Brady (NYSE:BRC) Q2 2026 Earnings call February 19, 2026 10:30 AM ET Company ParticipantsAnn Thornton - CFOKeith Housum - Managing DirectorRussell Shaller - President and CEOConference Call ParticipantsSteve Ferazani - Equity AnalystOperatorGood day, and thank you for standing by. Welcome to the Brady Corporation Q2 2026 earnings conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during t ...

Financial Data and Key Metrics Changes - Organic sales increased by 1.6%, marking the 20th consecutive quarter of organic sales growth [7][16] - Adjusted earnings per share grew by 9% to $1.09 from $1 in the previous year [12][13] - Gross profit margin improved to 50.6% from 49.3% year-over-year [8][12] - Operating cash flow increased by 34.7% to $53.3 million compared to $39.6 million in the prior year [13][14] Business Line Data and Key Metrics Changes - The Americas and Asia regions saw organic sales growth of 3.1%, while Europe and Australia experienced a slight decline of 1.1% [7][18] - R&D expenses rose to $24.3 million, or 6.3% of sales, up from $18.7 million, or 5.2% of sales in the previous year [11] - Segment profit in the Americas and Asia increased by 16.9% to $53.8 million, with a profit margin increase from 19.7% to 21.4% [19] Market Data and Key Metrics Changes - Sales in the Americas were $251.6 million, up 7.6% from the previous year, with organic growth of 3.1% [18] - Europe and Australia reported sales of $132.5 million, with a total growth of 7.9% driven by foreign currency translation [21] - Asia's organic sales growth was notably strong at 14.2%, with India leading at nearly 25% [18][19] Company Strategy and Development Direction - The company is focused on creating world-class products for industrial customers, with a commitment to R&D increasing from 3% to nearly 6% of revenue [6][11] - The launch of the i4311 Transportable Industrial Desktop Label Printer exemplifies the company's innovation strategy [4][6] - The company aims to provide easy-to-use solutions for complex identification requirements, adapting to changing standards and regulations [24] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about returning to growth in Europe and Australia, despite current economic headwinds [41][42] - The company anticipates organic sales growth in the low single-digit percentages for the fiscal year ending July 31, 2026 [16] - Management highlighted the importance of U.S. manufacturing capacity utilization for future growth, currently at 77%-78% [33] Other Important Information - The company is in a net cash position of $97.8 million, allowing for continued investment in growth and shareholder value [14][15] - The company has increased its full-year adjusted diluted EPS guidance range from $4.90-$5.15 to $4.95-$5.15 [16] Q&A Session Summary Question: Concerns about organic sales growth in the Americas - Management clarified that organic growth in the Americas was 1.4%, and acknowledged a slowdown in momentum [30][31] Question: Factors influencing growth trajectory - Management indicated that growth is closely tied to U.S. manufacturing capacity utilization, which is currently low [33] Question: Margin health and pricing strategy - Management noted that margins improved due to a favorable product mix, with engineered products performing better than commoditized ones [36] Question: Confidence in European growth - Management expressed cautious optimism about modest growth in Europe, citing potential recovery signs [41] Question: Performance of recent acquisitions - Management reported that the Gravotech acquisition has met technology goals, although some segments are impacted by weak automotive markets [42] Question: Concerns about pricing for commodity products - Management acknowledged pricing pressures in the U.K. but emphasized a long-term shift away from commodity products [47]

Financial Data and Key Metrics Changes - Organic sales increased by 1.6%, marking the 20th consecutive quarter of organic sales growth [7][16] - Adjusted diluted earnings per share grew by 9% to $1.09 from $1 in the previous year [12][13] - Gross profit margin improved to 50.6% from 49.3% year-over-year [8][12] - Operating cash flow increased by 34.7% to $53.3 million compared to $39.6 million in the same quarter last year [13][14] Business Line Data and Key Metrics Changes - The Americas and Asia region saw organic sales growth of 3.1%, while Europe and Australia experienced a slight decline of 1.1% [7][18] - R&D expenses increased to $24.3 million, or 6.3% of sales, up from $18.7 million, or 5.2% of sales in the previous year [11][12] - Segment profit in the Americas and Asia increased by 16.9% to $53.8 million, with profit margin rising from 19.7% to 21.4% [19][22] Market Data and Key Metrics Changes - Sales in the Americas and Asia reached $251.6 million, up 7.6% from the previous year [18] - Organic sales in Asia grew by 14.2%, with India leading at nearly 25% organic sales growth [18][19] - In Europe and Australia, total sales were $132.5 million, with organic sales declining by 1.1% but benefiting from a 9% increase due to foreign currency translation [20][22] Company Strategy and Development Direction - The company is focused on creating new world-class products, exemplified by the launch of the i4311 Transportable Industrial Desktop Label Printer [3][4] - Investment in R&D has increased from approximately 3% to nearly 6% of revenue, indicating a commitment to innovation [5][11] - The company aims to provide easy-to-use solutions for complex identification requirements, adapting to changing market standards [24] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about returning to growth in Europe and Australia, despite current economic headwinds [41][42] - The company anticipates organic sales growth in the low single-digit percentages for the fiscal year ending July 31, 2026 [16] - Management noted that U.S. manufacturing capacity utilization is a key factor for growth, currently at 77%-78% [34][36] Other Important Information - The company is in a net cash position of $97.8 million, allowing for continued investment in growth and shareholder value [14][15] - The company has announced its 40th consecutive annual dividend increase, reflecting a strong commitment to returning value to shareholders [15] Q&A Session Summary Question: Concerns about organic sales growth in the Americas - Management clarified that organic growth in the Americas was 1.4%, with Asia contributing significantly to overall growth [30][32] Question: Confidence in Europe and Australia returning to growth - Management noted modest expectations for growth in Europe, with some regions showing improvement despite challenges [41][42] Question: Performance of recent acquisitions - Management reported that the Gravotech acquisition has met technology goals, although some segments are impacted by weak European automotive markets [43][44] Question: Issues with memory pricing or shortages - Management confirmed no current issues with memory supplies, as they are a low user of memory [45] Question: Reconciling R&D investment with organic growth - Management emphasized that R&D investments are long-term and correlate with improved gross margins, focusing on engineered products [47][48] Question: Pricing concerns for commodity products in Europe - Management acknowledged some pricing deterioration in the UK but indicated a long-term shift away from commodity products [49]

Financial Performance - Net sales for the three months ended January 31, 2026 increased 7.7% to $384.1 million compared to $356.7 million in the same period in the prior year, driven by organic sales growth of 1.6%, acquisition growth of 2.3%, and a 3.8% increase from foreign currency translation[63] - Gross margin for the three months ended January 31, 2026 increased 10.5% to $194.4 million, with a gross margin percentage of 50.6%, up from 49.3% in the prior year[65] - Operating income for the three months ended January 31, 2026 increased 21.4% to $62.2 million, representing 16.2% of net sales, compared to $51.2 million or 14.4% in the same period last year[68] - Net income for the three months ended January 31, 2026 was $48.1 million, or 12.5% of net sales, compared to $40.3 million, or 11.3% in the same period last year[70] - Total company net sales growth was 7.7% in the three months ended January 31, 2026, compared to 10.6% in the same period in the prior year[72] Expenses - R&D expenses increased 29.8% to $24.3 million in the three months ended January 31, 2026, representing 6.3% of net sales, up from 5.2% in the prior year[66] - SG&A expenses increased 1.9% to $107.9 million in the three months ended January 31, 2026, but decreased as a percentage of net sales to 28.1% from 29.7% in the prior year[67] Sales by Region - Americas & Asia net sales increased 7.6% to $251.6 million in the three months ended January 31, 2026, compared to $233.8 million in the same period in the prior year[73] - Europe & Australia net sales increased 7.9% to $132.5 million in the three months ended January 31, 2026, compared to $122.8 million in the same period in the prior year[77] Segment Profit - Segment profit for Americas & Asia increased 16.9% to $53.8 million in the three months ended January 31, 2026, compared to $46.0 million in the same period in the prior year[76] - Segment profit for Europe & Australia increased 35.5% to $15.4 million in the three months ended January 31, 2026, compared to $11.4 million in the same period in the prior year[80] Cash Flow and Financial Position - Cash and cash equivalents were $176.5 million at January 31, 2026, an increase of $2.1 million from July 31, 2025[82] - Net cash provided by operating activities was $86.7 million in the six months ended January 31, 2026, compared to $63.0 million in the same period of the prior year[82] - Net cash used in investing activities was $41.3 million in the six months ended January 31, 2026, which included the acquisition of a business for $17.4 million[83] - As of January 31, 2026, the outstanding balance on the Company's credit agreement was $78.7 million, with a maximum amount outstanding during the six months of $119.6 million[89] - The Company was in compliance with financial covenants, with a debt to EBITDA ratio of 0.2 to 1.0 as of January 31, 2026[90] Risks and Challenges - The company anticipates ongoing inflationary pressures and supply chain disruptions, which may impact financial performance[55] - Increased costs of raw materials, labor, and supply chain disruptions impacting overall profitability[94] - Decreased demand for the Company's products noted in the recent performance summary[94] - Challenges in developing technologically advanced products that meet customer demands[94] - Risks associated with the loss of key employees affecting operational stability[94] - Potential write-offs of goodwill and other intangible assets highlighted as a financial risk[94] - Foreign currency fluctuations posing a risk to financial performance[94] - Changes in tax legislation and tax rates could impact future earnings[94] - Ongoing litigation, including product liability claims, may affect financial outlook[94] - Global climate change and environmental regulations are becoming increasingly relevant to operations[94] - No material changes in market risk disclosures since the 2025 Form 10-K[95] Strategic Focus - The company plans to invest in organic growth through enhanced R&D and customer feedback to develop innovative products[57] - The company is focused on integrating recent acquisitions to enhance strategic position and accelerate long-term sales growth[59] - The company aims to improve digital capabilities and customer experience as part of its growth strategy[54]

EXHIBIT 99.1 For More Information: Investor contact: Ann Thornton 414-438-6887 Media contact: Kate Venne 414-358-5176 Brady Corporation Reports Fiscal 2026 Second Quarter Results and Raises the Low End of its Fiscal 2026 EPS Guidance MILWAUKEE (February 19, 2026) -- Brady Corporation (NYSE: BRC) ("Brady" or "Company"), a world leader in identification solutions, today reported its financial results for its fiscal 2026 second quarter ended January 31, 2026. Quarter Ended January 31, 2026 Financial Results: S ...

Sales for the quarter increased 7.7 percent. Organic sales increased 1.6 percent, acquisitions increased sales 2.3 percent and foreign currency translation increased sales 3.8 percent.Diluted EPS increased 21.7 percent to $1.01 in the second quarter of fiscal 2026 compared to $0.83 in the same quarter of the prior year. Adjusted Diluted EPS* increased 9.0 percent to $1.09 in the second quarter of fiscal 2026 compared to $1.00 in the same quarter of the prior year.Net cash provided by operating activities in ...

公司状况 基于历史财报周期，公司预计在2026年上半年发布下一财季报告，具体日期尚未公告。 以上内容基于公开资料整理，不构成投资建议。 经济观察网 布雷迪（BRC.US）近期值得关注的事件。根据截至2026年2月12日的公开信息，布雷迪 （BRC.US）近期无重大事件公告，但以下动态值得关注： 业绩经营情况 公司已于2026年2月12日公布2025财年财报，营收15.14亿美元（同比增长12.90%），净利润1.89亿美元 （同比下滑4.06%），资产负债比为3.20，流动比率1.891。 ...

公司2025财年业绩报告显示，净利润同比下滑4.06%至1.89亿美元，营业收入增长12.90%至15.14亿美 元。当前股息率为1.02%，未提及派息规模创新高。 经济观察网根据截至2026年2月12日的公开信息，布雷迪(BRC.US)近期并未宣布派息创历史新高的相关 事件。公司最新动态为2025财年业绩报告，其中净利润同比下滑4.06%至1.89亿美元，而营业收入增长 12.90%至15.14亿美元。当前股息率为1.02%，未提及派息规模创新高。 业绩经营情况 以上内容基于公开资料整理，不构成投资建议。 ...

经济观察网布雷迪(BRC.US)发布2025财年业绩，净利润同比下滑，营业收入实现增长。根据财报，公 司2025财年净利润为1.89亿美元，同比减少4.06%；营业收入为15.14亿美元，同比增长12.90%。当前资 产负债比为3.20，流动比率为1.89。 近期事件 截至2026年2月12日，公司未披露近期重大事件。根据历史财报周期，下一财季报告可能于2026年上半 年发布，具体日期尚未公告。 以上内容基于公开资料整理，不构成投资建议。 ...

Company Overview - Paradiem sold its entire holding of 166,374 shares of Brady Corporation, with an estimated transaction value of approximately $12.98 million based on the last disclosed position [2][3][6] - As of the last market close, Brady Corporation's shares were priced at $80.80, with a market capitalization of $3.81 billion and a revenue of $1.54 billion for the trailing twelve months (TTM) [4][6] - Brady Corporation reported a net income of $196.41 million for the TTM [4] Financial Performance - In the most recent quarter, Brady Corporation achieved a year-over-year sales growth of 7.5%, totaling $405.3 million, driven by organic growth and acquisitions [11] - Adjusted diluted earnings per share (EPS) increased by 8% to $1.21, while operating cash flow surged by 42.5% to $33.4 million [11] - The company raised the low end of its full-year adjusted EPS guidance to a range of $4.90 to $5.15, indicating strong execution and margin discipline [11] Market Position and Strategy - Brady Corporation specializes in identification solutions and workplace safety products, serving a diverse range of sectors including industrial manufacturing, healthcare, and government [8][9] - The company maintains a conservative balance sheet with a net cash position of approximately $67 million at the end of the quarter [11] - The broader portfolio of Paradiem suggests a strategic shift towards higher-beta cyclicals and large-cap industrial exposure, rather than a rejection of Brady's steady mid-cap profile [12]