Byrna Technologies Inc (NASDAQ:BYRN) stock rose 6.43% (As on October 6, 11:50:19 AM UTC-4, Source: Google Finance) after the company posted lower than expected results for the third quarter of FY 22. Byrna’s net gross profit margin came in at 55.4% after $0.2 million of inventory reserves and another $0.2 million of unfavorable manufacturing variances incurred as a result of moving manufacturing operations and related minor but inevitable production start-up issues at our new greenfield facility in Ft. Wayne Indiana. The new facility is now running smoothly, and we are experiencing higher levels of both efficiency and quality as a result of the larger, more modern facility and the improved layout. Gross margin was also affected by a favorable variance of $0.1 million as a result of receiving our first raw materials shipments by ocean freight. Cash at quarter-end Q3FY2022 declined by $1.4 million from quarter-end Q2FY2022 to $24.5 million. Inventory, at the end of Q3FY2022, was $15.4 million, including $7.7 million in raw materials (components) $1.0 million of WIP (work-in-progress), and $6.8 million in finished goods. Of this, $1.7 million was goods in transit.
BYRN in the third quarter of FY 22 has reported the adjusted loss per share of 7 cents, missing the analysts’ estimates for the adjusted loss per share of 1 cents. The company had reported the adjusted revenue growth of 43 percent to $12.4 million in the third quarter of FY 22, missing the analysts’ estimates for revenue of $14.46 million. Revenues were also up $0.8 million from the prior quarter (Q2FY2022), making Q3FY2022 the third consecutive quarter of revenue growth in 2022. The company ended the quarter with $1.7 million of unshipped orders, all of which the company expects will ship this quarter.
Byrna Technologies Inc. expects Q4 2022 revenue to be in the range of $16-18 million, versus the consensus of $18 million.
The company expects to see further margin benefits as the company transition more of the incoming shipments to ocean freight rather than the far more expensive airfreight shipments. The company is now in a position to transition to ocean freight as we have built up adequate inventory levels to allow production and fulfillment to continue even though we will be receiving limited incoming shipments of component inventory for 60 days or more. The increase in levels of both finished goods and raw materials should significantly reduce the risk of any unforeseen supply chain disruptions.