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B.O.S. Better Online Solutions Reports Financial Results for the Second Quarter of Fiscal Year 2016

Fifth consecutive quarter with net profit

RISHON LEZION, Israel, Aug. 29, 2016 (GLOBE NEWSWIRE) -- B.O.S. Better Online Solutions Ltd. (the "Company", "BOS") (Nasdaq:BOSC), a leading Israeli provider of RFID and Mobile solutions and a global provider of Supply Chain solutions to enterprises, today reported its financial results for the second quarter of fiscal year 2016.

Net profit for the second quarter of 2016 amounted to $126,000, as compared to $29,000 in the comparable quarter last year. Net profit for the first six months of 2016 amounted to $346,000, as compared to a net profit of $5,000 in the first six months of year 2015 and to a net profit of $334,000 in the entire year 2015.

Yuval Viner, BOS' CEO, stated: "We are pleased to present a fifth consecutive quarter with net profit. We are satisfied with the progress we have made with the integration of the acquisition of iDnext and Next-Line at the beginning of the year. This acquisition improved our capabilities to provide a wide array of operational solutions to our RFID and Mobile division customers."

Avidan Zelicovsky, BOS' President, stated: "We are satisfied with the growth of 21% in revenues in the first half of year 2016, as compared to the first half of year 2015. We plan our long term growth to be based on a possible acquisition of a complementary business and on expansion of our product and solution offerings. We continue to invest efforts in increasing our Supply Chain division’s business in the Far East. Our revenues in the Far East in the first half of year 2016 increased by 100%, to $3 million, as compared to $1.5 million in the comparable period last year."

Eyal Cohen, BOS' CFO, stated: "Our financial position continued to improve from quarter to quarter. As of June 30, 2016, our bank debt, net of cash, amounted to $1.8 million and shareholders' equity was $8 million. Our last twelve months EBITDA amounted to $1.3 million."

BOS will host a conference call on Tuesday, August 30, 2016 at 10 a.m. EDT - 5:00 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.

/EIN News/ -- For those unable to listen to the live call, a script 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. (BOSC) is a leading Israeli provider of RFID and Mobile solutions and a global provider of Supply Chain solutions to 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.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.

           
CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S Dollars in thousands)
           
      Six months ended
June 30,
  Three months ended
June 30,
        2016       2015       2016     2015
                                     
        (Unaudited)     (Unaudited)
                   
Revenues     $ 14,375     $ 11,928     $ 6,308     $ 6,101  
Cost of revenues       11,508       9,568       4,992       4,928  
Gross profit       2,867       2,360       1,316       1,173  
                   
Operating costs and expenses:                  
Sales and marketing       1,546       1,370       755       692  
General and administrative       809       763       351       354  
Total operating costs and expenses       2,355       2,133       1,106       1,046  
                   
Operating Income        512       227       210       127  
Financial expenses, net       (166 )     (222 )     (84 )     (98 )
Net income     $ 346     $ 5     $ 126     $ 29  
                   
Basic and diluted net income per share     $ 0.14     $ 0.00     $ 0.05     $ 0.02  
                   
Weighted average number of shares used in computing basic net income per share       2,446       1,852       2,512       1,887  


Weighted average number of shares used in computing diluted net income per share
      2,452       1,852       2,518       1,887  


         
CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands)
         
    June 30,
2016
      December 31,
2015
    (Unaudited)
      (Audited)
ASSETS              
               
CURRENT ASSETS:              
Cash and cash equivalents   $ 1,538     $ 1,419
Restricted bank deposits     185       195
Trade receivables     6,975       7,071
Other accounts receivable and prepaid expenses     849       725
Inventories     2,111       2,503
               
Total current assets     11,658       11,913
               
LONG-TERM ASSETS     62       303
               
PROPERTY, PLANT AND EQUIPMENT, NET     531       480
               
OTHER INTANGIBLE ASSETS, NET     224       7
               
GOODWILL     4,676       4,122
       
Total assets   $ 17,151     $ 16,825


         
CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands)
         
    June 30,
2016
  December 31,
2015
    (Unaudited)   (Audited)
         
LIABILITIES AND SHAREHOLDERS' EQUITY        
         
CURRENT LIABILITIES:        
Current maturities of long term loans     400       400
Trade payables     3,805       4,671
Employees and payroll accruals     616       480
Deferred revenues     796       796
Accrued expenses and other liabilities     235       320
         
Total current liabilities     5,852       6,667
         
LONG-TERM LIABILITIES:        
Long-term loans, net of current maturities     2,938       3,458
Liability related to acquisition of business     196       -
Accrued severance pay     169       155
Deferred gain     28       40
         
Total long-term liabilities     3,331       3,653
         
         
SHAREHOLDERS' EQUITY     7,968       6,505
         
         
Total liabilities and shareholders' equity   $ 17,151     $ 16,825


           
RECONCILIATION OF NON-GAAP FINANCIAL RESULTS

(U.S. dollars in thousands)
           
      Six months ended
June 30,
  Three months ended
June 30,
        2016       2015       2016     2015
      (Unaudited)   (Unaudited)
                   
                   
Net Income as reported     $ 346     $ 5     $ 126     $ 29  
Adjustments:                  
Amortization of intangible assets       53       32       23       16  
Stock based compensation       68       79       34       38  
Acquisition expenses       30       -       -       -  
Total Adjustments       151       111       57       54  
Net Income on a Non-GAAP basis     $ 497     $ 116     $ 183     $ 83  
                   


         
CONDENSED CONSOLIDATED EBITDA

(U.S. dollars in thousands)
         
    Six months ended
June 30,
  Three months ended
June 30,
      2016       2015       2016     2015
                 
Operating income   $ 512     $ 227     $ 210     $ 127  
Add:                
Amortization of intangible assets     53       32       23       16  
Stock based compensation     68       79       34       38  
Depreciation     93       70       46       35  
EBITDA   $ 726     $ 408     $ 313     $ 216  
                 


                                             
SEGMENT INFORMATION

(U.S. dollars in thousands)
                                             
      RFID and
Mobile
Solutions
  Supply
Chain
Solutions
    Intercompany   Consolidated     RFID and
Mobile
Solutions
    Supply
Chain
Solutions
    Intercompany     Consolidated
      Six months ended June 30,

2016
    Three months ended June 30,

2016
                                             
Revenues     $ 6,034   $ 8,368       $ (27 )   $ 14,375     $ 2,584     $ 3,750     $ (26 )     $ 6,308
                                             
Gross profit     $ 1,499   $ 1,368       $ -     $ 2,867     $ 687     $ 629     $ -       $ 1,316
                                             
                                             
      RFID and
Mobile
Solutions
  Supply
Chain
Solutions
    Intercompany   Consolidated     RFID and
Mobile
Solutions
    Supply
Chain
Solutions
    Intercompany     Consolidated
      Six months ended June 30,

2015
    Three months ended June 30,

2015
                                             
Revenues     $ 4,262       $ 7,671       $ (5 )       $   11,928     $ 2,032     $ 4,069     $ -       $ 6,101
                                                                             
Gross Profit     $ 1,126       $ 1,234       $ -         $   2,360     $ 538     $ 635     $ -       $ 1,173
                                             
     


For more information:
                    Eyal Cohen
                    CFO
                    +972-542525925

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