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 2005
B.O.S. BETTER ON-LINE SOLUTIONS, LTD.
(Translation of Registrant's Name into English)
100 BOS ROAD, TERADYON 20179, 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 [_]
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 [X]
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): N/A
THE INFORMATION IN PARAGRAPHS 1 THRU 6 OF THE REGISTRANT'S PRESS RELEASE
ATTACHED TO THIS FORM 6-K IS HEREBY INCORPORATED BY REFERENCE INTO THE
REGISTRANT'S REGISTRATION STATEMENTS ON FORM F-3 (NO. 333-117529) AND FORM S-8
(NOS. 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DATE ON WHICH THIS REPORT IS SUBMITTED, TO THE EXTENT NOT SUPERSEDED BY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 Ltd. Reports First Quarter 2005 Results; Dated
May 26, 2005.
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 On-Line Solutions, Ltd.
(Registrant)
By: /s/ Adiv Baruch
-------------------
Adiv Baruch
President and CEO
Dated: May 26, 2005
B.O.S. BETTER ONLINE SOLUTIONS LTD. REPORTS FIRST QUARTER 2005 RESULTS
TERADYON, Israel - (BUSINESS WIRE) - May 26, 2005--B.O.S. Better Online
Solutions Ltd. (the "Company" or "BOS") (NASDAQ:BOSC; TASE:BOSC) reported today
its results for the quarter ended March 31, 2005.
Revenues for the first quarter of 2005 were $7.3 million, compared to $1.2
million for the first quarter of 2004. Our revenues increased mainly due to the
consolidation of Odem Electronic Technologies 1992 ("Odem") (related to the
Electronic Component operating segment), which was acquired in November 2004, as
well as an increase of 60% in the sales of the Connectivity and Communication
operating segments (including Quasar Telecom (2004) Ltd., which began operating
in late September 2004). Net loss for the first quarter of 2005 was $943,000 (or
-$0.20 per share), compared to a net loss of $511,000 (or -$0.12 per share), for
the comparable period in 2004.
Gross profit for the first quarter of 2005 was $1.96 million, or 27% of
revenues, compared to $670,000, or 56% of revenues, for the first quarter of
2004. The lower gross margin is due mainly to the consolidation of Odem's
results since the gross margin of products sold by Odem is lower than the
average gross margin of the Company's other products.
Operating loss for the first quarter of 2005 was $533,000, compared to $452,000
for the first quarter of 2004.
Financial expenses for the first quarter of 2005 were $161,000, compared to
financial income of $15,000, for the first quarter of 2004. The financial
expenses reflect the interest expenses related to the convertible note of a $2
million principal amount issued in June 2004. During March 2005, $308,000 of the
principal amount of the note were converted into 100,000 shares.
As of March 31, 2005, the Company's balance sheet shows financial resources
(cash, cash equivalents and marketable securities) of $4.5 million and loans
(long and short term) of $3.5 million.
Adiv Baruch, BOS' CEO stated:
"The first quarter was characterized by growth, and an increase in revenues
alongside an increase in sales and marketing costs. This increase in costs was
needed in order to strengthen the sales and marketing infrastructure in
correlation with the Company's growth."
Edouard Cukierman, Chairman of BOS commented:
"I believe in the direction that the Company chose and its continuing
implementation towards further growth. The Catalyst fund, of which I am the CEO,
is participating as a lead investor in the new investment round in the Company."
ABOUT BOS
BOS (www.boscorporate.com) which is traded on the NASDAQ (NASDAQ: BOSC - News)
and on Tel-Aviv stock exchange (TASE: BOSC), was established in 1990. Through
its subsidiary BOScom Ltd. it develops and markets three types of products under
the BOSaNOVA brand:
o A communications products line (www.boscom.com) provides innovative
VoIP solutions to companies and organizations;
o A connectivity products line (www.bosweb.com) provides connectivity
solutions for IBM computers, from intermediate computers to personal
computers and LAN networks; and
o Software utilities products line (www.printbos.com) provides solutions
for the design, distribution and management documents for a range of
operating systems, including mainframe and UNIX.
In addition BOS supplies cellular adapters based on products of Quasar
Communication Systems Ltd., whose assets were acquired by BOS, and design
components and services through the ODEM Division, based on Odem Electronic
Technologies 1992 Ltd. in which a controlling stake was also recently acquired.
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, INCLUDING, BUT NOT LIMITED TO, THOSE RISKS
AND UNCERTAINTIES DETAILED IN BOS' 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.
1
CONSOLIDATED STATEMENTS OF OPERATIONS
--------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
THREE MONTHS ENDED YEAR ENDED
MARCH 31, DECEMBER 31,
-------------------------
2005 2004 2004
------- ------- -------
Revenues $ 7,272 $ 1,189 $ 8,282
Cost of revenues 5,314 519 4,608
------- ------- -------
Gross profit 1,958 670 3,674
------- ------- -------
Operating costs and expenses:
Research and development 736 423 2,296
Less - grants and participation - - (492)
Sales and marketing 919 292 1,706
General and administrative 836 407 1,705
------- ------- -------
Total operating costs and expenses 2,491 1,122 5,215
Operating loss (533) (452) (1,541)
Financial income (expenses), net (161) 15 (158)
------- ------- -------
Loss before taxes on income (694) (437) (1,699)
Taxes on income (59) - (20)
Equity in losses of an affiliated company (145) (74) (308)
Minority interest in earnings of a subsidiary (45) - (17)
------- ------- -------
Loss from continuing operations (943) (511) (2,044)
Loss related to discontinued operations - - (9)
------- ------- -------
Net loss $ (943) $ (511) $(2,053)
======= ======= =======
Basic and diluted net loss per share from continuing
operations $ (0.20) $ (0.12) $ (0.44)
======= ======= =======
Basic and diluted net loss per share from discontinued
operations $ - $ - $ -
======= ======= =======
Basic and diluted net loss of NIS 4.00 par value per
share $ (0.20) $ (0.12) $ (0.44)
======= ======= =======
REVENUES AND GROSS PROFIT (LOSS) FOR OPERATING SEGMENTS FOR THE FIRST QUARTER OF
2005 COMPARED TO THE FIRST QUARTER OF 2004
Electronic
Connectivity Communication Components Total
------------------ ------------------ ---------------- ------------------
Three months ended Three months ended Three months ended Three months ended
March 31, March 31, March 31, March 31,
------------------ ------------------ ---------------- ------------------
2005 2004 2005 2004 2005 2004 2005 2004
------ ------ ------ ------ ------ ---- ------ ------
Revenues $1,504 $1,063 $ 919 $ 126 $4,849 $ - $7,272 $1,189
====== ====== ====== ====== ====== ==== ====== ======
Gross profit (loss) $ 852 $ 680 $ 267 $ (10) $ 839 $ - $1,958 $ 670
====== ====== ====== ====== ====== ==== ====== ======
2
CONSOLIDATED BALANCE SHEETS
--------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA
MARCH 31, DECEMBER 31,
2005 2004
------- -------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 2,189 $ 2,578
Marketable securities 1,580 2,324
Trade receivables 5,576 4,557
Other accounts receivable and prepaid expenses 885 722
Inventories 2,955 3,086
------- -------
Total current assets 13,185 13,267
------- -------
LONG-TERM ASSETS:
Marketable securities 751 757
Severance pay fund 1,106 1,143
Investment in affiliated company 2,327 2,472
Property, plant and equipment, net 982 1,019
Goodwill 1,573 1,569
Customer list, net 1,362 1,389
Other intangible assets, net 449 471
Other assets 356 398
------- -------
Total long-term assets 8,906 9,218
$22,091 $22,485
======= =======
3
CONSOLIDATED BALANCE SHEETS
--------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA
MARCH 31, DECEMBER 31,
2005 2004
-------- --------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short term loans from banks $ 1,982 $ 1,354
Current maturities of long-term bank loans and convertible note 590 643
Trade payables 3,787 3,845
Employees and payroll accruals 679 664
Deferred revenues 442 364
Accrued expenses and other liabilities 1,041 1,141
-------- --------
Total current liabilities 8,521 8,011
-------- --------
LONG-TERM LIABILITIES:
Bank loans (net of current maturities) 41 54
Convertible note (net of current maturities) 900 1,151
Put option issued to minority shareholders in a subsidiary 359 359
Deferred taxes 330 348
Accrued severance pay 1,435 1,468
-------- --------
TOTAL long-term liabilities 3,065 3,380
MINORITY INTEREST IN A SUBSIDIARY 843 809
======== ========
LIABILITIES RELATED TO DISCONTINUED OPERATIONS 237 237
======== ========
COMMITMENTS AND CONTINGENT LIABILITIES
SHAREHOLDERS' EQUITY:
Share capital 4,915 4,823
Additional paid-in capital 44,650 44,426
Deferred stock-based compensation (157) (174)
Accumulated other comprehensive income 18 31
Accumulated deficit (40,001) (39,058)
-------- --------
TOTAL SHAREHOLDERS' EQUITY 9,425 10,048
-------- --------
TOTAL liabilities and shareholder's equity $ 22,091 $ 22,485
======== ========
4
CONSOLIDATED STATEMENTS OF CASH FLOWS
--------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS
YEAR ENDED
THREE MONTHS ENDED MARCH 31, DECEMBER 31,
------------------------- -------
2005 2004 2004
------- ------- -------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (943) $ (511) $(2,053)
Adjustments to reconcile net loss to net cash provided by (used in)
operating activities:
Loss (income) from discontinued operations - - 9
Depreciation and amortization of intangible assets 58 - 51
Depreciation of property, plant and equipment 86 71 300
Amortization of marketable securities premium 13 21 47
Accrued severance pay, net 4 (6) 8
Equity in losses of an affiliated company 145 74 308
Minority interest in earnings in a subsidiary 45 - 17
Capital loss from sale of property and equipment - - 5
Stock based compensation related to warrants issued to service
providers 58 33 121
Stock based compensation related to options issued to employee 15 - 5
Amortization of financial expenses related to issuance of
convertible note 35 - 78
Decrease (increase) in trade receivables (1,055) 301 (342)
Decrease in deferred taxes (21) - (47)
Decrease in other accounts receivable and prepaid expenses (168) (15) 33
Decrease (increase) in inventories 111 (39) (461)
Increase (decrease) in trade payables 111 110 961
Increase (decrease) in employees and payroll accruals, deferred
revenues, accrued expenses and other liabilities 20 (123) (63)
------- ------- -------
Net cash provided by (used in) operating activities from continuing (1,486) (84) (1,023)
operations
Net cash provided by (used in) operating activities from
discontinued operations - (82) (96)
------- ------- -------
Net cash provided by (used in) operating activities (1,486) (166) (1,119)
------- ------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (54) (39) (214)
Proceeds from sale of property and equipment - - 38
Investment in long-term marketable securities - (278) (1,247)
Acquisitions, net of cash acquired (139) - (1,443)
Proceeds from redemption of marketable securities 731 - 1,000
------- ------- -------
Net cash provided by (used in) investing activities from continuing 538 (317) (1,866)
operations
Net cash used in investing activities from discontinued operations - - -
------- ------- -------
Net cash provided by (used in) investing activities 538 (317) (1,866)
------- ------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds (repayment) of short term and long term bank loans 632 - (93)
Proceeds from long term convertible note and warrants, net of
issuance expenses (21) - 1,787
Payment of long term convertible note (40) - (80)
------- ------- -------
Net cash provided by (used in) financing activities from continuing 571 - 1,614
operations
Net cash used in financing activities from discontinued operations - - -
------- ------- -------
Net cash provided by (used in) financing activities 571 - 1,614
------- ------- -------
Decrease in cash and cash equivalents (377) (483) (1,371)
Decrease in cash and cash equivalents from discontinued operations 1 57 66
Effect of exchange rate changes on cash and cash equivalents (13) - 11
Cash and cash equivalents at the beginning of the year 2,578 3,872 3,872
------- ------- -------
Cash and cash equivalents at the end of the year $ 2,189 $ 3,446 $ 2,578
======= ======= =======
5