Q4 2024 Wrap Technologies Inc Earnings Call

Operator: while we believed our business has always had great promise.

Our business has always had great promise.

Operator: We have historically incurred consistent losses due to limited revenue and high operational expenses.

We historically incur consistent losses due to limited revenue and high operational expenses to address this situation. When we came on to manage the business.

Operator: To address this situation, when we came on to manage the business, we implemented a full corporate restructuring, knowing that that could cause a short-term cost to revenue. and perform.

We implemented a full corporate restructuring knowing that that could cause.

Short term cost to revenue.

Performance.

Operator: However, last year's financial performance is not why we're all here.

However, last year's financial performance is not why we're all here.

Operator: We're here to discuss our recent financial improvements and be part of a company that we believe is poised to become a leader in public safety globally. And we stand by that decision.

Speaker Change: Here to discuss our recent financial improvements and be part of a company that we believe is poised to become a leader in public safety globally.

And we stand by that decision.

Operator: We believe we're in a place to build the business we always thought existed within RAP.

Speaker Change: We believe we're in a place to build the business, we always thought existed within ramp.

Operator: The restructuring is now over. The business required a big step back in order to move forward. To achieve this, we aggressively slowed our burn and brought our monthly expenses to approximately $600,000 on a cash-annualized basis. We believe that that discipline gave us breathing room and time to rebuild and think the right way.

Speaker Change: The restructuring is now over.

Speaker Change: The business required a big step back in order to move forward.

Speaker Change: To achieve this we aggressively slowed our burn and brought our monthly expenses to approximately 600000 on a cash annualized basis.

Speaker Change: We believe that that discipline gave us some breathing room and time to rebuild and think the right way.

Operator: Why did we go forward?

Speaker Change: Why do we go forward.

Operator: Because after an intense, deep dive into the Bollinger App program and talking to our customers across the country, We believe that the BOLTwrap is an entry point, enabling us to expand and emerge with an integrated end-to-end competitive offering. And just about 30 days ago.

Speaker Change: Because after an intense deep dive into the ball or App program that talking to our customers across the country.

Speaker Change: We believe that the polo wrap is an entry point, enabling us to expand and emerge with an integrated end to end competitive offering.

Speaker Change: And just about 30 days ago, we put our money, where our mouth debts or confidence in that decision as reflected by the actions of our leadership team.

Operator: We put our money where our mouth. Our confidence in that decision is reflected by the actions of our leadership. and our most recent financing activity. purchases by entities affiliated with insiders. So this company increased management's beneficial ownership by over 50%, sending a clear message. We're just not talking about alignment with shareholders. We're proving.

Speaker Change: And our most recent financing activity.

Speaker Change: Purchases by entities affiliated with insider. So this company increase managers' beneficial ownership by over 50%, sending a clear message. We're just not talking about alignment with shareholders. We're proving it.

Operator: In 2024, revenue was $4.5 million, down 27% from $6.1 million in 2023. Cost of revenue decreased 37% from $3.2 million in 2023 to $2 million in 2024, with margins increasing 7 points from 47% to over 54%. Operating losses improved 17% from 1875 and 23 to 15, 6 and 24.

Speaker Change: In 2024 revenue was $4 5 million down 27% from $6 1 million in 'twenty three.

Speaker Change: Cost of revenue decreased 37% from $3 2 million and $23 2 million in 'twenty, four with margins, increasing seven points from 47% over 54%.

Speaker Change: Operating losses improved 17% from $18 75, and 23% to 15 six in 'twenty four.

Operator: Net losses improved 81% from $30.2 million in 2023 to $5.9 million in 2024.

Speaker Change: Net losses improved 81% from $30 2 million in 'twenty, three to $5 9 million or 24.

Scott: I'm now going to hand it over to Jared, our CEO and President. Thanks, Scott.

Jared: I'm now going to hand, it over to Jared our CEO and president.

Jared: Thanks Scott.

Jared: Along with the transformation, we're planning to level set and return to business fundamentals.

Jared: Along with the transformation, we are planning to level set and returned to business fundamentals.

Jared: I'm going to talk about three areas, our product, our market, and our people. First, the product. We know our product works. We believe it's differentiated, and it's an offering that's making its way into officers' belts and into their vehicles. When we sat down with our top customers, and especially the customers that were fully supported by us, we saw data showing that the BolaWrap is used more frequently than any other device on their belt. Customers consistently highlight the value of having a distraction tool they can deploy early before situations escalate to physical force. And as a result, officer injuries are reduced.

Jared: I'm going to talk about three areas, our product our market and our people.

Jared: First the product.

Jared: We know our product works.

Jared: We believe it's differentiated and it's an offering that is making its way into offers with belts and into their vehicles.

Jared: When we sat down with our top customers and especially the customers that were fully supported by US we saw data showing that the <unk> is used more frequently than any other device on their belt.

Jared: Customers consistently highlight the value of having a distraction tool. They can deploy early before situations escalate to physical force and as a result officer entries are reduced.

Jared: The second part is the market. The demand for a solution is growing and is expanding further with the addition of new services. Across the U.S. and globally, the use of force policies are becoming increasingly restricted. The opportunities for officers to rely on these traditional tools like tasers or batons are diminishing. This creates a clear gap in the use of force continuum. Without alternatives like ours, officers are forced to go hands-on and injuries are rising. We believe the market has validated the need for a de-escalation tool, and along with that, a robust training program to fully support it.

Jared: The second part is the market.

Jared: The demand for our solution is growing and is expanding further with the addition of new services.

Jared: Across the U S and globally the use of force policies are becoming increasingly restrictive.

Jared: The opportunities for officers to rely on these traditional tools like tasers over tons are diminishing.

Jared: This creates a clear gap in the use of force continuum.

Jared: That alternatives like ours officers are forced to go hands on and injuries are rising.

Jared: We believe the market has validated the need for the escalation tool and along with that robust training program to fully support it.

Jared: in our conversations with customers, they're asking us to become an end-to-end service provider and provide integrated solutions. They're asking us to go bigger. They're asking about our body cameras, virtual reality offerings, and additional services. As we step back and look at the market, we agree.

Jared: In our conversations with customers they are asking us to become.

Jared: And end to end service provider and provide integrated solutions.

Jared: They're asking us to go bigger.

Jared: They are asking about our body cameras virtual reality offerings and additional services.

Jared: As we step back and look at the market we agree.

Jared: It's time for a true competitor offering end-to-end services for public safety and law enforcement. Internationally, we have numerous late-stage opportunities in our pipeline, spanning various deal cycles. Many of these opportunities are the result of prior years efforts in developing relationships and launching pilot programs. and they're expected to now bear fruit.

Jared: It's time for a true competitor offering end to end services for public safety and law enforcement.

Jared: Internationally, we have numerous late stage opportunities in our pipeline spanning various deal sizes.

Jared: Many of these opportunities are the result of prior year's efforts and developing relationships and launching pilot programs and these are expected to know bear fruit.

Jared: To help accelerate our global growth, we started relationships to leverage U.S. government resources, such as the United States Export and Import Bank and the Department of Defense's Office of Strategic Capital.

Jared: Help accelerate our global growth, we started relationships to leverage U S government resources, such as the United States export import bank and the department of Defense's office of strategic capital.

Jared: We plan to be part of these efforts, which look to export made-in-the-USA offerings, like the BOLA wrap, while aligning with federal initiatives to counter China's influence in emerging markets.

Jared: We plan to be part of these efforts, which look to export made in the USA offerings like the bowler app, while aligning with federal initiatives to counter China's influence in emerging markets.

Jared: Now, finally, and most importantly, our people. Of course, any real transformation starts with people to bring our differentiated product to this growing and validated market. So we invested in talent, and we will continue to do so.

Jared: Now finally, and most importantly, our people.

Jared: Of course any road transformation starts with people to bring our differentiated product to this growing and validated the market.

Jared: So we invested in talent and we will continue to do so.

Jared: Almost every single leadership position at WRAP has been revitalized with individuals who we believe bring unmatched operational experience, entrepreneurial spirit, and an unwavering commitment to our mission. The team we've assembled has a global network. A network we believe has an exceptional reputation in the law enforcement community, and it took them decades to build it. These aren't just hires, they're accelerators. We believe this team will dramatically expedite our current and future business.

Jared: Almost every single leadership position at raft has been revitalized with individuals who we believe bring unmatched operational experience entrepreneurial spirit and an unwavering commitment to our mission.

Jared: The team we've assembled has a global network.

Jared: Network, we believe has an exceptional reputation that law enforcement community and it took them decades to build it.

Jared: These arent just hires there accelerators.

Jared: We believe this team will dramatically expedite our current and future business.

Jared: The recent acquisition of W1Global and the hiring of two members from their immediate network came after several months of close collaboration in their advisory capacity. Even within a short time, the tremendous value of the WN team became clear. Their leadership team and extended network are expected to bring immediate connectivity, trust, and credibility within the law enforcement community. both in the United States and international.

Jared: The recent acquisition of <unk> global and.

Jared: And the hiring of two members from their immediate network came after several months of close collaboration and their advisory capacity.

Jared: Even within a short time, the tremendous value of the Wm team became clear.

Our leadership team and extended network are expected to bring immediate connectivity trust and credibility within the law enforcement community.

Jared: Both in the United States and internationally.

Jared: And as a result. We believe the acquisition has already led to significant domestic and global sales opportunities. We now have enhanced access to senior leadership across global law and and we're actively building a domestic and international sales strategy centered on this powerful network.

And as a result, we.

Jared: We believe the acquisition has already led to significant domestic and global sales opportunities.

Jared: We now have enhanced access to senior leadership across global law enforcement.

Jared: And we are actively building a domestic and international sales strategy centered on this powerful network.

Jared: In just a moment on the pedigree of our recent additions, their backgrounds span the public sector. across organizations like the DEA, FBI, Department of Defense, NASA. DARPA, Air Force Research Labs. JSOC, Delta Units, and Intelligence Agency. And in the private sector, they are coming from leading companies in cybersecurity, aerospace, counterintelligence, physical threat assessments, anti-money laundering, and transactional crime. We believe this unique blend of public and private sector expertise now housed within WRAP Technologies positions us to bring talent, insight, and unmatched capabilities to both the law enforcement and the broader public safety market. We believe our team now opens doors to critical elements of the U.S.

Jared: And just a moment on the pedigree of our recent additions they.

Jared: <unk> background spanned the public sector.

Jared: Across organizations like the DEA FBI Department Defense NASA.

Jared: DARPA.

Jared: Air Force Research labs.

Jared: Jay Sock.

Jared: LT units and intelligence agencies.

Jared: And then the private sector they are coming from leading companies in cyber security aerospace counterintelligence physical threat assessments anti money laundering and transactional crime.

Jared: We believe this unique blend of public and private sector expertise now have housed within wrap technologies positions us to bring talent insight and unmatched capital capabilities to both law enforcement and the broader public safety markets.

Jared: We believe our team now opened stores two critical elements of the U S. Federal government responsible for providing providing monetary and training support to law enforcement agencies and countries of strategic importance to the United States.

Jared: federal government responsible for providing monetary and training support to law enforcement agencies in countries of strategic importance to the United States. The ability to unlock U.S. government-backed loans and grants is expected to greatly enhance our global offerings and expand our reach.

Jared: The ability to unlock U S government backed loans and grants is expected to greatly enhance our global offerings and expand our reach.

Operator: I'll now hand it back over to.

Scott: I'll now hand, it back over to Scott.

Jared: Thanks, Sharon. We're building a performance-driven culture. which we believe will drive significant growth to fulfill our vision to become a leading public safety company around the world. It's going to take some time. It's going to be lumpy. But you won't recognize this company in 12. We're committed to creating lasting partnerships based on continuous value. value that will be felt not only by officers, but also by the communities they serve. We believe the complex challenges in public safety can't be solved with just technology alone. While technological advancements have had an unprecedented positive impact, the human element How societies choose the police.

Jared: Sure.

Jared: We're building a performance driven culture.

Jared: Which we believe will drive significant growth to fulfill our vision to become a leading public safety company around the world.

Jared: It's going to take some time, it's going to be lumpy.

Jared: But you won't recognize this company in 12 months.

Jared: We're committed to creating lasting partnerships based on continuous value.

Jared: Value that will be felt not only by officers, but also by the communities. They serve we.

Jared: We believe the complex challenges in public safety can't be solved with just technology alone.

Jared: Technological advancements have had an unprecedented positive impact the human element.

Jared: Our societies choose is how societies choose to police themselves remains a driving force behind policy and best practices.

Jared: remains the driving force behind policy and best practice. We believe we have the team. the talent and the strategy to win and win big. Our money's right on the line. alongside you. This is baseline for what we believe will be a historic run in the public safety space. We all will make an impact together.

Jared: We believe we have the team.

The talent and the strategy to win and win that.

Jared: Our money is right on the line.

Jared: Alongside Yours. This is baseline for what we believe will be a historic run in the public safety space.

Jared: We will make an impact together.

Operator: That concludes our prepared remarks and we will now open up the call for Q&A.

Jared: That concludes our prepared remarks, and we will now open up the call for Q&A.

Operator: The first question is, what guidance can you provide for the rest of the year? You want me to take this card? I'll take that.

Jared: The first question is what guidance can you provide for the rest of the year.

Scott: And with that Scott I'll take that one.

Jared: Yeah.

Operator: Thankfully, this company's never given out guys. But let me share with you where we're getting our confidence. We're seeing massive shifts in policy right now throughout the country, and we're seeing that not just here, but we're seeing it through our client base globally. These policies are making it harder and harder to use the devices on the belt today. We're talking about tasers, batons. pepper spray and gum. And as Jared said in his comment... This is resorting and officers going hands on. Cops are getting hurt, injuries are up, and it's costing cities and our country, it's costing this country well over a billion dollars a year, and it's got to stop.

Jared: Thankfully. This this company has never given out guidance.

Jared: But let me share with you, where we're getting our confidence.

Jared: We're seeing.

Jared: Massive shifts in policy right now throughout the country and we're seeing that not just here or seeing it through our client base globally.

Jared: These policies are making it harder and harder to use the devices on the adult today, we're talking about tasers per tons.

Jared: Spray guns.

Jared: And as Jared said in his comments this is resorting officers going hand sawn.

Jared: Costs are getting hurt injuries.

Jared: Injuries are up and it's costing cities in our country.

Jared: It's costing this country over well over $1 billion, a year and it's got to stop.

Operator: These policies are driving more and more interest, and this is what's giving us confidence. The other piece that we have that we can talk about is our inventory that we are positioned to sell.

Jared: These policies are driving.

Jared: More and more interest.

Jared: And this is what's giving us confidence the other piece that we have that we can talk about is our inventory that.

Jared: That we are positioned to sell.

Operator: We feel good about that.

Operator: And the international piece. I just want to speak to this because a lot of people ask this question.

Jared: We feel good about that and the international piece I just wanted to speak to this because a lot of people that we get asked this question where does the international business, whereas the international base.

Operator: Where's the international business? The international business is there. I don't think there's been one opportunity that's been dropped. I can tell you that these pilots take a while. Most of these pilots, I would say at least a dozen of them, started probably two years ago. And now we're just starting to see... Activity that is Encouraging.

Jared: The international businesses, there I don't think Theres been one opportunity that's been dropped.

Jared: I can tell you that these pilots take a while most of these pilots I would say at least a dozen of them started probably two years ago and now we're just starting to see.

Activity that is.

Jared: Encouraging so when we talk about guidance, we're not going to give it here, but I can tell you that you could see with our investments that we made.

Operator: So when we talk about diet guidance, we're not going to give it here. But I can tell you that you could see with our investment that we made, it's given we're starting to see things that I have not witnessed in this business since inception.

Jared: It's given we're starting to see things that.

Jared: I have not witnessed in this business since inception.

Jared: Okay.

Operator: Lou, is there another question? Yes.

Speaker Change: Is there another question yes. The next question is what is the latest on R&D new products and what is the future for research and development at rack.

Operator: The next question is, what is the latest on R&D, new products, and what is the future for research and development at RAPID? Yeah, I can take that. So, look, we have finished good inventory, about $25 million worth of MSRP ready to go to the market. That's given us a pause to say, are there product improvements we can make to the BOLA wrap, and are there other areas of value that we can bring to customers? And the answer is yes, of course. So, we are looking at advancements into a BOLA wrap next-gen product. We believe that we can offer more broad services.

Yes, I can take that.

Speaker Change: So look we have.

Speaker Change: <unk> finished good inventory about $25 million with an MSRP of ready to go to the market.

Speaker Change: That's given us a pause to say are there product improvements, we can make to the boulder ramp and are there other areas of value that we can bring to customers and the answer is yes of course. So we are looking at advancements into a bull around next gen product.

Speaker Change: We believe that we can offer more broad services I personally come from a department of defense and intelligence community background I'm familiar with a lot of these technologies that had been in play in the public safety space for over a decade decades in some cases.

Operator: I personally come from a Department of Defense and Intelligence Community background. I'm familiar with a lot of these technologies that have been in play in the public safety space for over a decade, decades in some cases. And it's my observation that a lot of these technologies are ripe to be transitioned to law enforcement in U.S. public safety.

Speaker Change: And it's my observation.

Speaker Change: That a lot of these technologies are ripe to be transitioned to law enforcement and U S public safety and so the future of this company is one part providing and focusing in and Undistracted way a boiler wrap device, but there is an ecosystem of other complementary devices that are also useful to the company.

Operator: And so the future of this company is one part providing and focusing in an undistracted way a BoilerWrap device, but there is an ecosystem of other complemented devices that are also useful to the company. And so what we're going to first do, like any company should do, is that ideas are easy, but making them a reality becomes hard. And what we're going to do is staff that with the right people. And we've already made those decisions in bringing those people internal to the company to staff the research and development. These people come from, as I mentioned in my earlier piece, NASA, DARPA, Department of Defense, where technologies have been proven at the pointy edge of the spear with special military units, and those who practice, you know, U.S.

Speaker Change: And so what we're going to first do like any company should do is that ideas are easy, but making them a reality becomes hard and what we're going to do is stop that with the right people and we've already made those decisions and bringing those people internal to the company to staff the research and development. These people come from as I mentioned in my earlier piece.

Speaker Change: NASA DARPA Department of Defense, where the technology has been proven plenty edge of the spear with special military units and those who practice you know U S Department of Justice initiatives through DEA in Spi and the combination of their expertise that has been amassed over decades of their own respective careers.

Operator: Department of Justice initiatives through DEA and FBI, and the combination of their expertise that has been amassed over decades of their own respective careers. Plus, the technologies they know that are proven to work gives us unique insight to make our R&D efforts not proof of concepts, but more of an integration play. And what we plan to do is take a wider array of technology. integrate them into our company, and complement them with superior customer success. And we think the combination of technology that's been proven in an integrated way, plus customer service, will bring a differentiated offering to our customer base.

Speaker Change: Years.

Speaker Change: Once the technology. They know that are proven to work gives us unique insight to make our R&D efforts not proof of concepts, but more of an integration play and what we plan to do is take a wider array of technologies integrate them into our company and complement them with.

Speaker Change: Superior customer success.

Speaker Change: And we think the combination of technology, that's been proven in an integrated way plus customer service will bring a differentiated offering to our to our customer base. So R&D is on one part.

Operator: So R&D is on one part, advancements to our flagship product, BolaRack. It's also an integration play of proven technologies, some where it makes sense to do in-house, but others with partnering with the right technology partners and delivering that comprehensively to our customer.

Speaker Change: <unk> to our flagship product <unk>. It's also an integration play of proven technologies.

Speaker Change: Some where it makes sense to do in house, but others with partnering with the right technology partners and delivering that comprehensively to our customer.

Speaker Change: Great.

Operator: The next question is, what is the story on Chile? What is the update and what is the latest?

Speaker Change: The next question is what is the story on Chile, what is the update and what is the latest.

Operator: I'll take that one. We're talking about Chile on a daily basis here, so there's lots of, it's very active in how we're going to support that rollout that they're anticipating. Look, we saw, just like when you saw, we all saw the public information about their budget when they included BORAP in their 25 budget. We saw it at the exact same time, so we don't have specific... Tech And we're expecting, we're not counting on it, but we expect after a three year, one hell of an effort by our team to get Chile where it is. It's taken time.

Speaker Change: I'll take that one.

Speaker Change: We're talking about showing me on a daily basis here. So there is lots of.

Speaker Change: It's very active.

Speaker Change: And how we're going to support that rollout that they are anticipating but we saw just like when you saw we all saw the public information about their budget when they included bowl wrapping their twenty-five budget.

Speaker Change: We saw the exact same time.

Speaker Change: So.

Speaker Change: We don't have specifics specific rollout plans, we're just being told and told and told that this is going to <unk>.

Speaker Change: We should anticipate this are checking on it our supplies and inventory.

Speaker Change: And we're expecting we're not counting on it but we expect after a three year one hell of an effort by our team to get Chile, where it is right now.

Operator: We think we should see some of that, we should see a good result this year. We picked up a nice order from them last year. but what we're expecting is much bigger this year. They're asking and spending a lot of time talking about training. How are we going to support a rollout to their national police? It's a big under And quite frankly, it's taken a lot of thought and a lot of teamwork and a lot of discussion about the training and the rollout of this. So timing is very difficult for us to predict, but we're waiting.

Speaker Change: <unk> taken time.

Speaker Change: But we think we should see some of the.

Speaker Change: Some of that we should see a good result, this year, we picked up a nice order from them last year.

Speaker Change: But what we're expecting is much bigger this year, they're asking and spending a lot of time talking about training how are we going to support a rollout to their national police.

Speaker Change: Big undertaking.

Speaker Change: And quite frankly, it's taken.

A lot of thought and a lot of teamwork and a lot of discussion about the training and the rollout of this cell type.

Speaker Change: Timing is very difficult for us to predict but we're waiting so we cant call out are not going to call out when thats going to happen but.

Operator: So we can't call out, we're not going to call out when that's going to happen, but I'm, I am hopeful, we're all hopeful that we see a nice part of that this year.

Speaker Change: I am hopeful we're all hopeful that we see a nice part of that this year.

Operator: The next question, why do international deals take so long? This is twofold. I just mentioned that some of these pilots take time. We're rolling out a new product into public safety. It hasn't, there's been really no new rollout on the belt since, since Taser, right? And that was 30 years ago. So this is not easy. It takes time. I'm seeing these pilots continue to press in advance. Lots, the discussions to me are feeling much more fluent and much, now that we're on the front end of them, I feel like.

Speaker Change: Okay.

Speaker Change: The next question why the international deals take so long.

Speaker Change: Let me speak to that.

Speaker Change: This is twofold I just mentioned that some of these pilots take time.

Speaker Change: We're rolling out a new product into public safety. It Hasnt theres been really no new rollout on the bell since.

Speaker Change: And that was 30 years ago. So this is not easy it takes time.

Speaker Change: I am seeing is these pilots.

Speaker Change: Continue to press in advance.

Speaker Change: Lots of discussions to me are feeling much more affluent and much now that we're on.

Speaker Change: On the front end of them.

Operator: We're getting closer and closer, but the new piece that we just introduced was the funding by Eximbank, that funding option. We're going to our client base and presenting this funding option, along with a couple other programs that are existing within our government. And the reception has been. very positive. In fact, it's not for every country because there's plenty of countries that have their own funding source. But we've been offering this to the distributors, the reaction's been phenomenal, and they are telling us, and this is just new to us, presenting this option. They're telling us that it's going to absolutely make a difference in getting some of these deals over the line.

Speaker Change: I feel like.

Speaker Change: We're getting closer and closer but the new piece that we just introduced was funding by accident back that funding option, we're going to our client base and per M and presenting this funding option along with a couple other programs that are existing within our government.

Speaker Change: And the reception has been.

Speaker Change: Very positive in fact, it's not for every country, because theres plenty of countries that have their own funding sources.

Speaker Change: But we've been offering this to the distributors. The reaction has been phenomenal and they are telling us and this is just new to us as being presenting us option theyre, telling us that that's going to absolutely make a difference in getting some of these deals are gone.

Operator: So I feel like our connectivity with this XM program and other programs that we're discovering with our current government and the positioning, there's a real way for us to. really help our distributors and our customers support them in ways that we just simply weren't able to do in the past. And I believe that is going to accelerate our flow of internet.

Speaker Change: So I feel like.

Speaker Change: Our connectivity with this <unk> program and other programs that were discovering with our current government and the positioning there is a there's a real way for us to.

Speaker Change: Really help our distributors and our customers.

Speaker Change: Support them in ways that we are just simply werent able to do in the past and I believe that is going to accelerate our.

Speaker Change: Our flow of an international business.

Operator: The next question is, where are you in the move to Virginia? Yeah, I'll take that.

Speaker Change: Yeah.

Speaker Change: The next question is where are you in the move to Virginia.

Operator: So, we announced at the end of last year that we're moving out of Arizona to southwest Virginia. That move is already underway. Much of the actual equipment has been moved out of state and is now in place on an assembly line ready to go in Virginia. The full move will be complete in the middle of Q2. It's right around the corner.

Speaker Change: Yeah.

Speaker Change: Yeah I'll take that.

Speaker Change: So we announced at the end of last year that we're moving out of Arizona to southwest Virginia that move is already underway.

Speaker Change: Much of the actual equipment has been moved out of state and is now in place are on an assembly line ready to go in Virginia. The full move will be complete in the middle of Q2 right around the corner.

Operator: I think a follow-on action to that question is when will manufacturing resume? And what we're going to do is we're going to get the manufacturing line up and running again with low volume but high-quality throughput to make sure that the move is fully complete. It's not just to move the people. It's not just about moving equipment. It's making sure the capability has fully transitioned. And so, as an insurance policy to that process, we always have a very robust documented process on assembly to preserve the institutional knowledge that the company had in making boulder wraps and cassettes.

Speaker Change: I think a follow on action to that question is when will manufacturing resume and what we're going to do is really get the manufacturing line up and running again with low volume, but high quality throughput to make sure that the move is fully complete it's not just to move the people. It's not just about moving equipment, making sure the capability is.

Speaker Change: Fully transitioned.

Speaker Change: And so as an insurance policy to that process, we always have a very robust.

Speaker Change: Documented process on assembly to preserve the institutional knowledge that the company had in making bullet wraps and cassettes and those are also most recently documented in a very detailed video processed that also helps as an onboarding process for future Assembly workers.

Operator: And those are also most recently documented in a very detailed video process that also helps as an onboarding process for future assembly workers.

Operator: So, the move is one part in physical time and space. The other part is preserving the knowledge and proving that it's been successful. For me, that means I'm going to pay close attention to preserving the high-quality products that law enforcement deserves.

Speaker Change: So the move is one part and physical time and space. The other part is preserving the knowledge and proving that its been successful for me that means I'm going to pay close attention to preserving the high quality products that law enforcement deserves.

Operator: And that will be fully complete expected in the middle of Q2.

Speaker Change: And that will be fully complete expected in the middle of Q2.

Operator: The next question is, why the W-1 Global Act? I'll take the front end. It starts with people. not only has this group at W1BIT connected for most of their careers. But the network that they developed over those decades of work together is very relevant. And I can just tell you that before we made this acquisition, we channel checked and we actually tested some of our biggest opportunities around the globe. And there's not one of those opportunities where W1 doesn't have a contact either coming out of the embassy or coming out of the space that they used to serve.

Speaker Change: The next question.

Speaker Change: The next question is why the W. One global acquisition.

Speaker Change: I'll take the front end of that it starts with people.

Speaker Change: Not only has this group the W. One that connected for most of their careers.

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Speaker Change: But the network.

Speaker Change: They that they developed over those decades of work together is very relevant and I can just tell you that before we made this acquisition.

Speaker Change: Channel checked and we actually tested some of our biggest opportunities around the globe and there is not one of those opportunities where W. One doesn't have a contact you to coming out of the embassy or coming out of there.

Operator: So with that kind of connectivity, it gives us new perspective, a new touch point. And at the end of the day, it is about relationships and trust. And that that is that that is what W1 is about. Not only do they have a robust, profitable business, but they also have established trust and access that we just never had access to. So putting that combining that with with with with what we're doing overseas and actually what we're doing with this with our current administration. I think is very powerful and we're already seeing impact on opportunities and it's just been, call it 45 days post the acquisition.

Speaker Change: And coming out of the space that used to serve.

Speaker Change: So with that kind of connectivity it gives us new perspective, a new touch point at the end of the day it is about relationships and trust and that.

Speaker Change: That is that that is W want us about not only do they have.

Speaker Change: Robust profitable business, but they also have established trust and the access that we just never had access to so putting that.

Speaker Change: Combining that with with with with what we're doing overseas and actually what we're doing with this with our current administration.

Speaker Change: It's very powerful and we're already seeing.

Speaker Change: Impact on opportunities and it's just been call. It 45 days post the acquisition or so so it's already reflecting it in our pipeline escaping me great confidence that this is going to be a thriving new relationship and we're going to open up doors that we would never be able to open it in the past, citing.

Operator: So it's already reflecting in our pipeline. It's given me great confidence that this is gonna be a thriving new relationship and we're gonna open up doors that we would never be able to open in the past. Exciting, it's an accelerator and it's now.

Speaker Change: It's an accelerator and it's now.

Operator: Are there any future acquisition plans? Yeah, I'll take that. Look, largely, you grow either organically or inorganically. And so the answer is yes, there are future acquisitions.

Speaker Change: Great.

Speaker Change: Are there any future acquisition plans.

Speaker Change: Yeah I'll take that.

Speaker Change: Largely you grow either organically or Inorganically and so the answer is yes, there are future acquisition plans.

Operator: And when we look at acquisitions, you know, the framework I like to look at is you're going to acquire for the team, for people, for technology, or to expand your addressable market or TAM, so team, tech, and TAM. And so when we're going to do this is that we must grow, we must bring revenue, we must increase value. We will be focused on doing that organically with the capabilities we have in-house, but we will also be looking at the best attractive acquisitions that don't hurt us in a dilutive sense, that bring in team or tech or expand our addressable market.

Speaker Change: And when we look at acquisitions the framework I look to like to look at is youre going to acquire for.

Speaker Change: For the team for people for technology or to expand your addressable market or Tam So team Tech and Tam.

Speaker Change: And so when are we going to do this is that we must grow we.

Speaker Change: We must bring revenue we must increase value.

Speaker Change: We will be focused on doing that organically with the capabilities. We have in house, but we will also be looking at the best attractive acquisitions that don't hurt us in a dilutive sense that bring in team.

Operator: And a good representation of that was a recent W1 acquisition. We got world-class personnel now in the company. And it brings us more clarity to go to market with the VOLUNRAP program that it simultaneously also expanded our addressable market by adopting and integrating their existing business. So we'll see a bump to additional services from that acquisition.

Speaker Change: Tech or expanded our addressable market and a good representation of that was the recent <unk> acquisition, we got world class.

Speaker Change: Personnel now in the company.

Speaker Change: And it brings us more clarity to go to market with the Ebola program that is simultaneously also expanded our addressable market.

Speaker Change: By adopting and integrating their existing business lines. So we will see a bump to additional services from that acquisition as well.

Operator: We have time for one more question.

Speaker Change: We have time for one more question.

Operator: What are you doing in DC? a lot.

Speaker Change: What are you doing in D C.

Operator: I'll take the front end of it. Yeah. We're establishing an office, as we put out in a press release, multiple partnerships on the way in DC. We're pressing federally with language, we're pressing on a state-to-state basis. quite a bit of lobbying work. connectivity that we have we never had and we then there are. opportunities on border, there's opportunities in prisons, there's opportunities at schools. Part of the problem here is there's just endless. ways for us to play and we need to do that through partnerships. We can't do that all on our own. It's just too much, too big of a body of work.

Speaker Change: A lot.

Speaker Change: I'll take the front end of it yet.

Speaker Change: We were.

Speaker Change: Establishing an office as we put out in our press release.

Speaker Change: Multiple partnerships on the way in D C.

Speaker Change: We're pressing federally.

Speaker Change: With language or pressing on a state by state to state basis.

Speaker Change: It's <unk>.

Speaker Change: Quite a bit of lobbing work.

Speaker Change: It's <unk>.

Speaker Change: Connectivity that we never had and then there are.

Speaker Change: Opportunities on border Theres opportunities in prison, there's opportunities at schools.

Speaker Change: Part of the problem here is there just endless wave.

Speaker Change: Ways for us to play and we need to do that through partnerships, we can't do that on our own. It's just too big of a body of work.

Operator: So we believe that. getting super connected in DC, pressing it. and in putting resources to programs there are really going to set us up for a number of federal opportunities right now that we see.

Speaker Change: So we believe that.

Speaker Change: Getting super connected in D C.

Speaker Change: Crossing it.

Speaker Change: And and putting resources to two two programs there are really going to set us up for a number of federal opportunities right now that we see.

Jared: Jared, you have some, I'm sure you have some thoughts on. Yeah, I think any strategy that does not include a federal strategy is incomplete. So we have to open our doors to federal business. So we're going to be moving into D.C. Part of that move to Virginia was to align with the state in its close proximity to other research elements within the federal space in the D.C. Beltway metro area. And what we're going to do is organize our company to be open for federal business. So that means doing all the requisite groundwork in establishing the paperwork and process and different accreditations that required to accept federal funding.

Jerry: Jerry do you have some I'm sure you have some thoughts on.

Jerry: Yes, I think any strategy that does not include a federal strategies and complete so we have to open our doors to federal business. So we're going to be moving into D. C. Part of that move to Virginia was to align with the state and its close proximity to other research elements within the federal space and the D C Beltway Metro area and.

Jerry: What we're going to do is organized for a company to be open for federal business. So that means doing all the requisite groundwork and establishing the paperwork and process and different accreditations that required to accept federal funding. It's an interesting time in the federal government as we all know there's a lot of emphasis is being put on optimization and efficiency.

Jared: It's an interesting time in the federal government, as we all know. There's a lot of emphasis being put on optimization and efficiency, and that aligns nicely to our core offering. You know, we believe that there's a lot of bloat and public safety, that a lot of these technologies exist today, many of which exist in government and other areas. We're going to bring awareness to that on the capability side. We're going to also understand where the current requirements are that address critical national security and public safety gaps. And we're going to look for the contracts that move that government money under the right contract vehicle with the right requirement and be there to service it.

Jerry: And that aligns nicely to our core offering.

Jerry: We believe that Theres, a lot of blue and public safety than a lot of these technologies exist today, many of which existed in government and other areas, we're going to bring awareness to that on the capability side. We're going to also understand where the current requirements are that address critical national security and public safety gaps and we're going to look for the contracts that moved that.

Jerry: Government money under the right contract vehicle with the REIT requirement and be there to service. It we can sometimes take that directly will also look at other ways in channels that are established in doing government business like key partners in that area, we're going to build as many paths to yes in this company to bring in federal government work.

Jared: We can sometimes take that directly. We'll also look at other ways and channels that are established in doing government business, like key partners in that area. We're going to build as many paths to yes in this company to bring in federal government.

Operator: That concludes our fourth quarter and full year 2024 earnings call. Thank you for joining.

Jerry: Yes.

That concludes our fourth quarter and full year 2024 earnings call. Thank you for joining if you have any additional questions you can submit them to IR at <unk> Dot com.

Operator: If you have any additional questions, you can submit them to ir at wrap.com. Hmm.

Jerry: Yeah.