VirTra reports first quarter 2023 financial results
VirTra reports increases in total revenue, gross profit and net income for Q1 2023
CHANDLER, Ariz. — VirTra, Inc. (Nasdaq: VTSI) (“VirTra”), a global provider of judgmental use of force training simulators, firearms training simulators for the law enforcement and military markets, reported results for the first quarter ended March 31, 2023. The financial statements are available on VirTra’s website and here.
First Quarter 2023 Financial Summary:
- Total revenue increased 48% to a record $10.0 million
- Gross profit increased 88% to $6.9 million, or 69% of total revenue
- Net income increased by $2.4 million to $2.9 million
- Adjusted EBITDA increased to $4.0 million
- Improved strong balance sheet with cash and cash equivalents of $14.3 million at March 31, 2023
First Quarter 2023 Financial Highlights:
“Coming off our 17th consecutive year of revenue growth in 2022, in Q1 we worked from our record backlog to deliver VirTra’s first ever quarterly revenue performance in the double-digit millions,” said Bob Ferris, chairman and co-CEO of VirTra. “Simultaneously, our actions to improve internal processes and streamline the overall business have significantly enhanced the efficiency of our operations, leading to the strongest bottom-line performance in the Company’s history. To build on our market-leading position and expand our revenue pathways, we are pursuing additional product and content development to make VirTra’s training capabilities even stronger.”
John Givens, co-CEO of VirTra added: “We remain committed to optimizing our business operations and driving profitability while ramping up our sales efforts as we move into the second quarter and beyond. While we are making strides in clearing our backlog and fulfilling orders more efficiently, we recognize that there are still many untapped opportunities in the market, both domestic and international. To capitalize on this potential, we are implementing sales initiatives to maximize our market penetration and prioritize areas with the greatest growth potential. We are focused on continued success in the coming quarters as we execute our growth strategies.”
First Quarter 2023 Financial Results
Total revenue increased 48% to $10.0 million from $6.8 million in the first quarter of 2022. The increase in revenue was the result of the deliveries of two major government contracts and one large international contract.
Gross profit increased 88% to $6.9 million from $3.7 million in the first quarter of 2022. Gross profit margin, defined as total revenue less cost of sales, was 69.3%, an improvement compared to 54.6% in the first quarter of 2022. The increase in gross profit was primarily due to the increased sales achieved while maintaining cost of sales in line with 2022 levels. The increased gross margins resulted from the favorable product mix of systems, accessories and services sold in the quarter.
Net operating expense was $3.5 million, compared to $3.0 million in the first quarter of 2022. The increase in net operating expenses was due to increased R&D expenses additional costs related to the Orlando facility and one-time costs in payroll and related expenses.
Operating income increased by $2.8 million to $3.5 million from $0.7 million in the first quarter of 2022.
Net income was $2.9 million, or $0.27 per diluted share (based on 10.9 million weighted average diluted shares outstanding), compared to net income of $0.6 million, or $0.05 per diluted share (based on 10.8 million weighted average diluted shares outstanding), in the first quarter of 2022.
Adjusted EBITDA, a non-GAAP metric, increased to $4.0 million from $1.0 million in the first quarter of 2022.
“Our first quarter financial results represent vast year-over-year improvements and demonstrate the success of our ongoing efforts to drive growth and profitability,” said CFO Alanna Boudreau. “We achieved a strong gross profit margin of 69%, a reflection of our focus on maintaining cost of sales while effectively selling a favorable mix of simulators, accessories, and services. Our record net income of $2.9 million and adjusted EBITDA of $4.0 million highlight our ability to execute even amidst operational transformations. These strong results put us on track to meet our financial targets for 2023 and position us well for continued success in the law enforcement and military simulator markets.”
VirTra’s management will hold a conference call today (May 15, 2023) at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss these results. VirTra’s chairman and co-CEO, Bob Ferris, co-CEO John Givens and Chief Financial Officer Alanna Boudreau, will host the call, followed by a question-and-answer period.
U.S. dial-in number: 1-877-407-9208
International number: 1-201-493-6784
Conference ID: 13738125
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Investor Relations at 949-574-3860.
A replay of the call will be available after 7:30 p.m. Eastern time on the same day through May 29, 2023.
Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay ID: 13738125
About VirTra, Inc.
VirTra (Nasdaq: VTSI) is a global provider of judgmental use of force training simulators, firearms training simulators and driving simulators for the law enforcement, military, educational and commercial markets. The company’s patented technologies, software, and scenarios provide intense training for de-escalation, judgmental use-of-force, marksmanship, and related training that mimics real-world situations. VirTra’s mission is to save and improve lives worldwide through practical and highly effective virtual reality and simulator technology. Learn more about the company at www.VirTra.com.