VTSI Virtra Inc

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): August 12, 2024

 

VIRTRA, INC.

(Exact name of Registrant as Specified in Its Charter)

 

Nevada		001-38420		93-1207631
(State or Other Jurisdiction		(Commission		(IRS Employer
of Incorporation)		File Number)		Identification No.)

 

295 E. Corporate Place
Chandler, AZ		85225
(Address of Principal Executive Offices)		(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (480) 968-1488

 

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.0001 par value		VTSI		NASDAQ Capital Market

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

Item 2.02. Results of Operations and Financial Condition.

 

On August 12, 2024, VirTra, Inc. issued a press release announcing its financial results for the second quarter ended June 30, 2024. A copy of this press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information contained in the website is not a part of this Current Report on Form 8-K.

 

The information under this Item 2.02, including Exhibit 99.1, is being furnished and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of such section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.		Description
99.1		Press release of the registrant dated August 12, 2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	VIRTRA, INC.
Date: August 12, 2024	By:	/s/ John F. Givens II
	Name:	John F. Givens II
	Title:	Chief Executive Officer

 

 

 

 

Exhibit 99.1

 

 

VirTra Reports Second Quarter and First Half 2024 Financial Results

 

Quarterly Bookings Improve as VirTra Advances Product Launches and Expands Focus on Federal and Defense Markets

 

CHANDLER, Ariz. — August 12, 2024 — VirTra, Inc. (Nasdaq: VTSI) (“VirTra” or the “Company”), a global provider of judgmental use of force training simulators, firearms training simulators for the law enforcement and military markets, reported results for the second quarter ended June 30, 2024. The financial statements are available on VirTra’s website and here.

 

Second Quarter 2024 and Recent Operational Highlights:

 

	●	Bookings increased by $3 million quarter-over-quarter, doubling since Q1, highlighting improved market conditions and a strengthened sales approach.
	●	Gross margins improved to 91%, marking a significant increase from 83% in Q1.
	●	Maintained robust working capital at $34.8 million, positioning the Company for sustained growth and operational agility.
	●	Advanced V-XR launch preparations, with the new extended reality solution set to begin shipping by the end of Q3 2024.
	●	Appointed Brandon Cox as Chief Technology Officer to accelerate innovation and lead new product development efforts.
	●	Launched new online and in-person masterclass training programs to maximize simulator utilization and enhance customer success outcomes through improved engagement and skill development.
	●	VirTra simulators approved for DoD-funded research projects, reinforcing the Company’s standing in defense and research sectors.

 

Second Quarter and Six Month 2024 Financial Highlights:

 

		For the Three Months Ended												For the Six Months Ended
All figures in millions, except per share data		June 30, 2024				June 30, 2023				% Δ				June 30, 2024				June 30, 2023				% Δ
Total Revenue		$	6.1			$	10.3				-41	%		$	14.2			$	20.4				-30	%
Gross Profit		$	5.5			$	5.9				-7	%		$	11.0			$	12.9				-15	%
Gross Margin			91	%			57	%			N/A				78	%			63	%			N/A
Net Income (Loss)		$	1.2			$	1.0				N/A			$	2.4			$	4.0				N/A
Diluted EPS		$	0.11			$	0.09				N/A			$	0.22			$	0.36				N/A
Adjusted EBITDA		$	1.6			$	2.6				N/A			$	3.70			$	6.55				N/A

 

Management Commentary

 

CEO John Givens stated, “Our recent developments have positioned us strongly for future growth. Although our second quarter revenue was impacted by earlier challenges with federal budget resolutions, we have successfully doubled our bookings sequentially from the first quarter. This increase in bookings reflects the positive momentum we are building as we move through the second half of the year. VirTra’s sales pipeline is stronger than ever, and the sales team is starting to gain traction, reflecting our efforts to align sales operations with the operational excellence we’ve established in other departments. We have also enhanced our ability to capture law enforcement dollars through a greatly improved pipeline of federal grants, supported by a new program that identifies and matches potential grants with customer needs.

 

 

“The upcoming launch of our V-XR platform represents a significant opportunity to redefine training methodologies across our core law enforcement and military markets, and also in areas such as healthcare and education, where we are already experiencing strong interest. We are also focused on expanding our reach further into U.S. Federal and Department of Defense channels by actively pursuing these opportunities through targeted marketing campaigns and strategic initiatives. We are deploying a dedicated sales team tasked with securing larger contracts in U.S. Federal and Department of Defense channels. This specialized unit is strategically equipped to navigate complex opportunities and drive significant growth in these key areas.

 

“We are aiming to extend our leadership in simulation training by enhancing our systems and developing state-of-the-art products that align with the demands of larger market opportunities. With the appointment of Brandon Cox as Chief Technology Officer, we are set to advance our capabilities in areas such as data analytics and systems integration. As we pursue these advancements, our newly launched master class training programs, offering both online and in-person options, are designed to ensure customer success by providing comprehensive training solutions that enable clients to fully utilize our platforms and achieve effective training outcomes. These initiatives strengthen our position as a leader in simulation training and equip us with the technical expertise needed to pursue and secure larger contracts in key markets.”

 

Second Quarter 2024 Financial Results

 

Total revenue was $6.1 million, compared to $10.3 million in the prior year period. The decrease was primarily due to delays in purchasing decisions caused by the continuing resolution impacting bookings in recent quarters.

 

Gross profit totaled $5.5 million (91% of total revenue), compared to $5.9 million (57% of total revenue) in the prior year period. The 7% decrease in gross profit was primarily due to the change in sales. Gross margin increased mainly due to the lower cost of sales driven by operational enhancements, offsetting labor costs related to development projects, and 40% of the total revenue driven from the Company’s service and STEP contracts, which have limited cost of sales associated with the revenue.

 

Net operating expense was $4.4 million, a 10% increase from $4.0 million in the prior year period. This increase was driven by investments in sales and marketing, as well as strategic hiring to support growth initiatives. Also contributing to the increased operating expenses were enhancements to the Company’s IT infrastructure and compliance measures required for current and future contracts.

 

Operating income was $1.1 million, compared to $1.9 million in the second quarter of 2023.

 

Net income was $1.2 million, or $0.11 per diluted share (based on 11.1 million weighted average diluted shares outstanding), compared to net income of $1.0 million, or $0.09 per diluted share (based on 10.9 million weighted average diluted shares outstanding), in the second quarter of 2023.

 

Adjusted EBITDA, a non-GAAP metric, was $1.6 million, compared to $2.6 million in the second quarter of 2023.

 

Cash and cash equivalents were $18.4 million at June 30, 2024.

 

Financial Commentary

 

CFO Alanna Boudreau stated, “The second quarter presented notable challenges as our revenue declined year-over-year. Despite these headwinds, we achieved a remarkable 91% gross margin, driven by strategic cost management and a favorable product mix. Gross margin was further enhanced by capitalizing on development costs for key projects which are not yet generating revenue but are expected to provide significant future returns.

 

 

“Our bookings improvement underscores the effectiveness of our sales initiatives and the continued demand for our solutions. However, we recognize that maintaining this momentum will require sustained focus and execution. We have strengthened our working capital position to support strategic initiatives, ensuring we can invest in areas that promise long-term growth. Additionally, our ability to achieve a 93% rate of either renewing STEP contracts or transitioning to capital purchases among customers completing their initial agreements highlights our success in building a loyal customer base as we focus on new pipeline development. As we navigate the second half of the year, balancing our backlog and bookings will be crucial to optimizing revenue and capturing emerging market opportunities.”

 

Conference Call

 

VirTra’s management will hold a conference call today (August 12, 2024) at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss these results. VirTra’s Chief Executive Officer 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: 13747540

 

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.

 

The conference call will be broadcast live and available for replay here and via the investor relations section of the Company’s website.

 

A replay of the call will be available after 7:30 p.m. Eastern time on the same day through August 26, 2024.

 

Toll-free replay number: 1-844-512-2921

International replay number: 1-412-317-6671

Replay ID: 13747540

 

About VirTra, Inc.

 

VirTra (Nasdaq: VTSI) is a global provider of judgmental use of force training simulators, firearms training 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.

 

 

About the Presentation of Adjusted EBITDA

 

Adjusted earnings before interest, income taxes, depreciation, and amortization and before other non-operating costs and income (“Adjusted EBITDA”) is a non-GAAP financial measure. Adjusted EBITDA also includes non-cash stock option expense and other than temporary impairment loss on investments. Other companies may calculate Adjusted EBITDA differently. VirTra calculates its Adjusted EBITDA to eliminate the impact of certain items it does not consider to be indicative of its performance and its ongoing operations. Adjusted EBITDA is presented herein because management believes the presentation of Adjusted EBITDA provides useful information to VirTra’s investors regarding VirTra’s financial condition and results of operations and because Adjusted EBITDA is frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in VirTra’s industry, several of which present a form of Adjusted EBITDA when reporting their results. Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of VirTra’s results as reported under accounting principles generally accepted in the United States of America (“GAAP”). Adjusted EBITDA should not be considered as an alternative for net income, cash flows from operating activities and other consolidated income or cash flows statement data prepared in accordance with GAAP or as a measure of profitability or liquidity. A reconciliation of net income to Adjusted EBITDA is provided in the following tables:

 

		For the Three Months Ended																For the Six Months Ended
		June 30,				June 30,				Increase				%				June 30,				June 30,				Increase				%
		2024				2023				(Decrease)				Change				2024				2023				(Decrease)				Change
Net Income (Loss)		$	1,200,727			$	1,026,635			$	174,092				17	%		$	2,416,901			$	3,973,009			$	(1,556,108	)			-39	%
Adjustments:
Provision for income taxes			87,564				977,489				(889,925	)			-91	%			599,000				1,618,834				(1,019,834	)			-63	%
Depreciation and amortization			288,777				253,911				34,866				14	%			525,570				481,481				44,089				9	%
Interest (net)			(34,379	)			61,237				(95,616	)			-156	%			(88,957	)			109,420				(198,377	)			-181	%
EBITDA			1,542,689				2,319,272				(776,583	)			-33	%			3,452,514				6,182,744				(2,730,230	)			-44	%
Right of use amortization			69,418				244,581			$	(175,163	)			-72	%			199,493				366,355				(166,862	)			-46	%
Adjusted EBITDA		$	1,612,107			$	2,563,853			$	(951,746	)			-37	%		$	3,652,007			$	6,549,099			$	(2,897,092	)			-44	%

 

Forward-Looking Statements

 

The information in this discussion contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the “safe harbor” created by those sections. The words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “will,” “should,” “could,” “predicts,” “potential,” “continue,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that we make. The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements. All forward-looking statements in this document are made based on our current expectations, forecasts, estimates and assumptions, and involve risks, uncertainties and other factors that could cause results or events to differ materially from those expressed in the forward-looking statements. In evaluating these statements, you should specifically consider various factors, uncertainties and risks that could affect our future results or operations. These factors, uncertainties and risks may cause our actual results to differ materially from any forward-looking statement set forth in the reports we file with or furnish to the Securities and Exchange Commission (the “SEC”). You should carefully consider these risks and uncertainties described and other information contained in the reports we file with or furnish to the SEC before making any investment decision with respect to our securities. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement.

 

Investor Relations Contact:

 

Matt Glover and Alec Wilson

Gateway Group, Inc.

VTSI@gateway-grp.com

949-574-3860

 

 

- Financial Tables to Follow -

 

VIRTRA, INC.

CONDENSED BALANCE SHEETS

(Unaudited)

 

		June 30, 2024				December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents		$	18,411,634			$	18,849,842
Accounts receivable, net			9,124,425				15,724,147
Inventory, net			13,470,715				12,404,880
Unbilled revenue			1,389,658				1,109,616
Prepaid expenses and other current assets			1,953,015				906,803
Total current assets			44,349,447				48,995,288
Long-term assets:
Property and equipment, net			16,575,177				15,487,012
Operating lease right-of-use asset, net			519,375				716,687
Intangible assets, net			563,096				567,540
Security deposits, long-term			35,691				35,691
Other assets, long-term			201,670				201,670
Deferred tax asset, net			3,780,112				3,630,154
Total long-term assets			21,675,121				20,638,754
Total assets		$	66,024,568			$	69,634,042
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	1,013,483			$	2,282,427
Accrued compensation and related costs			1,920,367				2,221,416
Accrued expenses and other current liabilities			573,510				3,970,559
Note payable, current			230,457				226,355
Operating lease liability, short-term			189,098				317,840
Deferred revenue, short-term			5,619,406				6,736,175
Total current liabilities			9,546,321				15,754,772
Long-term liabilities:
Deferred revenue, long-term			3,022,676				3,012,206
Note payable, long-term			7,690,940				7,813,021
Operating lease liability, long-term			353,710				432,176
Total long-term liabilities			11,067,326				11,257,403
Total liabilities			20,613,647				27,012,175
Commitments and contingencies (See Note 9)
Stockholders’ equity:
Preferred stock $0.0001 par value; 2,500,000 shares authorized; no shares issued or outstanding			-				-
Common stock $0.0001 par value; 50,000,000 shares authorized; 11,112,230 shares and 11,107,230 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively			1,110				1,109
Class A common stock $0.0001 par value; 2,500,000 shares authorized; no shares issued or outstanding			-				-
Class B common stock $0.0001 par value; 7,500,000 shares authorized; no shares issued or outstanding			-				-
Additional paid-in capital			32,329,917				31,957,765
Retained earnings			13,079,894				10,662,993
Total stockholders’ equity			45,410,921				42,621,867
Total liabilities and stockholders’ equity		$	66,024,568			$	69,634,042

 

 

VIRTRA, INC.

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2024				2023				2024				2023
Revenues:
Net sales		$	6,075,040			$	10,336,903			$	14,169,438			$	20,363,838
Total revenue			6,075,040				10,336,903				14,169,438				20,363,838
Cost of sales			550,424				4,416,202				3,182,681				7,494,199
Gross profit			5,524,616				5,920,701				10,986,757				12,869,639
Operating expenses:
General and administrative			3,537,910				3,280,344				6,908,332				5,991,681
Research and development			855,285				711,754				1,548,665				1,478,050
Net operating expense			4,393,195				3,992,098				8,456,997				7,469,731
Income (loss) from operations			1,131,421				1,928,603				2,529,760				5,399,908
Other income (expense):
Other income			156,870				208,599				486,141				392,240
Gain on forgiveness of note payable			-				(133,078	)			-				(200,305	)
Other (expense) income
Net other income (expense)			156,870				75,521				486,141				191,935
Income (Loss) before provision for income taxes			1,288,291				2,004,124				3,015,901				5,591,843
Provision (Benefit) for income taxes			87,564				977,489				599,000				1,618,834
Net income (loss)		$	1,200,727			$	1,026,635			$	2,416,901			$	3,973,009
Net income (loss) per common share:
Basic		$	0.11			$	0.09			$	0.22			$	0.36
Diluted		$	0.11			$	0.09			$	0.22			$	0.36
Weighted average shares outstanding:
Basic			11,063,366				10,924,714				10,885,965				10,921,033
Diluted			11,065,866				10,933,130				10,885,965				10,925,702

 

 

VIRTRA, INC.

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

 

		Six Months Ended June 30
		2024				2023
Cash flows from operating activities:
Net income		$	2,416,901			$	3,973,009
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			525,077				479,889
Right of use amortization			197,312				244,580
Employee stock compensation			352,005				199,475
Stock issued for service			-				75,000
Changes in operating assets and liabilities:
Accounts receivable, net			6,599,722				(14,928,520	)
Inventory, net			(1,065,835	)			(375,211	)
Deferred taxes			(149,958	)			(3,122,905	)
Unbilled revenue			(280,044	)			5,063,881
Prepaid expenses and other current assets			(1,046,213	)			(15,281	)
Other assets			-				173,999
Accounts payable and other accrued expenses			(4,967,236	)			3,792,847
Operating lease right of use			(207,208	)			(257,677	)
Deferred revenue			(1,106,299	)			5,010,384
Net cash provided by operating activities			1,268,224				313,470
Cash flows from investing activities:
Purchase of property and equipment			(1,608,798	)			(345,640	)
Net cash (used in) investing activities			(1,608,798	)			(345,640	)
Cash flows from financing activities:
Principal payments of debt			(117,785	)			(118,087	)
Stock Options Exercised			20,151				9,634
Repurchase of Stock based options			-				-
Net cash (used in) financing activities			(97,634	)			(108,453	)
Net (decrease) in cash			(438,208	)			(140,623	)
Cash and restricted cash, beginning of period			18,849,842				13,483,597
Cash and restricted cash, end of period		$	18,411,634			$	13,342,974
Supplemental disclosure of cash flow information:
Interest paid		$	84,403			$	134,514
Income taxes paid (refunded)		$	5,314,387			$	-

 

v3.24.2.u1

Cover	Aug. 12, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Aug. 12, 2024
Entity File Number	001-38420
Entity Registrant Name	VIRTRA, INC.
Entity Central Index Key	0001085243
Entity Tax Identification Number	93-1207631
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	295 E. Corporate Place
Entity Address, City or Town	Chandler
Entity Address, State or Province	AZ
Entity Address, Postal Zip Code	85225
City Area Code	(480)
Local Phone Number	968-1488
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.0001 par value
Trading Symbol	VTSI
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false

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