July 2008 Brady 2008 Analyst Day Americas Presentation 1
July 2008
Brady 2008 Analyst DayAmericas Presentation
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Presentation Topics
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Americas Region SummaryBrady AmericasDirect Marketing & People ID
Global Product MarketsWire IdentificationHigh Performance ID
Direct Marketing Brady Americas People ID Global Account Management
Americas Business Structure
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DirectMarketing& People ID
Direct Marketing Direct Marketing : Seton (US, Canada, Brazil), DAWG, EMEDBusinesses: Regulatory Publishing: Personnel Concepts, Clement
BradyAmericas
People ID Brady People ID (CIPI, JAM, Promovision)Businesses: Varitronics, Stopware, Identicard and Identicam
Brady Americas Brady (US, Canada, Mexico, Brazil)Businesses: Electromark, Tiscor and SPC
Americas Presence – F’03 to F’08 TTM
MRO: OEM:
Sales($ in millions)
Segment Profit
0
100
200
300
400
500
600
700
2003 2004 2005 2006 2007 2008TTM
342418
499
610
299
050
100150
2003 2004 2005 2006 2007 2008TTM
6098
123142
42
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Americas:Sites: 15 24Employees: 1,900 3,200
($ in millions – pre-tax)
667
155
Americas Channels
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Direct Marketing
Biz to Biz onlyContinually reacquireSmaller average
order valueOften one-time
needsMRO markets
• Industrial, Safety, Electrical, Specialty• Resellers• MRO & OEM markets
Distribution
• Primarily large customers of custom product• Internet business in non-Brady Brand businesses• Mostly OEM markets
DirectDirect Marketing: sales made to end customers solicited mainly through mail, telesales or the internet. Primarily in Seton, EMED and Personnel Concepts.
Distribution Sales: Brady sales representatives work in conjunction with distributors or resellers to close business. Primarily in the Brady brand businesses & People ID.
Direct to Customer: sales to the end customer but not solicited through a direct mail model. Primarily the Brady Brand businesses.
Americas Business Mix
MRO OEM• Products- High Performance labels & systems- Wire ID labels & systems- Diecut parts• Higher growth prospects (GDP+)• Market growth drivers- Performance (highly specified)- Traceability- Operational efficiency• Highly competitive• Distribution & Direct sales channels
•Products- Safety & Facility ID - People ID- Wire ID & printers- Laboratory labels & systems-Compliance & safety posters
•Broad end use Markets -Plant & facility maintenance-Contractors-Utility-Government-Healthcare-Education-Research labs-Small businesses of all types
•Growth roughly nominal GDP•Market growth drivers-Regulatory compliance,
safety-Traceability, security & productivity•Small orders, consumable in nature•Distribution & Direct Mktg
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Markets
• Electrical & Industrial OEM’s• MRO• Utility• Laboratory• Medical• Aerospace/Defense• Mass Transit
Products
• Wire ID & Printers• High performance labels & printers• Facility ID & printers• Safety products• Sorbents• Diecut parts
Growth
• Brady (USA, Canada, Mexico, Brazil)• SPC• Electromark• Tiscor
Businesses
Brady Americas Summary
Organic• New Products• New space expansion• Channel programs• National Acct programs• Improving loyalty
Acquisitions• Asterisco• Scafftag
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Markets
• Manufacturing• Industrial MRO• Industrial Safety• Utility• Contractors• Small businesses of all types
Products
• Facility & safety ID• Asset ID• Compliance posters• Safety & training posters• Sorbents
Growth
• Seton (US, Canada, Brazil)• EMED• DAWG• Clement• Personnel Concepts
Businesses
Direct Marketing Summary
Organic• Migration to multi-channel approach• Improved circulation programs• Pricing strategy• Use of Manila telesalesAcquisitions• DAWG• Diversify spaces
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Markets
• Government• Corporations• Education• Healthcare• Special events
Products
• Employee ID cards• Lanyards & badge holders• Access control software & hardware• Visitor management software & hardware
Growth
• Brady People ID(CIPI and JAM)
• Identicard/Identicam• Stopware• Varitronics
Businesses
People ID Summary
Organic• New Products –consumables and software• Sales productivity initiatives• Improved service• Ebiz• New content products
Acquisitions• Not a focus right now
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Americas Locations
US: Milwaukee (4), Brooklyn Park, MN, Dallas, Wolcott, NY, Somerset, NJ, San Diego, Ontario, CA, Buffalo, Branford, CT, Terryville, CT, San Jose, Boston, Lancaster, PA, Concord, PA, Memphis,
Canada: Toronto
Mexico: Tijuana, Reynosa, Queretaro
Brazil: Sao Paulo, Manaus
24 Total locations19 with Manufacturing3 software businesses
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Brooklyn Park, MN: engineer and mfg. printers and software for Brady globally
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Strategy: vertical integration of printers, software and consumables
Currently expanding low cost printer capabilities in our Penang, Malaysia plant
Glendale, WI: coating of tape materials for Brady globally and external customers
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Strategy: vertical integration of material R&D, coating and converting resulting in proprietary consumables
Milwaukee, WI: mfg short run wire markers, signs & labels; central warehouse for all stock products
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Strategy: same day, single shipment to distributors of products made in different Brady plants
Tijuana, MX: longer run stock labels, wire markers and signs
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Strategy: low cost production of longer run stock products,local production for Mexican market
Markets
• All OEM’s• Laboratory• Medical• Automotive
Competition
• Fragmented local & regional converters• 3M• Tyco• Zebra• Worldmark
Growth
• Bar code labels• Computer printable labels• Brand protection labels• RFID labels & tags• Handheld & benchtop printers & supplies• Nameplates• Software
Products
High Performance Identification
Organic• New products• Laboratory ID market• New markets• Expanded capabilities
Acquisitions• Asterisco
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High Performance Identification
Market Definition: All film labels & nameplates used to warn, identify, instruct, inform, trace, protect, & decorate.
Major Segments: On-demand labels, flexo & prime labels, nameplates
Growth: GDP+
Market Dynamics that lead to our position: - Development of on-demand printing technologies- Use of barcoding for traceability for warranty and repair- Drive to lower costs, reduce inventory and suppliers
Growth Drivers:- Need for traceability, warranty tracking- POS branding driving use of film materials vs. paper- Interactive, value add media development
Historical successes:- Sales of “on demand” computer printable labels & systems - Market leadership in PC board labeling - Growth in Lab market for specimen ID
Large & fragmented market where Brady has primarily excelled with “on-demand” labels sold with printing systems. Opportunities for growth exist selected niche markets, application & geographies.16
Flexo Labels
On-Demand Labels
Prime Labels
Nameplates
Flexographic labels: printed via flexography, mostly customsNameplates: product ID, custom printed on PolycarbonatePrime labels: product ID on consumer/retail productsOn-demand: variably printable on site by customers
High Performance Identification Markets
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“On demand” labels and systems is an area we do well in and can continue to excel.Our overall profitability is better than the market as a whole due to niche approach & pricing philosophy.The overall film label market is huge with many acquisition options but most do not meet our standards for profitability and differentiation.Initial research in adjacencies has identified numerous new niche markets & applications we are exploring Target acquisitions will be in specific geographies, markets or technologies where we can excel & generate higher margins.
High Performance Identification Summary
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Wire Identification
Market Definition: Customers who design, install, identify, manage and/or document electrical power systems or voice/data networks
Major Segments: Electrical: MRO, contractors & OEM’s, Datacomm installers, Aerospace/Defense/Mass Transit (ADM)
Growth: GDP
Market Dynamics that lead to our position: - Complicated wire designations that lead to the requirement for on-demand printing
Growth Drivers- Expansion of the datacomm market- More sophisticated wiring in commercial, hospitality & residential buildings- ADM market
Historical Successes- Lead the market conversion to printing systems with consumables.- Strong market position in electrical OEM & MRO customers- Earned loyalty with the best channel partners
Excellent market position in a profitable niche for high performance materials where printing systems also play a critical role in the customers decision20
Wire Identification Summary
Wire identification and systems is an area we do well in and have excellent brand recognition.
Continue aggressive new product development
Continue with wire ID acquisitions in Europe & Asia
Move into adjacent products to expand the overall market we play in and increase importance to customers
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