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Byrna Technologies (BYRN) - 2024 Q4 - Earnings Call Transcript
BYRNByrna Technologies (BYRN)2025-02-07 21:38
Financials

Financial Data and Key Metrics Changes - Net revenue for Q4 2024 was 28million,a7928 million, a 79% increase from 15.6 million in Q4 2023 [9] - Full year 2024 net revenue totaled 85.8million,up10185.8 million, up 101% from 42.6 million in 2023 [11] - Gross profit for Q4 2024 was 17.6millionor62.817.6 million or 62.8% of net revenue, compared to 9 million or 57.8% for Q4 2023 [11] - Net income for Q4 2024 was 9.7million,comparedtoanetlossof9.7 million, compared to a net loss of 0.8 million for Q4 2023, a 10.5millionimprovement[13]−AdjustedEBITDAforQ42024totaled10.5 million improvement [13] - Adjusted EBITDA for Q4 2024 totaled 5.2 million compared to 400,000forQ42023[15]BusinessLineDataandKeyMetricsChanges−Direct−to−consumerrevenuesincreasedby400,000 for Q4 2023 [15] Business Line Data and Key Metrics Changes - Direct-to-consumer revenues increased by 8.9 million through byrna.com and amazon.com compared to the prior year period [10] - Operating expenses for Q4 2024 were 13.5million,upfrom13.5 million, up from 9.7 million for Q4 2023, reflecting a 39% increase [12] Market Data and Key Metrics Changes - Sales in Mexico grew to 890,000from890,000 from 300,000 the prior year, with expectations to at least double in 2025 [45] - In Canada, sales grew from 1.36millionin2023to1.36 million in 2023 to 2.47 million in 2024, with expectations to reach approximately 4millionin2025[46]CompanyStrategyandDevelopmentDirection−Thecompanyplanstoopenadditionalretailstores,withfournewlocationsexpectedsoon[30]−ApartnershipwithSportsman′sWarehouseissettolaunchastore−within−a−storemodelatelevenlocations,withpotentialexpansiontofiftyadditionallocationsbytheendof2025[34]−ThecompanyiscommittedtoexitingChinabymidyearandaimstosourcenearly1004 million in 2025 [46] Company Strategy and Development Direction - The company plans to open additional retail stores, with four new locations expected soon [30] - A partnership with Sportsman's Warehouse is set to launch a store-within-a-store model at eleven locations, with potential expansion to fifty additional locations by the end of 2025 [34] - The company is committed to exiting China by midyear and aims to source nearly 100% of components from US suppliers by the end of 2025 [47] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the trajectory of the business and ongoing marketing efforts, believing the market for less lethal weapons among gun owners in the US is in the tens of millions of consumers [52] - The company expects strong year-over-year growth despite a traditional seasonal slowdown in consumer spending in Q1 [53] Other Important Information - The company has no current or long-term debt, and cash and short-term marketable securities totaled 25.7 million, an increase of $5.2 million compared to November 30, 2023 [15][16] - The company has committed to providing training for employees at Sportsman's Warehouse locations to ensure effective sales of Byrna products [96] Q&A Session Summary Question: Demand and sales trends in the first quarter - Management indicated that Q1 is traditionally a slower quarter but expects it to be a record quarter, well above previous high watermarks [57][58] Question: Operating expense leverage and incremental margins - Management noted that while marketing expenses will increase, variable selling expenses remain consistent, and new retail stores will incur additional operating expenses [64][65] Question: Sportsman's Warehouse partnership and rollout timing - Management expects the initial eleven stores to start producing profits within three to four months, with potential for rapid expansion if successful [80] Question: Production plans and inventory levels - Management confirmed no shortages in components and expects to grow inventory as they prepare for the launch of the compact launcher [83][84] Question: Revenue growth and margin expectations for 2025 - Management anticipates strong double-digit growth in 2025, with increasing margins expected due to cost reductions and the introduction of higher-margin products [88][90]