Brady Corporation (BRC) Earnings Call Transcript & Summary

Good day, ladies and gentlemen. Thank you for standing by. Welcome to Brady Corporation's 2023 Annual Shareholders' Meeting. [Operator Instructions] Please note that today's conference may be recorded. I will now hand the conference over to your host for today, Ann Thornton, Chief Financial Officer. Please go ahead.

Thank you. Good morning, and welcome to the Brady Corporation Fiscal 2023 Annual Shareholders' Meeting. Thank you for joining us today. I'm Ann Thornton, Brady's CFO. The slides for this morning's call are located on our website at www.bradycorp.com/investors. Please note that during this call, we may make comments about forward-looking information. Words such as expect, will, may, believe, forecast and anticipate are just a few examples of words identifying a forward-looking statement. It's important to note that forward-looking information is subject to various risk factors and uncertainties, which could significantly impact expected results. You can read about these risk factors in more detail in our 2023 Form 10-K, which was filed with the SEC in September of this year. Moving to the agenda on Slide #3, we will first announce the results of the election of Brady's Board of Directors. Next, Brady's President and CEO, Russell Shaller, will provide some brief comments, and then we'll open it up to a Q&A session, whereby Russell as well as myself will be available to answer questions. Today's presentation is being broadcast live on the Internet and will also be available on our website for replay. So your participation in the Q&A session will constitute your consent to being recorded. Also, please note that this teleconference is copyrighted by Brady Corporation and may not be rebroadcast without the consent of Brady. I'd like to now move to Slide #4 for the formal business portion of this meeting and introduce Mr. Brad Richardson, the Chair of Brady's Board of Directors, to read the results of the election of the Board of Directors. Brad?

Well, thank you very much, Ann, and good morning, everyone. As Ann mentioned, I'm Brad Richardson, the Chair of Brady's Board of Directors. The following are the individuals who are standing for election to Brady's Board of Directors: Mr. Pat Allender; Dr. David Bem; Dr. Elizabeth Bruno; Ms. Joanne Collins Smee; Ms. Nancy Gioia; Mr. Vineet Nargolwala; myself, Brad Richardson; Dr. Michelle Williams; and lastly, Russell Shaller. Our shareholders can find our Board members bios in our annual report on Form 10-K as well as on the Brady website. We are proud to offer this high-quality and diverse set of directors for reelection to the Board. Let's turn to Slide 5 for the results of the election of the Board of Directors. I'm pleased to announce that the shareholders of 100% of the Class B common voting stock voted in favor of the election of the director nominees, and they are, therefore, elected to a 1-year term. Thank you again for all your time and support of Brady Corporation. I'll now turn the call over to Russell.

Perfect. Thank you, Brad. Having a Board that is engaged and brings their broad experience and knowledge is critical to the success of any organization. So thank you all for helping Brady to be a better company every single day. Before starting the Q&A session, I'd like to share a few comments. First and foremost, I'd like to thank all 5,600 Brady employees. Without you, we would never have been as successful as we had in 2023. 2023 was truly a fantastic year for Brady. From a financial perspective, our GAAP earnings per share was up 21%, finishing at an all-time record high of $3.51 per share. This marks the third consecutive year of record earnings per share. Our strong earnings were driven by organic sales growth of 5.5%, with excellent performance in both of our regions. We also demonstrated our commitment to return funds to our shareholders through dividends and share buybacks, totaling $120.4 million last year. And in September, we announced our 38th consecutive year of annual dividend increases. We've increased our dividend every year since going public. Our commitment to R&D remains a top priority because we believe that the steady new product launches will continue to separate us from our competition and help to maintain our organic growth rates. In the slide, you'll find a picture of one of our latest new products, the M511 portable printer. This exciting new printer is extremely versatile. It's Bluetooth-enabled, it's highly durable, and it makes an ideal range of applications. It can connect 5 users simultaneously, and a wide variety of our high-performance materials can be printed through this innovative portable printer. We're extremely proud of this printer, and we know that it will make our customers' everyday jobs easier and more efficient. We're also focused on our commitment to ESG through both reducing our own environmental footprint as well as designing products that help our customers reduce their environmental footprint. The M511 is a perfect example because it has the ability to print sharp text, images, barcodes and graphics from edge-to-edge, resulting in very little material waste. We have several new products and initiatives underway that we believe will further our progress in our ESG journey. And lastly, I would like to highlight our people. Brady is a fantastic organization with incredible brands and loyal customers who place their trust in us every day. For this, we are extremely grateful. But what I believe separates Brady from the rest is our excellent team of people who are focused on doing the right thing every single day for all of our stakeholders, which includes our communities, our employees and, of course, our shareholders. We're committed to fostering an inclusive culture where our employees' voices are heard and where leadership embodies our core values every day. I'm proud of everything we accomplished this year. Our new products, our organic sales growth and our third consecutive year of record earnings per share results could not have been accomplished without the hard work and dedication of the entire Brady team. With that, I would like to start the Q&A. Operator, would you please provide instructions to our shareholders?

[Operator Instructions] And I see no phone questions at this time. I'll turn the call back over to Mr. Russell Shaller for any closing.

Thank you. Okay. If there are no questions, I would like to thank all of you for your participation today. And on behalf of Brady's Board of Directors and everyone at Brady, we thank you for being a shareholder of Brady Corporation. Have a great day. Operator, you may disconnect the call.

Ladies and gentlemen, that does conclude our conference for today. Thank you for your participation. You may now disconnect.