BOS Reports Financial Results for the Third Quarter and First Nine Months of the Year 2021


RISHON LE ZION, Israel, Nov. 30, 2021 (GLOBE NEWSWIRE) -- BOS Better Online Solutions Ltd. ("BOS" or the "Company") (NASDAQ: BOSC) reported financial results for the third quarter and first nine months of the year 2021.

Eyal Cohen, BOS's CEO, stated: "We have made progress in the first nine months of the year 2021 as compared to the comparable period last year:

  • Revenues grew by 6%
  • Gross profit increased by 15%
  • Net income of $351,000 in the first nine months of the year 2021 as compared to a $1.2 million net loss in the comparable period last year
  • A fifth consecutive profitable quarter.

The Robotics division’s operating loss has decreased significantly, to $489,000 in the first nine months of 2021 from $2.4 million in the comparable period last year. However, the Robotics division did not yet reach the breakeven point as previously projected. We expect the Robotics division to breakeven in the year 2022. We believe in the long-term growth potential of our Robotics division because of the increasing shortage in manpower for industrial and logistic processes. 

The devaluation of the US dollar against the NIS in the first nine months of 2021 yielded an increase in our operating expenses by approximately $170,000 as compared to the comparable period last year."

Avidan Zelicovsky, BOS's President, stated: "The global shortage in commodities has presented an opportunity for our Supply Chain division. We have launched a new service for our electronic industry clients that significantly shortens the lead time for the electronic components. This service has been a growth engine of this division in the first nine months of 2021". 

Eyal Cohen, BOS's CEO, added:" In view of the third quarter results, we have revised our outlook for the year 2021 in respect of our net income, to be between $400,000 and $600,000 instead of $1,000,000. Our outlook for the year 2021 revenues has not been changed and remains $33 million. We will announce our outlook for the year 2022 during the first quarter of the year 2022". 

BOS will host a conference call on Tuesday, November 30, 2021, at 9:00 a.m. EST, 4:00 p.m., Israel Time. A question-and-answer session will follow management's presentation. To access the conference call, please dial one of the following numbers:

US: +1-888-281-1167, International: +972-3-9180644.

For those unable to listen to the live call, a replay of the call will be available the next day on the BOS website: www.boscom.com

About BOS

BOS provides services and systems for inventory production and management in three channels:

  • Services – The Supply Chain division provides inventory procurement and kitting.

  • Integration – the RFID division provides off-the-shelf software and equipment to track and manage inventory in the production floor and warehouse.

  • Development – the Intelligent Robotics division develops and builds custom-made robotic cells for the industrial and logistic processes.

Contact:Eyal Cohen, CEO
+972-542525925 | eyalc@boscom.com

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, failure to successfully integrate and achieve the potential benefits of the acquisition of the business operations of Imdecol Ltd. (the Robotics business line), 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 impact of the COVID-19 virus and 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
           
  Nine months ended Three months ended
September 30,September 30,
   2021   2020
  2021 2020
  (Unaudited) (Unaudited)
     
Revenues $24,555  $23,125  $7,998  $8,179 
Cost of revenues  19,697   18,153   6,423   6,435 
Inventory Impairment  -   752   -   81 
Gross profit  4,858   4,220   1,575   1,663 
               
Operating costs and expenses:              
    Research and development  154   71   40   50 
    Sales and marketing  2,902   2,933   973   978 
    General and administrative  1,343   1,251   466   408 
    Impairment of Goodwill and intangible assets  -   988   -   - 
Total operating costs and expenses  4,399   5,243   1,479   1,436 
               
Operating income (loss)  459   (1,023)  96   227 
Financial income (expenses), net  (107)  (235)  (9)  (98)
Other income, net  -   50   -   50 
                 
Income before taxes on income (loss)  352   (1,208)  87   179 
Taxes on income  (1)  -   -   - 
Net income (loss) $351  $(1,208) $87  $179 
               
Basic and diluted net income (loss) per share $0.07  $(0.28 $0.02  $0.04 
Weighted average number of shares used in computing basic net income per share  5,201   4,284   5,223   4,329 
Weighted average number of shares used in computing diluted net income per share  5,421   4,284   5,613   4,339 
             
Number of outstanding shares as of September 30, 2021 and 2020  5,237   4,321   5,237   4,321 
              

 

 
 CONSOLIDATED BALANCE SHEETS 

 (U.S. dollars in thousands)


     September
30, 2021
  December
31, 2020
   (Unaudited)   (Audited)
ASSETS      
       
CURRENT ASSETS:      
Cash and cash equivalents $2,002 $1,036
Restricted bank deposits  236  140
Trade receivables  8,846  9,172
Other accounts receivable and prepaid expenses  1,226  1,311
Inventories  5,149  4,871
     
Total current assets  17,459  16,530
     
LONG-TERM ASSETS  44  59
     
PROPERTY AND EQUIPMENT, NET  1,139  956
     
OPERATING LEASE RIGHT-OF-USE ASSETS, NET  992  767
     
OTHER INTANGIBLE ASSETS, NET  25  40
     
GOODWILL  4,676  4,676
     
Total assets $24,335 $23,028
       

 

CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands)

    
 September 30,  December 31, 2020
 2021  
 (Unaudited) (Audited)
    
LIABILITIES AND SHAREHOLDERS' EQUITY   
    
CURRENT LIABILITIES:   
Current maturities of long term loans$825 $815
Operating lease liabilities, current 495  557
Trade payables 5,060  5,492
Employees and payroll accruals 769  985
Deferred revenues 742  601
Advances net of inventory in process 106  68
Accrued expenses and other liabilities 231  391
    
Total current liabilities 8,228  8,909
    
LONG-TERM LIABILITIES:   
Long-term loans, net of current maturities 756  1,216
Operating lease liabilities, non-current 628  367
Long term deferred revenues 190  303
Accrued severance pay 336  364
    
Total long-term liabilities 1,910  2,250
    
    
TOTAL SHAREHOLDERS' EQUITY 14,197  11,869
    
    
Total liabilities and shareholders' equity$24, 335 $23,028
    

 

CONDENSED CONSOLIDATED EBITDA
(U.S. dollars in thousands)
 
  Nine months ended Three months ended
September 30,September 30,
   2021  2020  2021 2020
         
 Operating income (loss) $459 $(1,023) $96 $227
  Add:        
Impairment of Goodwill and other intangible assets  -  988   -  -
Amortization of intangible assets  15  36   5  5
Stock-based compensation  44  57   13  18
Depreciation  175  208   64  66
EBITDA $693 $266  $178 $316
         

 

SEGMENT INFORMATION
(U.S. dollars in thousands)
 
 RFID   Intelligent
Robotics
 Intercompany  Consolidated
Supply
Chain
Solutions
 
    Nine months ended September 30,
  2021
            
            
Revenues$9,193 $14,168  1,340  $(146) $24,555 
            
            
Gross profit 2,212  2,683  (37)               -   4,858 
            
Allocated operating expenses 1,641  1,788  452                -   3,881 
            
Unallocated operating expenses* -  -  -      518 
            
Income (loss) from operations$571 $895 $(489)               -   459 
            
Financial expenses and tax on income          (108
            
            
Net income         $351 
          

 


 RFID  Supply
Chain
Solutions
 Intelligent
Robotics
 Intercompany  Consolidated 
      Nine months ended September 30,
      2020
             
             
Revenues$8,976  $13,825 $367  $(43)
 $23,125 
             
             
Gross profit (loss) 2,223   2,882  (885)  -   4,220 
             
             
Allocated operating expenses 1,524   1,730  534   -   3,788 
             
Impairment of goodwill and intangible assets -   -  988   -   988 
  -   -  -       
Unallocated operating expenses*           467 
             
Income (loss) from operations$699  $1,152 $(2,407)  -   (1,023)
             
Financial expenses and tax on income           (185)
             
Net loss          $(1,208)
             

 


SEGMENT INFORMATION
(U.S. dollars in thousands)
               
 RFID   Supply
Chain
Solutions
  Intelligent
Robotics
   Intercompany   Consolidated 
      Three months ended September 30,
      2021
               
               
Revenues$2,871  $4,919 $304   $(96)
 $7,998 
               
               
Gross profit (loss) 660   984  (69)
                -   1,575 
               
Allocated operating expenses 529   640  116                 -   1,285 
               
Unallocated operating expenses*             194 
  -   -  -        
Income (loss) from operations$131  $344 $(185)
                -   96 
               
Financial income and tax on income             (9)
               
Net income            $87 
               

 

                 
  RFID   Supply
Chain
Solutions
  Intelligent
Robotics
   Intercompany   Consolidated 
       Three months ended September 30,
       2020
                 
                 
Revenues$3,264 $4,849 $66  $- $8,179 
                 
                 
Gross profit (loss) 749  1,013  (99)               -  1,663 
                 
Allocated operating expenses 518  586  205                -  1,309 
                 
Impairment of goodwill and intangible assets -  -      -                -  - 
                 
Unallocated operating expenses*              127 
  -  -  -        
Income (loss) from operations$238 $427 $(311)               -  227 
                 
Financial expenses and tax on income              (48)
Net loss             $179 
                 

* 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.