B.O.S. Better Online Solutions Reports Financial Results for the Fourth Quarter and Fiscal Year Ended December 31, 2012
Net Profit in the Fourth Quarter of 2012
RISHON LEZION, Israel, April 2, 2013 (GLOBE NEWSWIRE) -- B.O.S Better Online Solutions Ltd. (the "Company", "BOS") (Nasdaq:BOSC), a leading Israeli provider of RFID and Supply Chain solutions to global enterprises, today reported its financial results for the fourth quarter and fiscal year ended December 31, 2012.
Highlights for the fourth quarter of year 2012:
-
Revenues of $6.2 million, as compared to revenues of $7.7 million in the fourth quarter of 2011. However, revenues increased by 15% on a quarter to quarter basis over the $5.4 million in revenues that we generated in the third quarter of 2012.
-
Operating profit of $63,000, which represents the third consecutive quarter in 2012 in which we have generated an operating profit, as compared to operating loss of $1 million in the fourth quarter of 2011.
-
Net profit, after six consecutive quarters with net loss, of $37,000 as compared to net loss of $2.1 million in the fourth quarter of 2011.
-
Net profit on NON GAAP basis of $347,000 as compared to net loss of $156,000 in the fourth quarter of 2011
-
EBITDA of $193,000 as compared to negative EBITDA of $300,000 in the fourth quarter of 2011.
Highlights for year 2012:
-
Operating profit of $192,000 as compared to $1 million operating loss in 2011.
-
Net loss reduced to $549,000 from $3,214,000 in year 2011.
-
Net profit on NON GAAP basis of $287,000 as compared to net loss of $176,000 in 2011
-
EBITDA of $665,000 as compared to $407,000 in 2011.
Yuval Viner, BOS CEO, stated: "We are very pleased with the fourth quarter and 2012 results that reflect continuing improvement in the Company's performance. We anticipate that we will end 2013 with a net profit on a non-GAAP basis."
Eyal Cohen, BOS CFO, added: "In light of the improvement in the financial results, we were also able to reduce our loans by $1.7 million during 2012 and we expect a further reduction in the loans by at least $0.5 million during 2013."
Conference Call
BOS will host a conference call on Thursday, April 4th, 2013 at 10:00 a.m. ET 5:00 p.m. Israel time. A question-and-answer session will follow management's presentation. Interested parties may participate in the conference call by dialing to + 972-3-9180644 approximately five to ten minutes before the call start time.
For those unable to listen to the live call, a replay of the call will be available the next day after the call on BOS's website, at: http://www.boscorporate.com.
About BOS
B.O.S. Better Online Solutions Ltd. (Nasdaq:BOSC) is a leading provider of RFID and Supply Chain solutions to global enterprises. BOS' RFID and mobile division offers both turnkey integration services as well as stand-alone products, including best-of-breed RFID and AIDC hardware and communications equipment, BOS middleware and industry-specific software applications. The Company's supply chain division provides electronic components consolidation services to the aerospace, defense, medical and telecommunications industries as well as to enterprise customers worldwide.
For more information, please visit: www.boscom.com.
Use of Non-GAAP Financial Information
BOS reports financial results in accordance with U.S. GAAP and herein provides some non-GAAP measures. These non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures. These non-GAAP measures are intended to supplement the Company's presentation of its financial results that are prepared in accordance with GAAP. The Company uses the non-GAAP measures presented to evaluate and manage the Company's operations internally. The Company is also providing this information to assist investors in performing additional financial analysis that is consistent with financial models developed by research analysts who follow the Company. The reconciliation set forth below is provided in accordance with Regulation G and reconciles the non-GAAP financial measures with the most directly comparable GAAP financial measures.
Safe Harbor Regarding Forward-Looking Statements
The forward-looking statements contained herein reflect management's current views with respect to future events and financial performance. These forward-looking statements are subject to certain risks and uncertainties that could cause the actual results to differ materially from those in the forward-looking statements, all of which are difficult to predict and many of which are beyond the control of BOS. These risk factors and uncertainties include, amongst others, the dependency of sales being generated from one or few major customers, the uncertainty of BOS being able to maintain current gross profit margins, inability to keep up or ahead of technology and to succeed in a highly competitive industry, inability to maintain marketing and distribution arrangements and to expand our overseas markets, uncertainty with respect to the prospects of legal claims against BOS, the effect of exchange rate fluctuations, general worldwide economic conditions and continued availability of financing for working capital purposes and to refinance outstanding indebtedness; and additional risks and uncertainties detailed in BOS's periodic reports and registration statements filed with the U.S. Securities Exchange Commission. BOS undertakes no obligation to publicly update or revise any such forward-looking statements to reflect any change in its expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.
CONSOLIDATED STATEMENTS OF OPERATIONS |
U.S. dollars in thousands, except per share data |
|
|
|
|
|
|
Year ended |
Three months ended |
|
December 31, |
December 31, |
|
2012 |
2011 |
2012 |
2011 |
|
(Audited) |
(Unaudited) |
|
|
|
|
|
Revenues |
$24,503 |
$33,434 |
$6,154 |
$7,698 |
Cost of revenues |
19,050 |
26,481 |
4,751 |
6,199 |
Inventory write offs |
385 |
443 |
144 |
310 |
Gross profit |
5,068 |
6,510 |
1,259 |
1,189 |
|
|
|
|
|
Operating costs and expenses: |
|
|
|
|
Research and development, net |
125 |
403 |
11 |
68 |
Sales and marketing |
3,058 |
4,273 |
708 |
1,018 |
General and administrative |
1,693 |
2,252 |
477 |
605 |
Impairment of other intangible assets |
-- |
555 |
-- |
555 |
Total operating costs and expenses |
4,876 |
7,483 |
1,196 |
2,246 |
|
|
|
|
|
Operating profit (loss) |
192 |
(973) |
63 |
(1,057) |
Financial expenses, net |
(781) |
(2,241) |
(182) |
(1,231) |
Other expenses, net |
(147) |
(172) |
(68) |
-- |
Income (loss) before taxes on income |
(736) |
(3,386) |
(187) |
(2,288) |
Tax benefit |
187 |
172 |
224 |
187 |
Net profit (loss) |
$ (549) |
$ (3,214) |
$ 37 |
$ (2,101) |
|
|
|
|
|
Basic and diluted net profit (loss) per share |
$ (0.49) |
$ (4.56) |
$ 0.03 |
$ (2.84) |
|
|
|
|
|
Weighted average number of shares used in computing basic net earnings per share |
1,117,876 |
704,513 |
1,118,075 |
742,195 |
Weighted average number of shares used in computing diluted net earnings per share |
1,117,876 |
704,513 |
1,118,075 |
742,195 |
|
CONSOLIDATED BALANCE SHEETS |
(U.S. dollars in thousands, except per share amounts) |
|
|
|
|
December
31, 2012 |
December
31, 2011 |
|
(Audited) |
(Audited) |
ASSETS |
|
|
|
|
|
CURRENT ASSETS: |
|
|
Cash and cash equivalents |
$354 |
$411 |
Trade receivables |
8,007 |
8,507 |
Other accounts receivable and prepaid expenses |
616 |
744 |
Inventories |
3,160 |
4,020 |
|
|
|
Total current assets |
12,137 |
13,682 |
|
|
|
LONG-TERM ASSETS: |
|
|
Severance pay fund |
21 |
41 |
Bank deposits |
438 |
427 |
Investment in other companies |
-- |
68 |
Other assets |
11 |
23 |
|
|
|
Total long-term assets |
470 |
559 |
|
|
|
PROPERTY, PLANT AND EQUIPMENT, NET |
963 |
1,166 |
|
|
|
OTHER INTANGIBLE ASSETS, NET |
357 |
540 |
|
|
|
GOODWILL |
4,122 |
4,122 |
|
|
|
|
$18,049 |
$20,069 |
|
CONSOLIDATED BALANCE SHEETS |
U.S. dollars in thousands, except share and per share data |
|
|
|
|
December
31, 2012 |
December
31, 2011 |
|
(Audited) |
(Audited) |
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
Short-term bank loans and current maturities |
$6,383 |
$7,496 |
Trade payables |
4,915 |
4,165 |
Employees and payroll accruals |
408 |
553 |
Deferred revenues |
467 |
550 |
Current maturities of liability to Dimex Systems |
136 |
300 |
Accrued expenses and other liabilities |
567 |
967 |
|
|
|
Total current liabilities |
12,876 |
14,031 |
|
|
|
LONG-TERM LIABILITIES: |
|
|
Long-term bank loans, net of current maturities |
1,188 |
1,530 |
Accrued severance pay |
119 |
163 |
Liability to Dimex Systems, net of current maturities |
710 |
747 |
|
|
|
Total long-term liabilities |
2,017 |
2,440 |
|
|
|
|
|
|
COMMITMENTS AND CONTINGENT LIABILITIES |
|
|
|
|
|
SHAREHOLDERS' EQUITY: |
|
|
Share capital |
23,374 |
23,065 |
Additional paid-in capital |
50,891 |
51,093 |
Accumulated other comprehensive profit |
(243) |
(243) |
Accumulated deficit |
(70,866) |
(70,317) |
|
|
|
Total shareholders' equity |
3,156 |
3,598 |
|
|
|
Total liabilities and shareholders' equity |
$18,049 |
$20,069 |
|
CONSOLIDATED STATEMENTS OF CASH FLOWS |
U.S. dollars in thousands |
|
|
|
|
Year ended
December 31, |
Year ended
December 31, |
|
2012 |
2011 |
|
(Audited) |
|
|
|
Net Cash provided by (used in) operating activities |
1,709 |
(365) |
|
|
|
Net cash used in investing activities |
(311) |
(1,040) |
|
|
|
Net cash used in (provided by) financing activities |
(1,455) |
1,113 |
|
|
|
Decrease in cash and cash equivalents |
(57) |
(292) |
|
|
|
Cash and equivalents at the beginning of the period |
411 |
703 |
|
|
|
Cash and cash equivalents at the end of the period |
$354 |
$411 |
|
|
|
|
|
RECONCILIATION OF NON-GAAP FINANCIAL RESULTS |
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS |
(U.S. dollars in thousands, except per share amounts) |
|
|
|
|
|
|
Three months ended December 31, |
|
2012 |
2011 |
|
GAAP
(as reported) |
Adjustments |
Non-
GAAP |
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
$6,154 |
$ -- |
$6,154 |
$7,698 |
Gross profit |
1,259 |
144a |
1,403 |
1,499 |
|
|
|
|
|
Operating costs and expenses: |
|
|
|
|
Research and development, net |
11 |
-- |
11 |
68 |
Sales and marketing |
708 |
(46)b |
662 |
925 |
General and administrative |
477 |
(53)c |
424 |
569 |
|
-- |
-- |
|
|
Total operating costs and expenses |
1,196 |
(99) |
1,097 |
1,562 |
|
|
|
|
|
Operating profit (loss) |
63 |
243 |
306 |
(63) |
Financial expenses, net |
(183) |
-- |
(183) |
(280) |
Other expenses, net |
(67) |
67d |
-- |
-- |
Income (loss) before taxes on income |
(187) |
310 |
123 |
(343) |
Tax benefit |
224 |
-- |
224 |
187 |
Net income (loss) |
$ 37 |
$ 310 |
$ 347 |
$ (156) |
|
|
|
|
|
Notes to the reconciliation: |
a – Write off of slow moving inventory |
b - Amortization of intangible assets. |
c - Stock based compensation. |
d– Impairment in related with investment in Companies. |
|
RECONCILIATION OF NON-GAAP FINANCIAL RESULTS |
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS |
(U.S. dollars in thousands, except per share amounts) |
|
|
|
|
|
|
Year ended December 31, |
|
2012 |
2011 |
|
GAAP
(as reported) |
Adjustments |
Non-
GAAP |
Non-GAAP |
|
|
|
|
|
Revenues |
$24,503 |
-- |
$24,503 |
$33,434 |
Gross profit |
5,068 |
385a |
5,453 |
6,953 |
|
|
|
|
|
Operating costs and expenses: |
|
|
|
|
Research and development, net |
125 |
-- |
125 |
403 |
Sales and marketing |
3,058 |
(183)b |
2,875 |
3,897 |
General and administrative |
1,693 |
(100)c |
1,593 |
2,083 |
Impairment of other intangible assets |
-- |
|
-- |
-- |
Total operating costs and expenses |
4,876 |
(283) |
4,593 |
6,383 |
|
|
|
|
|
Operating profit (loss) |
192 |
668 |
860 |
570 |
Financial expenses, net |
(781) |
(21)d |
(760) |
(934) |
|
|
|
|
|
Other expenses, net |
(147) |
80e, 67f |
-- |
16 |
Income (loss) before taxes on income |
(736) |
836 |
100 |
(348) |
Tax benefit |
187 |
-- |
187 |
172 |
Net income (loss) |
$ (549) |
$ 836 |
$ 287 |
$ (176) |
|
|
|
|
|
Notes to the reconciliation: |
a – Write off of slow moving inventory |
b - Amortization of intangible assets. |
c - Stock based compensation. |
d- Depreciation of prepaid expenses and value of warrants attached to Convertible note. |
e –Property write off. |
f - Impairment in related with investment in Companies. |
|
CONDENSED CONSOLIDATED EBITDA |
(U.S. dollars in thousands) |
|
|
|
|
|
|
Year ended |
Three months ended |
|
December 31, |
December 31, |
|
2012 |
2011 |
2012 |
2011 |
|
(Audited) |
(Unaudited) |
|
|
|
|
|
Operating Profit (loss) |
$ 192 |
$ (973) |
$ 63 |
$ (1,057) |
Add: |
|
|
|
|
Amortization of intangible assets |
183 |
376 |
46 |
93 |
Stock based compensation |
107 |
169 |
60 |
36 |
Depreciation |
183 |
280 |
24 |
73 |
Impairment of intangible assets |
-- |
555 |
-- |
555 |
EBITDA |
$ 665 |
$ 407 |
$ 193 |
$ (300) |
|
|
|
|
|
|
|
|
|
|
RFID and
Mobile
Solutions |
Supply
Chain
Solutions |
Intercompany |
Consolidated |
RFID and
Mobile
Solutions |
Supply
Chain
Solutions |
Intercompany |
Consolidated |
|
Year ended December 31, |
Three months ended December 31, |
|
2012 |
2012 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
$ 8,894 |
$ 15,915 |
$ (306) |
$ 24,503 |
$ 2,343 |
$ 3,899 |
$ (88) |
$ 6,154 |
|
|
|
|
|
|
|
|
|
Cost of Revenues |
$ 6,313 |
$ 13,043 |
$ (306) |
$ 19,050 |
$ 1,679 |
$ 3,160 |
$ (88) |
$ 4,751 |
|
|
|
|
|
|
|
|
|
Inventory write offs |
$ 223 |
$ 162 |
$ -- |
$ 385 |
$ 97 |
$ 47 |
$ -- |
$ 144 |
|
|
|
|
|
|
|
|
|
Gross profit |
$ 2,358 |
$ 2,710 |
$ -- |
$ 5,068 |
$ 567 |
$ 692 |
$ -- |
$ 1,259 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RFID and
Mobile
Solutions |
Supply
Chain
Solutions |
Intercompany |
Consolidated |
RFID and
Mobile
Solutions |
Supply
Chain
Solutions |
Intercompany |
Consolidated |
|
Year ended December 31, |
Three months ended December 31, |
|
2011 |
2011 |
|
|
|
|
|
|
|
|
|
Revenues |
$ 13,128 |
$ 21,332 |
$ (1,026) |
$ 33,434 |
$ 3,261 |
$ 4,869 |
$ (432) |
$ 7,698 |
|
|
|
|
|
|
|
|
|
Cost of Revenues |
$ 9,802 |
$ 17,705 |
$ (1,026) |
$ 26,481 |
$ 2,358 |
$ 4,273 |
$ (432) |
$ 6,199 |
|
|
|
|
|
|
|
|
|
Inventory write offs |
$ 221 |
$ 222 |
$ -- |
$ 443 |
$ 129 |
$ 181 |
$ -- |
$ 310 |
|
|
|
|
|
|
|
|
|
Gross profit |
$ 3,105 |
$ 3,405 |
$ -- |
$ 6,510 |
$ 774 |
$ 415 |
$ -- |
$ 1,189 |
CONTACT: B.O.S. Better Online Solutions Ltd.
Mr. Eyal Cohen, CFO
+972-54-2525925
eyalc@boscom.com