B.O.S. Better Online Solutions Ltd. (BOSC) Earnings Call Transcript & Summary

Thank you for joining our call. [indiscernible] We are excited to meet you again with our quarterly media meeting. Today, we have a comprehensive agenda. We will start by reviewing our financial results, business strength and growth strategy. After that, we have a Q&A session to address any questions or concerns you will have. Let's begin with the looking forward statement.

Ladies and gentlemen, thank you for standing by. Welcome to the BOS Conference Call. [Operator Instructions] This conference call is being recorded and will be available on the BOS website as of tomorrow. Before I turn the call over to Mr. Cohen, I would like to remind everyone that forward-looking statements for the respected company's business, financial condition and results of its operations are subject to risks and uncertainties which could cause actual results to differ materially from those contemplated. Such forward-looking statements include, but are not limited to, product demand, pricing, market acceptance, changing economic conditions, risks and product and technology development and the effect of the company's accounting policies as well as certain other risk factors, which are detailed from time to time in the company's filings with the various securities authorities. I would now like to turn the call over to Mr. Eyal Cohen, CEO. Mr. Cohen, please go ahead.

Thank you. The first quarter reflects record income of a $740,000. We have achieved this gradually and consistently as a team, reflecting our collective effort and dedication. Our trailing 12 months revenue amounted to $43 million. EBITDA, $3 million, net income of $2.1 million and EPS in the trailing 12 month, $0.36. This results put us on track toward achieving our financial targets for 2024 reach our revenues of $46 million, our net income was $2.2 million. We have a strong balance sheet. The $34 million assets, $20 million of shareholders' equity, which accounted 60% of the assets. Our third class of cash net of flows of $1.7 million. Our business performance combined with our healthy balance sheet provide us with the right ecosystem for thinking, exploring and developing agents for future growth. The focused slide presents most [indiscernible] valuation ratios based on the trailing 12 months. The market cap ratio to net income is 7.7%. The market cap ratio to projected net income for year '24 is 7.3% million Market operation to EBITDA inside of 5.3% and the market cap ratio to the shareholders' equity is only 82%. Despite our positive trends [indiscernible] our market cap remains roughly unchanged. It was $15 million in December '21, where we earned only $0.5 million a year, and remain $15 million -- $50 million today where we earned more than $2 million, also [ 365 ]. I hope, BOS analyst coverage this year to explore BOS value opportunity to more investments. Business rates. The Supply Chain division has expanded the lease of electronic manufacturers in [indiscernible] and increased the [indiscernible] . Hence, we expect revenue growth of [indiscernible] in 2024 and beyond. In addition, we are facing increased demand from the Israeli defensive network and we anticipate it will positively affect the supply chain division revenues this. The robotic [indiscernible] division is successfully transitioning from Israeli civilian sector to Israeli defense sector [indiscernible] in '24. This division's revenues in the first quarter of the year will not reflect its potential revenues for year '24 because a significant portion of the orders we receive are in the production -- now for efficient sales are mainly to logistic centers in Israel. We have significantly expanded our offering for niche sales and expect this will yield revenues from near-term sales. I want to turn the call to Mr. Zeltzer, Moshe.

Thank you, Eyal. Good morning, and afternoon, everybody. In reference to Eyal's review and within a broader framework versus first quarter report for net income are the primary effect of the comprehensive companies in the process that Eyal has been leading for the past years. When in effect the meaning of it is the rejuvenation of most of course, core business while bringing it to a consistent course of sound organic sales and profit growth specifically first quarter was characterized by the continued implementation of significant steps to strengthen capabilities with productivity and expand organic source of income. -- as well as strengthening the organizational structure and the basic process in the LTV. Looking ahead, to the rest of the year and next year, combining our strong competition or its favorable market dynamics in the Israeli defense, in high-tech segments. We are optimistic about the future. We plan to continue expanding the business lines of all of our divisions in the premium segments in Israel, which should lead to a further growth -- in addition, we plan to expand the division footprint to the production floor and warehouse to the retail store. I trust mostly made by -- to achieve these challenging goals. Our teams indication expertise and hard work having instrumentally our success so far and very confident that they will continue to drive our growth and achieve our goals. Thank you for your attention. I will now hand over back presentation to Eyal.

Thank you, Ziv. At this time, we begin the W&A session. If you have questions, please un-mute and present yourself while all of the participants remain mute, thank you.

I would like to know why the revenue of the first quarter of this year was less than last year. And is there any impact of the war that influenced this quarter? And what do you think about the gross margin, do you think this level is -- are going to stay. Do you think they can improve? And do you think that the second quarter could be better because of the war or there's no impact? That's all for now.

Regarding the decrease in revenues per the first permit quarter -- it's not a sign to any effect. Because of that, we keep on our outlook for the year. If we keep it on with it at a level of $46 million and regardless of gross -- by the way, part of the decrease is related to deferred revenues of the year for [indiscernible] division which are very low revenue this quarter because most of the old of our imports and we recognize having its profile. And -- regarding the war regarding the situation is about 25% of our business these defense segment. And the -- we try -- we are trying to increase distortion. They absolutely support our into support our continued growth during this year and maybe beyond.

Okay. So you'll see another place of another space of improvement for the gross margin?

I'm not sure regarding the gross margin or profit margin. But regarding the revenues will agree that $46 million loan this year. And we believe we will continue to close revenue next year as well.

Congratulations on the great quarter and the record earnings. It's nice to see that I know you just mentioned that about 75% of your revenue is defense related. What was this a year ago? How much has the defense business grown?