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BOS Reports Financial Results for the Fourth Quarter and

Published:

RISHON LE ZION, Israel, March 28, 2024 (GLOBE NEWSWIRE) — BOS Better Online Solutions Ltd. (“BOS” or the “Company”) (NASDAQ: BOSC) reported its financial results for the fourth quarter and the year 2023.

Year 2023 Financial Highlights:

  • Revenues grew by 6.5% to $44.2 million from $41.5 million in the year 2022 ;
  • Operating profit increased to $2.5 million from $1.9 million in the year 2022;
  • EBITDA amounted to $3.06 million compared to $2.4 million in the year 2022.
  • Financial expenses decreased to $441,000 from $647,000 in the year 2022.
  • Net income amounted to $2.01 million or $0.35 per basic share compared to $1.28 million or $0.23 per basic share in the year 2022.

Fourth Quarter 2023 Financial Highlights:

  • Revenues reduced by 3.5% to $10.9 million from $11.3 million in the fourth quarter of the year 2022;
  • Operating profit amounted to $400,000 compared to $652,000 in the fourth quarter of the year 2022;
  • EBITDA amounted to $562,000 compared to $781,000 in the fourth quarter of the year 2022;
  • Financial income amounted to $31,000 compared to financial expenses of $115,000 in the fourth quarter of the year 2022;
  • Net income amounted to $427,000 or $0.07 per basic share compared to $531,000 or $0.09 per basic share in the fourth quarter of the year 2022.

Eyal Cohen, BOS’ CEO, stated: “We are pleased with the financial results of year 2023, which reflect net income of $2 million, above our expectation of $1.5 million.

“The fourth quarter results of 2023 were weak as compared to those of the fourth quarter of 2022 due to the war that started in October 2023. However, during the first quarter of 2024, the business environment in Israel has begun to recover. In addition, most of our business is linked to the Israeli defense market that has been showing increased demand. We therefore expect that in 2024 our revenues will grow to $46 million from $44.2 million in 2023 and our net income shall increase to $2.2 million from $2 million in 2023.”

Ziv Dekel, BOS’ Chairman stated: “Year 2023 was characterized by growing in revenues and net income which supported by continued strengthening of BOS’ core capabilities and enhancement of our competitive position in our different market places. This forms the basis for our future growth and profits.”

BOS will host a video conference meeting on March 28, 2024 at 9:00 a.m. EDT. A question-and-answer session will follow management’s presentation.

To access the video conference meeting, please click on the following link:

https://us06web.zoom.us/j/81096669677?pwd=UDnhFOusds9UBQSEkC28wqY9pvM1ac.1

or dial: +1 646 876 9923, meeting ID – 810 9666 9677, passcode – 185490

For those unable to participate in the video conference, a recording of the meeting will be available the next day on the BOS website: www.boscorporate.com

About BOS

BOS’ technologies enhance inventory processes through three business divisions:

  • The Intelligent Robotics division automates industrial and logistic inventory processes;
  • The RFID division marks and tracks inventory; and
  • The Supply Chain division manages inventory.

Use of Non-GAAP Financial Information
BOS reports financial results in accordance with US 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, the continued availability of financing for working capital purposes and to refinance outstanding indebtedness; and additional risks and uncertainties detailed in BOS’ periodic reports and registration statements filed with the US Securities and 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
 
  Year ended
December 31,
  Three months ended
December 31,
    2023       2022       2023     2022
  (Unaudited)
  (Audited)   (Unaudited)
  (Audited)
       
Revenues $ 44,179     $ 41,511     $ 10,886     $ 11,328  
Cost of revenues   34,970       32,451       8,796       8,738  
Gross profit   9,209       9,060       2,090       2,590  
Operating costs and expenses:              
Research and development   158       166       44       38  
Sales and marketing   4,891       4,924       1,278       1,375  
General and administrative   1,762       2,122       420       564  
Other income, net   (52 )     (81 )     (52 )     (39 )
Total operating costs and expenses   6,759       7,131       1,690       1,938  
               
Operating income   2,450       1,929       400       652  
Financial income (expenses), net   (441 )     (647 )     31       (115 )
Income before taxes on income   2,009       1,282       431       537  
Taxes on income   (4 )     (6 )     (4 )     (6 )
Net income $ 2,005     $ 1,276     $ 427     $ 531  
               
Basic net income per share $ 0.35     $ 0.23     $ 0.07     $ 0.09  
Diluted net income per share $ 0.34     $ 0.23     $ 0.07     $ 0.09  
Weighted average number of shares used in computing basic net income per share   5,727       5,550       5,748     5,702  
Weighted average number of shares used in computing diluted net income per share   5,905       5,589       5,856     5,703  
               
Number of outstanding shares as of December 31, 2023 and 2022   5,748       5,702       5,748     5,702  
                             

 

CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands)
 
  December 31, 2023   December 31, 2022
  (Unaudited)   (Audited)
ASSETS              
               
CURRENT ASSETS:              
Cash and cash equivalents $ 2,344     $ 1,763  
Restricted bank deposits   217       130  
Trade receivables   12,424       10,834  
Other accounts receivable and prepaid expenses   963       1,414  
Inventories   6,070       6,433  
       
Total current assets   22,018       20,574  
       
LONG-TERM ASSETS   196       260  
       
PROPERTY AND EQUIPMENT, NET   3,268       3,270  
       
OPERATING LEASE RIGHT-OF-USE ASSETS, NET   1,026       1,110  
       
OTHER INTANGIBLE ASSETS, NET   1,078       486  
       
GOODWILL   4,895       4,895  
       
Total assets $ 32,481     $ 30,595  
               
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands)
 
  December 31,
2023
  December 31,
2022
  (Unaudited)   (Audited)
       
LIABILITIES AND SHAREHOLDERS’ EQUITY      
       
CURRENT LIABILITIES:      
Current maturities of long-term loans $ 170     $ 586  
Operating lease liabilities, current   235       301  
Trade payables   7,710       7,984  
Employees and payroll accruals   980       1,016  
Deferred revenues   600       542  
Advances net of inventory in process   137       47  
Accrued expenses and other liabilities   1,072       719  
       
Total current liabilities   10,904       11,195  
       
LONG-TERM LIABILITIES:      
Long-term loans, net of current maturities   1,150       1,294  
Operating lease liabilities, non-current   759       827  
Long-term deferred revenues   339       241  
Accrued severance pay   490       404  
       
Total long-term liabilities   2,738       2,766  
       
TOTAL SHAREHOLDERS’ EQUITY   18,839       16,634  
       
Total liabilities and shareholders’ equity $ 32,481     $ 30,595  
               
CONDENSED CONSOLIDATED EBITDA
(U.S. dollars in thousands)
 
  Year ended
December 31,
  Three months ended
December 31,
    2023       2022       2023     2022
               
Operating income $ 2,450     $ 1,929     $ 400     $ 652  
Add:              
Amortization of intangible assets   168       107       48       31  
Stock-based compensation   98       97       24       22  
Depreciation   342       255       90       76  
EBITDA $ 3,058     $ 2,388     $ 562     $ 781  
                               
SEGMENT INFORMATION
(U.S. dollars in thousands)
 
  RFID   Supply Chain Solutions
  Intelligent Robotics    Intercompany    Consolidated
  Year ended December 31, 2023        
                       
                       
Revenues $ 13,713     $ 28,845       1,742       (121 )   $ 44,179  
                       
Gross profit   3,179       5,845       185               9,209  
                       
Allocated operating expenses   2,150       3,675       258               6,083  
                       
Unallocated operating expenses*                           676  
                       
Income (loss) from operations $ 1,029     $ 2,170     $ (73 )             2,450  
                       
Financial expenses and tax on income                       (445 )
                       
Net income                     $ 2,005  
                       
                       
  RFID   Supply Chain Solutions
  Intelligent Robotics    Intercompany    Consolidated
  Year ended December 31, 2022
                                       
Revenues $ 15,318     $ 25,232       961             $ 41,511  
                       
Gross profit (loss)   3,778       5,441       (159 )             9,060  
                       
Allocated operating expenses   2,535       3,450       425               6,410  
                       
Unallocated operating expenses*                           721  
                       
Income (loss) from operations $ 1,243     $ 1,991     $ (584 )             1,929  
                       
Financial expenses and tax on income                       (653 )
                       
Net income                     $ 1,276  
                           

*Unallocated operating expenses include costs not specific to a particular segment but are general to the group, such as expenses incurred for insurance of directors and officers, public company fees, legal fees, and other similar corporate costs.

SEGMENT INFORMATION
(U.S. dollars in thousands)
                       
  RFID   Supply Chain Solutions   Intelligent Robotics   Intercompany     Consolidated
  Three months ended December 31, 2023
                       
Revenues $ 3,622     $ 7,017     $ 279       (32 )   $ 10,886  
                       
Gross profit   725       1,257       108             2,090  
                       
Allocated operating expenses   513       974       72             1,559  
                       
Unallocated operating expenses*                       131  
                       
Income from operations $ 212     $ 283     $ 36             400  
                       
Financial income and tax on income                       27  
                       
Net income                     $ 427  
                       
                       
  RFID   Supply Chain Solutions   Intelligent Robotics   Intercompany     Consolidated
  Three months ended December 31, 2022
                       
Revenues $ 4,273     $ 6,789     $ 266             $ 11,328  
                       
Gross profit   1,187       1,560       (157 )             2,590  
                       
Allocated operating expenses   645       1,014       78               1,737  
                       
Unallocated operating expenses*                       201  
                       
Income (loss) from operations $ 542     $ 546     $ (235 )             652  
                       
Financial expenses and tax on income                       (121 )
                       
Net income                     $ 531  
                           

*Unallocated operating expenses include costs not specific to a particular segment but are general to the group, such as expenses incurred for insurance of directors and officers, public company fees, legal fees, and other similar corporate costs.


            

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