EX-99 2 exhibit_99-1.htm YEAR 2013 RESULTS exhibit_99-1.htm


Exhibit 99.1
 
B.O.S. Better Online Solutions Reports Financial Results for the fourth quarter and fiscal year ended
December 31, 2013
 
Fourth quarter of year 2013: 78% growth in consolidated EBITDA. Breakeven in 2013 as opposed to net loss
of $549,000 in 2012
 
RISHON LEZION, Israel, April 14, 2014 (GLOBE NEWSWIRE) - B.O.S Better Online Solutions Ltd. (the "Company", "BOS") (Nasdaq: BOSC), 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, 2013.
 
Highlights for the fourth quarter of year 2013:

 
·
Consolidated revenues grew by 14.6% to $7.1 million from $6.2 million in the comparable quarter last year. RFID and Mobile solution revenues grew by 40% to $3.3 million from $2.3 million in the comparable quarter last year.

 
·
Net profit amounted to $43,000 (including tax expenses of $15,000) as compared to $37,000 (including a tax benefit of $224,000) in the comparable quarter last year.

 
·
Net profit on NON GAAP basis amounted to $135,000 (including tax expenses of $15,000) as compared to $347,000 (including a tax benefit of $224,000) in the comparable quarter last year.

 
·
EBITDA grew by 78% to $343,000 as compared to $193,000 in year 2012.
 
Highlights for year 2013:

 
·
Consolidated revenues grew by 5.7% to $25.9 million from $24.5 million in year 2012.
RFID and Mobile solution revenues grew by 17.5% to $10.5 million as compared to $8.9 million in year 2012.

 
·
Net loss was reduced to break even (including $13,000 tax expenses) as compared to a net loss of $549,000 (including a $187,000 tax benefit) in year 2012.

 
·
Net profit on NON GAAP basis amounted to $536,000 (including $13,000 tax expenses) as compared to $287,000 (including a $187,000 tax benefit) in year 2012.

 
·
EBITDA grew by 73% to $1.2 million as compared to $665,000 in year 2012.

Liquidity and loans

Cash and cash equivalents and long term bank deposits amounted to $1.5 million as of December 31, 2013. The trend of reduction in loans has continued and by December 31, 2013 our loans were reduced to $7.5 million, from $8.4 million as of December 31, 2012. We expect a further reduction in our loans in year 2014.

 
 

 
 
Edouard Cukierman, Chairman of the Board, stated, "We are very pleased with these results, which reflect a continuing improvement in the Company’s performance and financial position. We expect these positive trends to continue in 2014."

Yuval Viner, BOS CEO, stated: "We are satisfied with the progress we made in year 2013 and we are very pleased with the growth of the RFID and Mobile solution division. Yet, we have to improve the financial performance of the Supply Chain division. We anticipate that we will end year 2014 with a net profit on a non-GAAP basis."

Conference Call
 
BOS will host a conference call on Wednesday, April 16, 2014 at 10 a.m. EDT - 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 + 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
 
Contact:
B.O.S. Better Online Solutions Ltd.
Mr. Eyal Cohen, CFO
+972-54-2525925
eyalc@boscom.com
 
About BOS
 
B.O.S. Better Online Solutions Ltd. (Nasdaq: BOSC - News) 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
December 31,
   
Three months ended
 December 31,
 
   
2013
   
2012
   
2013
   
2012
 
   
(Audited)
   
(Unaudited)
 
                         
Revenues
  $ 25,903     $ 24,503     $ 7,056     $ 6,154  
Cost of revenues
    20,751       19,050       5,600       4,751  
Inventory write offs
    121       385       (17 )     144  
Gross profit
    5,031       5,068       1,473       1,259  
                                 
Operating costs and expenses:
                               
       Research and development
    -       125       -       11  
       Sales and marketing
    2,924       3,058       793       708  
       General and administrative
    1,523       1,693       488       477  
Total operating costs and expenses
    4,447       4,876       1,281       1,196  
                                 
Operating profit
    584       192       192       63  
Financial expenses, net
    (549 )     (781 )     (134 )     (182 )
Other expenses, net
    (22 )     (147 )     -       (68 )
Profit (loss) before taxes on income
    13       (736 )     58       (187 )
Tax benefit (expenses)
    (13 )     187       (15 )     224  
Net profit (loss)
  $ -     $ (549 )   $ 43     $ 37  
                                 
Basic and diluted net profit (loss) per share
  $ -     $ (0.49 )   $ 0.04     $ 0.03  
                                 
Weighted average number of shares used in computing basic net earnings per share
    1,171,657       1,117,876       1,200,849       1,118,075  
Weighted average number of shares used in computing diluted net earnings per share
    1,171,657       1,117,876       1,216,979       1,118,075  

 
 

 
 
CONSOLIDATED BALANCE SHEETS

 (U.S. dollars in thousands, except per share amounts)

   
December 31, 2013
   
December 31, 2012
 
   
(Unaudited)
 
ASSETS
           
             
CURRENT ASSETS:
           
Cash and cash equivalents
  $ 1,005     $ 354  
Trade receivables
    8,137       8,007  
Other accounts receivable and prepaid expenses
    819       616  
Inventories
    3,718       3,160  
                 
Total current assets
    13,679       12,137  
                 
LONG-TERM ASSETS:
               
Severance pay fund
    26       21  
Restricted Bank deposits
    486       438  
Other assets
    9       11  
                 
Total long-term assets
    521       470  
                 
PROPERTY, PLANT AND EQUIPMENT, NET
    689       963  
                 
OTHER INTANGIBLE ASSETS, NET
    176       357  
                 
GOODWILL
    4,122       4,122  
                 
Total assets
  $ 19,187     $ 18,049  

 
 

 

CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands, except share and per share data


   
December 31, 2013
   
December 31, 2012
 
   
(Audited)
 
             
LIABILITIES AND SHAREHOLDERS' EQUITY
           
             
CURRENT LIABILITIES:
           
Short-term bank loans
  $ 5,426     $ 5,959  
Current maturities of long term loans
    498       424  
Trade payables
    6,232       4,915  
Employees and payroll accruals
    433       408  
Deferred revenues
    639       467  
Current maturities of liability related to the Dimex acquisition
    428       136  
Accrued expenses and other liabilities
    523       567  
                 
Total current liabilities
    14,179       12,876  
                 
LONG-TERM LIABILITIES:
               
Long-term bank loans, net of current maturities
    781       1,188  
Accrued severance pay
    159       119  
Liability in related to the Dimex acquisition, net of current maturities
    365       710  
                 
Total long-term liabilities
    1,305       2,017  
                 
COMMITMENTS AND CONTINGENT LIABILITIES
               
                 
SHAREHOLDERS' EQUITY:
               
     Share capital
    26,178       23,374  
Additional paid-in capital
    48,634       50,891  
Accumulated other comprehensive profit
    (243 )     (243 )
Accumulated deficit
    (70,866 )     (70,866 )
                 
Total shareholders' equity
    3,703       3,156  
                 
Total liabilities and shareholders' equity
  $ 19,187     $ 18,049  

 
 

 


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,
 
   
2013
   
2012
 
   
GAAP
(as reported)
   
Adjustments
   
Non-GAAP
   
Non-GAAP
 
       
                         
Revenues
  $ 7,056     $ -     $ 7,056     $ 6,154  
Gross profit
    1,473       (17 )a     1,456       1,403  
                                 
Operating costs and expenses:
                               
Sales and marketing
    793       (46 )b     747       673  
General and administrative
    488       (63 )c     425       424  
Total operating costs and expenses
    1,281       (109 )     1,172       1,097  
                                 
Operating profit
    192       92       284       306  
Financial expenses, net
    (134 )     -       (134 )     (183 )
Profit  before taxes on income
    58       92       150       123  
Tax benefit (expenses)
    (15 )     -       (15 )     224  
Net profit
  $ 43     $ 92     $ 135     $ 347  

Notes to the reconciliation:
a – Write off of slow moving inventory
b - Amortization of intangible assets.
c - Stock based compensation.

 
 

 

RECONCILIATION OF NON-GAAP FINANCIAL RESULTS
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

(U.S. dollars in thousands, except per share amounts)
 
   
Year ended December 31,
 
   
2013
   
2012
 
   
GAAP
(as reported)
   
Adjustments
   
Non-GAAP
   
Non-GAAP
 
       
Revenues
  $ 25,903       -     $ 25,903     $ 24,503  
Gross profit
    5,031       121 a     5,152       5,453  
                                 
Operating costs and expenses:
                               
Research and development, net
    -       -       -       125  
Sales and marketing
    2,924       (182 )b     2,742       2,875  
General and administrative
    1,523       (211 )c     1,312       1,593  
Total operating costs and expenses
    4,447       (393 )     4,054       4,593  
                                 
Operating profit
    584       514       1,098       860  
Financial expenses, net
    (549 )     -       (549 )     (760 )
Other expenses, net
    (22 )     22 d     -       -  
Profit before taxes on income
    13       536       549       100  
Tax benefit (expenses)
    (13 )     -       (13 )     187  
Net income
  $ 0     $ 536     $ 536     $ 287  

Notes to the reconciliation:
a – Write off of slow moving inventory
b - Amortization of intangible assets.
c - Stock based compensation.
d –Property write off.

 
 

 
 
CONDENSED CONSOLIDATED EBITDA

 (U.S. dollars in thousands)
 
   
Year ended
 December 31,
   
Three months ended
 December 31,
 
   
2013
   
2012
   
2013
   
2012
 
             
 Operating Profit
  $ 584     $ 192     $ 192     $ 63  
  Add:
                               
Amortization of intangible assets
    182       183       46       46  
Stock based compensation
    211       107       63       60  
Depreciation
    173       183       42       24  
EBITDA
  $ 1,150     $ 665     $ 343     $ 193  

   
RFID and Mobile Solutions
   
Supply
Chain Solutions
   
Intercompany
   
Consolidated
   
RFID and Mobile Solutions
   
Supply
Chain Solutions
   
Intercompany
   
Consolidated
 
   
Year ended December 31,
 2013
   
Three months ended December 31,
 2013
 
                                                 
Revenues
  $ 10,451     $ 15,496     $ (44 )   $ 25,903     $ 3,272     $ 3,785     $ (1 )   $ 7,056  
                                                                 
Gross profit
  $ 2,882     $ 2,149     $ -     $ 5,031     $ 889     $ 584     $ -     $ 1,473  

   
RFID and Mobile Solutions
   
Supply
Chain Solutions
   
Intercompany
     
Consolidated
   
RFID and Mobile Solutions
   
Supply
Chain Solutions
   
Intercompany
 
Consolidated
   
Year ended December 31,
 2012
   
Three months ended December 31,
 2012
 
                                                 
Revenues
  $ 8,894     $ 15,915     $ (306 )   $ 24,503     $ 2,343     $ 3,899     $ (88 )   $ 6,154  
                                                                 
Gross profit
  $ 2,358     $ 2,710     $ -     $ 5,068     $ 567     $ 692     $ -     $ 1,259