Investor Relations Counsel
Financial Profiles, Inc.
Tempe, Ariz. (August 15, 2016) – VirTra Systems, Inc. (OTC Pink: VTSI), a leading provider of use of force simulators and firearms training simulators, today announced its financial results for the second quarter ended June 30, 2016. The financial statements are available on VirTra’s website and here.
Second Quarter 2016 Financial Highlights:
- Net sales of $3.4 million
- Gross profit of $2.0 million
- Gross profit margin of 58%
- Net income of $0.1 million
Bob Ferris, Chairman and Chief Executive Officer of VirTra, commented: “We generated $3.4 million in net sales for the second quarter and $9.6 million for the first half of 2016, our highest level of revenue for the first six months of the year in the Company’s history. Our continued strong results reflect the increasing demand for our simulation solutions both in the U.S. and throughout the world. In 2016, we have expanded our list of strategic customers to include such prominent government agencies as the U.S. State Department and the Australian Border Force. We believe that if we exceed our customers’ expectations on these projects, we will benefit from a “knock-on” effect in our efforts to secure new business and grow our market share. We are excited about the upcoming annual meeting and the opportunities that lie ahead for our business and for our shareholders as we continue to pursue our long term plans for growth and market liquidity.”
Second Quarter Results for the Three Months Ended June 30, 2016
Net sales were $3.4 million in the quarter, an increase of 9%, compared to $3.1 million for the second quarter of 2015.
Gross profit was $2.0 million for the quarter, an increase of 17%, compared to $1.7 million for the second quarter of 2015.
Gross margin for the quarter was 58%, compared to 54% for the second quarter of 2015. The year-over-year increase in gross margin was primarily due to a shift in the mix of products and services that we delivered between the two periods.
Selling, general and administrative expenses were $1.9 million for the quarter, an increase of 31%, compared to $1.4 million in the second quarter of 2015. The increase was primarily due to a $0.4 million non-recurring expense based on the redemption of previously issued stock options that were approaching the end of their expiration term for employees still in good standing. Under the former CEO, the Board approved stock options committed to employees over the course of many years, the result being an unusually large number of stock options that would all expire on April 1, 2016. As of the June 30, 2016, all stock options approved under the former CEO have either been cancelled or redeemed.
Operating income for the quarter was $0.1 million, compared to $0.3 million in the second quarter of 2015. The decrease in operating income was primarily due to the higher selling, general and administrative expenses in the quarter, impacted by the $0.4 million non-recurring expense discussed above.
Net income was $0.1 million for the quarter, or break-even per basic share, compared to $0.2 million, or break-even per basic share, for the second quarter of 2015.
Stockholders’ equity increased to $6.9 million at June 30, 2016, an increase of 113%, compared to $3.2 million at June 30, 2015.
The Company had no outstanding debt as of June 30, 2016.
Cash and cash equivalents were $4.1 million at June 30, 2016, compared to $1.2 million at June 30, 2015.
Matt Burlend, Chief Operating Officer for VirTra, said, “Our record first half of 2016 performance is the direct result of delivering quality products to customers, driven by our increased investment in sales, marketing and research and development, combined with our excellent reputation for customer service. While we understand that sales cycles and market conditions will impact our quarterly revenues and profitability, we continue to believe that 2016 will be another strong year for VirTra.”
About VirTra Systems, Inc.
VirTra is a global leading provider of the world’s most realistic and effective judgmental use of force simulators. VirTra is the higher standard in firearms training simulators, offering a variety of simulator platforms, powerful gas-powered recoil kits and the patented Threat-Fire™ simulated hostile return fire system. VirTra’s products provide the very best simulation training available for personnel that are entrusted with lethal force and critical missions. The Company’s common stock is not registered under the Securities Exchange Act of 1934 and the Company does not currently file periodic or other reports with the Securities and Exchange Commission.
This news release includes certain information that may constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “proposed,” “planned,” “potential” and similar expressions, or are those, which, by their nature, refer to future events. All statements, other than statements of historical fact, included herein, including statements about VirTra’s beliefs and expectations, are forward-looking statements. Forward-looking information is necessarily based upon a number of assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information. Although VirTra believes that such statements are reasonable, it can give no assurance that such forward-looking information will prove to be accurate. VirTra cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward-looking statements as a result of various factors. Accordingly, due to the risks, uncertainties and assumptions inherent in forward-looking information, readers and prospective investors in the Company’s securities should not place undue reliance on forward-looking information. All forward-looking information contained in this press release is given as of the date hereof, is based upon the opinions and estimates of management and information available to management as at the date hereof and is subject to change. The Company assumes no obligation to revise or update forward-looking information to reflect new circumstances, whether as a result of new information, future events or otherwise, except as required by law.