UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended April 30, 2006

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period from                     to                     

BRADY CORPORATION

(Exact name of registrant as specified in its charter)

Wisconsin		39-0178960
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

6555 West Good Hope Road, Milwaukee, Wisconsin 53223
(Address of principal executive offices)
(Zip Code)

(414) 358-6600
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes þ  No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

Large accelerated filer þ  Accelerated filer o   Non-accelerated filer o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o  No þ

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

As of May 22, 2006, there were outstanding 45,577,842 shares of Class A Nonvoting Common Stock and 3,538,628 shares of Class B Voting Common Stock. The Class B Common Stock, all of which is held by affiliates of the Registrant, is the only voting stock.

 

 

FORM 10-Q

BRADY CORPORATION

INDEX

		Page
PART I. Financial Information
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets			3
Condensed Consolidated Statements of Income			4
Condensed Consolidated Statements of Cash Flows			5
Notes to Condensed Consolidated Financial Statements			6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			18
Item 3. Quantitative and Qualitative Disclosures About Market Risk			29
Item 4. Controls and Procedures			29
PART II. Other Information
Item 1A. Risk Factors			30
Item 6. Exhibits			34
Share Sale and Purchase Agreement
Rule 13a-14(a)/15d-14(a) Certification
Rule 13a-14(a)/15d-14(a) Certification
Section 1350 Certification
Section 1350 Certification

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS
BRADY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)

		April 30, 2006				July 31, 2005
		(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents		$	90,314			$	72,970
Short term investments			30,000				7,100
Accounts receivable, less allowance for losses ($5,309 and $3,726, respectively)			166,962				123,453
Inventories:
Finished products			50,827				38,827
Work-in-process			11,162				9,681
Raw materials and supplies			31,863				22,227
Total inventories			93,852				70,735
Prepaid expenses and other current assets			37,402				28,114
Total current assets			418,530				302,372
Other assets:
Goodwill			452,748				332,369
Other intangible assets, net			95,189				71,647
Deferred income taxes			40,302				39,043
Other			9,145				6,305
Total other assets			597,384				449,364
Property, plant and equipment:
Cost:
Land			6,553				6,388
Buildings and improvements			73,606				65,007
Machinery and equipment			175,205				157,093
Construction in progress			10,424				6,510
			265,788				234,998
Less accumulated depreciation			150,251				136,587
Net property, plant and equipment			115,537				98,411
Total		$	1,131,451			$	850,147
LIABILITIES AND STOCKHOLDERS’ INVESTMENT
Current liabilities:
Accounts payable		$	60,790			$	52,696
Wages and amounts withheld from employees			46,361				49,620
Taxes, other than income taxes			6,443				4,815
Accrued income taxes			23,205				24,028
Other current liabilities			32,713				29,649
Short-term borrowings and current maturities on long-term debt			126				4
Total current liabilities			169,638				160,812
Long-term debt, less current maturities			350,187				150,026
Other liabilities			56,377				42,035
Total liabilities			576,202				352,873
Stockholders’ investment:
Class A nonvoting common stock — Issued 45,881,743 and 45,877,543 shares, respectively and outstanding 45,462,077 and 45,792,199 shares, respectively			459				458
Class B voting common stock — Issued and outstanding 3,538,628 shares			35				35
Additional paid-in capital			101,242				99,029
Income retained in the business			445,508				382,880
Treasury stock — 419,666 and 85,344 shares, respectively of Class A nonvoting common stock, at cost			(15,341	)			(1,575	)
Accumulated other comprehensive income			25,198				17,497
Other			(1,852	)			(1,050	)
Total stockholders’ investment			555,249				497,274
Total		$	1,131,451			$	850,147

See Notes to Condensed Consolidated Financial Statements.

BRADY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Dollars in Thousands, Except Per Share Amounts)

		(Unaudited)
		Three Months Ended April 30,												Nine Months Ended April 30,
										Percentage												Percentage
		2006				2005				Change				2006				2005				Change
Net sales		$	266,494			$	209,766				27.0	%		$	730,103			$	606,401				20.4	%
Cost of products sold			125,739				95,898				31.1	%			348,252				282,052				23.5	%
Gross margin			140,755				113,868				23.6	%			381,851				324,349				17.7	%
Operating expenses:
Research and development			7,314				5,941				23.1	%			20,677				17,744				16.5	%
Selling, general and administrative			89,215				72,384				23.3	%			241,543				208,335				15.9	%
Total operating expenses			96,529				78,325				23.2	%			262,220				226,079				16.0	%
Operating income			44,226				35,543				24.4	%			119,631				98,270				21.7	%
Other income and (expense):
Investment and other income — net			2,279				36				6230.6	%			2,759				812				239.8	%
Interest expense			(4,496	)			(2,101	)			114.0	%			(8,920	)			(6,277	)			42.1	%
Income before income taxes			42,009				33,478				25.5	%			113,470				92,805				22.3	%
Income taxes			11,763				8,522				38.0	%			31,772				26,913				18.1	%
Net income		$	30,246			$	24,956				21.2	%		$	81,698			$	65,892				24.0	%
Per Class A Nonvoting Common Share:
Basic net income		$	0.62			$	0.51				21.6	%		$	1.67			$	1.35				23.7	%
Diluted net income		$	0.61			$	0.50				22.0	%		$	1.64			$	1.32				24.2	%
Dividends		$	0.13			$	0.11				18.2	%		$	0.39			$	0.33				18.2	%
Per Class B Voting Common Share:
Basic net income		$	0.62			$	0.51				21.6	%		$	1.65			$	1.33				24.1	%
Diluted net income		$	0.61			$	0.50				22.0	%		$	1.62			$	1.31				23.7	%
Dividends		$	0.13			$	0.11				18.2	%		$	0.37			$	0.31				19.4	%
Weighted average common shares outstanding (In Thousands):
Basic			48,923				49,177								49,039				48,872
Diluted			49,833				50,192								49,962				49,754

See Notes to Condensed Consolidated Financial Statements.

BRADY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)

		(Unaudited)
		Nine Months Ended
		April 30,
		2006				2005
Operating activities:
Net income		$	81,698			$	65,892
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			23,973				19,991
Gain on Foreign Currency Contract			(1,517	)			—
Income tax benefit from the exercise of stock options			—				4,747
Deferred income taxes			(3,500	)			(2,354	)
Loss on sale or disposal of property, plant & equipment			188				599
Provision for losses on accounts receivable			1,102				980
Non-cash portion of stock-based compensation expense			4,275				3,101
Changes in operating assets and liabilities (net of effects of business acquisitions):
Accounts receivable			(25,570	)			(5,099	)
Inventories			(14,123	)			(8,423	)
Prepaid expenses and other assets			(2,604	)			(979	)
Accounts payable and accrued expenses			(3,748	)			(10,056	)
Income taxes			(1,657	)			10,107
Other liabilities			4,813				3,491
Net cash provided by operating activities			63,330				81,997
Investing activities:
Acquisition of businesses, net of cash acquired			(155,283	)			(49,397	)
Purchases of short-term investments			(105,800	)			(34,000	)
Sales of short-term investments			82,900				22,950
Purchases of property, plant and equipment			(26,291	)			(14,411	)
Purchase of Foreign Currency Contract			(2,134	)			—
Proceeds from sale of property, plant and equipment			(51	)			288
Other			(1,907	)			(1,188	)
Net cash used in investing activities			(208,566	)			(75,758	)
Financing activities:
Payment of dividends			(19,070	)			(15,885	)
Proceeds from the exercise of stock options			6,960				14,635
Principal payments on debt			(721	)			(83,046	)
Net proceeds from issuance of debt			200,000				83,000
Purchase of treasury stock			(27,299	)			—
Income tax benefit from the exercise of stock options			3,707				—
Net cash provided by (used in) financing activities			163,577				(1,296	)
Effect of exchange rate changes on cash			(997	)			(760	)
Net increase in cash and cash equivalents			17,344				4,183
Cash and cash equivalents, beginning of period			72,970				68,788
Cash and cash equivalents, end of period		$	90,314			$	72,971
Supplemental disclosures:
Cash paid during the period for:
Interest, net of capitalized interest		$	4,572			$	4,051
Income taxes, net of refunds			30,844				12,982
Acquisitions:
Fair value of assets acquired, net of cash		$	61,602			$	35,971
Liabilities assumed			(23,188	)			(18,212	)
Goodwill			116,869				31,638
Net cash paid for acquisitions		$	155,283			$	49,397

See Notes to Condensed Consolidated Financial Statements.

BRADY CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Nine Months Ended April 30, 2006
(Unaudited)
(In thousands, except share and per share amounts)

NOTE A — Basis of Presentation

          The condensed consolidated financial statements included herein have been prepared by Brady Corporation and subsidiaries (the “Company” or “Brady”) without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of the Company, the foregoing statements contain all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the financial position of the Company as of April 30, 2006 and July 3l, 2005, and its results of operations for the three months and nine months ended April 30, 2006 and 2005, and its cash flows for the nine months ended April 30, 2006 and 2005. The condensed consolidated balance sheet as of July 31, 2005 has been derived from the audited consolidated financial statements of that date and condensed. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts therein. Due to the inherent uncertainty involved in making estimates, actual results in future periods may differ from the estimates.

          Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to rules and regulations of the Securities and Exchange Commission. Accordingly, the condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statement presentation. It is suggested that these condensed consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s latest annual report on Form 10-K for the year ended July 31, 2005.

          Reclassifications — Certain prior period amounts have been reclassified to conform with the current period presentation.

NOTE B — Goodwill and Intangible Assets

          Changes in the carrying amount of goodwill for the nine months ended April 30, 2006, are as follows:

		Americas				Europe				Asia				Total
Balance as of July 31, 2005		$	226,843			$	73,544			$	31,982			$	332,369
Goodwill acquired during the period			101,734				6,102				9,033				116,869
Translation adjustments and other			901				1,258				1,351				3,510
Balance as of April 30, 2006		$	329,478			$	80,904			$	42,366			$	452,748

          Goodwill increased by $120,379 during the nine months ended April 30, 2006, including an increase of $3,510 attributable to translation adjustments and adjustments to the preliminary allocation of the purchase price of Technology Print Supplies Ltd. and its associate, Technology Supply Media Co., Ltd. in Thailand, which were acquired on July 29, 2005. The additional increase in goodwill of $116,869 for the nine months ended April 30, 2006 was due to the allocation of the purchase price for the acquisitions of STOPware, Inc., TruMed Technologies, Inc., J.A.M. Plastics Inc., Personnel Concepts, and IDenticard Systems, Inc. in the United States, Identicam Systems in Canada, Texit Danmark AS and Texit Norge AS in Europe, QDP Thailand Co. Ltd. in Asia, and Accidental Health & Safety Pty. Ltd. and Trafalgar First Aid Pty. Ltd. in Australia.

          Other intangible assets include patents, trademarks, non-compete agreements and other intangible assets with finite lives being amortized in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 142, “Goodwill and Other Intangible Assets.” The net book value of these assets was as follows:

		April 30, 2006																July 31, 2005
		Weighted																Weighted
		Average																Average
		Amortization				Gross												Amortization				Gross
		Period				Carrying				Accumulated				Net Book				Period				Carrying				Accumulated				Net Book
		(Years)				Amount				Amortization				Value				(Years)				Amount				Amortization				Value
Amortized other intangible assets:
Patents			16			$	7,210			$	(4,957	)		$	2,253				16			$	6,830			$	(4,525	)		$	2,305
Trademarks and other			8				2,737				(1,391	)			1,346				10				1,370				(1,134	)			236
Customer relationships			8				71,795				(14,301	)			57,494				8				51,211				(7,244	)			43,967
Purchased software			4				3,523				(1,897	)			1,626				5				3,148				(1,353	)			1,795
Non-compete agreements			4				8,184				(4,336	)			3,848				4				6,216				(3,212	)			3,004
Unamortized other intangible assets:
Trademarks			N/A				28,622				—				28,622				N/A				20,340				—				20,340
Total						$	122,071			$	(26,882	)		$	95,189							$	89,115			$	(17,468	)		$	71,647

          The increase in customer relationships for the nine months ended April 30, 2006, relates to the acquisitions of STOPware, Inc., TruMed Technologies, Inc., J.A.M. Plastics Inc., Personnel Concepts, and IDenticard Systems, Inc. in the United States, Identicam Systems in Canada, Texit Danmark AS and Texit Norge AS in Europe, QDP Thailand Co. Ltd. in Asia, and Accidental Health & Safety Pty. Ltd. and Trafalgar First Aid Pty. Ltd. in Australia. The increase in trademarks for the same period is due primarily to the acquisitions of Texit Danmark AS, Texit Norge AS, J. A. M. Plastics Inc., and Personnel Concepts. The value of goodwill and intangible assets in the Condensed Consolidated Financial Statements at April 30, 2006 differs from the value assigned to them in the preliminary allocation of purchase price due to the effect of fluctuations in the exchange rates used to translate financial statements into the United States Dollar.

          Amortization expense on intangible assets was $4,084 and $1,978 for the three-month periods ended April 30, 2006 and 2005, respectively and $9,414 and $6,062 for the nine-month periods ended April 30, 2006 and 2005, respectively. The amortization over each of the next five fiscal years is projected to be $12,773, $12,299, $11,770, $11,207 and $10,387 for the years ending July 31, 2006, 2007, 2008, 2009 and 2010, respectively.

NOTE C — Comprehensive Income

          Total comprehensive income, which is comprised of net income, foreign currency adjustments and net unrealized gains and losses from cash flow hedges, amounted to approximately $34,579 and $34,619 for the three months ended April 30, 2006 and 2005, respectively and $89,399 and $82,692 for the nine months ended April 30, 2006 and 2005, respectively.

NOTE D — Net Income Per Common Share

          Reconciliations of the numerator and denominator of the basic and diluted per share computations for the Company’s Class A and Class B common stock are summarized as follows:

		Three Months Ended								Nine Months Ended
		April 30,								April 30,
		2006				2005				2006				2005
Numerator:
Net Income		$	30,246			$	24,956			$	81,698			$	65,892
Numerator for basic and diluted Class A net income per share			30,246				24,956				81,698				65,892
Less: Preferential dividends			—				—				(758	)			(751	)
Less: Preferential dividends on dilutive stock options			—				—				(16	)			(23	)
Numerator for basic and diluted Class B net income per share		$	30,246			$	24,956			$	80,924			$	65,118
Denominator:
Denominator for basic net income per share for both Class A and Class B			48,923				49,177				49,039				48,872
Plus: Effect of dilutive stock options			910				1,015				923				882
Denominator for diluted net income per share for both Class A and Class B			49,833				50,192				49,962				49,754
Class A Non Voting Common Stock net income per share:
Basic		$	0.62			$	0.51			$	1.67			$	1.35
Diluted		$	0.61			$	0.50			$	1.64			$	1.32
Class B Voting Common Stock net income per share:
Basic		$	0.62			$	0.51			$	1.65			$	1.33
Diluted		$	0.61			$	0.50			$	1.62			$	1.31

          Options to purchase 614,500 and 621,500 shares of Class A Common Stock were excluded from the calculation of diluted net income per share for the three and nine months ended April 30, 2006, respectively, because their inclusion would have been anti-dilutive, or in the case of performance stock awards, because the number of shares ultimately issued is contingent on Company performance against metrics established for the performance period.

          Options to purchase 616,000 shares of Class A Common Stock were not included in the computation of diluted net income per share for the nine months ended April 30, 2005 because the option exercise price was greater than the average market price of the common shares and, therefore, the effect would be anti-dilutive. No options were excluded from the computation of diluted net income per share for the three months ended April 30, 2005.

NOTE E — Acquisitions

          During the nine months ended April 30, 2006, the Company acquired STOPware, Inc. (August 2005), Texit Danmark AS and Texit Norge AS (collectively “Texit”) (September 2005), TruMed Technologies, Inc. (October 2005), QDP Thailand Co. Ltd. (“QDPT”) (October 2005), J.A.M. Plastics Inc. (December 2005), Personnel Concepts (January 2006), IDenticard Systems, Inc. and Identicam Systems in Canada (February 2006) and Accidental Health & Safety Pty. Ltd. and Trafalgar First Aid Pty. Ltd (March 2006) for a total combined purchase price, net of cash purchased, of $155,283 in cash.

          A brief description of each company acquired during the nine months ended April 30, 2006 is included below:

	§		STOPware, Inc. is located in San Jose, California and is a manufacturer of visitor-badging and lobby-security software used to identify and track visitors.
	§		Texit is a manufacturer and distributor of wire markers and cable-management products headquartered in Odense, Denmark, with operations in Ålesund, Norway.
	§		TruMed Technologies, Inc. is a converter of disposable products and components for manufacturers in the medical device, diagnostic, personal care and industrial markets and is located in Burnsville, Minnesota.
	§		QDPT is located in Wangnoi, Ayutthaya, Thailand and designs and manufactures high-precision components for the electronic, medical and automotive industries, specializing in precision laminating, stamping and contract assembly.
	§		J.A.M. Plastics Inc. is located in Anaheim, California and specializes in the sale and manufacture of security-related accessory products including patented badge holders, lanyards and retractable badge reels.
	§		Personnel Concepts is located in Pomona, California and is a direct marketer of labor-law compliance posters and related products. Personnel Concepts also offers consultative expertise on required communication of federal and state minimum wages, HIPAA privacy regulations, and EEO compliance, among other regulatory areas.
	§		IDenticard Systems, Inc. is located in Lancaster, Pennsylvania and its affiliate Identicam Systems in Canada is located in Markham, Ontario. The Companies are market leaders in personal identification, access control and consumable identification badges.
	§		Accidental Health & Safety Pty. Ltd. and Trafalgar First Aid Pty. Ltd. are located in Glendenning, New South Wales, Australia and are suppliers and distributors of customized first-aid kits, related safety products and signage for commercial enterprises.

The allocation of the purchase price of each company acquired during the nine months ended April 30, 2006, with the exception of STOPware, Inc., is preliminary pending the final valuation of intangible assets, tangible assets and liabilities. The results of the operations of each acquisition have been included since their respective dates of acquisition in the accompanying condensed consolidated financial statements.

The combined purchase price resulted in the allocation (or preliminary allocation) to intangible assets in the accompanying Condensed Consolidated Balance Sheet as follows:

		April 30, 2006
Goodwill		$	116,869
Customer relationships			19,549
Trademarks			8,411
Non-compete agreements			1,451
Purchased software			378
Patents			110
Other			1,305
Total		$	148,073

          Of the $116,869 allocated to goodwill, $31,301 associated with J.A.M. Plastics, Inc., TruMed Technologies, Inc. and IDenticard Systems, Inc. is expected to be deductible for tax purposes based on preliminary analysis.

          The purchase agreements for Texit, QDPT and STOPware, Inc. each include a provision for contingent payments based upon meeting certain performance conditions over a period of time subsequent to the acquisition. The total contingent payments of between $3,200 and $5,050 have not been accrued as liabilities in the accompanying condensed consolidated financial statements based on the accounting guidance in SFAS No. 141. The purchase agreements for QDPT and STOPware, Inc. do include holdback provisions of $310 and $200, respectively, that have been recorded as liabilities in the condensed consolidated financial statements.

          As of April 30, 2006, the allocation of the purchase price of Signs and Labels Ltd. in the U.K. remained preliminary pending the determination of the final purchase price and the final valuation of intangible assets. This company was purchased in the fourth quarter of fiscal 2005.

The following unaudited pro forma results of operations of the Company for the three and nine months ended April 30, 2006 and 2005, respectively, give effect to all acquisitions completed since August 1, 2005 as listed above as though the transactions had occurred on August 1, 2004.

		Three Months Ended April 30,								Nine Months Ended April 30,
		2006				2005				2006				2005
Net Sales
As reported		$	266,494			$	209,766			$	730,103			$	606,401
Pro forma			267,778				235,753				773,372				678,451
Net Income
As reported		$	30,246			$	24,956			$	81,698			$	65,892
Pro forma			30,909				26,486				83,666				66,722
Per Class A Nonvoting Common Share:
Basic Earnings per share
As reported		$	0.62			$	0.51			$	1.67			$	1.35
Pro forma			0.63				0.54				1.71				1.37
Diluted Earnings per share
As reported		$	0.61			$	0.50			$	1.64			$	1.32
Pro forma			0.62				0.53				1.67				1.34
Per Class B Voting Common Share:
Basic Earnings per share
As reported		$	0.62			$	0.51			$	1.65			$	1.33
Pro forma			0.63				0.54				1.69				1.35
Diluted Earnings per share
As reported		$	0.61			$	0.50			$	1.62			$	1.31
Pro forma			0.62				0.53				1.66				1.33

These unaudited pro forma results have been prepared for comparative purposes only and primarily include adjustments for amortization arising from the valuation of intangible assets, interest expense on debt issued in connection with the acquisitions, and the related income tax adjustments. The pro forma information is not necessarily indicative of the results that would have occurred had the acquisitions occurred at the beginning of the periods presented, nor is it necessarily indicative of future results.

NOTE F — Segment Information

          The Company’s reportable segments are geographical regions that are each managed separately. The Company has three reportable segments: Americas, Europe and Asia. Following is a summary of segment information for the three and nine months ended April 30, 2006 and 2005:

																		Corporate
																		and
		Americas				Europe				Asia				Subtotals				Eliminations				Totals
Three months ended April 30, 2006:
Revenues from external customers		$	137,438			$	80,420			$	48,636			$	266,494			$	—			$	266,494
Intersegment revenues			12,152				1,052				964				14,168				(14,168	)			—
Profit (loss)			35,026				21,304				12,397				68,727				(2,724	)			66,003
Three months ended April 30, 2005:
Revenues from external customers		$	109,058			$	71,452			$	29,256			$	209,766			$	—			$	209,766
Intersegment revenues			12,048				657				1,396				14,101				(14,101	)			—
Profit (loss)			28,155				21,563				7,778				57,496				(905	)			56,591
Nine Months Ended April 30, 2006:
Revenues from external customers		$	363,446			$	230,466			$	136,191			$	730,103			$	—			$	730,103
Intersegment revenues			42,560				3,199				4,778				50,537				(50,537	)			—
Profit (loss)			92,188				62,071				37,124				191,383				(7,741	)			183,642
Nine Months Ended April 30, 2005:
Revenues from external customers		$	309,762			$	206,865			$	89,774			$	606,401			$	—			$	606,401
Intersegment revenues			33,851				1,959				3,421				39,231				(39,231	)			—
Profit (loss)			73,966				61,296				25,397				160,659				(2,915	)			157,744

          Following is a reconciliation of segment profit to income before income taxes for the three and nine months ended April 30, 2006 and 2005:

		Three Months Ended April 30,								Nine Months Ended April 30,
		2006				2005				2006				2005
Total profit from reportable segments		$	68,727			$	57,496			$	191,383			$	160,659
Corporate and eliminations			(2,724	)			(905	)			(7,741	)			(2,915	)
Unallocated amounts:
Administrative costs			(20,947	)			(19,288	)			(61,885	)			(55,526	)
Interest-net			(3,784	)			(1,826	)			(7,694	)			(5,472	)
Foreign exchange			1,574				(211	)			1,635				35
Other			(837	)			(1,788	)			(2,228	)			(3,976	)
Income before income taxes			42,009				33,478				113,470				92,805
Income taxes			(11,763	)			(8,522	)			(31,772	)			(26,913	)
Net income		$	30,246			$	24,956			$	81,698			$	65,892

NOTE G — Stock-Based Compensation

          The Company has an incentive stock option plan under which the Board of Directors may grant non-qualified stock options to purchase shares of Class A Common Stock to employees. Additionally, the Company has a non-qualified stock option plan for non-employee directors under which shares of Class A Common Stock are available for grant. The options have an exercise price equal to the fair market value of the underlying stock at the date of grant and vest ratably over a three-year period, with one-third becoming exercisable one year after the grant date and one-third additional in each of the succeeding two years. Options issued under these plans, referred to herein as “service-based” awards, generally expire 10 years from the date of grant. During the fiscal years ended July 31, 2006, and 2005, certain executives and key management employees were issued stock options that vest upon meeting certain financial performance conditions in addition to the vesting schedule described above. These options, referred to herein as “performance-based” awards, expire 5 years from the date of grant.

          The Company has 11,550,000 shares of Class A Common Stock authorized for issuance upon exercise of non-qualified stock options or restricted stock under various incentive stock plans as of April 30, 2006. The Company uses treasury stock or will issue new Class A Common Stock to deliver shares under these plans.

          Effective August 1, 2005, the Company adopted SFAS No. 123(R), “Share Based Payment”. In accordance with this standard, the Company recognizes the compensation cost of all share-based awards on a straight-line basis over the vesting period of the award. Total stock compensation expense recognized by the Company during the three and nine months ended April 30, 2006, was $1,448 ($884 net of taxes) and $4,275 ($2,608 net of taxes), respectively. The Company expects that total stock compensation expense for the year ending July 31, 2006 will be approximately $5,800 on a pre-tax basis. As of April 30, 2006, total unrecognized compensation cost related to share-based compensation awards was approximately $10,909, net of estimated forfeitures, which the Company expects to recognize over a weighted-average period of approximately 1.9 years.

          The Company adopted the fair value recognition provisions of SFAS No. 123(R), using the modified-prospective-transition method. Under that transition method, compensation cost recognized in fiscal 2006 includes: (a) compensation cost for all share-based payments granted prior to, but not yet vested as of August 1, 2005, based on the grant date fair value estimated in accordance with the original provisions of SFAS No. 123, and (b) compensation cost for all share-based payments granted subsequent to August 1, 2005, based on the grant date fair value estimated in accordance with the provisions of SFAS No. 123(R). Results for prior periods have not been restated.

          Prior to August 1, 2005, the Company accounted for employee stock-based compensation under the intrinsic value method prescribed by Accounting Principles Board Opinion (“APB”) No. 25, “Accounting for Stock Issued to Employees.” Under APB No. 25, no employee stock option based compensation expense was recorded in the income statement prior to August 1, 2005 for the service-based options. For performance-based options, the Company recorded compensation expense for changes in the market value of the underlying common stock under APB No. 25. Total stock compensation expense recognized by the Company during the three and nine months ended April 30, 2005 was $1,053 ($632, net of taxes) and $2,940 ($1,861, net of taxes), respectively. The compensation cost for these periods included expense for both performance stock options and restricted stock.

          The effect of adopting SFAS 123(R) is not significant to the financial statements due to the accounting treatment for performance options. Under APB No. 25, performance options require variable accounting and the amount expensed in the income statement is dependent on the stock price at the end of the period. If the Company had continued to account for share-based compensation under APB No. 25, the compensation expense charged to the income statement related to performance options would not have been materially different than the total stock-based compensation expense charged to the income statement under SFAS 123(R) for the three and nine month periods ended April 30, 2006.

          Had compensation cost for all options granted prior to August 1, 2005 been determined based on the fair value at grant date consistent with SFAS No. 123, the Company’s net income and income per share would have been as follows for the three and nine months ended April 30, 2005:

		Three Months Ended				Nine Months Ended
		April 30, 2005				April 30, 2005
Net income:
As reported		$	24,956			$	65,892
Stock-based compensation expense recorded, net of tax			632				1,861
Pro forma expense, net of tax			(1,100	)			(2,464	)
Pro forma		$	24,488			$	65,289
Net income per class A common share
Basic:
As reported		$	0.51			$	1.35
Pro forma adjustments			(0.01	)			(0.01	)
Pro forma		$	0.50			$	1.34
Diluted:
As reported		$	0.50			$	1.32
Pro forma adjustments			(0.01	)			(0.01	)
Pro forma		$	0.49			$	1.31
Net income per class B common share
Basic:
As reported		$	0.51			$	1.33
Pro forma adjustments			(0.01	)			(0.01	)
Pro forma		$	0.50			$	1.32
Diluted:
As reported		$	0.50			$	1.31
Pro forma adjustments			(0.01	)			(0.01	)
Pro forma		$	0.49			$	1.30

          The Company has estimated the fair value of its performance-based option awards granted after August 1, 2005 using the Black-Scholes option valuation model. The weighted-average assumptions used in the Black-Scholes valuation model as of April 30, 2006 are reflected in the following table:

Black-Scholes Option Valuation Assumptions		Performance-based options				Service-based options
Expected term (in years)			3.39				5.72
Expected volatility			31.10	%			34.56	%
Expected dividend yield			1.50	%			1.52	%
Risk-free interest rate			4.09	%			4.50	%
Weighted-average market value of underlying stock at grant date		$	33.89			$	37.64
Weighted-average exercise price		$	33.89			$	37.64
Weighted-average fair value of options granted during the period		$	8.34			$	13.10

The total fair value of stock options vested during the nine months ended April 30, 2006 and 2005 was approximately $3,100 for each period.

          The Company uses historical data regarding stock option exercise behaviors to estimate the expected term of options granted based on the period of time that options granted are expected to be outstanding. Expected volatilities are based on the historical volatility of the Company’s stock. The expected dividend yield is based on the Company’s historical dividend payments. The risk-free interest rate is based on the U.S. Treasury yield curve in effect on the grant date for the length of time corresponding to the expected term of the option. The market value is obtained by taking the average of the high and the low stock price on the date of grant.

          A summary of stock option activity under the Company’s share-based compensation plans for the nine months ended April 30, 2006 is presented below:

										Weighted
										Average
										Remaining				Aggregate
		Shares				Weighted Average				Contractual				Intrinsic
Options		(‘000s)				Exercise Price				Term (Years)				Value
Outstanding at July 31, 2005			3,529			$	18.41
New grants			914			$	36.30
Exercised			(470	)		$	14.81
Forfeited or expired			(29	)		$	22.29
Outstanding at April 30, 2006			3,944			$	22.95				7.3			$	52,334
Exercisable at April 30, 2006			1,950			$	17.22				5.9			$	36,574

          The weighted-average grant date fair value of options granted during the nine months ended April 30, 2006 and 2005 was $11.40 and $6.95, respectively. The total intrinsic value of options exercised during the nine months ended April 30, 2006 and 2005, based upon the average market price during the period, was approximately $10,752 and $13,558 respectively.

NOTE H — Debt

          On January 19, 2006, the Company’s unsecured $125 million multi-currency revolving loan agreement was amended to increase the available amount to $200 million. Under the five-year agreement, which has a final maturity date of March 31, 2009, the Company has the option to use either a base interest rate (based upon the higher of the federal funds rate plus one-half of 1% or the prime rate at Bank of America) or a Eurocurrency interest rate (at the LIBOR rate plus margin). A commitment fee is payable on the unused portion. The agreement requires the Company to maintain certain financial covenants. As of April 30, 2006, the Company was in compliance with the covenants of the agreement. The agreement restricts the amount of certain types of payments, including dividends, which can be made annually to $25 million plus 50% of the consolidated net income for the prior year. The Company believes that, based on historic dividend practice, this restriction would not affect its ability to follow a similar dividend practice in the future. As of April 30, 2006, there were no outstanding borrowings on the five-year revolving loan agreement.

          On February 14, 2006, the Company completed the private placement of $200 million in ten-year fixed notes at 5.3 percent interest to institutional investors. The notes will be amortized in equal installments over seven years, beginning in 2010. The notes have been fully and unconditionally guaranteed on an unsecured basis by the Company’s domestic subsidiaries. The Company intends to use the net proceeds of the offering to finance previously announced acquisitions and future acquisitions, and for general corporate purposes. This private placement was exempt from the registration requirements of the Securities Act of 1933. The notes will not be registered for resale and may not be resold absent such registration or an applicable exemption from the registration requirements of the Securities Act of 1933 and applicable state securities laws.

NOTE I — Stockholders’ Investment

          In September 2005, the Company announced that the Board of Directors of the Company approved a share repurchase program for up to 800,000 shares of the Company’s Class A Common Stock during fiscal 2006. The share repurchase plan was implemented by purchasing shares on the open market or in privately negotiated transactions, with repurchased shares available for use in connection with the Company’s stock option plan and for other corporate purposes. As of January 31, 2006, the Company had completed the repurchase of all 800,000 shares of its Class A Common Stock for $26,495 under the repurchase plan approved by the Board of Directors.

          Additional treasury shares are held in the Company’s deferred compensation plan. During the nine months ended April 30, 2006, the total cost of treasury shares purchased by the deferred compensation plan was $804. The net cost of the Company’s Class A common shares held in the deferred compensation plan and accounted for as treasury shares as of April 30, 2006 was $1,853.

NOTE J — Employee Benefit Plans

          The Company provides postretirement medical, dental and vision benefits for all regular full and part-time domestic employees (including spouses) who retire on or after attainment of age 55 with 15 years of credited service. Credited service begins accruing at the later of age 40 or date of hire. All active employees first eligible to retire after July 31, 1992, are covered by an unfunded, contributory postretirement healthcare plan where employer contributions will not exceed a defined dollar benefit amount, regardless of the cost of the program. Employer contributions to the plan are based on the employee’s age and service at retirement.

          The Company accounts for postretirement benefits other than pensions in accordance with SFAS No. 106, “Employers’ Accounting for Postretirement Benefits Other than Pensions.” The Company funds benefit costs on a pay-as-you-go basis. The components of net periodic benefit cost for fiscal 2006 and the amount that the Company expects to fund in fiscal 2006 are expected to be consistent with those reported thereto in Note 3 to the consolidated financial statements included in the Company’s latest annual report on Form 10-K for the year ended July 31, 2005.

NOTE K — Subsequent Events

          On April 7, 2006, the Company announced that it had signed a definitive agreement to acquire Tradex Converting AB, headquartered in Kungalv, Sweden. Tradex is a leading manufacturer and supplier of pressure sensitive, die-cut adhesive components for the mobile handset and electronics industries. Founded in 1965, Tradex had sales of approximately SEK 680 million (US $92.5 million based on exchange rates as of April 30, 2006) during the year ended December 31, 2005. On May 17, 2006, the Company announced that it had received regulatory approval to complete the acquisition and, on May 23, 2006, the Company completed the acquisition.

          On April 26, 2006, the Company announced that it had signed a definitive agreement to acquire Daewon Industry Corporation, based in Seoul, South Korea. Daewon is a manufacturer and supplier of pressure sensitive, die-cut adhesive components for the mobile handset and electronics industry. Founded in 1997, Daewon had fiscal 2005 sales of approximately $40 million. The acquisition is subject to customary regulatory approvals and is expected to close during the fourth quarter of fiscal 2006.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(in thousands, except share and per share amounts)

Overview

          Brady is an international manufacturer and marketer of identification solutions and specialty materials which identify and protect premises, products, and people. Its products include high-performance labels and signs, printing systems and software, label-application and data-collection systems, safety devices and precision die-cut materials. Founded in 1914, the Company serves customers in electronics, telecommunications, manufacturing, electrical, construction, laboratory, education, governmental, public utility, computer, transportation and a variety of other industries. The Company manufactures and sells products domestically and internationally through multiple channels including direct sales, distributor sales, mail-order catalogs, telemarketing, retail, and electronic access through the Internet. The Company operates manufacturing facilities and/or sales offices in Australia, Belgium, Brazil, Canada, China, Denmark, England, France, Germany, Hong Kong, Hungary, India, Italy, Japan, Korea, Malaysia, Mexico, the Netherlands, Norway, the Philippines, Singapore, Slovakia, Spain, Sweden, Taiwan, Thailand, Turkey and the United States. The Company believes that its reputation for innovation, commitment to quality and service, and dedicated employees have made it a world leader in the markets it serves.

          Sales for the quarter ended April 30, 2006, increased 27.0% to $266,494, compared to $209,766, in the same period last year. Base sales increased 11.8% compared to the same period in the prior year and acquisitions added 17.3%, while the effect of fluctuations in the exchange rates used to translate financial results into the United States Dollar reduced sales by 2.1%. The increase in base sales for the quarter ended April 30, 2006, was largely driven by a 48.9% increase in base sales in Asia, primarily due to growth in China, boosted by business transferred from Singapore. Additionally, the Company continues to experience solid growth in many of its mature markets in the Americas and Europe with base growth of 5.8% and 6.0%, respectively. Net income for the quarter ended April 30, 2006, was $30,246 or $0.61 per diluted Class A Common Share, which was up 21.2% from $24,956 or $0.50 per share reported in the third quarter of last fiscal year. Net income growth, driven primarily by increased business, increased slightly less than sales growth, due largely to the impact of acquisitions made within the last 12 months. In the last two fiscal years, acquired companies have tended to be less profitable than the Company’s base business. Purchase accounting can have immediate short-term impacts on acquisitions due to the valuation of backlog and manufactured profit on finished goods. Medium-term impacts include amortization on customer relationships, non-compete agreements and other intangible assets. These can negatively impact the profitability of acquisitions for a number of years. Expected synergies from the acquisitions generally take from several months to two years to realize. Initially the synergies may be negative as the Company normally invests in people and systems for the acquired companies.

          Sales for the nine months ended April 30, 2006, increased 20.4% to $730,103 compared to $606,401 in the same period last year. Base sales were up 9.5% for the period compared to the same period in fiscal 2005. Acquisitions added 12.2% to sales and the effect of exchange rates reduced sales by 1.3%. The base sales increase for the nine-month period ended April 30, 2006, was driven by increased demand in Asia as noted above and by strong performance in electrical and OEM markets in the Americas. Net income for the nine-month period was $81,698 or $1.64 per diluted Class A Common Share, up 24.0% from $65,892 or $1.32 per share reported in the same period of last year.

On May 17, 2006, the Company increased its annual guidance for fiscal 2006 increasing the sales range to $985 million to $995 million, up from the previous guidance of $980 million to $990 million, increasing the net income range to $103 million to $104 million, up from the previous guidance of $100 million to $103 million, and diluted earnings per share of $2.06 to $2.08 up from the previous guidance of $2.00 to $2.06. The Company expects capital expenditures to be approximately $32 million and depreciation and amortization to be approximately $32 million for the full fiscal year ending July 31, 2006. This guidance was issued before the closing of the acquisition of Tradex Converting AB and therefore does not include Tradex, nor does it include Daewon Industry Corp., which was announced in April 2006 and is awaiting government approval. Management believes this guidance is justified based on the Company’s strong performance in the first nine months of fiscal 2006 and acquisitions made this fiscal year, but notes that this guidance should be viewed in light of the various factors that could affect performance described in or incorporated by reference into this report, as well as the following factors:

	§		The Company continues to experience pressure from suppliers who are attempting to raise their prices as well as customers seeking cost decreases.
	§		The Company’s business operations and those of its customers and suppliers give rise to market risk exposure due to changes in foreign exchange rates. Fluctuations in the United States Dollar relative to other currencies may introduce some volatility with respect to the Company’s sales and net income guidance.
	§		Management remains cautious regarding sales and net income growth in Europe, due to the uncertain economic environment in the region.
	§		The Company continues its preparations for compliance with the European directive on Waste Electrical and Electronics Equipment (WEEE). The new directive requires that by July 2006 all electronic and electrical equipment be free of substances as defined in the new Restrictions on the Use of Hazardous Substances (RoHS) directive. The Company could incur additional costs of compliance or loss of sales, based on availability of compliant subcomponents and the finalization of globally implementing regulations.

          Looking long term, the Company intends to continue its growth strategies of developing proprietary products; making acquisitions that expand its product range, geographic presence, technical expertise or market penetration; and further improving processes to best serve customers. Going forward, business and market uncertainties may affect results. For a discussion of additional factors that could impact results, please refer to the risk factors contained in Item 1A of Part II of this report and the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the fiscal year ended July 31, 2005.

Results of Operations

          As noted in the overview section above, net sales were 27.0% higher for the three months ended April 30, 2006 than the same quarter of the previous year. The increase was comprised of an increase of 11.8% attributed to base sales, a decrease of 2.1% due to the effect of currencies on sales, and an increase of 17.3% due to the acquisitions of J.A.M. Plastics, Inc., Personnel Concepts, STOPware, Inc., TruMed Technologies, Inc. and IDenticard Systems, Inc. in the United States, Identicam Systems in Canada, Signs & Labels Ltd. in the United Kingdom, Texit Danmark AS in Denmark, Texit Norge AS in Norway, QDP Thailand and Technology Print Supplies Ltd and its associate, Technology Supply Media Co., Ltd. in Thailand and Accidental Health & Safety Pty. Ltd. and Trafalgar First Aid Pty. Ltd. in Australia. For the nine months ended April 30, 2006, sales were 20.4% higher than the same period of the previous year. The increase was comprised of an increase of 9.5% attributed to base sales, a decrease of 1.3% due to the effect of currencies on sales, and an increase of 12.2% due to the acquisitions listed above plus the acquisition of Electromark.

          Gross margin as a percentage of sales decreased from 54.3% to 52.8% for the quarter and from 53.5% to 52.3% for the nine-month period ended April 30, 2006, compared to the same periods of the previous year. The gross margin decline was due to a combination of the following factors:

	§		The Company’s product mix is changing, with the faster growing OEM electronics business reducing gross margins overall. While gross margins are lower in the OEM business, selling, general, and administrative expenses are lower as well.
	§		Acquired companies require some time to integrate and implement synergies required to achieve the same level of profitability of our existing businesses.
	§		The Company’s investment in Bratislava, Slovakia is ahead of schedule and represents an investment in cost of goods sold due to startup costs.
	§		The Company centralized its warehouse facilities in Milwaukee, Wisconsin, resulting in moving costs in the quarter ended April 30, 2006.

          Selling, general and administrative (“SG&A”) expenses as a percentage of sales decreased from 34.5% to 33.5% for the quarter and from 34.4% to 33.1% for the nine months ended April 30, 2006, compared to the same periods of the prior year. The decrease in SG&A as a percentage of sales was primarily due to an increase in the mix of business attributable to the OEM electronics business in Asia, which has lower SG&A expenses, offset by lower gross margins. Lower SG&A associated with acquired businesses also contributed to the decrease in SG&A as a percent of sales. In absolute dollars, SG&A increased $16,831 for the quarter and $33,208 for the nine months ended April 30, 2006, compared to the same periods in the prior year, primarily due to the addition of SG&A expenses associated with acquired businesses and increased sales volume.

          Research and development expenses as a percentage of sales decreased slightly from 2.8% to 2.7% for the quarter and from 2.9% to 2.8% for the nine months ended April 30, 2006, compared to the same periods of the previous year. In absolute dollars, research and development expenses increased from $5,941 to $7,314 for the quarter and from $17,744 to $20,677 for the nine months ended April 30, 2006, compared to the same periods in the prior year. New product development and customer support continues to be a major focus of the Brady management team.

          Investment and other income increased from $36 to $2,279 for the quarter and from $812 to $2,759 for the nine months ended April 30, 2006, compared to the same periods in the prior year. The increase was primarily due to a gain of approximately $1,500 on a currency option that the Company purchased to hedge against increases in the purchase price in U.S. dollar terms of Tradex as the transaction is denominated in Swedish Krona.

          Interest expense increased from $2,101 to $4,496 for the quarter and from $6,277 to $8,920 for the nine months ended April 30, 2006, compared to the same periods in the prior year. The increase in interest expense reflects the interest expense on the private placement of $200 million in ten-year notes that was completed in the third quarter of fiscal 2006.

          The Company’s effective tax rate was 28.0% for the nine months ended April 30, 2006, compared to 29.0% for the same period of the previous year. The improvement in the effective rate was due to a continuing shift to a higher percentage of the Company’s pre-tax income to lower tax rate countries.

          Net income as a percentage of sales decreased from 11.9% to 11.3% for the quarter and increased from 10.9% to 11.2% for the nine months ended April 30, 2006, compared to the same periods in the prior year. The decrease as a percentage of sales for the quarter was due to the lower gross margins discussed above, which were partially mitigated by lower SG&A and tax rates. The increase for the nine-month period was due to strong margin performance in the Americas region earlier in the Company’s current fiscal year.

Business Segment Operating Results

Management of the Company evaluates results based on the following geographic regions: Americas, Europe, and Asia.

																		Corporate
																		and
		Americas				Europe				Asia				Subtotals				Eliminations				Total
SALES TO EXTERNAL CUSTOMERS
Three months ended:
April 30, 2006		$	137,438			$	80,420			$	48,636			$	266,494				—			$	266,494
April 30, 2005			109,058				71,452				29,256				209,766				—				209,766
Nine months ended:
April 30, 2006		$	363,446			$	230,466			$	136,191			$	730,103				—			$	730,103
April 30, 2005			309,762				206,865				89,774				606,401				—				606,401
SALES GROWTH INFORMATION
Three months ended April 30, 2006:
Base			5.8	%			6.0	%			48.9	%			11.8	%			—				11.8	%
Currency			1.4	%			(8.4	%)			0.3	%			(2.1	%)			—				(2.1	%)
Acquisitions			18.8	%			15.0	%			17.1	%			17.3	%			—				17.3	%
Total			26.0	%			12.6	%			66.3	%			27.0	%			—				27.0	%
Nine months ended April 30, 2006:
Base			4.9	%			3.1	%			40.0	%			9.5	%			—				9.5	%
Currency			1.5	%			(6.5	%)			1.0	%			(1.3	%)			—				(1.3	%)
Acquisitions			10.9	%			14.8	%			10.7	%			12.2	%			—				12.2	%
Total			17.3	%			11.4	%			51.7	%			20.4	%			—				20.4	%
SEGMENT PROFIT (LOSS)
Three months ended:
April 30, 2006		$	35,026			$	21,304			$	12,397			$	68,727				($2,724	)		$	66,003
April 30, 2005			28,155				21,563				7,778				57,496				(905	)			56,591
Percentage increase (decrease)			24.4	%			(1.2	%)			59.4	%			19.5	%			201.0	%			16.6	%
Nine months ended:
April 30, 2006		$	92,188			$	62,071			$	37,124			$	191,383				($7,741	)		$	183,642
April 30, 2005			73,966				61,296				25,397				160,659				(2,915	)			157,744
Percentage increase			24.6	%			1.3	%			46.2	%			19.1	%			165.6	%			16.4	%

NET INCOME RECONCILIATION

		Three months ended:								Nine months ended:
		April 30,				April 30,				April 30,				April 30,
		2006				2005				2006				2005
Total profit for reportable segments		$	68,727			$	57,496			$	191,383			$	160,659
Corporate and eliminations			(2,724	)			(905	)			(7,741	)			(2,915	)
Unallocated amounts:
Administrative costs			(20,947	)			(19,288	)			(61,885	)			(55,526	)
Interest – net			(3,784	)			(1,826	)			(7,694	)			(5,472	)
Foreign exchange			1,574				(211	)			1,635				35
Other			(837	)			(1,788	)			(2,228	)			(3,976	)
Income before income taxes			42,009				33,478				113,470				92,805
Income taxes			(11,763	)			(8,522	)			(31,772	)			(26,913	)
Net income		$	30,246			$	24,956			$	81,698			$	65,892