OREANDA-NEWS. VirTra Systems, Inc. (OTC Pink:VTSI), a leading provider of use of force simulators and firearms training simulators, today announced its financial results for the first quarter ended March 31, 2016. 

First Quarter 2016 Financial Highlights:

  • Net sales of $6.2 million
  • Gross profit of $4.1 million
  • Gross profit margin of 66%
  • Net income of $2.4 million

“We are pleased to announce that our first quarter performance delivered a substantial increase in revenue growth and profitability,” said Bob Ferris, Chairman and Chief Executive Officer of VirTra. “The success we have achieved through our disciplined approach to operations, and our focus on new and emerging opportunities for our products, has translated into record financial metrics, including revenues, margins and profitability. We still have much to accomplish, as world-wide, there are many with lethal force responsibility who still lack access to quality training scenarios and simulators. We are excited about the opportunities that lie ahead for our business and for our shareholders as we pursue our long term plans for growth and market liquidity.”

First Quarter Results for the Three Months Ended March 31, 2016

Net sales were $6.2 million in the quarter, an increase of 141%, compared to $2.6 million for the first quarter of 2015.

Gross profit was $4.1 million for the quarter, an increase of 173%, compared to $1.5 million for the first quarter of 2015.

Gross margin for the quarter was 66%, compared to 59% for the first quarter of 2015. The year-over-year increase in gross margin was primarily due to increased sales volume.

Selling, general and administrative expenses were $1.7 million for the quarter, compared to $1.5 million in the first quarter of 2015. The higher expenses were primarily due to an increase in workforce to support the growth in revenues.

Operating income for the quarter was $2.4 million, compared to $0.1 million in the first quarter of 2015. The increase in operating income was primarily due to increased sales volume.

Net income was $2.4 million for the quarter, or $0.01 per basic share, compared to $0.2 million, or break-even per basic share, for the first quarter of 2015.

Stockholders’ equity increased to $6.8 million at March 31, 2016, an increase of 130%, compared to $2.9 million at March 31, 2015.

The Company had no outstanding debt as of March 31, 2016.

Cash and cash equivalents were $3.1 million at March 31, 2016, compared to $1.3 million at March 31, 2015. 

Mark Skidmore, Vice President and Chief Accounting Officer for VirTra, said, “Our record first quarter performance is the direct result of our successful sales efforts and continued reinvestment into effective simulation products, all backed up by exceptional customer support. We remain confident that we have both the right products and teams necessary to continue our success into the future. While we understand that sales cycles and market conditions will impact our quarterly revenues and profitability, we nonetheless believe that the future of our company remains strong.”

About VirTra Systems, Inc.

VirTra is a global leading provider of the world's most realistic and effective judgmental use of force simulators. VirTra is the higher standard in firearms training simulators, offering a variety of simulator platforms, powerful gas-powered recoil kits and the patented Threat-Fire™ simulated hostile return fire system.  VirTra’s products provide the very best simulation training available for personnel that are entrusted with lethal force and critical missions.  The Company’s common stock is not registered under the Securities Exchange Act of 1934 and the Company does not currently file periodic or other reports with the Securities and Exchange Commission.

VIRTRA SYSTEMS, INC. BALANCE SHEET  
                   
            March 31,    December 31,  
              2016       2015    
    Assets   (unaudited)   (audited)  
Current assets:              
  Cash and cash equivalents    $   3,051,297     $   3,317,020    
  Accounts receivable, net        4,857,968         2,346,141    
  Inventory            971,480         902,642    
  Prepaid expenses and other current assets      96,464         51,620    
                   
  Total current assets      8,977,209         6,617,423    
                   
Property and equipment, net      502,576         516,005    
Investment in Modern Round      136,579         136,579    
                   
Total assets    $   9,616,364     $   7,270,007    
                   
    Liabilities and Stockholders' Equity          
                   
Current liabilities:              
  Accounts payable  $   606,935     $   508,358    
  Accrued compensation and related costs      589,116         467,881    
  Accrued expenses and other current liabilities.      196,456         238,347    
  Deferred revenue      1,309,795         1,523,841    
                   
  Total current liabilities      2,702,302         2,738,427    
                   
Long-term liabilities:              
  Accrued rent liability - long-term      151,936         159,941    
                   
Total liabilities      2,854,238         2,898,368    
                   
Commitments and contingencies            
                   
Stockholders' equity:              
Preferred stock $0.005 par value; 2,000,000 shares authorized;         
  no shares issued or outstanding as of March 31, 2016 and December 31, 2015      -          -     
Common stock $0.005 par value; 500,000,000 shares authorized; 158,293,245 shares         
  issued and 158,250,045 shares outstanding as of March 31, 2016;  158,293,245         
  shares issued and 158,250,045 shares outstanding as of December 31, 2015      791,466         791,466    
Additional paid-in capital      13,386,517         13,352,527    
Treasury stock at cost, 43,200 common shares as of        
  March 31, 2016 and December 31, 2015, respectively      (2,981 )       (2,981 )  
Accumulated deficit          (7,412,876 )       (9,769,373 )  
                   
Total stockholders' equity      6,762,126         4,371,639    
                   
Total liabilities and stockholders' equity  $   9,616,364     $   7,270,007    
                   
VIRTRA SYSTEMS, INC. STATEMENTS OF OPERATIONS (unaudited)  
                   
             Three months ended March 31, 
  
              2016       2015    
                   
Net revenues    $   6,232,293     $   2,584,796    
                   
Cost of products sold      2,101,025         1,072,551    
                   
Gross profit        4,131,268         1,512,245    
                   
General and administrative expenses      1,742,048         1,462,418    
                   
Income from operations        2,389,220         49,827    
                   
Other income/(expense):              
Other income         517         137,137    
                   
Other expense          -          (2,064 )  
                   
Net other income          517         135,073    
                   
Income before income taxes        2,389,737         184,900    
                   
Income tax expense        33,240         -     
                   
Net income    $   2,356,497     $   184,900    
                   
Weighted average of common and common equivalent shares outstanding:                      
-Basic         158,250,045         158,285,045    
                   
Net  income per common and common equivalent share:        
-Basic     $   0.01     $   0.00    
                   
VIRTRA SYSTEMS, INC. STATEMENTS OF STOCKHOLDERS' EQUITY  
                                 
          Common stock 
                  
                  Additional    Treasury   Accumulated      
          Shares   Amount   paid-in capital   Stock   Deficit   Total  
                                 
                                 
Balance at January 1, 2015       158,285,045     $  791,641     $   13,239,621     $   (2,981 )   $  (11,306,356 )   $  2,721,925    
                                 
Net income          -          -          -          -          1,536,983         1,536,983    
                                 
Issued shares purchased and canceled      (35,000 )       (175 )       (5,422 )       -          -          (5,597 )  
                                 
Stock-based compensation        -          -          118,328         -          -          118,328    
                                 
                                 
Balance at December 31, 2015         158,250,045         791,466         13,352,527         (2,981 )       (9,769,373 )       4,371,639    
                                 
                                 
Net income          -          -          -          -          2,356,497         2,356,497    
                                 
Stock-based compensation        -          -          33,990         -          -          33,990    
                                 
Balance at March 31, 2016         158,250,045     $  791,466     $   13,386,517     $   (2,981 )   $   (7,412,876 )   $  6,762,126    
                                 
VIRTRA SYSTEMS, INC. STATEMENTS OF CASH FLOWS (unaudited)  
               
        Three months ended March 31, 
  
          2016       2015    
               
Cash flows from operating activities:        
  Net income  $   2,356,497     $   184,900    
               
  Adjustments to reconcile net income to net cash        
    provided by operating activities:        
      Depreciation and amortization        45,555         44,144    
      Stock-based compensation        33,990         38,149    
      Other income received in Modern Round equity        -          (136,579 )  
  Changes in operating assets and liabilities:        
    Accounts receivable, net      (2,511,827 )       (880,420 )  
    Inventory      (68,838 )       (199,915 )  
    Prepaid expenses and other current assets        (44,844 )       8,444    
    Accounts payable and other accrued expenses        169,916         337,192    
    Deferred revenue      (214,046 )       156,490    
               
Net cash provided/(used) by operating activities        (233,597 )       (447,595 )  
               
Cash flows from investing activities:        
  Purchase of property and equipment        (32,126 )       (139,452 )  
               
Net cash used in investing activities      (32,126 )       (139,452 )  
               
Cash flows from financing activities:        
  Draws on line of credit      -          -     
  Repayments of line of credit        -          -     
               
Net cash used in financing activities      -          -     
               
Increase/(decrease) in cash and cash equivalents        (265,723 )       (587,047 )  
Cash and cash equivalents, beginning of period        3,317,020         1,912,729    
               
Cash and cash equivalents, end of period  $   3,051,297     $   1,325,682    
               
Cash paid during the period for:        
               
  Interest  $   -      $   -     
               
  Taxes  $   21,610     $   -     
               
Noncash investing and financing activities:        
               
  Receipt of Modern Round equity    $   -      $   136,579