VirTra, Inc. (NASDAQ:VTSI) Q4 2021 Earnings Conference Call August 2, 2022 4:30 PM ET Company Participants Bob Ferris - Chairman & Co-CEO John Givens - Co-CEO Marsha Foxx - Chief Accounting Officer Conference Call Participants Richard Baldry - ROTH Capital Jaeson Schmidt - Lake Street. Allen Klee - Maxim Group Operator Good afternoon. Welcome to VirTra's Fourth Quarter and Full Year 2021 Earnings Conference Call. My name is Vikram and I will be your operator for today's call. Joining us for today's presenta ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to ______________ Commission file number: 001-38420 VIRTRA, INC. (Exact name of registrant as specified in its charter) | Nevada | 93-1207631 | | --- | --- | | (St ...

Financial Data and Key Metrics Changes - Total revenue for Q3 2021 was $6.1 million, a 5% decrease from $6.4 million in Q3 2020 [11] - For the first nine months of 2021, total revenue increased 21% to $15.8 million from $12.5 million in the same period of 2020 [12] - Gross profit for Q3 2021 decreased 28% to $2.9 million from $4.0 million in Q3 2020, with a gross profit margin of 47.2% compared to 61.9% in Q3 2020 [12][13] - Net income for Q3 2021 was $1.3 million or $0.12 per diluted share, an improvement from $868,000 or $0.11 per diluted share in Q3 2020 [17] - Adjusted EBITDA for Q3 2021 totaled $520,000, down from $1.6 million in Q3 2020 [18] Business Line Data and Key Metrics Changes - Record bookings of $11 million in Q3 2021, leading to a record backlog of $21.7 million, up 28% from the previous quarter and 51% from Q3 2020 [6][20] - International revenue for Q3 2021 was $860,000, nearly double the total international revenue for all of 2020 [28] Market Data and Key Metrics Changes - The company experienced challenges in closing international deals due to COVID-19 restrictions, but recent wins indicate a recovery in international markets [7][25] - The military segment shows potential for growth as the company partners with established firms to access military contracts [29] Company Strategy and Development Direction - The company plans to expand its international business and has made significant contract wins in the Middle East and Europe [25][26] - An acquisition of a new headquarters in Chandler, Arizona, is expected to enhance operational efficiencies and increase production capacity [32] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery from COVID-19 and the potential for increased international sales as travel restrictions ease [42] - The company aims to maintain healthy margins despite fluctuations due to product mix and inventory reserves [33][44] Other Important Information - The company reported a nonrecurring $1.3 million gain from the forgiveness of PPP loans, which positively impacted net income [17][18] - The backlog includes multi-year warranties, contributing to a recurring revenue stream [70] Q&A Session Summary Question: Supply chain challenges and component shortages - Management acknowledged occasional supply chain challenges but expressed confidence in meeting customer demand [40] Question: Competitors in the international market - Management noted that existing competitors are similar to those in the domestic market, with no significant new entrants [41] Question: Expectations for gross margin recovery in Q4 - Management indicated that gross margins may fluctuate based on product mix but aims to maintain healthy margins [43][44] Question: Benefits of the new headquarters - The new facility is expected to increase production capacity and operational efficiencies [48][49] Question: Catalysts for military market expansion - Management highlighted ongoing partnerships with established companies and the potential for growth in military contracts [51][54] Question: R&D expenses and future run rates - R&D expenses increased due to government contracts, and management is investing in next-generation technologies [58] Question: Inventory build and safety stocks - Inventory increases are partly due to safety stock measures in response to supply chain issues [60] Question: Sales capacity and bookings growth - Management is monitoring sales capacity closely and is open to increasing sales staff if justified [62][64] Question: Bookings breadth between existing clients and new customers - Management indicated that bookings are driven by both existing clients and new customer wins as COVID-19 restrictions ease [66][68] Question: Recognition of backlog and revenue acceleration - Management explained that some backlog is time-locked due to warranties, but they have a good track record of converting backlog to recognized revenue [70][74]

Financial Performance - Revenues for Q3 2021 were $6,093,263, a decrease of 5% compared to $6,413,721 in Q3 2020, while revenues for the nine months ended September 30, 2021, increased by 27% to $15,790,364 from $12,521,663 in the same period in 2020[104]. - Cost of sales for Q3 2021 increased by 32% to $3,217,911 compared to $2,446,455 in Q3 2020, and for the nine months ended September 30, 2021, it rose by 34% to $7,211,807 from $5,381,403 in the same period in 2020[105]. - Gross profit for Q3 2021 was $2,875,352, a decrease of 28% from $3,967,266 in Q3 2020, while gross profit for the nine months ended September 30, 2021, increased by 20% to $8,578,557 from $7,140,260 in the same period in 2020[106]. - Operating income for Q3 2021 was $265,580, a decrease of 78% from $1,219,273 in Q3 2020, while operating income for the nine months ended September 30, 2021, was $1,650,403 compared to an operating loss of $114,549 in the same period in 2020[108]. - Net income for the three months ended September 30, 2021, was $1,342,972, a 55% increase from $868,084 in the same period in 2020[111]. - For the nine months ended September 30, 2021, net income was $2,527,494, compared to a net loss of $122,586 in 2020, marking a 2162% increase[111]. - Adjusted EBITDA for the three months ended September 30, 2021, was $519,646, a decrease of 67% from $1,593,745 in the same period in 2020[112]. Cash Flow and Investments - The company had cash and cash equivalents of $21,545,843 as of September 30, 2021, compared to $6,841,984 as of December 31, 2020[112]. - Net cash provided by operating activities was $1,362,626 for the nine months ended September 30, 2021, compared to a net cash used of $166,900 in the same period in 2020[113]. - Net cash used in investing activities was $12,035,043 for the nine months ended September 30, 2021, compared to net cash provided of $1,530,034 in 2020[114]. - Net cash provided by financing activities was $25,376,276 for the nine months ended September 30, 2021, significantly up from $1,319,259 in 2020[115]. Market Strategy and Future Plans - The company plans to expand its market share by developing and marketing effective simulators, aiming for disciplined growth and increased working capital[100]. - The company intends to broaden its total addressable market through new marketing strategies and product offerings to attract a wider range of customers[100]. - The company is open to partnerships and acquisitions to enhance efficiency and optimize long-term growth for shareholders[100]. - The company has suspended its stock repurchase program due to uncertainties arising from the COVID-19 pandemic, which has also led to reduced customer shipments and installations[103]. Backlog and Bookings - The company received bookings totaling $11.0 million for the three months ended September 30, 2021, and $24.4 million for the nine months ended September 30, 2021[117]. - As of September 30, 2021, the company's backlog was $21.7 million, with expectations for conversion to revenue in 2021 and early 2022[117]. Capital Resources - The company believes its current capital resources will be adequate for more than 12 months, but is open to raising additional funds for expansion[118].

Financial Data and Key Metrics Changes - Total revenue for Q2 2021 was $5.3 million, a 90% increase from $2.8 million in Q2 2020 [12] - Gross profit for Q2 2021 increased 99% to $3.1 million from $1.6 million in Q2 2020, with a gross profit margin of 59.7% [13] - Net income for Q2 2021 was $529,400 or $0.05 per diluted share, compared to a net loss of $601,300 or a loss of $0.08 per diluted share in Q2 2020 [17] - Adjusted EBITDA for Q2 2021 was $1 million, improving from a loss of $579,200 in Q2 2020 [18] - As of June 30, 2021, unrestricted cash and cash equivalents were $23.8 million, up from $5 million at the end of the prior quarter [21] Business Line Data and Key Metrics Changes - The increase in total revenue was attributed to a higher number of simulators and accessories completed and delivered [12] - Backlog totaled $17 million, reflecting a 6% sequential increase and a 19% year-over-year increase [20] Market Data and Key Metrics Changes - The demand for VirTra's training solutions continues to grow, with a 19% year-over-year increase in backlog [9] - The company has received bookings totaling $13.5 million for the six-month period ending June 30, 2021 [19] Company Strategy and Development Direction - The company aims to drive greater business scale through financial, organizational, and operational improvements [27] - An $18 million equity capital raise in April has strengthened the balance sheet, providing resources to capitalize on larger opportunities in police and military markets [28] - The upgrade of the ERP system is expected to improve business processes and internal controls, positioning the company for higher growth [33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the robust sales pipeline but acknowledged challenges in converting pipeline to orders due to COVID-19 limitations [45] - The company is monitoring customer budgets closely, noting that some customers are not facing budget issues while others are [47] - Management highlighted the importance of demonstrating product effectiveness to customers as a key factor in winning sales [48] Other Important Information - The company has received an $800,000 delivery order under a five-year contract with the US Department of Homeland Security [35] - The military training simulation product lineup includes advanced features that enhance training effectiveness [41] Q&A Session Summary Question: Can you discuss the order patterns seen this quarter? - Management noted a robust sales pipeline but emphasized the difficulty in predicting when pipeline will convert to orders due to ongoing COVID-19 limitations [45] Question: What are customers saying about their budgets? - Feedback varies, with some customers having no budget issues, while others require convincing of the need for training products [47] Question: Are there any supply constraints affecting operations? - Management indicated that proactive inventory management has mitigated supply constraints, and no shipments have been delayed due to component shortages [50] Question: Can you elaborate on the inventory build? - Most of the inventory increase is attributed to scaling the business rather than solely derisking component shortages [52] Question: How do bookings growth and revenue recognition relate? - Management explained that bookings include recurring revenue components, which complicate the relationship between bookings and recognized revenue [56] Question: Can you discuss the step offering and its growth? - The subscription model has been well-received, with all clients who started the step program renewing their service [64]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2021 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to ______________ Commission file number: 001-38420 VIRTRA, INC. (Exact name of registrant as specified in its charter) | Nevada | 93-1207631 | | --- | --- | | ...

VirTra, Inc. (NASDAQ:VTSI) Q1 2021 Earnings Conference Call May 17, 2021 4:30 PM ET Company Participants Bob Ferris – Chairman and Chief Executive Officer Marsha Foxx – Chief Accounting Officer Conference Call Participants Richard Baldry – ROTH Capital Jason Smith – Lake Street Operator Good afternoon, and welcome to VirTra's First Quarter 2021 Earnings Conference Call. My name is Matthew, and I'll be your operator for today's call. Joining us for today's presentation are the company's Chairman and CEO, Bob ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION FORM 10-Q Washington, D.C. 20549 Commission file number: 001-38420 Registrant's telephone number, including area code: (480) 968-1488 VIRTRA, INC. N/A (Exact name of registrant as specified in its charter) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2021 | Nevada | 93-1207631 | | --- | --- | | (State or other jurisdiction of | (I.R.S. Employer | | incorporation or organiz ...

Financial Data and Key Metrics Changes - In Q4 2020, the company reported revenue of $6.6 million, an 11% increase from $5.9 million in Q4 2019, and for the full year 2020, total revenue was $19.1 million, a 2% increase from $18.7 million in 2019 [22][6][29] - Gross profit for Q4 2020 increased 80% to $4.8 million, representing 72.5% of revenue, compared to $2.6 million or 44.8% of revenue in Q4 2019 [23] - Net income for Q4 2020 was $1.6 million or $0.21 per diluted share, compared to a net loss of $66,000 or $0.10 per diluted share in Q4 2019 [25] Business Line Data and Key Metrics Changes - The increase in revenues was attributed to higher sales and subscriptions of simulators, accessories, curriculum, and training, along with recurring extended warranty revenue [22] - The company’s backlog increased to $14.6 million as of December 31, 2020, up 52% from $9.6 million a year ago [27] Market Data and Key Metrics Changes - The company faced challenges in foreign markets due to extensive travel restrictions, impacting international sales [16] - Despite these challenges, the company managed to grow its core customer base, demonstrating resilience in its business model [16] Company Strategy and Development Direction - The company aims to innovate and launch solutions that meet the current and future needs of its core customer base, focusing on law enforcement and military markets [12] - The company is transitioning to a new ERP system to better handle current business demands and prepare for future growth [18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about continued sales order strength in early 2021, indicating a healthy sales pipeline [39] - The company noted that the demand for quality training in law enforcement and military sectors remains high, which is expected to drive future growth [34][35] Other Important Information - The company reported a significant write-off related to its investment in Modern Round due to pandemic impacts on the entertainment and restaurant industries [31] - The company ended 2020 with approximately $6.8 million in cash and cash equivalents, up from $3.3 million in 2019 [28] Q&A Session Summary Question: Is the order momentum seen in 2020 continuing into 2021? - Management confirmed that there is continued strength in sales orders, although it may come in spurts [39] Question: Are there concerns about budgetary pressures from customers? - Management indicated that there are no major industry moves towards expanded or constrained budgets, and they are focused on improving sales processes [40][41] Question: What is the outlook for gross margin sustainability? - Management stated that historically, gross margins are around 60%, and while there can be fluctuations, investors should consider long-term trends [42] Question: How is the easing of COVID-19 restrictions impacting backlog and revenue recognition? - Management noted that easing restrictions will help recognize revenue, but they remain cautious about staff safety [47][48] Question: How does the current environment impact the opportunity pipeline? - Management expressed satisfaction with the strong pipeline, suggesting that increased scrutiny on police training may be driving demand [50] Question: How have customers adapted to virtual sales processes? - Management acknowledged that while virtual trade shows are less effective, customers have adapted well to digital sales processes [52]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to ______________ Commission file number: 001-38420 VIRTRA, INC. (Exact name of registrant as specified in its charter) | Nevada | 93-1207631 | | --- | --- | | ...