisted of organic sales growth of 4.0 percent in Identification Solutions and an organic sales decline of 1.6 percent in Workplace Safety.

Nine-Month Period Ended April 30, 2019 Financial Results:

Income before income taxes increased 10.1 percent, finishing at $117.6 million for the nine-month period ended April 30, 2019, compared to $106.8 million in the same period last year.

Net income for the nine-month period ended April 30, 2019 was $94.6 million compared to $56.1 million in the same period last year. During the nine-month period ended April 30, 2019, net income was impacted by a reduced income tax rate of 19.5 percent primarily due to certain audit settlements in the current quarter. The prior nine-month period ended April 30, 2018 was impacted by tax charges of $21.1 million primarily related to the passage of the U.S. Tax Cuts and Jobs Act of 2017.

Earnings per diluted Class A Nonvoting Common Share were $1.78 for the nine-month period ended April 30, 2019, compared to $1.07 in the same period last year. During the nine-month period ended April 30, 2018, earnings per diluted Class A Nonvoting Common Share were reduced by approximately $0.40 from tax charges primarily related to the enactment of U.S. tax legislation.

Sales for the nine-month period ended April 30, 2019 decreased 1.3 percent, which consisted of organic sales growth of 3.1 percent, a decrease in sales of 2.8 percent from foreign currency translation, and a decline in sales of 1.6 percent from the divestiture of a business during the fourth quarter of fiscal 2018. Sales for the nine-month period ended April 30, 2019 were $865.4 million compared to $876.4 million in the same period last year. By segment, sales increased 2.1 percent in Identification Solutions and decreased 9.7 percent in Workplace Safety, which consisted of organic sales growth of 4.4 percent in Identification Solutions and an organic sales decline of 0.2 percent in Workplace Safety.

“Our continued focus on organic sales growth through the development of innovative new products that generate value for our customers and solve their problems while providing strong customer service is working as we posted our eighth consecutive quarter of organic sales growth,” said Brady’s President and Chief Executive Officer, J. Michael Nauman. “Organic sales growth along with the execution of sustainable efficiency gains throughout our SG&A structure is once again the driver of our year-over-year pre-tax income growth. We remain committed to our investments in automation in our manufacturing facilities, our digital presence, and in the development of innovative new products. We’re taking actions today that we believe will result in continued long-term improvement in our financial results and will drive shareholder value.”

“Our balance sheet and cash position are strong. We have over $238 million of cash on hand and are in a net cash position of $188.1 million at April 30, 2019,” said Brady’s Chief Financial Officer, Aaron Pearce. “We generated $52.7 million of cash flow from operating activities this quarter, we invested $5.4 million in capital expenditures, and we returned $11.2 million to our shareholders in the form of dividends. Our balance sheet provides significant flexibility to invest in growth opportunities while returning cash to our shareholders through dividends and opportunistic share buybacks.”

Fiscal 2019 Guidance:

The Company is increasing its full year fiscal 2019 Earnings per diluted Class A Nonvoting Common Share guidance from its previous range of $2.25 to $2.35 to a range of $2.35 to $2.40. Included in this guidance is organic sales growth of approximately 3.0 percent, a fourth quarter income tax rate in the mid-20 percent range, depreciation and amortization expense of approximately $24 million, and capital expenditures of approximately $28 to $30 million during the year ending July 31, 2019. This guidance is based upon foreign exchange rates as of April 30, 2019.

A webcast regarding Brady’s fiscal 2019 third quarter financial results will be available at www.bradycorp.com/investors beginning at 9:30 a.m. Central Time today.

Brady Corporation is an international manufacturer and marketer of complete solutions that identify and protect people, products and places. Brady’s products help customers increase safety, security, productivity and performance and include high-performance labels, signs, safety devices, printing systems and software. Founded in 1914, the Company has a diverse customer base in electronics, telecommunications, manufacturing, electrical, construction, medical, aerospace and a variety of other industries. Brady is headquartered in Milwaukee, Wisconsin and as of July 31, 2018, employed approximately 6,200 people in its worldwide businesses. Brady’s fiscal 2018 sales were approximately $1.17 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.

In this news release, statements that are not reported financial results or other historic information are “forward-looking statements.” These forward-looking statements relate to, among other things, the Company'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.

The use of 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: our ability to compete effectively or to successfully execute our strategy; Brady’s ability to develop technologically advanced products that meet customer demands; difficulties in protecting our websites, networks, and systems against security breaches; decreased demand for our products; Brady’s ability to retain large customers; extensive regulations by U.S. and non-U.S. governmental and self-regulatory entities; risks associated with the loss of key employees; divestitures and contingent liabilities from divestitures; Brady’s ability to properly identify, integrate, and grow acquired companies; litigation, including product liability claims; Brady’s ability to execute facility consolidations and maintain acceptable operational service metrics; foreign currency fluctuations; the impact of the Tax Reform Act and any other changes in tax legislation and tax rates; potential write-offs of Brady’s substantial intangible assets; differing interests of voting and non-voting shareholders; Brady’s ability to meet certain financial covenants required by our debt agreements; 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 within Item 1A of Part I of Brady’s Form 10-K for the year ended July 31, 2018.

BRADY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited; Dollars in thousands, except per share data)



	Three months ended April 30,		Nine months ended April 30,
	2019		2018		2019		2018
Net sales	$	289,745			$	298,421			$	865,367		$	876,352
Cost of goods sold	143,996			147,339			433,269			435,513
Gross margin	145,749			151,082			432,098			440,839
Operating expenses:
Research and development	11,437			11,678			33,837			33,512
Selling, general and administrative	94,691			101,695			281,988			299,411
Total operating expenses	106,128			113,373			315,825			332,923

Operating income	39,621			37,709			116,273			107,916

Other income (expense):
Investment and other income	2,065			31			3,425			1,303
Interest expense	(708	)		(761	)		(2,137	)		(2,453	)

Income before income taxes	40,978			36,979			117,561			106,766

Income tax expense	6,197			10,979			22,916			50,657

Net income	$	34,781			$	26,000			$	94,645		$	56,109


Net income per Class A Nonvoting Common Share:
Basic	$	0.66			$	0.50			$	1.80		$	1.09
Diluted	$	0.65			$	0.49			$	1.78		$	1.07
Dividends	$	0.21			$	0.21			$	0.64		$	0.62

Net income per Class B Voting Common Share:
Basic	$	0.66			$	0.50			$	1.79		$	1.07
Diluted	$	0.65			$	0.49			$	1.76		$	1.05
Dividends	$	0.21			$	0.21			$	0.62		$	0.61

Weighted average common shares outstanding (in thousands):
Basic	52,766			51,747			52,499			51,628
Diluted	53,480			52,729			53,215			52,610

BRADY CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)



	April 30, 2019		July 31, 2018
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	238,432			$	181,427
Accounts receivable—net	162,094			161,282
Inventories	119,895			113,071
Prepaid expenses and other current assets	18,746			15,559
Total current assets	539,167			471,339
Property, plant and equipment—net	99,491			97,945
Goodwill	412,378			419,815
Other intangible assets	38,135			42,588
Deferred income taxes	7,068			7,582
Other	19,638			17,662
Total	$	1,115,877			$	1,056,931
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	64,584			$	66,538
Wages and amounts withheld from employees	52,849			67,619
Taxes, other than income taxes	7,886			8,318
Accrued income taxes	4,378			3,885
Other current liabilities	48,169			44,567
Total current liabilities	177,866			190,927
Long-term obligations	50,303			52,618
Other liabilities	63,164			61,274
Total liabilities	291,333			304,819
Stockholders’ equity:
Class A nonvoting common stock—Issued 51,261,487 shares, and outstanding 49,284,372 and 48,393,617 shares, respectively	513			513
Class B voting common stock—Issued and outstanding, 3,538,628 shares	35			35
Additional paid-in capital	330,051			325,631
Retained earnings	612,474			553,454
Treasury stock—1,977,115 and 2,867,870 shares, respectively of Class A nonvoting common stock, at cost	(50,083	)		(71,120	)
Accumulated other comprehensive loss	(68,446	)		(56,401	)
Total stockholders’ equity	824,544			752,112
Total	$	1,115,877			$	1,056,931

BRADY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited; Dollars in thousands)



	Nine months ended April 30,
	2019		2018
Operating activities:
Net income	$	94,645			$	56,109
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	17,836			19,047
Non-cash portion of stock-based compensation expense	10,311			7,581
Deferred income taxes	3,796			26,501
Changes in operating assets and liabilities:
Accounts receivable	332			(10,710	)
Inventories	(9,254	)		(7,790	)
Prepaid expenses and other assets	(2,204	)		480
Accounts payable and accrued liabilities	(19,176	)		(133	)
Income taxes	616			(1,863	)
Net cash provided by operating activities	96,902			89,222

Investing activities:
Purchases of property, plant and equipment	(17,528	)		(14,755	)
Other	(1,810	)		(197	)
Net cash used in investing activities	(19,338	)		(14,952	)

Financing activities:
Payment of dividends	(33,488	)		(32,110	)
Proceeds from exercise of stock options	20,333			10,011
Proceeds from borrowing on credit facilities	13,637			17,439
Repayment of borrowing on credit facilities	(13,568	)		(69,012	)
Other	(5,185	)		(3,622	)
Net cash used in financing activities	(18,271	)		(77,294	)

Effect of exchange rate changes on cash	(2,288	)		(17	)

Net increase (decrease) in cash and cash equivalents	57,005			(3,041	)
Cash and cash equivalents, beginning of period	181,427			133,944

Cash and cash equivalents, end of period	$	238,432			$	130,903

BRADY CORPORATION AND SUBSIDIARIES

(Unaudited; Dollars in thousands)



	Three months ended April 30,		Nine months ended April 30,
	2019		2018		2019		2018
NET SALES
ID Solutions	$	213,979			$	212,154			$	641,283		$	628,291
Workplace Safety	75,766			86,267			224,084			248,061
Total	$	289,745			$	298,421			$	865,367		$	876,352

SALES INFORMATION
ID Solutions
Organic	4.0	%		3.7	%		4.4	%		3.7	%
Currency	(3.1	)%		4.1	%		(2.3	)%		3.0	%
Total	0.9	%		7.8	%		2.1	%		6.7	%
Workplace Safety
Organic	(1.6	)%		1.7	%		(0.2	)%		(0.1	)%
Currency	(5.3	)%		7.4	%		(3.7	)%		5.7	%
Divestitures	(5.3	)%		—	%		(5.8	)%		—	%
Total	(12.2	)%		9.1	%		(9.7	)%		5.6	%
Total Company
Organic	2.4	%		3.2	%		3.1	%		2.7	%
Currency	(3.8	)%		5.0	%		(2.8	)%		3.6	%
Divestitures	(1.5	)%		—	%		(1.6	)%		—	%
Total	(2.9	)%		8.2	%		(1.3	)%		6.3	%

SEGMENT PROFIT
ID Solutions	$	39,892			$	36,970			$	119,311		$	106,896
Workplace Safety	6,099			7,537			16,301			21,037
Total	$	45,991			$	44,507			$	135,612		$	127,933

SEGMENT PROFIT AS A PERCENT OF NET SALES
ID Solutions	18.6	%		17.4	%		18.6	%		17.0	%
Workplace Safety	8.0	%		8.7	%		7.3	%		8.5	%
Total	15.9	%		14.9	%		15.7	%		14.6	%



	Three months ended April 30,		Nine months ended April 30,
	2019		2018		2019		2018
Total segment profit	$	45,991			$	44,507			$	135,612		$	127,933
Unallocated amounts:
Administrative costs	(6,370	)		(6,798	)		(19,339	)		(20,017	)
Investment and other income	2,065			31			3,425			1,303
Interest expense	(708	)		(761	)		(2,137	)		(2,453	)
Income before income taxes	$	40,978			$	36,979			$	117,561		$	106,766

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Brady Corporation F’19 Q3 Financial Results May 23, 2019

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Forward-Looking Statements 2 In this presentation, statements that are not reported financial results or other historic information are “forward-looking statements.” These forward-looking statements relate to, among other things, the Company'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. The use of 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: our ability to compete effectively or to successfully execute our strategy; Brady’s ability to develop technologically advanced products that meet customer demands; difficulties in protecting our websites, networks, and systems against security breaches; decreased demand for our products; Brady’s ability to retain large customers; extensive regulations by U.S. and non- U.S. governmental and self-regulatory entities; risks associated with the loss of key employees; divestitures and contingent liabilities from divestitures; Brady’s ability to properly identify, integrate, and grow acquired companies; litigation, including product liability claims; Brady’s ability to execute facility consolidations and maintain acceptable operational service metrics; foreign currency fluctuations; the impact of the Tax Reform Act and any other changes in tax legislation and tax rates; potential write-offs of Brady’s substantial intangible assets; differing interests of voting and non- voting shareholders; Brady’s ability to meet certain financial covenants required by our debt agreements; 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 within Item 1A of Part I of Brady’s Form 10-K for the year ended July 31, 2018. 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 except as required by law.

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Q3 F’19 Financial Summary 3 • Sales were $289.7M in Q3 of F’19 compared with $298.4M in Q3 of F’18. – Organic sales increased 2.4%. – Foreign currency translation decreased sales 3.8%. – Sale of business decreased sales 1.5%. • Gross profit margin of 50.3% in Q3 of F’19 compared with 50.6% in Q3 of F’18. • SG&A expense of $94.7M (32.7% of sales) in Q3 of F’19 compared with $101.7M (34.1% of sales) in Q3 of F’18. • R&D expense of $11.4M (3.9% of sales) in Q3 of F’19 compared with $11.7M (3.9% of sales) in Q3 of F’18. • Income before income taxes increased 10.8% to $41.0M in Q3 of F’19 compared with $37.0M in Q3 of F’18. • Net income was $34.8M in Q3 of F’19 compared with $26.0M in Q3 of F’18. – Reduced income tax rate of 15.1% in Q3 of F’19 compared with 29.7% in Q3 of F’18. • Net income per Class A Diluted Nonvoting Common Share was $0.65 in Q3 of F’19 compared with $0.49 in Q3 of F’18.

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Sales Overview 4 SALES (millions of USD) $305 $298 $297 $295 $293 $289 $290 $290 $288 $285 $282 $276 $275 $265 $255 Q3 F'17 Q4 F'17 Q1 F'18 Q2 F'18 Q3 F'18 Q4 F'18 Q1 F'19 Q2 F'19 Q3 F'19 Organic Sales (1.9%) 3.0% 1.7% 3.2% 3.2% 2.5% 4.7% 2.3% 2.4% Growth Q3 F’19 SALES: Q3 F’19 SALES COMMENTARY: • 2.4% increase in organic sales: • ID Solutions – Organic sales increased in all three regions. • ID Solutions – Organic sales increased 4.0%. • Workplace Safety – Organic sales increased in Europe • Workplace Safety – Organic sales decreased and Australia and declined in North America. 1.6%. • Foreign currency translation had a negative impact on • 3.8% decrease due to foreign currency translation. sales in the quarter. • 1.5% decrease due to the sale of a business.

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Gross Profit Margin 5 GROSS PROFIT & GPM% (millions of USD) 50.7% 50.6% 50.3% 50.3% 49.9% 50.0% 49.7% 49.6% 49.5% $151 50% $150 $146 $147 $147 $144 $144 $146 $140 $140 45% $125 $100 40% Q3 F'17 Q4 F'17 Q1 F'18 Q2 F'18 Q3 F'18 Q4 F'18 Q1 F'19 Q2 F'19 Q3 F'19 Q3 F’19 – GROSS PROFIT MARGIN: • Slight decline in GPM from 50.6% in Q3 of F’18 to 50.3% in Q3 of F’19. • Costs increased in certain areas including freight and personnel. • We continue to invest in automation and manufacturing efficiencies to offset cost increases.

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SG&A Expense 6 SG&A EXPENSE AND SG&A EXPENSE AS A % of SALES (millions of USD) 35.7% 34.1% $110 34.5% 35% 33.4% 33.9% 32.8% $102 32.3% 32.7% $100 33% $100 $98 30.6% $97 $98 $95 $95 $93 30% $91 $90 28% $80 25% Q3 F'17 Q4 F'17 Q1 F'18 Q2 F'18 Q3 F'18 Q4 F'18 Q1 F'19 Q2 F'19 Q3 F'19 Q3 F’19 – SG&A EXPENSE: • SG&A expense was $94.7M (32.7% of sales) in Q3 of F’19 compared to $101.7M (34.1% of sales) in Q3 of F’18. • SG&A expense is down in absolute dollars as a result of foreign currency translation, the sale of a business in the fourth quarter of F’18, and due to on-going efficiency gains. • We continue to drive sustainable efficiency gains in administrative expenses and non-customer facing selling expenses while investing in sales-generating resources.

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R&D Expense 7 R&D EXPENSE AND R&D EXPENSE AS A % of SALES (millions of USD) $14.0 3.9% 3.9% 3.9% 3.9% 3.9% 3.8% 3.9% 4.0% $12.0 3.6% 3.6% $11.7 $11.7 $11.3 $11.3 $11.4 $11.1 $11.0 $10.5 3.5% $10.0 $10.0 3.0% $8.0 $6.0 2.5% Q3 F'17 Q4 F'17 Q1 F'18 Q2 F'18 Q3 F'18 Q4 F'18 Q1 F'19 Q2 F'19 Q3 F'19 Q3INCREASING F’19 – R&D OUR EXPENSE: INVESTMENT IN RESEARCH & DEVELOPMENT: • Investing in R&D to drive future organic sales growth. • Improved new product pipeline. • Anticipate R&D expense for the full fiscal year ending July 31, 2019 to be approximately in line with the prior year.

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Income Before Income Taxes 8 INCOME BEFORE INCOME TAXES (millions of USD) $45.2 $45 $41.0 $39.9 $40 $37.0 $35.9 $36.7 $34.8 $35.0 $35 $30.6 $30 $25 $20 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 F'17 F'17 F'18 F'18 F'18 F'18 F'19 F'19 F'19 Year on Year Growth 3.2% 12.2% 12.2% 20.4% 20.7% 26.0% 14.8% 4.8% 10.8% INCOME BEFORE INCOME TAXES: • Income before income taxes increased 10.8% to $41.0M in Q3 of F’19 compared to $37.0M in Q3 of F’18. • The increase in pre-tax income was primarily driven by organic sales growth and reduced SG&A expenses.

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Net Income & Diluted EPS 9 NET INCOME (millions of USD) NET INCOME PER CLASS A DILUTED SHARE $40 $0.66 $0.65 $35.0 $34.8 $0.58 $0.60 $0.55 $30.6 $29.2 $30 $0.48 $0.49 $0.49 $25.2 $25.8 $26.0 $0.43 $22.6 $0.40 $20 $0.20 $10 $4.3 $0.08 $0 $0.00 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 F'17 F'17 F'18 F'18 F'18 F'18 F'19 F'19 F'19 F'17 F'17 F'18 F'18 F'18 F'18 F'19 F'19 F'19 Q3 F’19 – NET INCOME & DILUTED EPS: • Net income increased to $34.8M in Q3 of F’19 compared to $26.0M in Q3 of F’18. • Diluted EPS increased to $0.65 in Q3 of F’19 compared to $0.49 in Q3 of F’18.

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Cash Generation & Uses 10 CASH FLOW FROM OPERATING ACTIVITIES (millions of USD) CASH FLOWS IN Q3 OF F’19: $60 • Cash flow from operating activities was $52.7M $52.9 $53.8 $52.7 in Q3 of F’19 compared to $46.8M in Q3 of F’18. $50 $46.8 $37.8 • Free cash flow* was $47.3M in Q3 of F’19 $40 $34.7 compared to $40.5M in Q3 of F’18. $30 $25.4 • Invested $5.4 million in capital expenditures in $18.8 $20 Q3 of F’19. $10 $7.7 • Returned $11.2M to our shareholders in the form of dividends in Q3 of F’19. $0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 F'17 F'17 F'18 F'18 F'18 F'18 F'19 F'19 F'19 % of Net Earnings 168% 210% 134% 181% 180% 154% 54% 87% 152% (millions of USD) 3 Mos. Ended 3 Mos. Ended 9 Mos. Ended 9 Mos. Ended April 30, 2019 April 30, 2018 April 30, 2019 April 30, 2018 Cash Balance - Beginning of Period $ 202.2 $ 115.3 $ 181.4 $ 133.9 Cash Flow from Operating Activities 52.7 46.8 96.9 89.2 Capital Expenditures (5.4) (6.3) (17.5) (14.8) Dividends (11.2) (10.7) (33.5) (32.1) Debt Borrowings (Repayments) - Net - (11.7) - (51.6) Effect of Exchange Rates on Cash (1.5) (1.8) (2.3) - Other 1.6 (0.7) 13.4 6.3 Cash Balance - End of Period $ 238.4 $ 130.9 $ 238.4 $ 130.9 * Free Cash Flow is calculated as Net Cash Provided by Operating Activities less Capital Expenditures.

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Net Cash (Debt) 11 NET CASH (DEBT) (millions of USD) DEBT STRUCTURE (millions of USD) $188 $190 $151 $138 Interest Apr. 30, 2019 July 31, 2018 $140 $129 Rate Balance Balance Private Placements: $90 EUR-den. 2010 Series (10-yr.) 4.24% $ (50.3) $ (52.6) $73 TOTAL DEBT $ (50.3) $ (52.6) $48 $44 $40 $26 Cash and Cash Equivalents 238.4 181.4 NET CASH $ 188.1 $ 128.8 -$10 $(9) -$60 Q3 F'17 Q4 F'17 Q1 F'18 Q2 F'18 Q3 F'18 Q4 F'18 Q1 F'19 Q2 F'19 Q3 F'19 STRONG BALANCE SHEET: • April 30, 2019 cash = $238.4M and debt = $50.3M. • Net cash increased $37.5M in Q3 of F’19. • Approximately $110M of cash is held in the United States. • Balance sheet provides flexibility for future investments.

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Full-Year F’19 Guidance 12 F’19 Diluted EPS guidance range increased to $2.35 to $2.40. (previous guidance range was $2.25 to $2.35). F’19 Guidance Assumptions: • Full-year organic sales growth of approximately 3%. • Full-year depreciation and amortization expense of approximately $24M. • Fourth quarter income tax expense in the mid-20% range. • Full-year capital expenditures of approximately $28M - $30M.

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Identification Solutions 13 Q3 F’19 vs. Q3 F’18 (millions of USD) Q3 F’19 SUMMARY: • Revenues increased 0.9%: Q3 F’19 Q3 F’18 Change • Organic = +4.0% Sales $ 214.0 $ 212.2 + 0.9% • Fx = - (3.1)% Segment Profit 39.9 37.0 + 7.9% • Organic sales increased in the low-single digits in the Americas and Asia. Segment Profit % 18.6% 17.4% + 120 bps • Organic sales increased in the mid-single digits in Europe. • Segment profit as a percent of sales increased due to ongoing efficiency gains in our operations and SG&A SALES & SEGMENT PROFIT % (millions of USD) structure. $240 20% 19% 19% 18% 17% 18% $230 17% 17% 17% 17% 17% 16% $220 $218 $218 $214 $211 $212 14% $210 $209 $210 $206 OUTLOOK: 12% • Expect F’19 organic sales to grow from 4% to 5%. $200 $197 10% • Anticipate further increases in sales-generating $190 8% investments while continuing to drive efficiency gains throughout the organization. $180 6% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 F'17 F'17 F'18 F'18 F'18 F'18 F'19 F'19 F'19

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Workplace Safety 14 Q3 F’19 vs. Q3 F’18 (millions of USD) Q3 F’19 SUMMARY: • Revenues decreased (12.2%): Q3 F’19 Q3 F’18 Change • Organic = - (1.6%) Sales $ 75.8 $ 86.3 - 12.2% • Fx = - (5.3%) Segment Profit 6.1 7.5 - 19.1% • Divestiture = - (5.3%) Segment Profit % 8.0% 8.7% - 70 bps • Organic sales increased in the low-single digits in Europe and Australia and decreased by approximately 10% in North America. • Segment profit negatively impacted by organic sales SALES & SEGMENT PROFIT % (millions of USD) decline, foreign currency translation, and the sale of the Runelandhs business in the fourth quarter of last 13% 14% fiscal year. $100 12% $95 10% 10% 9% 9% $90 8% 8% 7% 8% 6% $86 6% $85 OUTLOOK: $81 6% $80 $80 $80 $79 $78 4% • Expect F’19 organic sales to be effectively flat. $75 $76 • Anticipate Europe and Australia to continue to $75 $73 2% perform well while our Americas business continues $70 0% to recover. Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 F'17 F'17 F'18 F'18 F'18 F'18 F'19 F'19 F'19

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Investor Relations 15 Brady Contact: Ann Thornton Investor Relations 414-438-6887 Ann_Thornton@bradycorp.com See our web site at www.bradycorp.com



EXHIBIT NUMBER	DESCRIPTION
99.1	Press Release of Brady Corporation, dated May 23, 2019, relating to third quarter fiscal 2019 financial results.
99.2	Informational slides provided by Brady Corporation, dated May 23, 2019, relating to third quarter fiscal 2019 financial results.