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Byrna Technologies sees self-defense weapon hit the bullseye with strong sales

Snapshot

What really burnishes the Byrna HD’s market appeal is that it is not a firearm under federal law, and doesn’t require a gun license

Byrna Technologies Inc. - Byrna Technologies’ self-defense weapon hits the bullseye with strong sales

Quick facts: Byrna Technologies Inc.

Price: 1.4 USD

OTCQB:BYRN
Market: OTCQB
Market Cap: $205.57 m
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  • Developed Byrna HD, which dispenses chemical irritants from a handgun-like personal security device
  • Also offers the 40mm Blunt Impact Projectile (BIP) line of products which use pain compliance to control a target
  • Receives recurring revenue from selling ammunition, cartridges, chemical irritant payloads, and training rounds

What Byrna Technologies does:

Byrna Technologies Inc (CSE:BYRN) (OTCMKTS:BYRN), formerly Security Devices International, is a non-lethal defense technology company that manufactures and sells less-than-lethal security devices and ammunition.

The Andover, Massachusetts-based company developed the Byrna HD, a handgun-like device that dispenses chemical irritants. The small, lightweight 0.68 caliber device is equipped with a five-round magazine capable of accurately hitting a target at up to 60 feet — without causing serious injury. Its chemical payload is designed to burn an assailant’s eyes and respiratory system.

Byrna’s product mix includes the 40 millimeter (mm) Blunt Impact Projectile (BIP) line of products that use pain compliance to control a target. The company has developed eight versions of the standard BIP, seven of which contain a payload and one of which is a cheaper cost, training round. A payload is an internal medium within the BIP, holding an irritant like pepper spray powder or tear gas.

Founded in 2005, Byrna operates in Canada and the US, and its products are used by the military, correctional services, police agencies, private security companies, and individuals looking for personal security.

In addition to tapping the red-hot market for security devices, the company also draws large recurring revenue from selling ammunition, cartridges, chemical irritant payloads, and training rounds. Smaller recurring revenue comes from laser sight adds, holsters, and spare magazines.

How is it doing:

As of late 2020, Byrna had achieved two milestones underscoring its growth and momentum amid increasing demand for self-defense weapons.

Firstly, the company commenced production at a second manufacturing plant in Ft Wayne, Indiana. The leased, 14,000-square-foot facility allows Byrna to start cranking out 200 units per day, with plans to up production to 500 units. The company also has a manufacturing facility in South Africa that is currently producing 600 units per day. The South African facility will satisfy in-nation and international orders, while Fort Wayne will meet North American demand.

Secondly, in its fiscal fourth quarter, the latest financial reporting period that ended November 30, 2020, the company recorded sales of $11.1 million, more than double the $4.2 million it made in 3Q. Domestic sales represented 91% of the total and more than 85% were generated through the company’s e-commerce website. Law enforcement sales accounted for 3.4%.

The 4Q boom brought Byrna's 2020 full fiscal year sales to $16.7 million, a significant year-over-over-increase versus $924,000. Over the full year, launchers represented 80% of Byrna's global sales with ammunition, accessories and apparel representing the other 20%. 

Production for the quarter totaled 35,799 units, including 4,945 units produced in Fort Wayne, Indiana, up from 14,874 total units in the third quarter. This brought production for the full fiscal year 2020 to 55,777 units.

Looking ahead to fiscal 2021, CEO Bryan Ganz said the company expects "sales to be a multiple of our 2020 full-year sales."

Meanwhile, with the recent deaths of unarmed civilians and the resulting civil unrest in US cities, Byrna sees strong community support across the US for government entities to increase their adoption of less-lethal weapon systems and tactics. The global demand for such a market is expected to reach $11.85 billion by 2023. 

Byrna HD sales have also soared as coronavirus pandemic fears have triggered personal safety concerns. The unsettled economic conditions have made people more concerned about increased crime rates, boosting demand for the Byrna device.

Strong sales growth has the company thinking of expansion plans. It formed a new division, Byrna LE, that will introduce the Byrna line to domestic and international law enforcement agencies as well as to global private security companies and other professionally licensed entities. Leading Byrna's law enforcement business will be RJ Boatman, the group's executive vice president for governmental affairs who’s one of the most highly decorated law enforcement officers in the US.

Byrna recently acquired privately owned South African manufacturer Roboro Industries Pty Ltd, giving it the production muscle to “keep pace” with the growing demand for the Byrna HD security device, which comes as part of a kit in either orange, tan, black, grey, green, hot pink, or yellow. It is deceptively easy to use, with virtually no recoil.

Byrna has a robust intellectual property portfolio covering a wide array of designs for non-lethal technologies. It currently has seven US patents and four international patents. It also has 13 patents which are pending and nine registered designs along with a US trademark.

Inflection points:

  • Increase daily production at Ft Wayne plant to 500 units 
  • Expects to build strongly on FY20 sales in FY21 
  • Eyeing Nasdaq listing to raise profile with investors
  • Grow newly formed Byrna LE division 

What the boss says:

"We are extremely pleased with our fourth-quarter results. 2020 was a transformative year for Byrna as the Company grew both sales and production by well over 1,000% and built out the infrastructure needed to sustain its current growth trajectory," CEO Bryan Ganz said in a recent sales statement.

"Byrna was able to produce these record results despite being capacity constrained for much of the year. More importantly, demand for the Company's flagship product, the Byrna HD, has only continued to grow as the Company builds brand awareness. Increasingly, Byrna is becoming the answer for both law enforcement and consumers that are looking for a safe and effective less-lethal self-defense solution."

Contact the author: [email protected]

Follow him on Twitter @PatrickMGraham

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