Brady (BRC) Sidoti September Small-Cap Virtual Conference summary

Business overview and strategy

• Specializes in high-performance specialty adhesives and identification products for harsh environments, serving diverse end markets globally.

• No single customer accounts for more than 10% of sales; 47% of revenue is generated outside the U.S.

• Focused on innovation, with R&D spend reaching an all-time high of 5.1% of sales in fiscal 2024.

• Product portfolio includes wire identification, safety signage, healthcare ID, and people identification.

• ESG initiatives emphasize environmental efficiency, diverse workforce, and strong governance.

Financial performance and trends

• Achieved four consecutive years of record EPS, with 2024 EPS up 17% over 2023.

• Operating cash flow increased 22% in 2024 to $255 million, a company record.

• Gross profit margin improved to 51.3% in 2024, driven by operational efficiencies and strategic price increases.

• SG&A as a percentage of sales reduced by 800 basis points over eight years.

• Maintains a strong balance sheet with a net cash position of $159 million as of July 31.

Capital allocation and shareholder returns

• 39th consecutive annual dividend increase announced at the start of fiscal 2024.

• Returned $117 million to shareholders in 2024 through buybacks and dividends.

• Opportunistic approach to M&A, focusing on strategic fit and technology or product expansion.

• Willing to pause buybacks or acquisitions if valuation or fit is not optimal.

• CapEx expected to be lower following a facility purchase; maintains flexibility for future investments.