Smith & Wesson Brands, Inc. · NASDAQ:SWBI
Smith & Wesson Brands — Investor Presentation (December 2012)
29 slides from Smith & Wesson Brands's investor presentation, Dec 11, 2012
Slide 1: Smith & Wesson Investor Presentation
December, 2012 Smith & Wesson Investor Presentation
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, Concealed
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 Recent sale of non-core perimeter security business U.S. Consumer - leverage professional markets Family of brands: Smith & Wesson(r) M&P(r) Thompson/Center Arms(tm) M&P(r) - Brand and product platform: Pistols and modern sporting rifles Operatio
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 International Sales Alcoa, Inc. Coca-Cola Pillsbury Mark Smith _______________ VP, Manufacturing and Supply Chain Management Alvarez & Marsal Ecolab Robert Cicero ________________ VP, General Counsel, Chief Compliance O
Slide 8: Q2 Fiscal 2013 Highlights
Q2 Fiscal 2013 Highlights (Oct. 31, 2012 - From Continuing Operations) (Oct. 31, 2012 - From Continuing Operations) (Oct. 31, 2012 - From Continuing Operations) 8
Slide 9: First Six Months Highlights and Guidance
First Six Months Highlights and Guidance (Fiscal Year 2013 - From Continuing Operations) Actual and Estimated Fiscal Year April 30 Sales (in Millions) First Half Fiscal 2013 Actual: Sales $272.6M (+48.1%) Gross Profit Margin 36.6% Operating Income 21.3% Diluted EPS $0.53 Cash at Oct. 31 $61.3M Adjus
Slide 10: SWHC: Backlog and Orders
SWHC: Backlog and Orders (in Millions) 10 Record Backlog Levels: Q2 FY13 backlog is a record vs. any prior Q2 Two recent consecutive quarters of decline reflects normal seasonality Q4 FY12: Strong net orders reflect customers competing for allocations amid SWHC capacity constraints Q2 FY13: Net orde
Slide 11: NSSF Adjusted NICS Data
National Shooting Sports Foundation (NSSF) adjusts FBI NICS data to eliminate background checks associated with permit applications and checks on active CCW permit databases. NSSF adjusted NICS data provides a more accurate picture of market conditions. Source: NSSF -National Shooting Sports Foundat
Slide 12: Industry: Growth in Handguns, Long Guns, Permit Checks
Industry: Growth in Handguns, Long Guns, Permit Checks 12
Slide 13: Industry Highlights: Adjusted NICS Setting Records
Industry Highlights: Adjusted NICS Setting Records (National Instant Criminal Background Check System) National Shooting Sports Foundation, Published December 6, 2012 - November 2012 results: Adjusted NICS checks numbered 1,525,177 Adjusted NICS checks up 38.5% over November 2011 Adjusted NICS check
Slide 14: Industry: Strong Sales Indications
Industry: Strong Sales Indications Manufacturer projected sales based on excise tax collections First half 2012 shipment value of Handguns and Long guns up 47% over prior yr Latest reported Q2 2012 showed Handgun tax obligations up 52% over Q2 2011 Source: Federal Excise Tax collections on mfg sales
Slide 15: Handgun and Long Gun Projected Sales History 1982 - 2011
Handgun and Long Gun Projected Sales History 1982 - 2011 Manufacturer sales § (Milions) based on FET Nasnas ete ee so 82 83 64 05 Go G7 ao 60 90 91 Sz 95 $4 G5 ah G7 ae 99 00 OF G2 03 Ga O5 06 OY dB 0 io 1
Slide 16: Pistols Driving Growth in Handguns
Pistols Driving Growth in Handguns Pistols now represent 82% of units both manufactured and imported Source: BATF, Includes US manufacturer and imports, excludes exports
Slide 17: 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 18: SWHC: Firearms Growth Drivers
Consumer Market - U.S. Focus on Concealed Carry, Personal Protection, Recreation Expand Market Share: M&P(r) Platform, Polymer Pistol Unit Growth New Product Pipeline Leverage Higher Performance Standards from Professional Markets Professional Market Law Enforcement / Federal Government Military - M
Slide 19: Major Focus: M&P Pistol Growth
Major Focus: M&P(tm) Pistol Growth Current Situation: Pistol category is 82% of handguns Compact/slim and full-size polymer pistols are increasing in popularity M&P(r) products sought after by retail & consumer, e.g. M&P(r) Shield(tm) Our Focus: Grow M&P(r) Pistol market share: Increased consumer ad
Slide 20: M&P - Proven Performance
M&P(r) - Proven Performance M&P(r) - Proven Performance Strong & Marketable Differences 20
Slide 21: Demonstrated Track Record of Significant New Products
Demonstrated Track Record of Significant New Products 2006 2007 2008 2009 2010 2011 2012 S&W M&P 15 S&W M&P Pistols S&W M&P15-22 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 21 M&P Shield
Slide 22: New Models for the M&P Platform
New products: M&P(r) Shield, M&P(r) C.O.R.E. Polymer pistol category Concealed Carry, Personal Protection and Recreation Consumer and Professional Additional calibers and models for the M&P(r) Modern Sporting Rifle platform: Hunting Will only announce new product introductions when timing is right M
Slide 23: The M&P Shield
The M&P(r) Shield(tm) SLIM Less than 1" thin CONCEALABLE 6" overall length POWERFUL 9mm or .40 S&W 23 "Guns hit store shelves at the end of the month in April or early May. The pistol itself is a lot to talk about - the most rugged of all "pocket rocket" pistols with M&P reliability and quality, but
Slide 24: The NEW M&P Pro-Series C.O.R.E.
The NEW M&P(r) Pro-Series C.O.R.E.(tm) New M&P(r) Pro Series C.O.R.E. Pistols expand the popular M&P(r) line of pistols and are available in Competition Optics Ready Equipment Models: Quick, custom, competition-based optics Crisp 4.5 pound trigger pull and faster reset in between shots Textured inte
Slide 25: 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(r) Pistol platform Optimize expenses on a company-wide basis Focus on improving gross margins Maintain robust new product pipeline Launch new products strategical
Slide 26: Financial Model: Three Year Goals
Financial Model: Three Year Goals 26 Gross Margins of 38% - 40% -- Drivers will include: Focus on M&P(r) platform Exit from Walther business Introduction of significant new products Leverage supplier capability and invest in vertical integration Further simplify and refine go-to-market strategy Oper
Slide 27: Questions / Answers / Addendum Slides
December, 2012 Smith & Wesson Investor Presentation Questions / Answers / Addendum Slides
Slide 28: Industry: NSSF-Adjusted NICS Setting Records
Industry: NSSF-Adjusted NICS Setting Records (National Instant Criminal Background Check System) National Shooting Sports Foundation, Published December 3, 2012 - "NOVEMBER NSSF-ADJUSTED NICS CHECKS UP 38.5% . . . Powered by the largest single day ever for background checks on Black Friday, November
Slide 29: Smith & Wesson
December, 2012 Smith & Wesson Investor Presentation
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