Brady (BRC) Q2 2025 earnings summary

Executive summary

• Q2 FY2025 sales increased 10.6% to $356.7M, with organic growth of 2.6% and acquisitions contributing 10.2%, partially offset by a 2.2% FX headwind.

• Adjusted Diluted EPS rose 7.5% to $1.00, while GAAP Diluted EPS declined to $0.83 from $0.90 due to amortization and reorganization costs.

• Net income for Q2 FY2025 was $40.3M, down from $43.6M YoY; Adjusted Net Income increased 5.9% to $48.1M.

• Americas and Asia delivered strong organic sales growth of 4.3% and segment profit margin of 19.7%, while Europe and Australia saw a 0.8% organic decline and 9.3% margin.

• Facility closures and reorganization actions impacted margins and net income, with $5.7M in related costs.

Financial highlights

• Gross profit margin was 49.3%, down from 50.2% last year, impacted by closure and reorganization costs.

• SG&A expenses increased due to higher amortization, reorganization, and acquisition-related costs.

• Operating cash flow was $39.6M in Q2, with free cash flow improving to $32.5M from negative $13.5M last year.

• Cash and cash equivalents at quarter-end were $138.5M, with net cash position of $50.8M and debt at $87.7M.

• Six-month sales were $733.7M, up 12.1% YoY, with Adjusted Diluted EPS at $2.12.

Outlook and guidance

• Raised FY2025 Adjusted Diluted EPS guidance to $4.45–$4.70, GAAP EPS guidance at $3.99–$4.24.

• Expecting low single-digit organic sales growth for FY2025.

• Full-year CapEx expected at $35M and income tax rate at 21%.

• Guidance reflects impact of facility closure and reorganization costs.