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 May 2007
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 x Form 40-F o
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 o No x
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A
THE GAAP FINANCIAL STATEMENTS APPEARING IN THE PRESS RELEASE ATTACHED TO THIS FORM 6-K ARE HEREBY INCORPORATED BY REFERENCE INTO THE REGISTRANT’S REGISTRATION STATEMENTS ON FORM F-3 (NOS. 333-130048, 333-137153) AND FORM S-8 (NOS. 333-136957, 333-110696, 333-100971 AND 333-11650), AND TO BE A PART THEREOF FROM THE DATE ON WHICH THIS REPORT IS SUBMITTED, TO THE EXTENT NOT SUPERSEDED BY DOCUMENTS OR REPORTS SUBSEQUENTLY FILED OR FURNISHED.
Attached hereto and incorporated by reference is the following Registrant’s press release:
B.O.S Better Online Solutions Reports First Quarter 2007 Financial Results
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) By: /s/ Shmuel Koren —————————————— Shmuel Koren President and CEO |
Dated: May 8, 2007
B.O.S Better Online Solutions Reports First Quarter 2007 Financial Results
| — | Quarterly non –GAAP operational breakeven |
| — | RFID revenues ramped up: reaching a quarterly record of $420 thousand |
RISHON LEZION, Israel, May 8 /PRNewswire-FirstCall/ – B.O.S. Better Online Solutions Ltd. (the “Company” or “BOS”) (NASDAQ: BOSC; TASE: BOSC) reported today its results for the first quarter ended March 31, 2007.
– Revenues of $5.4 million, up 5.5% from $5.1M in the first quarter of 2006
– Supply Chain solutions division revenues grew by 10.7% to $5.0 million from $4.5 million in the first quarter of 2006
– Quarterly non–GAAP operating results show breakeven, with GAAP operating loss of $169 thousand.
– Quarterly GAAP net loss of $326 thousand, or $(0.05) per share
– Backlog increased by 7% to $6.5 million as of March 31, 2007 from $6.1 million in December 2006
Revenues for the first quarter of 2007 amounted to $5.4 million, a 5.5% increase over the revenues in the first quarter of 2006. Our backlog as of March 31, 2007 amounted to $6.5 million, reflecting a 7% increase over backlog of $6.1 million in December 31, 2006.
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Operating results show breakeven on a non – GAAP basis (excluding option compensation and amortization of intangible assets) in the first quarter of the year 2007 as compared to a non – GAAP operating income of $130 thousands in first quarter of the year 2006. Operating loss in the first quarter of the year 2007, on a GAAP basis, was $169 thousand as compared to a loss of $43 thousand in first quarter of the year 2006.
Information with respect to stock-based compensation and amortization expenses for the first quarter of 2007 and 2006 is included in a table setting forth non-GAAP information that accompanies the condensed financial statements in this release.
Financial expenses in the first quarter of 2007 were $195 thousand, as compared to $78 thousand in the first quarter of 2006. The increase is attributed mainly to the raise of an additional $1.5 million of convertible note during August 2006. The principal balance of the convertible note as of March 2007 was $2.4 million, with conversion prices of $2.97 and $3.78. Conversion of the convertible note could significantly reduce the Company’s financial expenses.
Net loss for the first quarter of 2007 amounted to $326 thousand (or $0.05 per share) as compared to net loss of $160 thousand (or $0.03 per share) in the first quarter of 2006 (excluding a gain of $297 thousand from discontinued operations).
Cash reserves, as of March 31, 2007, totalled $2.6 million. The Company’s balance sheet also shows short term loans of $5.1 million and long term loans of $1.9 million. During the first quarter of 2007, we converted $1.4 million of our short term bank loan into long term bank loans. In rights offering completed in April 2007, we raised gross proceeds of approximately $4.4 million, which strengthen our cash and equity position.
Edouard Cukierman, Chairman of the Board of Directors, said: “we are very pleased with the execution of BOS’s strategic plan and are looking forward to take the Company to the next level.”
Shmuel Koren, BOS’s President and CEO, added:” There are clear signs that our organic growth engines are gaining momentum as reflected in the 11% growth we achieved in our Supply Chain Solutions division. We continued to win new non – Israeli customers, expanded distribution agreements and, in particular, managed to ramp up our RFID revenues to a new quarterly record of $420,000. With a much strengthened balance sheet following a successful raise of approximately $4.4 million through a rights offering, we are well positioned to continue to enhance our company’s growth and exploit lucrative opportunities in our space. “
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B.O.S Better Online Solutions Ltd. (“BOS”) was established in 1990. Through its wholly owned subsidiaries, BOS’s activities are focused on two segments:
Supply-Chain Solutions segment, based on Odem Electronic Technologies 1992 Ltd., providing solutions in the RFID, semiconductors, electronic components, CCD, imaging, networking, telecom and automation fields.
Software Solutions segment, with products marketed under the BOSaNOVA brand name. These products deliver instant and transparent connectivity from IBM iSeries computers to personal computers, thin clients and browsers.
BOS is traded on NASDAQ (BOSC) and on the Tel-Aviv Stock Exchange (BOSC). BOS’s website address is www.boscorporate.com.
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 a few major customers, the uncertainty of our 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; and additional risks and uncertainties detailed in BOS’s periodic reports and registration statements filed with the U.S. 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.
Contact:
B.O.S Better Online Solutions Ltd.
Mr. Gilad Friedhaber, +972-54-8110410
gilad@kwan.co.il
or
Mr. Eyal Cohen, CFO, +972-3-954-1000
eyalc@boscom.com
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| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
| U.S. dollars in thousands, except per share data |
| Three months ended March 31 |
Year ended December 31, | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2007 |
2006 |
2006 | |||||||||
| (Unaudited) |
|||||||||||
| Revenues | $ | 5,383 | $ | 5,102 | $ | 20,917 | |||||
| Cost of revenues | 4,249 | 3,898 | 16,200 | ||||||||
| Gross profit | 1,134 | 1,204 | 4,717 | ||||||||
| Operating costs and expenses: | |||||||||||
| Research and development | 127 | 148 | 486 | ||||||||
| Sales and marketing | 589 | 524 | 2,019 | ||||||||
| General and administrative (includes share based compensation in the amount of $123, $121 and $727 in the three months ended March 31, 2007, March 31, 2006 and for the year ended December 31, 2006, respectively) | 587 | 575 | 3,268 | ||||||||
| Total operating costs and expenses | 1,303 | 1,247 | 5,773 | ||||||||
| Operating loss | (169 | ) | (43 | ) | (1,056 | ) | |||||
| Financial expenses, net | (195 | ) | (78 | ) | (626 | ) | |||||
| Other income, net | 11 | (39 | ) | - | |||||||
| loss before taxes on income | (353 | ) | (160 | ) | (1,682 | ) | |||||
| Taxes on income | 27 | - | 89 | ||||||||
| Net loss after taxes | (326 | ) | (160 | ) | (1,593 | ) | |||||
| Loss from continuing operations | (326 | ) | (160 | ) | (1,593 | ) | |||||
| Income related to discontinued operations | - | 297 | 1,685 | ||||||||
| Net income (loss) | $ | (326 | ) | $ | 137 | $ | 92 | ||||
| Basic and diluted net loss per share from continuing operations | $ | (0.05 | ) | $ | (0.03 | ) | $ | (0.24 | ) | ||
| Basic and diluted net earnings per share from discontinued operations | $ | - | $ | 0.05 | $ | 0.25 | |||||
| Basic and diluted net earnings (loss) per share | $ | (0.05 | ) | $ | 0.02 | $ | 0.01 | ||||
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| CONDENSED CONSOLIDATED BALANCE SHEETS |
| U.S. dollars in thousands, except per share data |
| March 31, 2007 |
December 31, 2006 | |||||||
|---|---|---|---|---|---|---|---|---|
| (Unaudited) |
||||||||
| ASSETS | ||||||||
| CURRENT ASSETS: | ||||||||
| Cash and cash equivalents | $ | 2,579 | $ | 2,033 | ||||
| Trade receivables | 5,728 | 5,632 | ||||||
| Other accounts receivable and prepaid expenses | 939 | 858 | ||||||
| Inventories | 4,053 | 4,017 | ||||||
| Total current assets | 13,299 | 12,540 | ||||||
| LONG-TERM ASSETS: | ||||||||
| Severance pay fund | 747 | 741 | ||||||
| Investment in other companies | 8,082 | 8,082 | ||||||
| Other | 44 | 65 | ||||||
| Total long-term assets | 8,873 | 8,888 | ||||||
| PROPERTY, PLANT AND EQUIPMENT, NET | 543 | 520 | ||||||
| CUSTOMER LIST, NET | 1,578 | 1,629 | ||||||
| GOODWILL | 952 | 952 | ||||||
| $ | 25,245 | $ | 24,529 | |||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| CURRENT LIABILITIES: | ||||||||
| Short term loans from banks | $ | 3,469 | $ | 2,931 | ||||
| Current maturities of long-term bank loans and convertible note | 1,660 | 1,157 | ||||||
| Trade payables | 2,968 | 3,844 | ||||||
| Employees and payroll accruals | 429 | 460 | ||||||
| Deferred revenues | 119 | 103 | ||||||
| Accrued expenses and other liabilities | 1,013 | 999 | ||||||
| Total current liabilities | 9,658 | 9,494 | ||||||
| LONG-TERM LIABILITIES: | ||||||||
| Bank loans (net of current maturities) | 963 | - | ||||||
| Convertible note (net of current maturities) | 968 | 1,171 | ||||||
| Deferred taxes | 347 | 362 | ||||||
| Accrued severance pay | 908 | 916 | ||||||
| Other long-term liabilities | 237 | 237 | ||||||
| Total long-term liabilities | 3,423 | 2,686 | ||||||
| SHAREHOLDERS' EQUITY | 12,164 | 12,349 | ||||||
| Total liabilities and shareholder's equity | $ | 25,245 | $ | 24,529 | ||||
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| Reconciliation of Non-GAAP Financial Measures in Accordance with SEC Regulation G |
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.
Reconciliation of GAAP to Non-GAAP Operating Margin by segments (U.S. dollars in thousands):
| Three months ended March 31, 2007 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Software Solutions |
Supply Chain Solutions |
Not allocated |
Consolidated | |||||||||||
| Revenues | 363 | 5,020 | - | 5,383 | ||||||||||
| Gross profit | 304 | 830 | - | 1,134 | ||||||||||
| GAAP Operating income (loss) | 15 | 126 | (310 | ) | (169 | ) | ||||||||
| Non-GAAP adjustment: | ||||||||||||||
| Share based compensation and amortization of intangible assets | 3 | 106 | 65 | 174 | ||||||||||
| Adjusted Non-GAAP operating income (loss) on non-GAAP | ||||||||||||||
| basis | 18 | 232 | (245 | ) | 5 | |||||||||
| Three months ended March 31, 2006 | ||||||||||||||
| Software Solutions |
Supply Chain Solutions |
Not allocated |
Consolidated | |||||||||||
| Revenues | 567 | 4,535 | - | 5,102 | ||||||||||
| Gross profit | 418 | 786 | - | 1,204 | ||||||||||
| GAAP Operating income (loss) | 75 | 176 | (294 | ) | (43 | ) | ||||||||
| Non-GAAP adjustment: | ||||||||||||||
| Share based compensation and amortization of intangible assets | - | 69 | 104 | 173 | ||||||||||
| Adjusted Non-GAAP operating income (loss) on non-GAAP | ||||||||||||||
| basis | 75 | 245 | (190 | ) | 130 | |||||||||
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| Year ended December 31, 2006 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Software Solutions |
Supply Chain Solutions |
Not allocated |
Consolidated | |||||||||||
| Revenues | 2,058 | 18,859 | - | 20,917 | ||||||||||
| Gross profit | 1,341 | 3,376 | - | 4,717 | ||||||||||
| GAAP Operating income (loss) | 66 | 701 | (1,823 | ) | (1,056 | ) | ||||||||
| Non-GAAP adjustment: | ||||||||||||||
| Share based compensation and amortization of intangible assets | - | 377 | 558 | 935 | ||||||||||
| Adjusted Non-GAAP operating income (loss) on non-GAAP | ||||||||||||||
| basis | 66 | 1,078 | (1,265 | ) | (121 | ) | ||||||||
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