VOTI DETECTION TARGETS 25 PER CENT SALES GROWTH IN 2019
Company: VOTI Detection (TSX-V:VOTI)
Headquarters: Saint-Laurent, Quebec
CEO: Rory Olson
In a matter of three years, Canadian tech company, VOTI Detection Inc. (VOTI), went from deploying 150 next generation x-ray scanners for a handful of customers, to more than 2,000 machines across 50 countries worldwide. These state-of-the-art scanners are used for threat detection and loss prevention within prison systems, court houses, airports, refugee camps and entertainment complexes – locations where public safety concerns are the highest. “One of our largest clients is Amazon,” explains Rory Olson, the CEO of VOTI. “The online retail giant uses 150 of our machines at their distribution centres across North America and Mexico.” Meanwhile, the list of other customers is equally impressive and includes Carnival Cruises, the US Air Force, Madison Square Gardens and the United Nations High Commission for Refugees. “We are widely deployed and have a proven technology.”
With safety and security being a top priority for a variety of stakeholders, both within the public and private sectors, Olson says the need for the products and services offered by VOTI is rapidly growing. “Estimates have the need for this technology growing between six and 10 per cent on a compound basis. It’s unfortunate but with every new security threat or terror attack that happens, the need for proper and efficient technology grows.” Olson estimates that the security technology marketplace is $2 billion, excluding China, and VOTI is targeting a 25 per cent sales growth in 2019.
A number of key features set VOTI apart from the competition. “We have taken what has traditionally been a hardware model and added software and technology to that model. This allows us to render a high resolution, 3DPerspective TM image. What you end up with is a game changing image quality.” Olson adds, a clearer image gives x-ray operators the chance to make faster and more informed decisions. “The only way they can do that is with a clearer image. The 3DPerspective TM and the clarity of the images from VOTI make this possible.” Another unique feature is the ability to dial into any of the VOTI scanners from a remote location. This is especially critical for troubleshooting. “We can run diagnostics from anywhere in the world, repair the machine and bring it back online as quickly as possible.” Most machines that run on hardware and are not accessible remotely can take anywhere from two days to two weeks to fix.
The company has been on an upward trajectory since Olson took over the leadership role in 2015. “We made about $2 million in sales that year. We added a distributor and cleaned up the architecture. By 2016, we doubled our business to $4 million. Then $18 million in 2017 and $23 million in fiscal 2018.” Olson says by the end of 2019, VOTI expects to have revenue growth of 25%.
Olson adds, the long-term opportunity in VOTI lays beyond the x-ray machines. “The sale of the machine may be a one-time opportunity. But every machine requires service. It’s a matter of law. So, the larger the install base, the more access we get to that recurring revenue.”
In 2019, VOTI anticipates further double-digit growth with the continued addition of x-ray machines being added to the marketplace. “We believe customers will buy our solution because it’s a better solution based on the ease of use of the machine and image clarity.”
When we asked Olson to tell us why now is the time to invest in VOTI, he offered these three reasons:
- Year over year revenue growth, with a record C$23m reported in fiscal 2018. VOTI expects to grow revenue by 25% in 2019 and continue to show strong gross margins and EBITDA improvement.
- Strong product pipeline, technology solutions and services for the company’s expanding customer base, existing customers and new global markets.
- Strong demand for VOTI’s products and services by established companies and organizations with scale, such as Carnival Cruise Lines, the US Air Force, Madison Square Garden, the Canadian Board Services Agency and many others.