WRAP - Earnings call transcript Q4 2021

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Paul Manley

Good afternoon, and welcome to the Wrap Technologies Fourth Quarter 2021 Earnings Conference Call. My name is Paul Manley and I'm Vice President of Investor Relations. Today, we'll provide a report on our progress and performance during the fourth quarter and full year and an update on our strategy and the executive search process.

Joining me on the call today are Wayne Walker, Chairman of our Board of Directors and Jim Barnes, our Chief Financial Officer. I'd like to take a moment now to remind you that certain statements made during the call today constitute forward-looking statements made to pursuant within the meaning of the Safe Harbor provisions of the Private Securities and Litigation Act of 1995, as amended. subject could known differ cause such are and unknown materially statements statements. that uncertainties actual forward-looking to and both risks from Such results to and in and earnings are risks filings described These press the uncertainties release in SEC. our with our made statements. statements of as and are this obligation to the undertake do not today any of update call, forward-looking The date we the forward-looking turn I'd call over like Wayne. to the that With you, to

Wayne Walker

at And good during the thanking development afternoon, six, everyone. three, generation to ready; retention; to the making take indicator our and want incorporating lighter organization mechanical; two, four, LED features three; power our by that and and deployment enforcement an team on we a assign launch life We introduction reducing fiscal executing device for the as discharge invested forward many of grip. XXX, battery an year Paul. BolaWrap maturing enterprise. feedback original I and quarter to and enhanced and the our The durability BolaWrap field. to is heavily applied and of start smaller a five, water foundation an first entire XXX long-term to output switching intense from innovation, products enhanced electronic BolaWrap we lay to from was from in steps BolaWrap one, creation. and Thanks indicate with product you, steps law increasing in our to for officers fourth when innovation, increase upgrade expand down updates using an the next value it Wrap to improving based The include; XXX two is resistance; a Wrap Perhaps which us was XXXX. step portfolio, the the helping the research Thank significant to device. and our in development achievement XXX of important year biggest is

off in We are XXX. and months orders on awaiting we interest excited level customers this generation. believe the of engagement in recent about the BolaWrap held And many next

more few talk about will We demand in moments. customer a

know, other Reality. WRAP As main our product of many you is

too to continue The training a law very platform the for help is feel in now, reality This customers and it enforcement. Reality new an across for the domestic academies comprehensive, interactive intuitive forward raise generation cumbersome prospective we Reality WRAP for to push. customers, product been We awareness us especially markets. make during WRAP demonstrate seasoned We and including tool presenting officers. is learning but international new QX, neither diversification we simulation-based complicated, for model. To benefits is to a part of can more have trading virtual police our to productive model to nor recruits entering of as introduce continuing QX look

Let customers our supply XXX. results. this quarter grew with now next and sales high many to a environment by achieved constrained in fourth me turn We We despite operating are a level growth BolaWrap of generation awaiting XX%. our

increased to agencies representing from end XXXX. also During the XXX of enforcement QX, of our saw we growth law train XXX%

officer indicators instructors positive certified of are future the prospects. Our believe We XXX% growth these XXXX, end of to from XXXX. also growth increased representing

sales Turning representing to year, the growth. full grew to we $X.X million XX%

services search and market and technologies This its today what to in results not for as market these forward beyond. can holds that now taking as us the brings today's continues strategy of and company announced may scale opportunities the for the billion. points as solid just crosses are When Wrap go on victory leadership executive and the in true coming significant call. laps, transition safety Wrap’s addressable the emphasized public technologies statement key expanding. be $XX January, year late has process. we're the While services addressable grow company any build and Board This public the safety to

foundation several value establish past growth weeks, lasting help the and innovation, parallel has the Over for creation. Board tracks focused on shareholder stable a two to

But the Reality. we foremost, know social, share. and strategy at management cannot know pivoting products We implement for are a we climates same and a diversification and We multi-faceted have to best Board First be been innovating, seizing to growth from Wrap market team. forward the believes the of of stream The priority revenue creating of pursuit come on the beyond best process the existing executing to and time, our to is path needs for considering at and the that are and services We of products in for can expense for political services. evolving the we This the broader recognize the Wrap the new searching why opportunities needs the by expanding regulatory BolaWrap foundation commercializing XXX. distributing its the leaders customers. of rollout at adept company's recurring next BolaWrap who strategy. is for build mix on be WRAP just diversifying want to

into area the plan. top working with actionable, been of has of search focus firm Executive measurable right to to operating the aforementioned the a turn The Board Officer an Chief vision identify second

aligned that a We the our are and leader searching opportunities. experience to has skills and needs for

appointment advanced course. call to the stage Barnes announcing to financial our to over an I greater detail. of results now and in that, we With at the turn our discuss look Jim CEO forward next will in are due We

Jim Barnes

Good the Wayne. the I'll for everyone. Thanks, move and quarter. straight discussing into afternoon, financial highlights fourth XXXX

over revenues momentum prior XX% XXXX. part compared XX% by positive XXXX stories in bodycam XXXX. with revenues XXX% on over X.X footage. BolaWrap the Domestic success in XX% represented of full record International the grew X.X generated of growth quarter revenues to increase QX for year driven XXXX. by of X.X in of were Revenues XXXX documented million we million a revenues year XX% over represented for that quarterly fourth the million First, revenue

believe significant a difference still BolaWrap, in room While by believe larger can addressable training market impacted policing. and restricting XXXX in penetration in make to product International a and time take and growth we grew schedule build ability market, demo making but our XXXX in our train growth modern, with for and was XX% safer is continue International restrictions customers to in and revenues reality it negatively virtual travel related restrictions distributors is small, are severely may by pandemic-related and XXXX. but we pandemic-related XXXX, lessening to momentum.

cannot geopolitical predict and also impact the at on will have time, conflicts We operations. sanctions our international this recent

now and that be conflicts. could our uncertainties growth have as pandemic limitations we to international face related flagged and We lumpy bounce revenue travel consistently restrictions

large Our the be especially geopolitical international tends are agencies law to as sensitive to business enforcement they national end-user events. and

the especially growth, BolaWrap We managing our are the XXX. focused new late for of launch business XXXX on continued with

charge. Our The of year. to were announced devices. incurred XXX gross for a international XX% reduced product that generally second line the product of was compared reported In as quarter, than prior margin fourth is which in was lower and orders launch. comparable the margin cartridges XXXX. BolaWrap preparing primarily XXXX result the mix XX% for October the quarter have exit XX%, plan a margin QX margins, we $XXX,XXX affected to This from without expense for our This one-time XX% January for of the

sales XXX period margins after model We as a will be will realized efforts volumes after are to BolaWrap in during Officer, automate the that and channel pleased difficult and higher Glenn XXXX expect progress the startup but and significant to of Hickman we of are our invested predict Chief model XXX We XXX margins the production transition, our to the Operating and costs phaseout and with product mix. have led effects and product by XXXX the due grows.

and operations. chain can affect supply challenges margins global face impact and also We that risks

assemble we suppliers. we global Tempe product in While on rely

risk of components are since most face cost laser While includes availability we can components, without electronic and small and and model battery be XXX impact, do our materials. airfreighted undue price

We are of components. at and delays have and key faced of unexpected shortages risk

We costs production. changes and increase components; and can of certain shortages price have price seen delay also increases

and expense for BolaWrap XXXX. components require in to may year. all QX development the compared time XXX design future production these XXXX We X.X also was certain from further and time-to-time R&D X.X around R&D factors can impact for expense need million to that launch results. X.X to for invested and develop can XXXX. costs million million costs, late significant was We the delay prior

improve to and market. to upgrade continue our respond We to the products

the cost R&D expect and to We cost to less XXXX completion than due development of XXX containment efforts. be BolaWrap management

new the of X.X timing may future or million initiatives XX.X SG&A non-cash important and R&D included in However, expense costs. opportunities. share-based compensation XXXX million was due of fluctuate to costs

customer efforts base. focused main sales, on Our product our investments demonstrations, are targeting worldwide awareness training SG&A and

more be stable We overall, costs. expect promotional focus related for requirement our on with sales awareness in will remain less activities to product but direct these and XXXX costs

sales XXXX, our invested support sales growth. growing worldwide and we During in to organization support

significant class incurred we XXXX. public and million. costs aggregating During X.X action company defense

to regarding made products XXXX, motion XXXX, management, class our action our clear baseless in allegations represented case meritless Our November was and in granted of filed rejection the the and performance. a

related company overall our cost efforts. and SG&A public XXXX containment to in decrease costs expect We as of costs part

investments XX growth. to will back approximately team the I that to call remains our With short-term growth thank to I Wayne. our cash would million like strong that to sheet XXXX and support balance Our contributed our of with entire turn needs. over

Wayne Walker

at months Wrap few past amiss a period have been transition but the the uncertainty. change in of In obviously

Our and strong produce team has its results. maintained focus

and executive We priorities to strong and and management One, Executive outlook, a emphasis top-line to achieve fiscal relationships to pent-up adding R&D we the distribution on months. like our feel highly develop also a provide With growth priorities demand BolaWrap of in our the domestic intense fiscal We part training our XXX; and three, shifting updates XXXX. forward now to empowering plan; from in leadership new and international respect the five, sales BolaWrap qualified four, year new look programs to these the of to identifying XXXX. Officer; expect and there's We put expanding coming strategic for XXX. have markets. across weeks team; out two, a for clear early Chief talent clear

focus plan firmly taking today the now for The in quarterly We geopolitical that is assessed be closing, chain issues an steps for interest can Thank CEO. management make ongoing now billion the player for you help we strong will in Wrap. and road. years the long-term believe time company's your market. has search the Wrap your value and in and Board we growth strategy quarters potential choppier the increasingly otherwise in new incredibly team and sales our important catalyst than addressable $XX Bigger right the that down However, and a like. we're picture headwinds, about right be a start optimistic would Wrap's hopefully can are creation supply

Paul Manley

to Due session will today. CEO call our joining a doing for transition, be everyone formal you we our this Q&A thank and Wayne, quarter. you, Thank not

do follow-up will you If Q and evening. hesitate any to respond at a Have a have do manner. not in I email great questions, Unidentified timely Analyst - pmanley@wrap.com me please

Wrap (WRAP) 11 Mar 222021 Q4 Earnings call transcript