Wrap Technologies Reports Fourth Quarter and Full-Year 2021

Delivered 96% Full-Year Revenue Growth and Generated Increased Brand Awareness Across Markets

Launched New BolaWrap 150 During the Fourth Quarter to a Positive Customer Reception

TEMPE, Ariz., March 10, 2022 (GLOBE NEWSWIRE) — Wrap Technologies, Inc. (Nasdaq: WRAP) (“Wrap” or the “Company”), a global leader in innovative public safety technologies and services, today announced results for the fourth quarter and full-year ended December 31, 2021.

Fourth Quarter 2021 Summary

  • Net Revenues of $2.4 million, growth of 73% over prior year Q4
  • Gross Margin of 30.1% compared with 33.4% for prior year Q4
  • Launched upgraded version of flagship remote restraint product in October 2021 – the BolaWrap 150
  • Trained law enforcement agencies increased to 940, growth of 109% from December 31, 2020
  • Certified officer instructors increased to 3,250, up 139% from December 31, 2020

Full-Year 2021 Summary

  • Net Revenues of $7.7 million in 2021, growth of 96% over the prior fiscal year
  • Gross Margin, excluding one-time non-cash line improvement expense of $0.8 million, of 35.5% for 2021 compared with 34.1% for 2020
  • Announced a collaboration with Amazon Web Services (“AWS”) to deliver WRAP Reality’s VR training platform to law enforcement
  • Continued strategy of releasing body-cam videos of successful BolaWrap uses by law enforcement agencies – increases awareness and educates public on de-escalation effectiveness
  • Published initial Environmental. Social, and Governance (“ESG”) letter to stakeholders and became a participant of the United Nations Global Compact
  • Earned the ISO 9001:2015 Certification for our Quality Management System

Commentary and Executive Search Update

Scot Cohen, co-founder, director and a large shareholder of Wrap, commented:

“Wrap delivered strong financial results and continued establishing valuable brand awareness across global markets in fiscal year 2021. This culminated in our best quarter of total revenues in our history and full-year total revenue growth of 96%. Leadership is incredibility proud of how our team adapted and retained focus during what was a year of change and transformation. In our view, the past year was an important step on our path to enhanced diversification, increased innovation and long-term value creation.”

“Since announcing our leadership transition plan in late January, the Board has been assessing Wrap’s go-forward strategy and working with a national search firm to identify the ideal chief executive officer to lead the Company during its next phase. The Board continues to believe Wrap has significant opportunities to grow and scale as the addressable market for public safety technologies and services expands. To seize these opportunities, we are looking for a leader with the ability to diversify our mix of products, offerings and data-oriented services beyond just BolaWrap and Wrap Reality. We are having advanced discussions and look forward to announcing the appointment of Wrap’s next chief executive officer once the Board’s search process concludes.”

    Three Months Ended   Year Ended    
Unaudited   December 31,   December 31,    
(Amounts in thousands, except per share data)   2021     2020     2021     2020      
Total revenues   $ 2,449     $ 1,415     $ 7,729     $ 3,944      
Net sales growth(1)     73   %   464   %   96   %   466   %  
Gross margin rate(2)     30.1   %   33.4   %   25.8(2)   %   34.1   %  
Net loss   $ (5,229 )   $ (3,556 )   $ (24,449 )   $ (12,580 )    
Net loss per basic and diluted share   $ (0.13 )   $ (0.10 )   $ (0.62 )   $ (0.37 )    

(1)   As compared to the prior-year period.
(2)   Excluding one-time expenses of $0.7 million incurred in the 2Q21, the gross margin rate was 35.5% for the full-year 2021.


Net Sales

  • Generated revenues of $2.4 million for 4Q21, 73% growth compared to 4Q20. Revenues increased 96% year over year.
  • International sales were 60% of total sales for the Full-Year 2021. This compares to 64% of total sales for the Full-Year 2020.
  • We shipped products to 15 additional countries in 2021. This brings us to having deployments in 51 countries.
  • Backlog at the end of the 4Q21 was $0.3 million.
  • We expect the pandemic to continue to impact sales efforts in 2022, but on a diminishing basis both in the U.S. and internationally.

Gross Profit

  • Generated $0.7 million of gross profit in 4Q21 and $2.0 million for the Full-Year 2021.
  • We anticipate our gross margins to improve as we ramp our revenue base and transition to the BolaWrap 150.

Selling, General and Administrative (SG&A) Expense

  • SG&A expense increased $0.4 million in 4Q21 compared to 4Q20. SG&A expense increased to $20.3 million in Full-Year 2021 compared to $11.7 million for Full-Year 2020.
  • The 2021 increase was driven primarily by a $2.6 million increase in non-cash share-based compensation, $2.8 million in compensation and consultancy costs as we invest in our sales force and training teams, and $1.6 million of public reporting related expense.
  • Travel expense increased modestly during 2021 as pandemic restrictions abated.

Research and Development (R&D) Expense

  • R&D expense increased $1.2 million in 4Q21 to $1.9 million, as compared to 4Q20, due primarily to the development of the new BolaWrap 150, development of Wrap Reality, and other R&D initiatives.
  • R&D expense for the Full-Year 2021 was $6.2 million representing a $3.4 million increase over Full-Year 2020 driven primarily by BolaWrap 150 development.
  • We continue to invest in R&D as we expand important research initiatives in response to identified market opportunities, including further development in WRAP Reality.

Capital Structure and Liquidity

  • Cash, cash equivalents and short-term investments were $34.9 million at year-end 2021 compared to $41.6 million at year-end 2020.
  • During 2021, received $12.0 million in proceeds from the exercise of warrants and $1.7 million in proceeds from the exercise of stock options.


The Company is not providing formal guidance for Fiscal Year 2022 at this time due its ongoing executive leadership transition and other market factors. Overall, the Company expects to achieve year-over-year growth in Fiscal Year 2022 thanks to increased customer demand and heightened visibility for the BolaWrap 150. With that said, the Company experienced supply chain issues in deploying the new BolaWrap 150 that impacted the Company through February 2022. It is anticipating that supply chain constraints and geopolitical uncertainty could lead to softer sales during the first half. The Company will update its outlook upon reporting first quarter results.

Webcast and Earnings Conference Call

The Company will host an investor conference today at 5:00 pm ET to review its results. This call and all supplemental information can be accessed on Wrap’s investor relations website: https://wrap.com/investors/. The dial in information for the investors is:

  •       PARTICIPANT DIAL IN (TOLL FREE): 1-877-270-2148

(ask the operator to join the WRAP Technologies conference call)

A recording of the conference call will be made available on the Company’s investor relations website.

About Wrap Technologies

WRAP Technologies (Nasdaq: WRAP) is a global leader in innovative public safety technologies and services. WRAP develops creative solutions to complex issues and empowers public safety officials to protect and serve their communities through its portfolio of advanced technology and training solutions.

WRAP’s BolaWrap® Remote Restraint device is a patented, hand-held pre-escalation and apprehension tool that discharges a Kevlar® tether to temporarily restrain uncooperative suspects and persons in crisis from a distance. Through its many field uses and growing adoption by agencies across the globe, BolaWrap is proving to be an effective tool to help law enforcement safely detain persons without injury or the need to use higher levels of force.

WRAP Reality, the Company’s virtual reality training system, is a fully immersive training simulator and comprehensive public safety training platform providing first responders with the discipline and practice in methods of de-escalation, conflict resolution, and use-of-force to better perform in the field.

WRAP’s headquarters are in Tempe, Arizona. For more information, please visit wrap.com.

Use of Non-GAAP Information

Included in this press release are non-GAAP operational metrics regarding agencies and training, amounts of non-cash stock-based compensation expense and adjusted gross margin, which the Company believes provide helpful information to investors with respect to evaluating the Company’s performance.

Trademark Information

BolaWrap, Wrap and Wrap Reality are trademarks of Wrap Technologies, Inc. All other trade names used herein are either trademarks or registered trademarks of the respective holders.

Cautionary Note on Forward-Looking Statements – Safe Harbor Statement

This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to: statements regarding the Company’s overall business; total addressable market; and, expectations regarding future sales and expenses. Words such as “expect”, “anticipate”, “should”, “believe”, “target”, “project”, “goals”, “estimate”, “potential”, “predict”, “may”, “will”, “could”, “intend”, and variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Moreover, forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond the Company’s control. The Company’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to: the Company’s ability to successfully implement training programs for the use of its products; the Company’s ability to manufacture and produce product for its customers; the Company’s ability to develop sales for its new product solution; the acceptance of existing and future products, including the acceptance of the BolaWrap 150; the risk that distributor and customer orders for future deliveries are modified, rescheduled or cancelled in the normal course of business; the availability of funding to continue to finance operations; the complexity, expense and time associated with sales to law enforcement and government entities; the lengthy evaluation and sales cycle for the Company’s product solution; product defects; litigation risks from alleged product-related injuries; risks of government regulations; the impact of health crises or outbreaks of disease, such as epidemics or pandemics; the impact resulting from geopolitical conflicts and any resulting sanctions; the ability to obtain export licenses for countries outside of the US; the ability to obtain patents and defend IP against competitors; the impact of competitive products and solutions; and the Company’s ability to maintain and enhance its brand, as well as other risk factors mentioned in the Company’s most recent annual report on Form 10-K, quarterly report on Form 10-Q, and other SEC filings. These forward-looking statements are made as of the date of this press release and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Except as required by law, the Company undertakes no duty or obligation to update any forward-looking statements contained in this release as a result of new information, future events or changes in its expectations.

Paul M. Manley
VP – Investor Relations
(612) 834-1804

Media Contact: media@wrap.com

Wrap Technologies, Inc.
Condensed Consolidated Balance Sheets
(unaudited – dollars in thousands)
  December 31,
    2021     2020  
Current assets:        
Cash and cash equivalents $ 4,937   $ 16,647  
Short-term investments   29,983     24,994  
Accounts receivable, net   3,859     1,871  
Inventories, net   1,566     2,655  
Prepaid expenses and other current assets   868     760  
Total current assets   41,213     46,927  
Property and equipment, net   976     357  
Operating lease right-of-use asset, net   51     139  
Intangible assets, net   1,982     1,397  
Other assets, net   9     13  
Total assets $ 44,231     48,833  
Current liabilities:        
Accounts payable and accrued liabilities $ 2,603   $ 1,953  
Customer deposits   43     2  
Deferred revenue   155     16  
Operating lease liability – short term   56     94  
Note payable to bank – short term       275  
Total current liabilities   2,857     2,340  
Long-term liabilities   110     79  
Total liabilities   2,967     2,419  
Stockholders’ equity   41,264     46,414  
Total liabilities and stockholders’ equity $ 44,231     48,833  


Wrap Technologies, Inc.  
Condensed Consolidated Statements of Operations and Comprehensive Loss  
(unaudited – dollars In thousands, except share and per share data)  
  Three Months Ended December 31, Year Ended December 31,  
    2021       2020       2021       2020    
Product sales $ 2,384     $ 1,382     $ 7,381     $ 3,868    
Other revenue   65       33       348       76    
Total revenues   2,449       1,415       7,729       3,944    
Cost of revenues                
Products and services   1,711       942       4,987       2,601    
Product line exit expense               747          
Total cost of revenues   1,711       942       5,734       2,601    
Gross profit   738       473       1,995       1,343    
Operating expenses (i):                
Selling, general and administrative   4,065       3,698       20,276       11,631    
Research and development   1,911       751       6,214       2,789    
Total operating expenses   5,976       4,449       26,490       14,420    
Loss from operations   (5,238 )     (3,976 )     (24,495 )     (13,077 )  
Other income (expense):                
Investment income   9       2       31       83    
Other         418       15       414    
    9       420       46       497    
Net loss $ (5,229 )   $ (3,556 )   $ (24,449   $ (12,580 )  
Net loss per basic common share $ (0.13 )   $ (0.10 )   $ (0.62 )   $ (0.37 )  
Weighted average common shares used to compute net loss per basic common share   40,791,772       37,399,195       39,281,620       33,846,338    
Comprehensive loss:                
Net loss $ (5,229 )   $ (3,556 )   $ (24,449 )   $ (12,580 )  
Net unrealized gain on short-term investments   (17 )     8       (21 )     15    
Comprehensive loss $ (5,246 )   $ (3,548 )   $ (24,470 )   $ (12,565 )  
(i) includes stock-based compensation expense as follows:                
  Three Months Ended December 31, Year Ended December 31,  
    2021       2020       2021       2020    
Selling, general and administrative $ 836     $ 564     $ 4,558     $ 1,957    
Research and development   210       111       798       280    
Total stock-based compensation expense $ 1,046     $ 675     $ 5,356     $ 2,237    
Wrap Technologies, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited – dollars in thousands)
    Year Ended December 31,  
      2020       2019    
Cash Flows From Operating Activities:          
Net loss   $ (24,449 )   $ (12,580 )  
Adjustments to reconcile net loss to net cash          
used in operating activities:        
Depreciation and amortization   478       163    
Share-based compensation   5,356       2,237    
Common shares issued for services   239          
Product line exit expense   747          
Debt forgiveness income           (417 )  
Gain on sale of assets   (27 )        
Warranty provision   10       30    
Inventory obsolescence         (68 )  
Software impairment charge   170          
Changes in contingent liability   (23 )        
Non-cash lease expense   88       122    
Non-cash interest expense           2    
Provision for doubtful accounts   123       10    
Changes in assets and liabilities:        
Accounts receivable     (2,111 )     (1,686 )  
Inventories     559       (343 )  
Prepaid expenses and other current assets     (109 )     (508 )  
Accounts payable     546       825    
Operating lease liability     (94 )     (128 )  
Customer deposits     41       (342 )  
Accrued liabilities and other     (54 )     493    
Warranty settlement     38       4    
Deferred revenue     (249 )     (1 )  
Net cash used in operating activities     (18,223 )     (12,187 )  
Cash Flows From Investing Activities:          
Purchase of short-term investments     (55,014 )     (34,980 )  
Proceeds from maturities of short-term investments     50,005       10,000    
Capital expenditures for property and equipment     (995 )     (249 )  
Investment in patents and trademarks     (187 )     (129 )  
Purchase of intangible assets     (750 )     (543 )  
Business acquisition           (210 )  
Proceeds from long-term deposits     4          
Net cash used in investing activities   (6,937 )     (26,111 )  
Cash Flows From Financing Activities:          
Sale of common stock and warrants           12,400    
Offering costs paid on sale of common stock and warrants         (733 )  
Proceeds from exercise of warrants     12,047       26,191    
Offering costs paid on exercise of warrants           (1,016 )  
Proceeds from exercise of stock options     1,678       705    
Proceeds from bank note           414    
Repayment of debt     (275 )        
Net cash provided by financing activities     13,450       37,961    
Net decrease in cash and cash equivalents     (11,710 )     (337 )  
Cash and cash equivalents, beginning of period     16,647       16,984    
Cash and cash equivalents, end of period   $ 4,937     $ 16,647    
Supplemental Disclosure of Non-Cash Investing          
and Financing Activities:          
Business acquisition liability   $     $ 298    
Business acquisition cost in deferred revenue   $     $ 15    
Change in unrealized gain on short-term investments   $ (21 )   $ 15    


Wrap Technologies Inc

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