zk1009011.htm
 
FORM 6 - K
 
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a - 16 or 15d -16
of the Securities Exchange Act of 1934

For the Month of November 2010

B.O.S. Better Online Solutions Ltd.
(Translation of Registrant's Name into English)

20 Freiman Street, Rishon LeZion, 75100, Israel
(Address of Principal Corporate Offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F S                          Form 40-F £

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b) (1): ___________

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b) (7): ___________

Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes £                          No S

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A
 
 
 
 
 
 
The press release that is attached hereto is hereby incorporated by reference into all effective Registration Statements, filed by us under the Securities Act of 1933, to the extent not superseded by documents or reports subsequently filed or furnished.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

 
B.O.S. Better Online Solutions Ltd.
(Registrant)
     
Dated: November 9, 2010
By:
/s/ Eyal Cohen
   
Eyal Cohen
   
CFO

 
 
 
 

B.O.S. Announces Net Profit in the Third Quarter and in
the First Nine Months of 2010
 
Positive outlook for 2011
 
RISHON LEZION, Israel, November 9, 2010 (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 third quarter, which ended September 30, 2010.

Highlights of the third quarter 2010 results:
 
 
1.
Revenues amounted to $9.4 million, reflecting a 16% growth compared to the same quarter last year.
 
2.
Operating profit amounted to $229,000, compared to an operating loss of $2.5 million in the same quarter last year.
 
3.
EBIDTA amounted to $579,000 compared to a negative EBIDTA of $2.2 million in the same quarter last year.
 
4.
Net profit amounted to $10,000, compared to net loss of $2.7 million in the same quarter last year. This is the second consecutive quarter in 2010 that the Company has posted a net profit, and the third consecutive quarter it has posted an operating profit.
 
5.
Net profit (excluding amortization of intangible assets and stock based compensation) was $363,000, compared to a net loss of $2.4 million in the same quarter last year.
 
6.
Positive cash flows from operating activities in the amount of $560,000 compared to $942,000 in the same period last year.
 
7.
Backlog as of September 2010 amounted to $11.2 million as compared to $9.9 million in September last year.

Highlights of the first nine months 2010 results:
 
 
1.
Revenues amounted to $29.2 million, reflecting a 16% growth compared to the same period last year.
 
2.
Operating profit amounted to $1 million, compared to an operating loss of $4.9 million in the same period last year.
 
3.
EBIDTA amounted to $1.8 million compared to a negative EBIDTA of $2.85 million in the same period last year.
 
4.
Net profit amounted to $25,000, compared to net loss of $5.8 million in the same period last year.
 
5.
Net profit (excluding amortization and impairment of intangible assets and stock based compensation) was $852,000, compared to a net loss of $3.8 million in the same quarter last year.
 
6.
Positive cash flows from operating activities in the amount of $854,000 compared to negative cash flows of $624,000 in the same period last year.
 
 
 
 
 
 
Yuval Viner, BOS CEO, stated: "We are very pleased with the continuing trend of improved results for the third consecutive quarter in 2010. Despite the seasonality of the third quarter, we achieved a net profit in the bottom line and expect growth in revenues and profits in 2011, as we focus on our profit-making activities."
  
Eyal Cohen, BOS CFO, added: "We are continuing to consider various alternatives with respect to our supply chain division’s U.S. subsidiary ("Summit") and plan to make a final decision during the fourth quarter.  Summit’s revenues for the first nine months of 2010 amounted to $7.5 million, with a net loss of $70,000. For the third quarter, Summit’s revenues were $2.3 million, and it posted a net loss of $224,000. BOS’ net profit for the third quarter of 2010, excluding the Summit operation, amounted to $234,000. In the event of a discontinuation of Summit operations, BOS might be subject to a non-cash write-off of up to $660,000. "
 
Conference Call
 
BOS will host a conference call on Wednesday, November 10, 2010 at 10:00 a.m. Eastern Daylight Time/17:00 p.m. Israel Time. A question-and-answer session will follow management's presentation. Interested parties may participate in the conference call by dialing the following numbers approximately five to ten minutes before the call start time:
 
North America +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 from the day after the call on the BOS 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) is a leading Israeli provider of RFID and Supply Chain solutions to global enterprises. BOS' RFID and supply chain offerings are helping customers worldwide improve the efficiency of enterprise logistics and organizational monitoring and control. BOS' RFID and mobile division (Israel) 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 divisions (Israel and US) provide RFID and electronic components consolidation services to the aerospace, defense, medical, telecommunications industries as well as to enterprise customers worldwide.
 
For more information, please visit: http://www.boscorporate.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.
 
 
 
 
 
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(U.S. dollars in thousands, except per share amounts)
 
   
Nine months ended
 September 30,
    
Three months ended
September 30,
  
   
2010
    
2009
    
2010
  
2009
  
   
(Unaudited)
    
(Unaudited)
  
                         
Revenues
   $ 29,225     $ 25,096     $ 9,368     $ 8,043  
Inventory allowance and write off
     (148 )     1,202       7       1,258  
Cost of revenues
     22,554       19,361       7,256       6,372  
Gross profit
     6,819       4,533       2,105       413  
                                 
Operating costs and expenses:
                                
    Research and development
     275       497       93       136  
    Sales and marketing
     4,116       6,476       1,380       2,260  
    General and administrative
     1,421       1,284       403       526  
    Impairment of goodwill
     -       1,218       -       -  
Total operating costs and expenses
     5,812       9,475       1,876       2,922  
                                 
Operating profit (loss)
     1,007       (4,942 )     229       (2,509 )
Financial expenses, net
     (971 )     (524 )     (300 )     (262 )
Other income (expenses), net
     (51 )     (304 )     37       (59 )
Loss before taxes on income
     (15 )     (5,770 )     (34 )     (2,830 )
Taxes benefit (tax on income)
     40       (67 )     44       125  
Net income (loss)
   $ 25     $ (5,837 )   $ 10     $ (2,705 )
                                 
Basic net income (loss) per share (*)
   $ 0.01     $ (2.25 )   $ 0.004     $ (1.05 )
                                 
Diluted net income (loss) per share (*)
   $ 0.01     $ (2.25 )   $ 0.004     $ (1.05 )
                                 
Weighted average number of shares used in
computing basic net earnings per share (*)
     2,632,611       2,605,503       2,643,728       2,605,503  
Weighted average number of shares used in
computing diluted net earnings per share (*)
     2,730,834       2,605,503       2,732,703       2,605,503  

(*) All earnings (loss) per share data are reported after the effect of the 1 for 5 reverse split that occurred on January 12, 2010.
 
 
 
 
 

CONDENSED CONSOLIDATED BALANCE SHEET
(U.S. dollars in thousands)

   
September 30, 2010
    
December 31, 2009
  
   
(Unaudited)
    
(Audited)
  
ASSETS
            
             
CURRENT ASSETS:
            
Cash and cash equivalents
   $ 788     $ 597  
Trade receivables, net
     10,419       8,685  
Other accounts receivable and prepaid expenses
     911       1,043  
Inventories
     7,689       8,776  
Investment in other company
     -       361  
Total current assets
     19,807       19,462  
                 
LONG-TERM ASSETS:
                
Severance pay fund
     662       652  
Investment in other company
     118       218  
Other assets
     152       123  
Total long-term assets
     932       993  
                 
PROPERTY, PLANT AND EQUIPMENT, NET
     1,186       1,278  
OTHER INTANGIBLE ASSETS, NET
     1,583       1,999  
GOODWILL
     4,298       4,172  
                 
Total assets
   $ 27,806     $ 27,904  

LIABILITIES AND SHAREHOLDERS' EQUITY
            
             
CURRENT LIABILITIES:
            
Short-term bank loans and current maturities
   $ 11,579     $ 11,787  
Trade payables
     5,290       5,097  
Employees and payroll accruals
     634       652  
Deferred revenues
     746       731  
Accrued expenses and other liabilities
     1,062       1,226  
Total Current Liabilities
     19,311       19,493  
                 
LONG-TERM LIABILITIES:
                
Long-term bank loans, net of current maturities
     491       816  
Deferred taxes and income tax accruals
     334       377  
Accrued severance pay
     767       770  
Convertible notes
     2,354       1,886  
Other long-term liabilities
     632       919  
Total long-term liabilities
     4,578       4,768  
                 
SHAREHOLDERS' EQUITY
     3,917       3,643  
Total liabilities and shareholder's equity
   $ 27,806     $ 27,904  
 
 
 
 
 
 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (U.S. dollars in thousands)
 
   
Nine months ended
 September 30,
    
Three months ended
 September 30,
  
   
2010
    
2009
    
2010
  
2009
  
   
(Unaudited)
    
(Unaudited)
  
                         
Cash flows provided by (used in) operating activities
     854       (624 )     560       942  
                                 
 Net cash used in investing activities
     (18 )     (1,225 )     (36 )     (178 )
 
                                
 Net cash provided by (used in) financing activities
     (645 )     1,920       (105 )     133  
                                 
Increase in cash and cash equivalents
     191       71       419       897  
                                 
Cash and  equivalents at the beginning of the period
     597       1,637       369       811  
                                 
Cash and cash equivalents at the end of the period
   $ 788     $ 1,708     $ 788     $ 1,708  
 
CONDENSED CONSOLIDATED EBITDA
 (U.S. dollars in thousands)

   
Nine months ended
 September 30,
    
Three months ended
 September 30,
  
   
2010
    
2009
    
2010
  
2009
  
   
(Unaudited)
    
(Unaudited)
  
                         
 Operating Profit (loss)
   $ 1,007     $ (4,942 )   $ 229     $ (2,509 )
  Add:
                                
Amortization of intangible assets
     437       267       223       86  
Stock based compensation
     181       451       61       173  
Depreciation
     200       156       66       55  
Impairment of goodwill
     -       1,218       -       -  
EBITDA
   $ 1,825     $ (2,850 )   $ 579     $ (2,195 )