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TASR / TASRW
TASR / TASRW
Safe Harbor Statement
Certain statements contained in this presentation may be deemed to be forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995, and TASER International intends that such forward-looking statements be subject to the safe-harbor created thereby. Such forward-looking statements relate to: 1) expected revenue and earnings growth; 2) the Company’s estimations regarding the size of its target markets; 3) the ability of TASER to successfully penetrate the law enforcement market; 4) the growth expectations for existing accounts; 5) the ability of TASER to expand its product sales to the private security, military and consumer self-defense markets; and 6) the Company’s target business model. TASER cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected by the forward-looking statements herein. Such factors include, but are not limited to: 1) market acceptance of the Company’s products; 2) TASER’s ability to establish and expands its direct and indirect distribution channels; 3) TASER’s ability to attract and retain the endorsement of key opinion-leaders in the law enforcement community; 4) the level of product technology and price competition for the Company’s Advanced TASER product; 5) the degree and rate of growth of the markets in which TASER competes and the accompanying demand for its products; and 6) other factors detailed in the Company’s filings with the Securities and Exchange Commission.
TASR / TASRW
ADVANCED TASER M26ADVANCED TASER M26
TASR / TASRW
Effective Range
TASR / TASRW
(Click on image above to start video. Click once to pause.)
Ohio State Highway PatrolAll Patrols Carry M26
TASR / TASRW
TASER vs. OC SprayRCMP Testing
TASR / TASRW
TASER ResultsOrange County Sheriffs, Florida
TASR / TASRW
Reduction of Deputy InjuriesOrange County Sheriffs, Florida
TASR / TASRW
Cost Benefit ModelAnnual Savings
• Officer Injury reduction: $368 / Officer
TASR / TASRW
Phoenix PD Field Results All Patrols Carry M26
• Suspect Injuries Dropped
• First Top-10 City to Deploy to All Patrol Officers
72%
TASR / TASRW
Los Angeles SheriffsAnalysis of Potential Savings
Estimated liability savings:
$2,500,000
M26 averted 3 potential shootings in first year alone.
TASR / TASRW
Cost Benefit ModelAnnual Savings
• Officer Injury Reduction: $368 / Officer• Liability Reduction: $294 / Officer• Suspect Injury reduction ???• Initial Cost: $741 / Officer
• Net Year 1 Cost: $ 76 / Officer
• Months to Break Even: 13.7
TASR / TASRW
Municipal Leases
Municipal Lease advantages:– Municipalities require cancellation for non-appropriation of funds
• Not classified as long term debt– Avoid time consuming/costly debt issuance requirements
• Leasing co assumes risk of cancellation for non-appropriation
– Very simple, inexpensive and easy to do• No legal, administrative or underwriting costs• Greater flexibility for allocation of resources
– No impact on credit rating or availability of credit
– Typical lease term 3 to 5 years
– Agency would own TASERS at end of lease.
TASR / TASRW
5 Year Lease OptionEl Paso (1091 Officers) Example
• Taser Initial Cost: $ 808,059
• Annual Cartridge Purch (4x): $ 99,117
• Total 5 year cost: $1,204,527
• Monthly Lease Cost: $ 22,789
• Annual Lease Cost: $ 273,468
• Annual Est. Savings: $ 724,882
• Net Annual Savings: $ 451,414
TASR / TASRW
US Potential Market (TAM)
Market Unit Size Dollar Potential
U.S. Police &Corrections
1,100,000 $440 Million
U.S. PrivateSecurity
1,800,000 $720 Million
U.S. Consumer 35,000,000*70,000,000**
$14 Billion$28 Billion
TOTAL: $43.2 Billion(Plus Recurring)
*Based on U.S. Handgun ownership: 30-35 million households.
**non-gun owning households
TASR / TASRW Police Market Penetration
0.3%12,000,000Global Police
3.6%1,100,000U.S. Police
100%40,000Police TASER M-26
% of TotalGroup
TASR / TASRW
Truly IncapacitatingSpecially Modified MX Animal TASER
(Click in area above to start video)
TASR / TASRWPricing & Margins
Distributor End UserITEM Price Price Margin
CARTRIDGES: $12-15 $15-18 50-60%
ADVANCED TASERS: $300 $400 72-78%
TASR / TASRW
Financial Performance(in thousands)
2.8 Million Shares Outstanding* Company Projections
1999 2000 2001 2002
Revenue: $2,366 3,499 6,800 9,843
EarningsPer Share: $(0.52) (0.19) 0.22 0.07
TASR / TASRW
Financial Performance(in thousands)
2.8 Million Shares Outstanding Post Offering
2001 2002
Revenue: $ 6,853 $ 9,843 up 44%
Gross Margins: 57% 56%
Net Income: $ 515 $ 209
Basic EarningsPer Share: $ 0.22 $ 0.07
TASR / TASRW2002 Marketing Investments
Expense 2002 Increase Cost perBasic Share
Tradeshows $387,000 $0.14
Advertising $273,000 $0.10
Commissions $200,000 $0.07
Lobbying $90,000 $0.03
TotalInvestment
$950,000 $0.34
TASR / TASRW
Target Business Model
17%
37.6
14.4
11.3%
46%
0.1%
57%
100%
2001
8.38Inv. Turns39.429DSO (days)45%40%Effective Tax Rate
3.6%20%Op. Profit
51%39%SG&A
1.4%5%R&D
56%64%Gross Margin
100%100%Revenue
2002Goal
* One time tax benefit
TASR / TASRWStock Data
IPO Date: May 8, 2001Price on 3/03/03: $4.00Trading Range: $3.30-$21.01(since unit split)
Market Capitalization: $11.2 millionShares Outstanding: 2.8 millionFloat: 1.8 millionEPS (mrq): $0.02 basicEPS (2002): $0.07 basic
TASR / TASRW
