BRADY CORPBRC
BRADY CORP Debt Disclosure
Debt
On August 1, 2019, the Company and certain of its subsidiaries entered into an unsecured $200 million multi-currency credit agreement with a group of five banks.
On November 14, 2022, the Company and certain of its subsidiaries entered into a Second Amendment to the Credit Agreement (“Amendment No. 2”) to, among other items, (a) increase the lending commitments by $100 million for total lending commitments of $300 million, (b) extend the final maturity date to November 14, 2027, (c) increase the interest rate on certain borrowings by 0.125%, and (d) increase the available amount under the credit agreement, at the Company's option and subject to certain conditions, from $300 million up to (i) an amount equal to the incremental borrowing necessary to bring the Company's consolidated net debt-to-EBITDA ratio as defined in the credit agreement to 2.5 to 1.0 plus (ii) $200 million.
On October 10, 2024, the Company and certain of its subsidiaries entered into a Third Amendment to the Credit Agreement (“Amendment No. 3”) with a group of six banks, which amended the original credit agreement dated August 1, 2019. Amendment No. 3 amended the original credit agreement to, among other things, change the applicable benchmark under the
credit agreement for borrowings denominated in Canadian Dollars from the Canadian Dollar Offered Rate (“CDOR”) to the adjusted Term Canadian Overnight Repo Rate Average Rate (“CORRA”). Borrowings under Amendment No. 3 are unsecured and are guaranteed by certain of the Company's domestic subsidiaries.
As of July 31, 2025, the outstanding balance on the credit agreement was $99.8 million. The maximum amount outstanding on the credit agreement during the year ended July 31, 2025 was $144.8 million. As of July 31, 2025, there was $198.1 million available for future borrowing, which can be increased to $1,093.1 million at the Company's option, subject to certain conditions. The credit agreement has a final maturity date of November 14, 2027. As such, borrowings are classified as long-term on the consolidated balance sheets.
The Company’s credit agreement requires it to maintain certain financial covenants, including a ratio of debt to trailing twelve months EBITDA, as defined in the agreement, of not more than a 3.5 to 1.0 ratio (leverage ratio) and trailing twelve months EBITDA to interest expense of not less than a 3.0 to 1.0 ratio (interest expense coverage ratio). As of July 31, 2025, the Company was in compliance with these financial covenants, with a ratio of debt to EBITDA, as defined by the agreements, equal to 0.3 to 1.0 and the interest expense coverage ratio equal to 67.3 to 1.0.
As of July 31, 2025 and 2024, borrowings on the credit agreement were as follows:
| July 31, 2025 | July 31, 2024 | ||||||||||||||||||||||
| Amount Outstanding (thousands) | Weighted Average Interest Rate | Amount Outstanding (thousands) | Weighted Average Interest Rate | ||||||||||||||||||||
Revolving credit agreement (1) | $ | 99,766 | 4.0 | % | $ | 90,935 | 5.3 | % | |||||||||||||||
(1)Borrowings under the revolving credit agreement as of July 31, 2025 included USD-denominated, British pound-denominated and Euro-denominated borrowings of $39,000, $10,588 and $50,178, respectively. The weighted average interest rate of the USD-denominated, British pound-denominated and Euro-denominated borrowings was 5.3%, 5.1% and 2.8%, respectively, as of July 31, 2025.
Borrowings under the revolving credit agreement as of July 31, 2024 included USD-denominated, British pound-denominated and Euro-denominated borrowings of $32,000, $10,267 and $48,668. The weighted average interest rate of the USD-denominated, British pound-denominated and Euro-denominated borrowings was 6.3%, 6.1% and 4.5%, respectively, as of July 31, 2024.
Due to the variable interest rate pricing of the Company's revolving debt, it is determined that the carrying value of the debt equals the fair value of the debt.
The Company had outstanding letters of credit of $2,094 and $1,766 at July 31, 2025 and 2024, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Sep 4, 2025 | Showing above |
| 2024 | Sep 6, 2024 | |
| 2023 | Sep 5, 2023 | |
| 2022 | Sep 1, 2022 | |
| 2021 | Sep 2, 2021 | |
| 2020 | Sep 16, 2020 | |
| 2019 | Sep 6, 2019 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.