Smith & Wesson Brands, Inc. · NASDAQ:SWBI
Smith & Wesson Brands — Investor Presentation (May 2012)
23 slides from Smith & Wesson Brands's investor presentation, May 7, 2012
Slide 1: James Debney, President & CEO; Jeffrey Buchanan, EVP & CFO, May 2012
James Debney, President & CEO Jeffrey Buchanan, EVP & CFO May, 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) 160 years of rich history Iconic brand with 92% aided awareness Smith & Wesson(r) Brand = Revolver Innovative product portfolio serving broad user groups Revolvers, Polymer Pistols, Metal Pistols, Conceal Car
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 Firearms Sale of Security Solutions - Perimeter Security Business (formerly USR) U.S. Consumer - leverage professional markets Family of brands: Smith & Wesson(r) M&P(tm) Thompson/Center Arms(tm) Walther(r) M&P(tm) - Brand and product platform: Pistols, r
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 Products Jeffrey Buchanan, EVP & CFO 25+ years: private and public company exp
Slide 7: Experienced Management Team
Experienced Management Team Mario Pasantes Sr. VP Marketing and Global Professional Sales Alcoa, Inc. Coca-Cola Pillsbury Mark Smith VP Manufacturing and Supply Chain Management Alvarez & Marsal Ecolab Robert Cicero VP, General Counsel and Chief Compliance Officer Chemtura Corp. Shearman & Sterling
Slide 8: Q3 FY12 Highlights (Jan 31, 2012)
Q3 FY12 Highlights (Jan 31, 2012) Q3 FY12 Highlights (Jan 31, 2012) 8
Slide 9: SWHC: Financial Highlights (From Continuing Operations)
SWHC: Financial Highlights (From Continuing Operations) Fiscal Year April 30 Sales (in Millions) Q3FY12 Actual: Sales $98.1M (+23.8%) Backlog $198.5M Gross Profit Margin 30.6% Op. Expense 20.1% Working capital $92.4M Cash $25.7M Q4FY12 Guidance: Sales $113.0M - $118.0M Gross Profit Margin 32.0% - 33
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 CY11
Strong Industry Sales Indications Through CY11 Wholesale projected sales based on excise tax collections. Full year excise tax collections for Handguns and Long guns up 24% over prior year Latest reported Q4 2011 showed Handgun tax obligations up 31.5% over Q4 2010 Source: Federal Excise Tax collect
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 (2011 Prelim Data Due Out JULY, 2012)
Slide 13: Industry: Pistols vs. Revolvers
Industry: Pistols vs. Revolvers Pistols and revolvers have different attributes, but pistols are attracting younger consumers into the handgun market. Pistol advantages versus revolvers: Capacity Rate of fire High tech/cutting edge Modern shape Trigger pull Safety features Revolver advantages versus
Slide 14: SWHC Firearms Growth Drivers
SWHC Firearms Growth Drivers Consumer Market - U.S. Focus on Concealed Carry, Personal Protection, Recreation Expand Market Share: Polymer Pistol Unit Growth (M&P(tm), BODYGUARD(r), S&W(r) brand) Robust New Product Pipeline is Required Leverage Positive Halo Effect from Professional Markets Professi
Slide 15: Major Focus: M&P Pistol Growth
Major Focus: M&P(tm) Pistol Growth Current Situation: Pistol category is 80% of handguns Compact and full-size polymer pistols are increasing in popularity M&P(tm) products well received by retail and consumer Our Focus: Grow M&P(tm) Pistol market share: Increased consumer advertising Increasing cap
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 Walther PPS S&W M&P 15 S&W M&P Pistols Walther PK380 S&W M&P15-22 Walther PPQ S&W M&P15 Sport S&W BG380 S&W BG 38 S&W M&P15 Whisper S&W M&P 22 Thompson/Center Venture S&W Governor T/C Dimension 17 M&P Shield
Slide 18: New Models for the M&P Platform
New Models for the M&P(tm) Platform New and exciting entries for polymer pistol category Concealed Carry and Personal Protection Consumer and Professional Additional calibers and models for the M&P Modern Sporting Rifle platform: Tactical Hunting Will only announce new product introductions when rea
Slide 19: The NEW M&P Shield
The NEW M&P Shield(tm) SLIM Less than 1" thin CONCEALABLE 6" overall length POWERFUL 9mm or 40 S&W 19
Slide 20: Key Accessory Partners Were Ready
Key Accessory Partners Were Ready Most Products Available at Launch 20
Slide 21: Our Strategic Direction: Focus on Firearms
Our Strategic Direction: Focus on Firearms Grow sales and increase profitability Expand manufacturing capacity intelligently Focus on M&P pistol platform Optimize expenses on a company-wide basis Focus on improving gross margins Maintain robust new product pipeline Launch new products strategically
Slide 22: Financial Model: Goals
Financial Model: Goals Sales: 100% CGS: 70% Margin: 30% Opex: 21% Operating Margin: 8% 22 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 FY In One to Two Years In Three to Five Years Note: Current
Slide 23: Question & Answers
Question & Answers For Investor Information contact Liz Sharp at lsharp@smith-wesson.com , (480) 949-9700
Smith & Wesson Holding — Investor Presentation (May 2012) on 6ix