Smith & Wesson Brands, Inc. · NASDAQ:SWBI
Smith & Wesson Brands — Investor Presentation (February 2012)
21 slides from Smith & Wesson Brands's investor presentation, Feb 8, 2012
Slide 1: James Debney, President & CEO; Jeffrey Buchanan, EVP & CFO
James Debney, President & CEO Jeffrey Buchanan, EVP & CFO February, 2012
Slide 2: Safe Harbor
Safe Harbor Certain statements contained in this presentation may be deemed to be forward- looking statements under federal securities laws, and the Company intends that such forward-looking statements be subject to the safe-harbor created thereby. Such forward-looking statements include but are not
Slide 3: Business Highlights
Business Highlights U.S. Market Leader for Firearms: Handguns, Modern Sporting Rifles (MSR)159 years of rich historyIconic brand with 93% aided awarenessSmith & Wesson(r) Brand = RevolverInnovative product portfolio serving broad user groupsRevolver, Polymer Pistol, Metal Pistol, Pocket Pistol, Bolt
Slide 4: Vision / Mission
Vision / Mission Our Vision: The leading firearms manufacturer Our Mission: To allow our employees to design, produce, and market high-quality, innovative firearms that meet the needs and desires of our consumer and professional customers 4
Slide 5: Focus, Simplify, Execute
Focus, Simplify, Execute Strategy - Focus on FirearmsSale of Security Solutions - Perimeter Security Business (formerly USR)U.S. Consumer - leverage professional marketsFamily of brands:Smith & Wesson(r)Walther(r)Thompson/Center ArmsM&P(tm)M&P(tm) - Brand and product platform: Pistols and modern spo
Slide 6: Experienced Leadership Team
Experienced Leadership Team James Debney, President & CEO 20+ years: multinational consumer and business-to- business environments including President of Presto Products Co., a $500 million business unit of Alcoa Consumer ProductsJeffrey Buchanan, EVP & CFO25+ years: private and public company exper
Slide 7: Experienced Management Team
Experienced Management Team MarioPasantesSr. VP Marketing and Global Professional SalesAlcoa, Inc.Coca-ColaPillsburyInternational Market DevelopmentStrong Global BrandsStrategyCustomer Development Mark SmithVP Manufacturing and Supply Chain ManagementAlvarez & MarsalEcolabMulti-Site OpsCapacity Expa
Slide 8: Q2 FY12 Highlights (Oct 31, 2011)
Q2 FY12 Highlights (Oct 31, 2011) Double digit sales growth, a leader in expanding key firearm categoriesTotal net sales +10.5% YOYPolymer pistol unit sales + 40% YOYModern sporting rifle unit sales +64% YOYOverall unit growth +27% vs. market growth of +12.6% (Adjusted NICS) Announced plan to divest
Slide 9: SWHC: Financial Highlights (From Continuing Operations)
SWHC: Financial Highlights (From Continuing Operations) Fiscal Year April 30 Sales (in Millions) Q2FY12 Actual:Sales $92.3M (+10.5%)Backlog $149.9MGross Profit Margin 26.7%Op. Expense $21.2MWorking capital $84.3MCash $49.2MQ3FY12 Guidance:Sales $92.0M - $96.0MGross Profit Margin Approx. 30.0%Op. Exp
Slide 10: NICS: Strength in Consumer Firearms Market
*National Shooting Sports Foundation (NSSF) adjusts FBI NICS data to eliminate background checks associated with permit applications and checks on active CCW permit databases, in order to provide a more accurate picture of market conditions. Adjusted NICS Checks* NICS: Strength in Consumer Firearms
Slide 11: Strong Industry Sales Indications Through Q3 CY11
Strong Industry Sales Indications Through Q3 CY11 Wholesale projected sales based on excise tax collections. YTD Q3 2011 excise tax collections exceeded prior YTD Q3 2010. Category growth of over 30% in the past 5 years. Source: Federal Excise Tax collections, Wholesale Value*Long guns include all r
Slide 12: Industry: Pistols Driving Handgun Growth
Industry: Pistols Driving Handgun Growth U.S. handgun growth has been driven by pistols, which now represent 80% of units sold. Source: BATF annual firearms mfg and export report. USITC import data. 12
Slide 13: Industry: Pistols vs. Revolvers
Industry: Pistols vs. Revolvers Pistols & revolvers have different attributes, but pistols win on self-defense and have attracted younger consumers into the handgun market. Pistol advantages versus revolvers:CapacityRate of fire High tech/cutting edgeModern shapeTrigger pullSafety featuresRevolver a
Slide 14: SWHC Firearms Growth Drivers
SWHC Firearms Growth Drivers Consumer Market - U.S.Focus on Concealed Carry, Personal Protection, RecreationExpand Market Share: Polymer Pistol Unit Growth (M&P(tm), BODYGUARD(r), The Sigma Series(r)) Robust New Product Pipeline is RequiredLeverage Positive Halo Effect from Professional MarketsProfe
Slide 15: Major Focus: M&P Pistol Growth
Major Focus: M&P(tm) Pistol Growth Current Situation:Pistol category is 80% of handgunsCompact and full-size polymer pistols are increasing in popularityM&P(tm) products well received by retail and consumerOur Focus:Grow M&P(tm) Pistol market share:Increased consumer advertisingIncreasing capacity t
Slide 16: M&P - Proven Performance
M&P - Proven Performance M&P - Proven Performance Strong & Marketable Differences 16
Slide 17: Demonstrated Track Record of New Products
Demonstrated Track Record of New Products 2006 2007 2008 2009 2010 2011 2012 WaltherPPS S&W M&P 15 S&W M&P Pistols WaltherPK380 S&W M&P15-22 WaltherPPQ S&W M&P15 Sport S&WBG380 S&WBG 38 S&W M&P15 Whisper S&WM&P 22 Thompson/Center Venture S&WGovernor T/C Dimension 17
Slide 18: New Models for the M&P Platform
New Models for the M&P(tm) Platform New and exciting entries for polymer pistol categoryConcealed Carry and Personal ProtectionConsumer and ProfessionalAdditional calibers and models for the M&P Modern Sporting Rifle platform:TacticalHuntingWill only announce new product introductions when ready - c
Slide 19: Our Strategic Direction: Focus on Firearms
Our Strategic Direction: Focus on Firearms Grow sales and increase profitabilityExpand manufacturing capacity intelligentlyFocus on M&P pistol platformReduce expenses on a company-wide basisFocus on improving gross marginsMaintain robust new product pipelineLaunch new products strategicallyLeverage
Slide 20: Financial Model: Goals
Financial Model: Goals Sales: 100%CGS: 70%Margin: 30%Opex: 22% Operating Margin: 8% 20 Sales: 100%CGS: 67%Margin: 33%Opex: 18% Operating Margin: 15% Sales: 100%CGS: 65%Margin: 35%Opex: 17% Operating Margin: 18% Guidance for Current FYIn One to Two YearsIn Three to Five Years Note: Current FY reflect
Slide 21: Question & Answers
Question & Answers For Investor Information contact Liz Sharp, lsharp@smith-wesson.com, (480) 949-9700
Smith & Wesson Holding — Investor Presentation (February 2012) on 6ix