PART I. Financial Information [Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Unaudited financial statements for January 31, 2022, show asset and sales growth, but a significant drop in operating cash flow [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of January 31, 2022, total assets increased to $1.387 billion, primarily due to higher inventories, with stable equity Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | Jan 31, 2022 (Unaudited) | July 31, 2021 | | :--- | :--- | :--- | | **Total Current Assets** | $500,015 | $465,104 | | Inventories | $167,456 | $136,107 | | **Total Assets** | **$1,387,063** | **$1,377,756** | | **Total Current Liabilities** | $227,496 | $257,584 | | Long-term debt | $83,000 | $38,000 | | **Total Liabilities** | **$420,495** | **$414,728** | | **Total Stockholders' Equity** | **$966,568** | **$963,028** | [Condensed Consolidated Statements of Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) For the six months ended January 31, 2022, net sales increased 17.8% to $639.5 million, with net income rising to $68.9 million Statement of Income Highlights (in thousands, except per share amounts) | Metric | Three Months Ended Jan 31, 2022 | Three Months Ended Jan 31, 2021 | Six Months Ended Jan 31, 2022 | Six Months Ended Jan 31, 2021 | | :--- | :--- | :--- | :--- | :--- | | **Net Sales** | $318,055 | $265,838 | $639,530 | $543,065 | | **Gross Margin** | $149,362 | $129,522 | $304,350 | $264,950 | | **Operating Income** | $42,872 | $37,412 | $87,207 | $79,600 | | **Net Income** | $33,815 | $30,860 | $68,861 | $64,341 | | **Diluted EPS (Class A)** | $0.65 | $0.59 | $1.32 | $1.23 | [Condensed Consolidated Statements of Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) Comprehensive income for the six months ended January 31, 2022, significantly decreased to $45.9 million due to negative foreign currency translation - Comprehensive income for the six months ended Jan 31, 2022, was **$45.9 million**, down from **$79.4 million** YoY[14](index=14&type=chunk) - The decrease was mainly caused by a **$22.6 million** loss from foreign currency translation adjustments, compared to a **$14.9 million** gain in the prior year[14](index=14&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Total stockholders' equity slightly increased to $966.6 million, driven by net income offset by dividends and share repurchases Changes in Stockholders' Equity (Six months ended Jan 31, 2022, in thousands) | Description | Amount | | :--- | :--- | | Balance at July 31, 2021 | $963,028 | | Net Income | $68,861 | | Other comprehensive loss, net of tax | ($22,986) | | Repurchase of Class A Common Stock | ($21,720) | | Cash dividends on Common Stock | ($23,249) | | **Balance at January 31, 2022** | **$966,568** | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow for the six months ended January 31, 2022, sharply declined to $24.3 million, primarily due to increased inventories Net Cash Flow Summary (Six months ended Jan 31, in thousands) | Activity | 2022 | 2021 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | **$24,328** | **$98,889** | | Net cash used in investing activities | ($16,381) | ($16,392) | | Net cash used in financing activities | ($4,505) | ($28,828) | | Effect of exchange rate changes on cash | ($3,370) | $6,276 | | **Net increase in cash and cash equivalents** | **$72** | **$59,945** | - The significant decrease in operating cash flow was primarily due to a **$34.4 million** use of cash for inventories, compared to a **$15.0 million** source of cash in the prior year[27](index=27&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes highlight increased inventories, strong ID Solutions sales, declining Workplace Safety sales, and ongoing share repurchases - Inventories increased to **$167.5 million** as of January 31, 2022, up from **$136.1 million** at July 31, 2021, with finished products accounting for the largest portion of the increase[33](index=33&type=chunk) Net Sales by Segment (Six months ended Jan 31, in thousands) | Segment | 2022 | 2021 | | :--- | :--- | :--- | | ID Solutions | $493,603 | $392,419 | | Workplace Safety | $145,927 | $150,646 | | **Total Company** | **$639,530** | **$543,065** | Segment Profit (Six months ended Jan 31, in thousands) | Segment | 2022 | 2021 | | :--- | :--- | :--- | | ID Solutions | $92,945 | $79,279 | | Workplace Safety | $6,808 | $11,451 | | **Total Company** | **$99,753** | **$90,730** | - The company's effective income tax rate for the six months ended January 31, 2022, was **20.6%**, consistent with the prior year[67](index=67&type=chunk)[68](index=68&type=chunk) - Subsequent to the quarter end, the Board declared a quarterly dividend of **$0.225** per share and the company repurchased an additional **181,514** shares for **$9.0 million**[69](index=69&type=chunk)[70](index=70&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=16&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes sales growth to organic and acquisitions, notes gross margin decline from inflation, and highlights segment performance and strong liquidity [Overview and Strategy](index=16&type=section&id=Overview%20and%20Strategy) Key fiscal 2022 initiatives focus on organic growth, acquisitions, digital enhancement, and managing profitability amidst cost inflation - Key fiscal 2022 initiatives include investing in organic growth, acquisitions, customer service, digital presence, and maintaining profitability through pricing actions to counter inflation[74](index=74&type=chunk) - The company is experiencing increased freight and input material cost inflation, which has negatively impacted gross profit margins and is expected to continue in the second half of fiscal 2022[75](index=75&type=chunk) - As of January 31, 2022, the company had total available liquidity of approximately **$462.7 million**, consisting of **$147.4 million** in cash and **$315.3 million** in potential borrowing capacity[76](index=76&type=chunk) [Results of Operations](index=17&type=section&id=Results%20of%20Operations) For the six months ended January 31, 2022, net sales increased 17.8% driven by organic growth and acquisitions, despite gross margin compression Net Sales Growth (Six months ended Jan 31, 2022 vs 2021) | Component | Growth Rate | | :--- | :--- | | Organic Sales Growth | 10.0% | | Acquisitions | 8.5% | | Foreign Currency (Decrease) | (0.7)% | | **Total Net Sales Growth** | **17.8%** | - Gross margin percentage for the six-month period decreased to **47.6%** from **48.8%** YoY, primarily due to increased costs of materials, labor, and freight[84](index=84&type=chunk) - R&D expenses for the six-month period increased by **38.8%** to **$27.9 million**, mainly due to the acquisitions of Code and Nordic ID[85](index=85&type=chunk) - SG&A expenses for the six-month period increased **14.5%** to **$189.3 million**, also primarily due to acquisitions and increased personnel costs[89](index=89&type=chunk) [Business Segment Operating Results](index=20&type=section&id=Business%20Segment%20Operating%20Results) ID Solutions segment sales grew significantly, while Workplace Safety sales declined due to reduced pandemic-related demand - **ID Solutions (IDS):** Six-month net sales increased **25.8%** (**14.6%** organic), driven by recovery from the pandemic and growth in all major product lines and regions. Segment profit margin decreased from **20.2%** to **18.8%** due to cost pressures and acquisition-related amortization[98](index=98&type=chunk)[99](index=99&type=chunk) - **Workplace Safety (WPS):** Six-month net sales decreased **3.1%** (**2.0%** organic decline). This was primarily due to a tough comparison with the prior year, which saw high sales of pandemic-related products. Segment profit margin fell from **7.6%** to **4.7%**[102](index=102&type=chunk)[106](index=106&type=chunk) [Liquidity and Capital Resources](index=21&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity despite a significant decrease in operating cash flow due to strategic inventory increases - Approximately **93%** of the company's **$147.4 million** in cash and cash equivalents were held outside the United States as of January 31, 2022[107](index=107&type=chunk) - Net cash from operating activities decreased to **$24.3 million** from **$98.9 million** YoY, primarily due to cash outflows for inventory purchases to mitigate supply chain disruption risks[109](index=109&type=chunk) - As of January 31, 2022, the outstanding balance on the revolving loan agreement was **$83.0 million**, with **$115.3 million** available for future borrowing[114](index=114&type=chunk) - The company was in compliance with its financial covenants, with a debt-to-EBITDA ratio of **0.33 to 1.0** (limit of **3.5 to 1.0**)[118](index=118&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=23&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in market risk information have occurred since the fiscal year ended July 31, 2021 - There has been no material change in market risk information since July 31, 2021[126](index=126&type=chunk) [Controls and Procedures](index=23&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting - The President & CEO and CFO concluded that the company's disclosure controls and procedures are effective as of January 31, 2022[127](index=127&type=chunk) - No changes occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[128](index=128&type=chunk) PART II. Other Information [Unregistered Sale of Equity Securities and Use of Proceeds](index=24&type=section&id=Item%202.%20Unregistered%20Sale%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 55,756 shares for $2.8 million, with 1,569,244 shares remaining authorized for repurchase Share Repurchases (Three months ended Jan 31, 2022) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | Nov 2021 | 43,277 | $49.90 | | Dec 2021 | 0 | N/A | | Jan 2022 | 12,479 | $50.98 | | **Total** | **55,756** | **$50.14** | - As of January 31, 2022, **1,569,244** shares remained authorized for purchase under the company's share repurchase program[130](index=130&type=chunk)[131](index=131&type=chunk) [Exhibits](index=25&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with Form 10-Q, including credit agreement amendments, CEO/CFO certifications, and XBRL data - Filed exhibits include the First Amendment to the Credit Agreement, CEO/CFO certifications under Rule 13a-14(a) and Section 1350, and XBRL interactive data files[133](index=133&type=chunk)

Brady Corporation (NYSE:BRC) Q1 2022 Earnings Conference Call November 18, 2021 10:30 AM ET Company Participants Ann Thornton - Chief Accounting Officer & Corporate Controller Michael Nauman - President, CEO & Director Aaron James Pearce - CFO & Treasurer Conference Call Participants Michael McGinn - Wells Fargo Steve Ferazani - Sidoti Keith Housum - Northcoast Research Disclaimer*: This transcript is designed to be used alongside the freely available audio recording on this page. Timestamps within the tran ...

Table of Contents 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 Non-accelerated filer ☐ Smaller reporting company ☐ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended October 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE ...

Brady Corporation (NYSE:BRC) Q4 2021 Earnings Conference Call September 2, 2021 10:30 AM ET Company Participants Ann Thornton - Chief Accounting Officer & Corporate Controller Michael Nauman - President, Chief Executive Officer & Director Aaron James Pearce - Chief Financial Officer & Treasurer Conference Call Participants Cashen Keeler - Bank of America Steve Ferazani - Sidoti & Company Michael McGinn - Wells Fargo Securities Keith Housum - Northcoast Research Operator Thank you for standing by, and welcom ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended July 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-14959 BRADY CORPORATION (Exact name of registrant as specified in charter) Wisconsin 39-0178960 (State or other jurisdiction of inco ...

Brady Corporation (NYSE:BRC) Q3 2021 Earnings Conference Call May 20, 2021 10:30 AM ET Company Participants Ann Thornton - Chief Accounting Officer Michael Nauman - President and Chief Executive Officer Aaron Pearce - CFO Conference Call Participants Michael McGinn - Wells Fargo Keith Housum - Northcoast Research Steve Ferazani - Sidoti Operator Good day, and thank you for standing by. Welcome to the Third Quarter 2021 Brady Corporation Earnings Conference Call [Operator Instructions]. Please be advised tha ...

Table of Contents 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 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended April 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Pe ...

Financial Data and Key Metrics Changes - Sales in Q2 2021 were $265.8 million, a decline of 3.9% compared to the previous year [19] - Pretax income decreased by 7% to $39.4 million, down from $42.4 million in the same quarter last year [19][27] - Diluted EPS was $0.59, compared to $0.62 in the second quarter of last year [19][28] - Gross profit margin was 48.7%, down from 50.3% year-on-year, reflecting a 160 basis point decline [23] - SG&A expenses decreased to $82.2 million from $87.4 million, with SG&A as a percentage of sales down to 30.9% from 31.6% [24] Business Line Data and Key Metrics Changes - Identification Solutions (IDS) sales declined by 5.4% to $194.2 million, with an organic sales decline of 6.9% [38] - Workplace Safety (WPS) sales grew by 0.4%, but organic sales declined by 4.8% [48] - IDS segment profit was $39 million, a slight decrease from $40.7 million, but segment profit as a percentage of sales increased to 20.1% [43] - WPS segment profit decreased to $3.5 million from $5.5 million, driven by revenue decline in North America [54] Market Data and Key Metrics Changes - Organic sales in Asia for IDS grew by over 10% compared to the previous year [40] - Demand in the Healthcare business improved but remained below pre-pandemic levels, with a 6% year-on-year decline [41] - The North American WPS business faced challenges, particularly with micro companies affected by shutdowns [48][49] Company Strategy and Development Direction - The company is focused on controlling costs while investing in growth, particularly in R&D and marketing [9][12] - There is a strong emphasis on digital marketing and enhancing online presence to drive sales growth [15][84] - The company is expanding geographically into underserved markets with growth potential, including India and Southeast Asia [13] - The strategy includes maintaining a strong balance sheet to support investments and shareholder returns [18][57] Management's Comments on Operating Environment and Future Outlook - The macro environment remains challenging due to the ongoing pandemic, but there is optimism for recovery as vaccines are rolled out [8][33] - Management expects a choppy recovery, with guidance for diluted EPS in the range of $2.48 to $2.58 for the fiscal year [35][36] - Confidence in revenue growth is based on strong cash flow and a solid balance sheet, allowing for continued investment in growth initiatives [17][37] Other Important Information - The company generated $36.1 million in cash flow from operating activities, a 153% increase from the previous year [28][29] - The cash balance increased to $277.6 million with no debt, allowing for flexibility in capital allocation [30] - The company is committed to increasing investments in R&D, with $9.9 million spent in the quarter [26] Q&A Session Summary Question: Can you quantify the returns on R&D investments and share gains? - Management indicated that new products typically take four to five years to reach full revenue, suggesting a larger rise in future revenues due to current investments [60][61] Question: How should we think about margins in IDS? - Management believes proprietary products will help increase margins, despite past reductions in non-proprietary products [63] Question: What is the impact of event-related products on revenue? - Management noted significant declines in event-related businesses but expects a rapid recovery once events resume [64][66] Question: Are there additional costs affecting Workplace Safety margins? - Management acknowledged shipping challenges but emphasized that the primary issue was product mix rather than significant additional costs [71][72] Question: What are the expectations for cash flow and CapEx in the second half? - Management expects strong cash generation in the third and fourth quarters, with CapEx projected to remain around 2% of sales [75][78] Question: Can you elaborate on the digital sales strategy? - Management highlighted significant improvements in digital presence and customer engagement, indicating strong year-over-year growth in digital sales [81][87] Question: What is the M&A strategy moving forward? - Management is focused on strategic acquisitions that align with long-term growth objectives, emphasizing a deliberate approach to M&A [90][92]

Table of Contents 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 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended January 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition ...

Brady Corporation (NYSE:BRC) Q1 2021 Earnings Conference Call November 19, 2020 10:30 AM ET Company Participants Ann Thornton - Chief Accounting Officer & Corporate Controller Michael Nauman - President & Chief Executive Officer Aaron Pearce - Chief Financial Officer Conference Call Participants Michael McGinn - Wells Fargo Keith Housum - Northcoast Research Operator Ladies and gentlemen, thank you for standing by. And welcome to the Q1 2021 Brady Corporation Earnings Call. At this time, all participants a ...