INVESTOR PRESENTATION JUNE 2020 SAFE HARBOR / FORWARD-LOOKING This - - PowerPoint PPT Presentation

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INVESTOR PRESENTATION JUNE 2020 SAFE HARBOR / FORWARD-LOOKING This - - PowerPoint PPT Presentation

INVESTOR PRESENTATION JUNE 2020 SAFE HARBOR / FORWARD-LOOKING This document contains certain forward - looking statements. All statements other than statements of historical fact are forwar d-looking statements for purposes of federal


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INVESTOR PRESENTATION

JUNE 2020

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This document contains certain “forward-looking statements”. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to, any projections of earnings, revenue or other financial items; any statements of the plans, strategies, goals and objectives of management for future operations; any statements concerning proposed new products and services or developments thereof; any statements regarding future economic conditions or performance; any statements or belief; and any statements of assumptions underlying any of the foregoing. Forward looking statements may include the words “may,” “could,” “estimate,” “intend,” “continue,” “believe,” “expect” or “anticipate” or other similar words, or the negative thereof. These forward-looking statements present our estimates and assumptions only as of the date of this report. Accordingly, readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the dates on which they are

  • made. We do not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the dates they are
  • made. You should, however, consult further disclosures and risk factors we include in Annual Reports on Form 10-K, Quarterly Reports on Form 10-

Q, and Reports filed on Form 8-K. In our filings with the Securities and Exchange Commission, references to “AMMO, Inc.”, “AMMO”, “the Company”, “we,” “us,” “our” and similar terms refer to AMMO, Inc. and its wholly owned operating subsidiaries The Enlight Group, SNI, LLC and Ammo Technologies, Inc.

SAFE HARBOR / FORWARD-LOOKING

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WHO WE ARE

We are a premier American ammunition manufacturer with products that emphasize innovative technologies These products are disrupting a complacent industry

We have an innovative, high-quality patent portfolio providing a significant competitive advantage over the competition Fully integrated supply chain with state-of-the-art manufacturing facilities that produce ~300M rounds/year with the ability to scale up to >500M rounds/year Multi-channel retail distribution of commercial products Ability to provide ammunition to militaries and law enforcement across the globe

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*Total addressable markets Sources: 2018 DOD Budget Proposal, NSSF

GLOBAL MARKET OPPORTUNITY

Military & Law Enforcement Commercial/Retail

TAM*

~$18.5B

Rest of World

>$12B

U.S.

$6.5B

TAM*

~$13.9B

Rest of World

>$12B

U.S.

~$1.9B

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MARKETS WE SERVE

U.S. Military

Special Operation Forces & Standard Infantry

Big Box Retail Stores Distributors Shooting Ranges Online Foreign Allies

Military & Law Enforcement

Global Commercial Market Global Defense Market

U.S. Law Enforcement

Federal, State & Local

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A DIFFERENTIATED AMMUNITION COMPANY

AMMO, Inc. Industry

Product Patented / Non-commodity Commoditized Branded / Licensed Characterized by Use / SKU Marketing Premium Value Quality / Price Point 35% Target 10-20% Average Product Margins Young, Active, Influencers Established, Older Generations Target Customer

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GLOBAL COMMERCIAL M ARKET

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COMMERCIAL PRODUCTS

Exclusive patented technology allows shooter to see projectile’s path Non-incendiary and do not generate heat allowing them to be used in environments where traditional tracer prohibited

(i.e. shooting ranges)

STREAK Visual Ammunition One Precise Shot – OPS stelTH Subsonic Ammunition AMMO Signature and Black Label Lines

Designed specifically for superior performance in suppressed firearms, reducing decibel levels while improving accuracy and cleanliness Utilizes HyperClean technology with a total metal jacket slowing suppressor corrosion and reducing build-up of lead emissions Superior ball and hollow point ammunition loaded for extreme accuracy and reliability Balanced velocity and recoil with HyperClean powder to shoot more and clean less Jacketed hollow point frangible with STREAK visual technology Lead-free, non-incendiary projectiles designed to penetrate a variety of barriers and deliver substantial force upon impact

  • f target

Ideal for self-defense scenarios providing significant stoppage power

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MULTI-CHANNEL DISTRIBUTION

Current Distribution Channels

Distributors Mass Merchants / Online Buying Groups Shooting Ranges

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GLOBAL DEFENSE M ARKET

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MARKET PENETRATION STRATEGY

Global Tactical Defense Division Launched in 2019 with Mission to Deliver High-Quality, Precision Rounds for Military & Defense Operations Across the World Introduce Proprietary Technologies Penetrate and Expand Market Share

Strong demand for our superior brand of patented armor piercing incendiary and hard-arm piercing incendiary rounds that are made in America Utilize our patented One-Way Luminescent (O.W.L) technology in our STREAK products to provide competitive advantage in tactical and defense scenarios Prove increased performance through demonstrations of lethality and accuracy Offer lower-cost, made in America product lines by controlling component manufacturing costs Utilize backlog of competitors to capture sales Partner with strategic players and weapon manufacturers to expand product lines

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DEFENSE PRODUCTS

Hard Armor Penetrating Incendiary (HAPI) Round

. x mm . x mm AC O T I O MA MA A A O MA MA . x mm

O.W.L. Non-Incendiary Visual Ammunition

Extremely effective and accurate alternative to current AP rounds

  • ffered by defense contractors –

consistently outperform competitor

  • fferings

Optimized incendiary projectile designed to penetrate and defeat hard targets Manufactured in America to match grade specs to ensure accuracy and effectiveness Utilizes the O.W.L. technology in STREAK ammo to illuminate the trajectory of the projectile Leaves visible trace with a non-incendiary round significantly improving accuracy Optimal ammunition for military tactical engagements – the trace is only visible in a 30-degree window from the point of view

  • f the shooter, making the round

completely undetectable from the target’s viewpoint

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CURRENT PROGRESS IN THE GLOBAL DEFENSE MARKET

Debuted new AP/HAPI ammunition at SHOT Show in January 2019 Awarded First Law Enforcement Contract Compliant with the U.S. State Department and Department

  • f Commerce statutes and

regulations governing the lawful export of ammunition and munition components

Met with various U.S. military personnel and more than a dozen allied countries Received and delivered initial test and evaluation orders Signed with several new distributors to expand global coverage Contract began shipping in the second half of 2019 to the state of Arizona providing ammunition to all Arizona law enforcement agencies

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JAGEMANN ACQUISITION

Closed Acquisition

  • f Jagemann Stamping’s

Brass Casing and Projectile Manufacturing Operations in March 2019

One of the leading brass casing manufacturers in the U.S.

Aligns key elements in our supply chain ensuring consistent access to brass casings and proprietary projectiles across varying business cycles Seamless integration between component manufacturing & assembly – allowing for more rapid product development and enhancing speed to market Secures industry best pricing to compete in global markets and expands industry relationships Diversifies revenue base and provides significant cash flow

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MANUFACTURING FACILITIES

25,000 sq.ft 20% only 50,000 sq.ft ~300M rounds

Among the top manufacturers in the country with state-of-the-art test labs Manitowoc facility supplies many leading ammunition manufacturers Ammo loading facility located in Payson, AZ Utilization rate - able to quickly scale and support growth of $200M+ in revenue with additional capital investment Brass casing and military loading facility in Manitowoc, WI Current combined capacity being produced per year with ability to scale up to >500M rounds per year

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RECENTLY ESTABLISHED SALES CALL CENTER

Began operations of sales call center at its Scottsdale, AZ headquarters

  • n April 1, 2020, with the responsibility of calling and servicing the ~67,000

stores with active federal firearms licenses. Call center is staffed with 11 full-time employees being led by proven sales leader and industry veteran Matt Nicholson. As of May 22, 2020, the call center has generated 268 new customers with

  • ver $5 million in sales being booked.

New customers represent >500 retail stores and a significant ecommerce presence from notable brands, including Rural King, Bi-Mart, Cascade Farm and Outdoor, Shoot Point Blank, and many other regional chains.

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KEY STATS

Trading Data (as of 6/8/20) Valuation Measures (as of 6/8/20) Financial Overview (TTM @ 12/31/19) Stock Price Enterprise Value Revenue

$2.85 $144.1M $11.4M

52 Week High/Low

$2.95/$0.96

Market Cap

$137.6M

  • Avg. Daily Volume (3 months)

59,460

Shares Outstanding

48.3M

Public Float

~70%

EV/Sales1

13.2x

GAAP Net Income2

$(17.9)M

GAAP EPS

$(0.41)

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1) Includes trailing twelve-month revenue as of the quarter ended 12/31/2019. 2) This figure includes approximately $9.5 million in noncash expenses.

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PROJECTED SALES GROWTH AND MARGIN EXPANSION

Sales Growth Drivers Margin Expansion Drivers:

$2.3 $4.6 $10.0

$14.5 $30.0

FY18 FY19 9-Months @ Q3'20 FY20E FY21E

Sales (in $mm) Significantly expand sales in defense and export markets Continue to grow retail presence, including adding more kiosks at big box retailers and penetrate the shooting range market Increase manufacturing capacity and utilization at current facilities Pricing power with patented proprietary technology that deliver superior performance Vertical integration Cost-efficient product distribution

Cost-efficient product distribution Control over component supply and pricing Premium Brands Higher Margins Increased Sales Diversified Channel Mix

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MANAGEMENT TEAM WITH DEEP TIES TO THE INDUSTRY

Fred Wagenhals

Chairman, President & CEO

Mark Hanish

President, Global Commercial Sales & Marketing

Steve Hilko

COO

Rob Wiley

CFO Founder of Action Performance Companies, a subsidiary of International Speedway Corp. (Nasdaq: ISCA) with over $400M annual sales of NASCAR- branded products Deep experience in the acquisition and monetization

  • f licensed products

Named Entrepreneur of the Year for the retail/ wholesale category by the Center for Entrepreneurial Leadership Over twenty years of experience in the firearms industry as a top sales executive for notable companies, including Surefire and FN America Founding member of the Scottsdale Gun Club, which

  • ne of the largest public

indoor shooting ranges in the country Former competitive shooters and has been sponsored since he was in college 40 years of experience in manufacturing, engineering and supply-chain logistics at notable consumer product companies, including Action International Marketing, Lionel and Action Performance Companies Widely recognized gun expert in the ammunition industry Joined AMMO as controller in 2018 Former Certified Public Accountant at Moss Adams, LLP Holds a master’s degree from Arizona State University and is a licensed CPA

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STRONG BOARD OF DIRECTORS

Robert Goodmanson Randy Luth Harry Markley Russel William (“Rusty”) Wallace, Jr.

More than 30 years of experience in the investment industry Currently is a registered investment advisor at Tealwood Asset Management in Minneapolis, MN Founder and CEO of Maxwell Simon, an investment advisory firm focused on private and public equity transactions Founder and president of LUTH-AR, one of the leading manufacturers of AR-15 firearms and firearm components in the world Former CEO of DPMS Panther Arms, a producer of AR-15 firearms and accessories Currently serves as the law enforcement senior advisor for the federal government More than 30 years with the Phoenix Police Department, most recently as assistant chief of the patrol division Principal Shareholder of the Rusty Wallace Automotive Group and Owner of Rusty Wallace Racing Competed in NASCAR races for over 16 years and is a member of the NASCAR Hall

  • f Fame

Currently serves as an analyst for ABC and ESPN

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KEY TAKEAWAYS

Multi-billion dollar addressable market ripe for disruption Diversified portfolio of premium products for both commercial and defense markets across the world Substantial competitive advantage through innovative patent and IP portfolio Ammunition lines that meet the current requirements and growing needs of the U.S. military and our allies Significant sales growth potential with near-term positive cash flow expected Consistently expanding presence through new strategic relationships with industry leaders Experienced management team and board with deep ties across the industry

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CONTACT US

Investor Relations Contact

Cody Slach

Managing Director, Gateway Investor Relations

(949) 574-3860 POWW@gatewayir.com