Security Devices International Inc (CSE:SDZ) (OTCMKTS:SDEV) revealed Wednesday that the sales of its popular non-lethal personal security device Byrna HD fired up record preliminary sales for the third quarter.
In a statement, the Wakefield, Massachusetts-based company said preliminary sales for the third quarter, which ended August 31, totaled $309,150, compared to $105,730 in the second quarter, and $11,146 in the first quarter.
The company chalked up 90% of the sales to the Byrna HD and accessories, with the balance of the sales coming from the company’s line of 40 mm Blunt Impact Projectiles. Of the $277,623 in Byrna sales, 81% was for the launcher and 19% came from accessories and ammunition. The company said the percentage of sales derived from accessories and ammunition is likely to expand as its customer base grows.
READ: Security Devices makes first US deliveries of its non-lethal personal security device Byrna HD
Sales were helped immeasurably by a product review by Sootch00, a well-known gun reviewer with over 850,000 YouTube subscribers. The video released on July 15 effectively demonstrated the incapacitating effects of the Byrna Black chemical irritant round.
The Byrna is a handgun-like device that dispenses chemical irritants. The small, lightweight .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.
For the quarter ended August 31, Security Devices said it produced 1,675 launchers, up from 204 launchers produced at the end of the second quarter.
Security Devices said production in South Africa was moved in mid-July to a new facility, Roboro Industries, a company experienced in both the manufacturing and the production of non-lethal weapons. The company said the decision “dramatically improved” production numbers and “significantly lowered” rejection rates.
The company explained that while changing the final assembly supplier mid-quarter was disruptive, it resulted in 1,327 launchers being produced after the shift, with a dramatically lower rejection rate.
"We are very pleased with the Roboro relationship," said Security Devices International CEO Bryan Ganz in a statement.
"They are just going to get better as their people gain more experience with our product," he noted.
Security Devices also announced that it has entered into a new binding agreement with Roboro Industries Proprietary Limited, which will be operating under the name Byrna Africa to serve as its authorized distributor in South Africa.
The company recently ended discussions of an exclusive distributorship with Dave Sheer Guns and cancelled the balance of a purchase order which contemplated special pricing.
"We are excited to have this opportunity to expand our relationship with the Roboro group," noted Ganz. "They've done a great job of taking over our production and we think they will be as effective representing us in South Africa."
According to the company, total production for the fourth quarter for Byrna HD devices is slated to be about 4,000 units.
In the fourth quarter, Security Devices will sponsor the Rick Ware Racing #52 Byrna Ford Mustang, which will be racing at the Federated Auto Parts 400, an annual Monster Energy NASCAR Cup Series stock car race held on September 21, at the Richmond Raceway in Richmond, Virginia.
In addition to the Richmond Race, SDI plans to attend a number of gun shows including the two-day Rapid City Gun Show at the Rushmore Plaza Civic Center in Rapid City starting on September 21.
It is also participating in the two-day Gun & Knife Show at the Eastern States Exposition in West Springfield, Massachusetts starting on October 26.
On July 22, Security devices issued $2,282,500 worth of 10% convertible notes due June 30, 2021. These notes are convertible into stock at any time prior to their maturity on June 30, 2021. Each $1,000 note was issued with 4,000 warrants, each exercisable into one share of SDI common stock at $0.25 per share at any time prior to their expiration on January 22, 2024.
The company closed a second tranche of these notes on September 16, raising another $817,500. As with the first tranche, Northeast Industrial Partners LLC will act as collateral agent for the purchasers of the notes. The net proceeds from the offering will be used for general corporate purposes and working capital.
The Byrna HD is not a "firearm" under federal law and does not require a federal gun license. State laws and local ordinances may regulate its possession, use, and carry in certain localities.
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