VOTI Detection Inc’s Value Should Soon Become Apparent

VOTI Detection Inc’s (TSXV:VOTI) sales have grown from $4 million in fiscal 2016 to $23 million in 2018

Capital Ideas Media | December 5, 2019 | SmallCapPower: VOTI Detection Inc. (TSXV:VOTI) has hit our screen. The Company is considered an “innovator” in X-ray security machines, according to research from Haywood Securities, which has started coverage with a “buy” rating and a price target of $3.75.

(Originally published on Capital Ideas Media on September 24, 2019)

Impressive names are trusting this small-cap company’s technology versus larger peers. VOTI counts Amazon, the U.S. Air Force and Tiffany’s among its clients. Haywood sees strong organic growth for VOTI with profitability on the horizon.

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Here’s some commentary from Haywood’s report on VOTI Detection:

Investment Brief: VOTI Detection is a Canadian small-cap technology company that develops X-ray security systems.

The Company’s patented technology generates superior X-ray images, helping operators better identify threats.

VOTI has shown impressive growth to date with an installed base located in more than 50 countries worldwide.

Its patented technology and innovative design of X-ray machines have led to major contract wins with marquee customers and exceptional organic growth.

In what is a steadily-growing sector dominated by a few large players, VOTI stands out as an innovator that is punching well above its weight.

Key Highlights:

  • Established and Growing List of Flagship Customerswith sales having grown from $4 million in fiscal 2016 to $23 million in 2018 and guidance for 25% revenue growth in 2019.
  • The Company continues to see strong traction with its solutions in market. Compared to market growth estimated at 6%-7%, VOTI’s organic growth rate is meaningfully outperforming.
  • VOTI has built a robust business with over 60 registered distributors and 10 exclusive distribution agreement in over 50 countries.
  • Secured several marquee customers through competitive bidding processes against much larger peers.
  • Notable customer wins include: Amazon, Tiffany’s, Carnival Cruise Line, the U.S. Air Force, Madison Square Gardenand others.


  • Differentiated Technology.Uptake of VOTI’s products stems from significant investment in research and development leading to the development of its proprietary 3D PerspectiveTM technology.
  • It allows for a superior image quality, helping to improve public safety by enabling operators to better detect threats.
  • Along with feature rich software applications built on top of its BioSans operating system, VOTI’s offering is driving significant customer value at a competitive price point.


“VOTI Detection’s patented technology and innovative design of X-ray machines have led to major contract wins with marquee customers and exceptional organic growth.” – Haywood Securities

  • Large Market Opportunity.The X-ray screening market is estimated to be $2.1 billion.
  • VOTI has achieved its growth organically and we see no signs of slowing down in the near term, with expected sales of approximately $30 million this year.
  • VOTI has ample room to gain market share relative to the few large incumbents that dominate the market.

“In what is a steadily growing sector dominated by a few large players, VOTI stands out as an innovator that is punching well above its weight.”– Haywood Securities




  • Guidance for 25% growth in 2019.
  • In Q3 2019, VOTI sold 218 units, substantially up from 134 units sold during the same period last year.
  • Momentum is expected to continue in Q4, and we view guidance for 25% growth as readily achievable.
  • VOTI’s margin profile is also expected to grow as its expanding installed base yields higher margin aftermarket service revenue.
  • We forecast 37% revenue growth in 2019 and 20% revenue growth in 2020.
  • We expect a gross margin of 35.7% with continued investment in growth to lead to modest EBITDA of ($0.3 million) in 2019.
  • For 2020, we forecast revenue of $37.7 million, representing 20% revenue growth and we expect adjusted EBITDA of $0.5 million.
  • Strong Leadership.CEO Rory Olson is a seasoned executive with more than 20 years of experience founding and leading startups as well as billion-dollar public companies.
  • He has a proven track record founding, restructuring, and operating numerous organizations in the tech sector.
  • Olson has participated in four exits and two IPOs.

“VOTI has secured several marquee customers through competitive bidding processes against much larger peers with wins including Amazon, Tiffany’s, Carnival Cruise Line, U.S. Air Force, and Madison Square Garden.” – Haywood Securities

Key risks

Competitive Risk: With several large incumbent players currently in place, many of VOTI’s competitors have greater financial resources, and well recognized brands. Competitors could price aggressively or expand product lines making VOTI’s products less competitive.

Balance Sheet Risk: There is risk of VOTI not being able to access required capital or only access capital in unfavourable market conditions, which could hamper VOTI’s ability to achieve its growth strategy and maintain operations.

Liquidity Risk. VOTI has a small market capitalization and limited share liquidity. This may cause increased volatility in the share price.


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Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.

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