Good day, ladies and gentlemen and welcome to the Brady Corporation Fourth Quarter 2016 Earnings Conference Call. At this time all participants are in listen-only mode. Later we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions]. As a reminder, this conference call is being recorded. I would now like to introduce your host for today’s conference Miss Ann Thornton, Director of Investor Relations. Miss Thornton, you may begin.

Thank you. Good morning and welcome to the Brady Corporation fiscal 2016 fourth quarter earnings conference call. The slides for this mornings call are located on our website at www.bradycorp.com. We will begin our prepared remarks on slide number three. 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. Risk factors were noted in our news release this morning and in Brady's fiscal 2015 Form 10-K, which was filed with the SEC in September of last year. Also, please note that this teleconference is copyrighted by Brady Corporation and may not be rebroadcast without the consent of Brady. We will be recording this call and broadcasting it on the internet. As such, your participation in the Q&A session will constitute your consent to being recorded. I will now turn the call over to Brady's President and Chief Executive Officer, Michael Nauman.

Thank you Ann. Good morning and thank you all for joining us. This morning we released our fourth quarter financial results and I am pleased to report that we finished fiscal 2016 with four consecutive quarters of improved profitability. This quarter, we increased earnings per share by 75% when compared to non-GAAP results of the fourth quarter of last year and we had another quarter of strong cash generation. Our consistent focus on the fundamentals are producing high quality products providing excellent customer service, developing stronger manufacturing processes and pushing for efficiencies in our G&A structure are the primary drivers of our improved financial results. We finished the year well, and I'm pleased with our consistent drive throughout fiscal 2016. Our improved financial performance is a direct result of the team's focus on continuous improvement and operational excellence. Our goal, however, is not only to improve short-term financial results, but to provide the foundation for a strong future. Each employee is focused on making the right decisions today that will ensure our long-term success, whether this is through creating a new innovative solution for our customers, taking the additional time and effort to implement a process improvement or taking those additional steps necessary to make our customers experience an excellent one. In many instances, these actions don't pay off immediately, but instead, set up Brady for a longer-term success model. Organic sales declined by just under 1% in our fourth quarter, which was effectively in line with our expectations coming into the quarter. Our R&D and new product development efforts continue to be a top priority as a strong pipeline of innovative product offerings is essential to our ability to grow organic sales over the long term. As I commented on in the past, we're driving down two parallel paths.…

Thank you, Michael and good morning everyone. I'll start the financial review on Slide number 3, this quarter revenues were down 2.3% to $282.1 million when compared to the fourth quarter of last year. This decrease consists of an organic sales decline of 0.9% and a decrease of 1.4% due to foreign currency translation. Our GAAP diluted EPS finished at $0.49 in the fourth quarter of this year compared to a GAAP loss of $0.77 in last year’s fourth quarter. We benefitted from a lower than normal tax rate in the fourth quarter of this year due to the conclusion of certain audits. If our tax rate would have been closer to our historical norm of approximately 28%, our EPS would have been $0.04 lower this quarter. These results compared to non-GAAP diluted EPS from continuing operations of $0.28 in last year’s fourth quarter. Turning to slide number four, you’ll find a summary of our quarterly sales trends. By division, organic sales decreased 0.2% in the ID Solutions segment and decreased by 2.7% in the workplace safety segment. Looking at our organic sales decline geographically, we saw a decrease in sales in the U.S. and in Australia where we continued to experience reduced demand. These declines were partially offset by organic sales growth in Western Europe where our businesses have performed quite well throughout fiscal 2016 despite a lack of significant economic growth. Foreign currency continued to be a headwind as sales declined 1.4% from foreign currency translation this quarter. Slide number five shows that our fourth quarter gross profit margin finished at 50.0%. Excluding onetime charges recognized in the fourth quarter of last year, our gross profit margin was approximately 47% in last year’s fourth quarter. This significant year-over-year improvement was primarily realized in the facilities that we consolidated…

Thank you, Aaron. Slide number 11 summarizes the Identification Solutions financial results for the fourth quarter. Organic sales were down by 0.2% and foreign currency translation further decrease sales by 1.2%. In total, IDS sales were down 1.4% to $198.7 million this quarter. Our European IDS business continues to lead this segment in organic sales, increasing by low single digits compared to last year. Sales growth in Europe has been consistent throughout all of fiscal 2016, and the business has increased organic sales for sixth consecutive quarters, which is a direct result of the efforts of our strong team in Europe. Organic sales in the IDS segment were weakest in Americas region. We continue to be impacted by the economy in Brazil as well as reduced demand in the U.S. and Canada. Organic sales decreased in both Brazil and Canada in the high single digits in the fourth quarter, while sales decreased in the U.S. in the mid-single digits compared to the same quarter last year. Fourth quarter organic sales growth was effectively flat in Asia as the rate of decline in China sales slowed compared to previous quarters. These modest declines in China were offset by increased organic sales throughout the rest of the Asian region. We're continuing to introduce new products to the marketplace that we're really excited about. This quarter, we launched the new BMP61 label printer, which is a handheld printer designed for quick and efficient identification of wires, cables and components. This printer uses Brady's high performance materials designed for tough industrial ID application and features multiple user interfaces, a touchscreen and multiple ways to connect, manage and save data. We're excited about this new printer as it combines new technology with a proven design for use in a wide range of application. IDS finished…

[Operator Instructions] Our first question comes from the line of Allison Poliniak with Wells Fargo. Your line is now open.

Hi guys, good morning.

Good morning.

Could you guys -- the European out growth relative to other region is it end market specific? I know you've highlighted a stronger team and such. And if not are there things you could be replicating in the other regions to drive some increased growth outside of the end market?

Good morning, Allison. Yes, absolutely. It's a twofold situation. We do have a very strong team in Europe that we're proud of and in some ways, they're ahead of the curve, we are sharing those practices with our other teams. I will say at the same time, because of the nature of the European market and the industries that are involved versus for instance, Brazil, U.S. oil and gas areas, etcetera and Australia, we are seeing better demand there as well. So it's a combination of factors. But absolutely in the areas of overachieving we are sharing those best practices with our other teams actively and also seeing results from that as an effect.

Great, thanks. And then just on SG&A for '17. I know, Aaron you highlighted R&D increasing some of the investments there. What level of R&D increase are we looking out for '17? And you know how should we think about the pace of SG&A throughout the year?

Yes. So let me start with R&D. We clearly are anticipating increases in R&D. As we pulled our guidance together, it could have approximately $0.05 increase -- sorry, $0.05 impact on our earnings per share so it's a pretty material increase in our R&D expense. As we look at SG&A next year, we were -- as Michael commented, we are absolutely focused on driving down our SG&A, while still making investments in certain selling functions. And it all comes down to driving efficiencies everywhere that we possibly can. I certainly don't want to give exact guidance with respect to SG&A, but rest assured, this continues to be a focus area for us.

Okay, great. Thank you.

Thank you.

Thank you. Our next question comes from the line of George Staphos of Bank of America Merrill Lynch. Your line is now open.

Thanks everyone, good morning. And my congratulations to you and your team for really great progress this year. I wanted to pick up on that one – well it’s well deserved. I wanted to pick on sort of the question from Allison on SG&A. So if we think about this past year that has just concluded, you raised guidance several times during the year. As you think about it, what was the primary if you had it nailed down to one thing driver of that, was it the operational efficiency or was it the SG&A reductions that drove that?

The biggest driver was definitely on the operations side versus the SG&A side. In fact, I think in -- some calls previously I actually mentioned that the SG&A improvements were coming a bit slower than we had hoped for. So operation, so gross margin if you will, was clearly the driver of over performance versus our initial guidance.

Okay. So as we sit here on this side of the phone, Aaron obviously, we can look at GDP, we can look at industrial reduction, we can look at non-res, but obviously the operations on the SG&A are things that we don't really get visibility into until you report for the next quarter. As you think about fiscal '17 on the guidance that you provided, where do you think the upside and downside, swing factors are? Are there more leverage, do you think this year to SG&A relative to operations, or how would you have us -- how would you counsel us?

Yes, great question. So as we look at our guidance, I'd say offsetting the challenging revenue environment are clearly these ongoing efficiency gains in the manufacturing facilities as well as SG&A expense. So if we dig down one level deeper, and we look at gross margin, I mean we clearly expect modest improvements in gross margin. The ongoing efficiency efforts will continue and we can stay very, very, very focused on driving efficiencies. We have a long run way of opportunities as we've talked about, and we certainly expect that we will drive efficiencies in excess of cost increases and greater than any pricing challenges we have as well. In SG&A, we absolutely expect to see some continued efficiencies as well, which would offset virtually all of the cost increases that we mentioned in our prepared remarks, i.e., increased selling resources, a bit of increased incentive compensation, etcetera. But again, it all comes from our perspective; it all comes back to the anticipated revenue challenges. That's really where we have the biggest concern. So I'm not giving you the exact answer on R&D -- I'm sorry on gross margin and SG&A because I want to avoid giving guidance at that level. But the point is, is that we should get improvements in both areas and we'll continue to focus on them.

Yes, understand, Aaron, and it wasn't necessarily trying to get you to the basis point on margins at all. I was just directionally; do you feel more comfortable about the gross margin trajectory or more comfortable about SG&A recognizing you're comfortable in both?

Yes. Actually, let me take a step back. If you would have asked me that question one year ago, I would have said I feel more comfortable with the gross margin improvements. As we sit here today, I feel pretty darn comfortable with both gross margins and SG&A improvement because we now have -- we now have started to get that momentum.

Okay, that's very helpful. My last one and then I will turn it over. Just very quickly on working capital, were you saying you expect less of a benefit this year from working capital improvement, or you actually could invest some funds into working capital this year as we think about the free cash flow model? Thank you.

No, I was absolutely coming at it from the perspective of less of an improvement.

Okay. Thank you very much.

Thank you.

Thank you. Our next question comes from the line of Charley Brady with SunTrust. Your line is now open.

Hey thanks, good morning guys.

Good morning, Charley

I just wanted to get back to your comments on the catalog and digitization. Just kind of a bigger picture question. Can you give us a sense remind us where that mix is today and really more importantly as you're looking out over a longer time period, where do you see that getting to? I guess how much does catalog sales kind of become acknowledging that's going to be an important piece of Brady's story for a long time. But I'm just trying to really gauge visionary what you're looking at in terms of where that mix will ultimately be, which obviously would have a pretty important margin impact on you guys.

Thanks, Charley. We are not breaking that split out. We have given you some guidance about growth in the past, and we'll continue to do so. But I will say this, we believe that there are typically step functions and change as you go from 1 model to the other that is somewhat based on technology changes somewhat based on generational changes. And so we do expect to see platforms of change or steps of change in the future as we go through literally the next decade. And so you will see a continuing shift in models to a much more real-time interactive approach as opposed to a more reactive catalog approach as we go forward.

Okay, that's helpful. And just a little bit related to that. Can you talk about without getting specific numbers, kind of the spending trends on optimizing that digital footprint that you've got? Obviously in the early days, a lot of money was being spent because you had a lot of heavy lifting to do. Further down that road today can you give a sense of how much you've been able to kind of backup the accelerator on spend on that? Obviously not to zero, but just – and that's translating into margin?

Right. So we clearly continue to spend in that area, we'll continue to invest in that area. But as you noticed, we had to turbocharge it in the beginning of the process as we were converting a number of our sites and making some very dramatic changes. I believe just a couple of years ago, we were behind the curve in our digital resolve. I believe we're now, in some cases, ahead of the curve, although we have a lot more opportunity. So you will see us to continue to invest in this area, but we are not investing at quite the rate that we were in the past.

Good thanks.

Thank you. Our next question comes from the line of Mig Dobre with Robert Baird. Your line is open.

Yes, good morning everyone. Maybe looking -- I might have missed this in your prepared remarks, I understand ID Solutions is expected to see a little bit of margin expansion. Did you comment on Workplace Safety for next year as well?

Yes. Actually, we did. And I'll actually just go right back to the script. Because effectively, our comment was that we expect our segment profit to be in the upper teens as a percent of sales, which of course should be a slight expansion over what we just saw this year.

Okay, I appreciate that. Sorry for missing it.

It's okay. Don't worry about it.

No, no, that's fair. And then I'm sort of looking maybe for a little bit of color with regards to the cadence of margin and ID Solutions into next year. Are there -- is there a seasonal aspect to it that we need to be aware of? I guess to be blunt, when I'm looking at the margin performance that you had in the back half of '16, which has been fairly consistent above 23 at segment level, is that the right way to think about it going into '17?

Well, I think, historically our second quarter is always our most challenging quarter for revenue, and that definitely has a margin impact. So I would look at it from the perspective of we typically have a very strong fourth quarter, although as an overall company in IDS we also have a reasonably strong fourth quarter whereas our second quarter because of a variety of timing issues in our industry is our slowest revenue quarter, hence, our most challenging margin quarter. We were making significant improvements that we're able to offset that this year.

But can you comment at all on the first quarter, for instance where you don't have the seasonal weakness?

Yes, we continue to expect good results in our margins in the first quarter.

Okay, great. And then last question for me is really more surrounding growth. I guess can you maybe help us understand or maybe put in some perspective the last couple of years in terms of organic growth; the way you're guiding for fiscal '17 obviously we're not really looking at a lot of growth there, either. I'm trying to understand what was end market-driven here versus maybe some company specific guidance. And at what point do think you'll be able to start narrowing the gap versus non [Indiscernible] GDP?

If you go back to my very first guidance, I believe I spoke about the need to reinvigorate our product development pipeline. I also spoke about the fact that, that would take an extensive period of time in the range of three years. We were on track. We are an industrial segment where our new product more specifically the revenue stream coming from new product development takes longer. The positive to that is the revenue streams last a lot longer. So once we do reinvigorate that pipeline, once we do start developing those streams, which we are, it will take -- it will have a longer term benefit. I will say that we did not anticipate the challenges at this point from the overall industrial economy than we're having, and I'm pleased that we're able to overcome those. But there is no question that the economic environment that we're in today is a challenging one. The good news is despite that I think you've seen some changes and some turnarounds in the areas particular of the WPS. But overall in our approach, in some of that comes from a better focus on what we're really good at and some of that comes from the fact that we are creating a stronger, more exciting product line that I think you're going to continue to see more significant results down the road. But it is going to take a while as I've said.

Good. Would down the road mean fiscal '18, fiscal '19?

Correct.

Thank you.

Thank you. Our next question comes from the line up Joe Mondillo with Sidoti & Company. Your line is now open.

Hi, good morning everyone.

Good morning, Joe.

So I think you might have just answered this, but relative -- considering your -- the guidance that you provided for fiscal '17 relative to your long term 2018 guidance, it's obviously backend weighted. And I'm just wondering if there's anything relative to the internal initiatives that you are doing, productivity improvement, projects, cost cutting that's more backend weighted that you could see hit more in 2018? Or is it more so just sort of the environment may be weighing a little more on 2017 and hopefully, that improves and maybe you get a long-term benefit relative to the R&D innovative new products. Is there anything sort of internal in terms of the cost cutting or if that's backend weighted or?

Joe, you hit it on the head. We continue to expect our efficiency and effectiveness efforts to garner improvement in our profitability. But the most significant factor we believe in the longer term that is really going to impact us in a positive way is the innovation initiative that we're in the middle of right now. We're very excited about the products that we are working on and the opportunities that we're working on, but those obviously take longer. And as I mentioned, looking in that longer-term horizon you're going to see therefore a bigger benefit from those. And given that we expect those products to garner better margins being newer products for us that should have a very solid impact on our earnings.

Okay. And then my second question just regarding SG&A it's sort of a two part question. First, administrative costs were up about 4% in '16 after actually falling like 11% in 2015. So just wondering if those are going to start coming down, again. What's going on there? And then in terms of long term sort of, if you will, normalized SG&A as a percent of sales, if you could flip a switch here and do everything overnight and not sort of affect any of your businesses or customer service or anything like that, where do you see sort of a normalized SG&A as a percent of sales? Because obviously even with quite frankly, maybe your 2018 goals, and you can tell me if I'm wrong or not, even those goals see maybe a little lofty to maybe some of your peers. So I'm just wondering what sort of maybe a five plus year outlook would be relative to normalized SG&A as a percent of sales.

Joe, I'll handle that question. So the first part of your question with respect to G&A expense being up in fiscal 2016 versus '15, that certainly is true. And there are really two primary drivers, actually two primary drivers offset by one item. First would be our equity based compensation, which you can see is up this year versus prior years. It is not that we've issued more equity; in fact that's not the case at all. It comes down to the fact that in prior years, we actually had some reversals due to turnover in executive team, etcetera. So that's a piece of it. Another piece of it is our bonus expense; it's actually up this year as well. As you know in 2015 the bonuses were pretty, I'll say modest but basically nil throughout the organization and a piece of that has come back. And that has been offset, at least partially offset by the efficiency gains that we've been talking about like I said, have clearly now garnered some traction. So that's the reason that G&A expense was actually up slightly in 2016. And as far as F '17, I don't want to get too granular with respect to that level of detail, what we expect. Now switching to the normalized SG&A so looking out into many, many years of hypothetical question that you raised, I really struggle to answer a question like that to be quite candid. The guidance that we just laid out that we slightly modified with respect to our three year plan, you can see that those targets are 33.5% to 34.5% of sales for SG&A. And frankly, we also look at it the same way you do Joe, and that is, it is lofty compared to our peers, but the reality is we can't pull it down overnight without having a very significant impact on our customer experience, etcetera. So we will continue to chop a way out of, we will continue to drive efficiencies everywhere that we possibly can within the organization. But beyond what you see in our three year plan, that's basically what we're willing to commit to at the moment. But rest assured, we are pushing efficiencies everywhere we possibly can.

Okay, and just to follow up. There's nothing -- is there anything sort of unique with your business relative to maybe your peers are not exactly the same as you guys and your footprint and your facilities and such? Is there anything that may hold you back long term to maybe get closer to you know obviously you are getting closer, but much closer, I guess, over a five plus year period. Or is it just going to take time and effort and such?

That's an important point as we take a look at how we're configured in the complexity of our Company. We are more complex than some of our peers. That provides us with some great benefits. In addition it provides challenges in the area of G&A. The benefits being that really, we come out the market in many different ways and/or in many, many different markets that often our peers are not. That's a great foundational strength we have, and that makes us a very robust company year in and year out. As you've noted though, the result of that is we are going to be challenged to hit best practices rates or peer rates of G&A. That does not mean that we aren't going to work hard to drive to that effect. One of the mantras that I think you repeatedly heard me say is we're driving decisions down into our organizations by creating a structure that can work within. By doing that, it will inherently drive our G&A down, and that's one of the big focuses we have. If they know the limits between stake and run, and they can make the decisions, we don't have to have a larger overhead structure, particularly in our corporate area to accommodate that.

Okay. Great. Thank you. Appreciate it.

Thank you.

Thank you. Our next question comes from the line of Keith Housum with Northcoast Research. Your line is now open.

Good morning guys and congratulations on the restructuring efforts so far. I am seeing some great dividends.

Thanks Keith.

As we look at your fourth quarter results, clearly they're better than expectations. Was there any of that due or how much of that was due to the delayed hiring and you're cautioning us through your spending that perhaps you're previously doing is offsetting that?

I think that had a very modest factor. In fact, it was extremely modest. Effectively, we're at employment rates that are similar to when I arrived two years ago. We are not doing this by attacking people directly, we're doing this by truly making ourselves a much more efficient and effective organization. I think when you delay hiring in a significant manner we have temporary risk or things of that nature without a huge disconnect in the economy. It really is counterproductive to our long-term goals. So our efforts really are designed to always look at the long term as we make the short term decisions. So yes, we did have some limited delayed hirings, but we don't believe in anyway did that impact our ability to grow in the longer term.

Okay, great. And then as we look at your Workplace Safety segment, as you look at the performance during the quarter and your expectations for '17, is there greater pressure on volume versus pricing? Or is it purely just volume driven at these levels?

Well, obviously, volume has a solid impact in our ability. If we can get a little help from the economy it helps us disproportionately without question. That said, we regularly and carefully look at our pricing models. We do a lot of beta testing of those, in making sure that we are at a price point that is positive for our customers and positive for us.

Okay, great. And finally my final question for you is on the Identification Solutions group. Is there one part of IDS that is outperforming the others as we look to the current performance as well us into '17?

We try not the break out our different segments below that point. However, as you know, health care is a little healthier at the moment. Admission rates are down, but there are opportunities there. In addition any time that you're looking at legislative changes that helps us in those segments of the involved in some of the legislative changes out there certainly are able to do better, because despite the economy, people have to respond to those type of factors. Health and governmental requirements.

Got it. Thank you.

Thank you.

Thank you. And our next question is a follow-up from the line of George Staphos of Bank of America Merrill Lynch. Your line is open.

Thank you. Hey Mike, can you comment at all in terms of what you see for the pace of non residential construction and how that might play out the next couple of years in terms of your markets? Do you see things as getting somewhat better? Do you see things is somewhat being challenged, recognizing the overall view is that going to be a tough growth environment next year or this fiscal year that you're entering?

We'll start with, yes, it's hurting us today. No question about that. I think the real factor involved and that has so much to do with the macro economy that I'm reticent to make unequivocal statement, clearly our history is that as a economy turbochargers and capacity ends up running out, we end up benefiting more at the end of that cycle than the beginning because people are changing the configurations of their factories, they're expanding, so on and so forth. So I think as you look at us and you see construction order capacity issues coming into play, that's a good sign for our future. That said, right now, we have -- and you have, and you can read just as I do all the models and we can look at our customers so many different indicators in the economy right now. I would not plan on forecasting a stronger model in the near future.

Okay. But also from where you sit perhaps because it's well -- maybe I shouldn't answer the question for you. But do you think the non-res trend is decelerating at this juncture status quo or moderate accelerating? And I realize that's a very broad question.

I would actually prefer you answering your own questions, but I certainly will do that for you, if you'd like. It is so market dependent at this point. I mean, giving you a great example, oil and gas. That is a huge segment of the U.S. economy, the Canadian economy and look at a couple the Scandinavian countries like Norway, it had a huge impact. If you look at mining industries and things like that in Australia where those significant not only to the economy to us, and there's no question those are in a more stage in some cases. So in the future, you would hope I'd expect that those could improve. But there are other cases that are unrelated that we may see different trends coming the other way, but some of the major ones that we're really being heard on right now, there's very, very little movement in those spaces at all. So you'd hope in the next couple of years as things work at normalized state and you would expect that those would improve.

Okay, I appreciate that.

I would prefer you answering your question though.

That's accurate based on my track record. I know somewhat challenging question answer on the line, Mike, but do you think there is a normalized level of margin IDS that at some point you don't want to go past and where would the stand relative to the threshold? I know you're not going to put out a single point number, but any thoughts would be helpful there. Thank you.

Sure. I think the key to us moving the margin over the long term has to do with the products we innovate and how we innovate them. We are unequivocally putting more efforts, more consistent effort and I think really more focused effort. I know more focused effort into how we develop our product and what products we're developing. We're seeing a lot more customer input into what their problem sets are that allow us to be much more creative in our solution sets. So I'm very excited about that. But that excitement is not just a revenue excitement. My history and the history of this company is the newer -- and most companies, the newer the products, the better you can gain margin traction. So I would say the most significant way we can change our margin mix in IDS is to have a fresher, more vibrant product introduction.

So to conclude then, once we get in to '18, '19, that's really going to be the driver of your margin at IDS, would that be fair?

Unequivocally.

Okay. Thank you very much. Good luck on the year coming up.

Thank you sir, appreciate it.

Thank you. And our last question is a follow up from Mig Dobre with Robert Baird. Your line is open.

Yes, thank you for taking my follow up. I'm just trying to understand your FX guidance a little bit better. Correct me if I'm wrong, but you're talking about something like 1.5% headwind, and I'm looking at a broad dollar index, it's basically flat year-over-year, down, call it 3% year-to-date. I'm just sort of having a hard time figuring out how you end up with a headwind?

So the 1.5%, two things to comment on. First of all it's based on exchange rate as of the end of our fiscal year. So as of July 31, that's item number one. And then item number 2, is it really comes down to where our businesses. So for instance, we have a very vibrant business in the U.K. as an example. And if you look at what happened with the pound, I think it was probably $1.46 at the end of our third quarter and somewhere in the $1.32, $1.33 range at the end of July. So you look at the big market like that, clearly that would provide a headwind. If you look at the euro on the other hand, the euro is somewhat stable frankly. But it really comes down to the basket of currencies revenues ultimately come out at, so it's a very calculated number.

So how big is your U.K. exposure?

I don't want to get into the revenues, but I will say this, it's a very nice side [ph] business for us in Europe. But I don't want to give the exact revenues.

Well, I understand. Is it larger than the euro denominated business?

No. No, it is not.

Okay. I can follow up off-line with you. Thank you.

Thank you. This concludes our Q&A session for today. I would now like to turn the call back over to Miss Thornton for any closing remarks.

We thank you for your participation today. As a reminder, the audio and slides from this morning's call are also available on our website at www.bradycorp.com. The replay of this conference call will be available over the phone beginning at 12:30 Central Time today, September 9. The phone number to access the call is 1-855-859-2056. International callers can dial 404-537-3406, and the passcode is 64003281. As always, if you have questions, please contact us. Thanks and have a nice day. Operator, could you please disconnect the call?

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program, and you may now disconnect. Everyone, have a great day.