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

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 large 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 October 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.  Byrna anticipates being able to fill a 23,000-unit order backlog by November. The South African facility will satisfy in-nation and international orders, while the Fort Wayne facility will meet North American demand. Secondly, in its third quarter, the latest financial reporting period that ended August 31, 2020, the company banked a tenfold year-over-year increase in revenue. Quarterly revenue was $4.2 million versus $307,101 -- driven by the popularity of the Byrna HD device kit. Byrna also reported cash on hand of $11.8 million and total assets of $21.9 million. Looking ahead to the rest of 2020, CEO Bryan Ganz said the company expects full-year revenues in the range of $16 million to $18 million, adding that its fiscal 4Q ending November 30 will be Byrna’s first quarter of positive net income.  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  Expect first quarter of positive net income in FY4Q  Eyeing Nasdaq listing to raise profile with investors Grow newly formed Byrna LE division  What the boss says: "Byrna Technologies generated a significant increase in sales in our fiscal third quarter, both on a year-over-year and a sequential basis," CEO Bryan Ganz said in a recent statement. "The current socio-political climate has created a heightened sense of the need for effective and reliable less-lethal self-defense in both civilians and law enforcement professionals. This, coupled with increased awareness of the unique aspects of our product resulting from favorable, high-profile media coverage, drove rapid order growth for our Byrna HD less-lethal personal security device." Contact the author: patrick@proactiveinvestors.com Follow him on Twitter @PatrickMGraham