RISHON LE ZION, Israel, May 30, 2024 (GLOBE NEWSWIRE) -- BOS Better Online Solutions Ltd. ("BOS" or the "Company") (NASDAQ:BOSC) reported its financial results for the first quarter of the year 2024. First Quarter 2024 Financial Highlights: Eyal Cohen, BOS' CEO, stated: "I am pleased with the financial results of the first quarter of 2024 reflecting a record quarterly net income of $741,000 and earnings per share of $0.13. These results puts us on track towards achieving our financial targets for 2024: reve ...

RISHON LEZION, Israel, April 15, 2024 (GLOBE NEWSWIRE) -- B.O.S. Better Online Solutions Ltd. (“BOS” or the “Company”) (NASDAQ: BOSC), announced today that it will release its financial results for the first quarter of 2024 before the market opens on Thursday, May 30, 2024. BOS will host a video conference call on May 30, 2024 at 9:00 a.m. EDT. A question-and-answer session will follow management’s presentation. To access the video conference call, please click on the following link: Join Zoom Meeting https ...

RISHON LEZION, Israel, April 15, 2024 (GLOBE NEWSWIRE) -- B.O.S. Better Online Solutions Ltd. (“BOS” or the “Company”) (NASDAQ: BOSC), announced today that it will release its financial results for the first quarter of 2024 before the market opens on Thursday, May 30, 2024. BOS will host a video conference call on May 30, 2024 at 9:00 a.m. EDT. A question-and-answer session will follow management’s presentation. To access the video conference call, please click on the following link: Join Zoom Meetinghttps: ...

[Directors, Senior Management and Employees](index=36&type=section&id=ITEM%206%3A%20DIRECTORS%2C%20SENIOR%20MANAGEMENT%20AND%20EMPLOYEES) This section details the company's leadership structure, compensation, board practices, employee overview, and share ownership by key personnel [Directors and Senior Management](index=36&type=section&id=6A.%20Directors%20and%20Senior%20Management) Details roles, ages, and biographies of directors and senior management, highlighting key executives like Ziv Dekel, Eyal Cohen, Avidan Zelicovsky, and Moshe Zeltzer Directors and Senior Management Overview | Name | Age | Position | | :--- | :--- | :--- | | Mr. Ziv Dekel | 60 | Chairman of the Board of Directors (Class C) | | Ms. Osnat Gur | 53 | Director (Class A) | | Mr. Yaron Eldad | 57 | Chairman of Audit and Compensation Committees (Class B) | | Mr. Eyal Cohen | 55 | Chief Executive Officer and Director (Class C) | | Mr. Avidan Zelicovsky | 54 | President | - Mr. Eyal Cohen, previously the CFO since 2007 and Co-CEO since 2017, has been the sole Chief Executive Officer since **December 2019**[9](index=9&type=chunk) - Mr. Yaron Eldad serves as the Chairman of both the Audit Committee and the Compensation Committee, and the Board has determined he is an independent director and a financial expert under SEC and Nasdaq rules[7](index=7&type=chunk) [Compensation](index=39&type=section&id=6B.%20Compensation) Outlines the compensation structure for directors and executive officers, including 2023 totals, Israeli Compensation Policy requirements, and specific salaries and benefits for key executives Total Director and Officer Compensation (2023) | Group | Salaries, Fees, Stock-Based Compensation, etc. (in thousands) | Pension, Retirement and Similar benefits (in thousands) | | :--- | :--- | :--- | | All directors and officers as a group (6 persons) | **$744** | **$105** | - The company's Compensation Policy, required by Israeli law (Amendment 20), was approved by shareholders and recently amended on **December 14, 2023**, to include a clawback policy compliant with Nasdaq listing rules[16](index=16&type=chunk)[17](index=17&type=chunk)[18](index=18&type=chunk) Executive Officer Monthly Salaries | Officer | Position | Gross Monthly Base Salary | | :--- | :--- | :--- | | Mr. Eyal Cohen | CEO | NIS 50,145 (approximately **$13,825**) | | Mr. Moshe Zeltzer | CFO | NIS 30,000 (approximately **$8,270**) | | Mr. Avidan Zelicovsky | President | NIS 54,984 (approximately **$15,159**) | - Non-employee directors receive an annual compensation of NIS 29,270 (approximately **$9,104**) and NIS 2,175 (approximately **$676**) for each board and committee meeting attended, and are also eligible for grants of **7,500 options** every three years[24](index=24&type=chunk)[25](index=25&type=chunk) [Board Practices](index=42&type=section&id=6C.%20Board%20Practices) Describes the Board of Directors' structure, including its classified nature, fiduciary duties, committee compositions, and the company's election to opt out of external director requirements - The Board of Directors is currently comprised of **4 directors**, divided into **3 classes** with staggered three-year terms to ensure continuity[47](index=47&type=chunk) - The company has opted out of the Israeli requirement to appoint External Directors, as permitted by the Relief Regulations for companies listed on foreign exchanges like Nasdaq[32](index=32&type=chunk)[51](index=51&type=chunk) - The Audit Committee consists of **three independent directors**, with Yaron Eldad serving as the chairperson and designated financial expert[57](index=57&type=chunk)[58](index=58&type=chunk) - The Compensation Committee is composed of **three independent directors** and is responsible for recommending the compensation policy and approving terms of employment for office holders[63](index=63&type=chunk)[64](index=64&type=chunk)[65](index=65&type=chunk) Board Diversity Matrix (As of March 15, 2024) | Gender Identity | Count | | :--- | :--- | | Female | 1 | | Male | 3 | | Non-Binary | 0 | | Did Not Disclose | 0 | | **Total Directors** | **4** | [Employees](index=47&type=section&id=6D.%20Employees) Provides an overview of the company's 83 employees as of March 15, 2024, all based in Israel, detailing their functional distribution and labor relations status Employee Breakdown by Function (as of March 15, 2024) | Department | Number of Employees | | :--- | :--- | | General and administrative | 10 | | Marketing and sales | 17 | | Technicians | 14 | | Engineers | 6 | | Manufacturing | 4 | | Operating activities | 32 | | **Total** | **83** | - All employees are located in Israel and are not represented by any labor union or collective bargaining agreements, though certain national labor provisions apply[75](index=75&type=chunk)[85](index=85&type=chunk) [Share Ownership](index=47&type=section&id=6E.%20Share%20Ownership) Details beneficial share and option ownership by directors and officers, and outlines the extended 2003 Israeli Stock Option Plan with 1,000,000 reserved Ordinary Shares Share and Option Ownership by Officers and Directors (as of March 15, 2024) | Name | Position | Options Beneficially Owned | % of Shares and Options Beneficially Owned | | :--- | :--- | :--- | :--- | | Eyal Cohen | Chief Executive Officer | 183,475 | **3.19%** | | Avidan Zelicovsky | President | 13,333 | **0.23%** | | Ziv Dekel | Chairman | 27,500 | **0.48%** | | Yaron Eldad | Director | 7,500 | **0.13%** | | Moshe Zeltzer | Chief Financial Officer | 20,000 | **0.35%** | | Osnat Gur | Director | 7,500 | **0.13%** | - The company's 2003 Israeli Stock Option Plan was extended through **May 31, 2033**, and the pool of reserved shares was increased to **1,000,000 Ordinary Shares**[82](index=82&type=chunk) - As of **March 20, 2024**, there were **300,833 options** outstanding under the plan, of which **156,666** were exercisable[94](index=94&type=chunk) [Major Shareholders and Related Party Transactions](index=49&type=section&id=ITEM%207%3A%20MAJOR%20SHAREHOLDERS%20AND%20RELATED%20PARTY%20TRANSACTIONS) This section identifies major shareholders and details transactions with related parties, including intercompany management fees and director/officer indemnities [Major Shareholders](index=49&type=section&id=7A.%20Major%20Shareholders) Identifies major shareholders, noting Todd M. Felte as the only beneficial owner of over 5% of Ordinary Shares, holding **9.68%** as of March 20, 2024 - To the company's knowledge, as of **March 20, 2024**, Todd M. Felte was the only shareholder beneficially owning more than **5%** of the company's shares, with **556,390 Ordinary Shares** representing **9.68% ownership**[95](index=95&type=chunk) Changes in Major Shareholder Holdings (Number of Shares) | Shareholder | Dec 31, 2020 | Dec 31, 2021 | Dec 31, 2022 | Dec 31, 2023 | | :--- | :--- | :--- | :--- | :--- | | Todd M. Felte | 845,700 | 845,700 | 556,390 | 556,390 | [Related Party Transactions](index=49&type=section&id=7B.%20Related%20Party%20Transactions) Details related party transactions, including intercompany management fees and indemnity undertakings for directors and officers with liability insurance up to **$2.5 million** Intercompany Management Fees | Year | Amount Charged to Subsidiaries | | :--- | :--- | | 2023 | **$2,331,000** | | 2022 | **$2,185,000** | - The company provides indemnity undertakings to its directors and officers for up to an aggregate amount of **$2,500,000**, in excess of any insurance proceeds[102](index=102&type=chunk) - The company's Compensation Policy allows for the purchase of directors' and officers' liability insurance with coverage up to **$2.5 million** per event and per period[104](index=104&type=chunk) [Financial Information](index=50&type=section&id=ITEM%208%3A%20FINANCIAL%20INFORMATION) This section presents key financial data, including export revenues, legal proceedings status, dividend policy, and a statement on significant changes [Consolidated Statements and Other Financial Information](index=50&type=section&id=8A.%20Consolidated%20Statements%20and%20Other%20Financial%20Information) Presents key financial details, including a decline in export revenues to **14%** in 2023, absence of legal proceedings, and no formal dividend policy Sales Outside of Israel | Year | Export Revenues | % of all revenues | | :--- | :--- | :--- | | 2023 | **$6,054,000** | **14%** | | 2022 | **$7,216,000** | **17%** | | 2021 | **$7,972,000** | **24%** | - The company reports no ongoing legal proceedings[109](index=109&type=chunk) - The company does not currently have a dividend policy, and any future dividends will be determined by the Board of Directors based on earnings and financial condition[110](index=110&type=chunk) [Significant Changes](index=51&type=section&id=8B.%20Significant%20Changes) Reports no significant changes in the company's financial or operational status - No significant changes were reported[111](index=111&type=chunk) [The Offer and Listing](index=51&type=section&id=ITEM%209%3A%20THE%20OFFER%20AND%20LISTING) This section provides details regarding the company's stock listing on the Nasdaq Capital Market [Offer and Listing Details](index=51&type=section&id=9A.%20Offer%20and%20Listing%20Details) Provides details on the company's stock listing, with Ordinary Shares traded on the Nasdaq Capital Market under the symbol "BOSC" - The company's Ordinary Shares are traded on the Nasdaq Capital Market under the symbol "**BOSC**"[112](index=112&type=chunk)[139](index=139&type=chunk) [Additional Information](index=52&type=section&id=ITEM%2010%3A%20ADDITIONAL%20INFORMATION) This section covers the company's governing documents, exchange controls, and a comprehensive overview of Israeli and U.S. tax implications for shareholders [Memorandum and Articles of Association](index=52&type=section&id=10B.%20Memorandum%20and%20Articles%20of%20Association) Summarizes key provisions of governing documents, including board powers, shareholder rights, classified board structure, and Israeli legal requirements for changes of control - The company's authorized share capital was increased to **11 million ordinary shares** in **December 2022**[144](index=144&type=chunk) - The Board of Directors is classified into **three separate classes**, with each class serving a three-year term, a structure that may delay or deter a potential takeover[155](index=155&type=chunk)[250](index=250&type=chunk) - Israeli law requires a tender offer for share acquisitions that result in a holding of **25% or more**, or **more than 45%**, of the voting power, unless certain exceptions apply[247](index=247&type=chunk) [Exchange Controls](index=56&type=section&id=10D.%20Exchange%20Controls) States no current Israeli currency control restrictions on dividends or share sale proceeds, but notes the government's retained authority to impose them - There are currently no Israeli currency control restrictions on dividends or proceeds from share sales, but the government retains the authority to impose them in the future[254](index=254&type=chunk) [Taxation](index=56&type=section&id=10E.%20Taxation) Provides an overview of Israeli and U.S. federal income tax implications for shareholders, covering corporate tax, capital gains, dividends, and PFIC status - The Israeli corporate tax rate has been **23%** effective **January 2018**[261](index=261&type=chunk) - Non-Israeli residents are generally exempt from Israeli capital gains tax on sales of shares of Israeli companies traded on a foreign stock exchange, provided certain conditions are met[264](index=264&type=chunk) - Dividends paid to non-Israeli residents are generally subject to a **25% withholding tax**, which may be reduced by an applicable tax treaty (e.g., the U.S.-Israel Tax Treaty)[270](index=270&type=chunk)[272](index=272&type=chunk) - The company believes it was not a Passive Foreign Investment Company (PFIC) for the **2023 taxable year**, but makes no assurances for future years, as PFIC status could have adverse U.S. tax consequences for U.S. shareholders[336](index=336&type=chunk) [Quantitative and Qualitative Disclosure about Market Risk](index=65&type=section&id=Item%2011%3A%20Quantitative%20and%20Qualitative%20Disclosure%20about%20Market%20Risk) Details primary market risks, including foreign currency exchange rate risk, credit risk from trade receivables, and interest rate risk, with hedging strategies and receivable insurance noted [Foreign Currency Exchange Rate Risk](index=65&type=section&id=Foreign%20Currency%20Exchange%20Rate%20Risk) Addresses currency risk, primarily NIS against USD, and the use of forward contracts to hedge payroll and related expenses - The company's most significant currency exposure is to the Israeli Shekel (NIS) against the U.S. dollar[358](index=358&type=chunk) - The company uses forward contracts designated as cash flow hedges to reduce the risk of exchange rate fluctuations on payroll and related expenses denominated in NIS, which resulted in an income of (**$25,000**) in **2023**[360](index=360&type=chunk) [Credit Risk Management](index=66&type=section&id=Credit%20Risk%20Management) Discusses credit risk from trade receivables across various regions, noting the absence of collateral requirements and the use of receivable insurance Trade Receivables by Geographical Market (in thousands) | Region | 2023 | 2022 | | :--- | :--- | :--- | | Israel and others | **$11,567** | **$9,993** | | India | **$355** | **$435** | | Americas | **$263** | **$401** | | Far East | **$49** | **$5** | | Europe | **$190** | - | | **Total** | **$12,424** | **$10,834** | [Controls and Procedures](index=67&type=section&id=Item%2015%3A%20Controls%20and%20Procedures) Addresses internal controls, with the CEO and CFO concluding effective disclosure controls and internal control over financial reporting as of **December 31, 2023**, based on the COSO framework [Management's Annual Report on Internal Control over Financial Reporting](index=67&type=section&id=Management%27s%20Annual%20Report%20on%20Internal%20Control%20over%20Financial%20Reporting) Management, including the CEO and CFO, concluded that internal control over financial reporting was effective as of **December 31, 2023**, based on the COSO (2013) framework - The CEO and CFO concluded that the company's disclosure controls and procedures were effective at a reasonable level of assurance as of the end of the period covered by the report[421](index=421&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of **December 31, 2023**, based on the COSO (2013) framework[423](index=423&type=chunk)[424](index=424&type=chunk) - This annual report does not include an attestation report from the registered public accounting firm regarding internal control, as permitted by SEC rules for the company[425](index=425&type=chunk) [Corporate Governance & Other Items](index=68&type=section&id=Item%2016) This section covers the audit committee's financial expert, principal accountant fees, corporate governance practices as a foreign private issuer, and cybersecurity risk management [Audit Committee Financial Expert](index=68&type=section&id=16A%3A%20Audit%20Committee%20Financial%20Expert) The Board of Directors has designated Mr. Yaron Eldad, Audit Committee chairman, as an "audit committee financial expert" under SEC regulations - The Board of Directors has determined that Mr. Yaron Eldad qualifies as an "**audit committee financial expert**"[429](index=429&type=chunk) [Principal Accountant Fees and Services](index=68&type=section&id=16C%3A%20Principal%20Accountant%20Fees%20and%20Services) Details fees paid to Fahn Kanne & Co. Grant Thornton Israel, the independent registered public accounting firm, all pre-approved by the audit committee Principal Accountant Fees (in thousands) | Fee Type | 2023 | 2022 | | :--- | :--- | :--- | | Audit Fees | **$81** | **$95** | | All Other Fees | **$0** | **$0** | | **Total** | **$81** | **$95** | [Corporate Governance](index=69&type=section&id=16G%3A%20Corporate%20Governance) As a foreign private issuer, the company follows Israeli corporate governance practices, specifically regarding shareholder approval for certain private placements, instead of Nasdaq rules - The company, as a foreign private issuer, follows Israeli law instead of Nasdaq rules regarding shareholder approval for certain private placements, as Israeli law does not require it for public companies traded only outside of Israel[435](index=435&type=chunk)[471](index=471&type=chunk) [Cybersecurity](index=69&type=section&id=16K%3A%20Cybersecurity) Describes the company's cybersecurity risk management program, overseen by key executives and the audit committee, with no significant material threats identified as of the reporting date - The company has an established cybersecurity risk management program, with oversight provided by the audit committee[474](index=474&type=chunk)[476](index=476&type=chunk) - As of the reporting date, no significant cybersecurity threats have been identified that are reasonably likely to materially impact the company[476](index=476&type=chunk) [Financial Statements](index=70&type=section&id=Item%2018%3A%20Financial%20Statements) This section presents the company's consolidated statements of operations, balance sheets, and cash flows, highlighting key financial performance and position metrics [Consolidated Statements of Operations](index=78&type=section&id=Consolidated%20Statements%20of%20Operations) Revenues increased to **$44.2 million** in 2023, with stable gross profit and a significant rise in net income to **$2.01 million** due to reduced expenses Consolidated Statements of Operations Highlights (in thousands) | Metric | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Revenues | **$44,179** | **$41,511** | **$33,634** | | Gross Profit | **$9,209** | **$9,060** | **$6,586** | | Operating Income | **$2,450** | **$1,929** | **$517** | | Net Income | **$2,005** | **$1,276** | **$451** | | Diluted EPS | **$0.34** | **$0.23** | **$0.08** | [Consolidated Balance Sheets](index=76&type=section&id=Consolidated%20Balance%20Sheets) Total assets grew to **$32.5 million** and shareholders' equity increased to **$18.8 million** as of **December 31, 2023**, reflecting a strengthened financial position Consolidated Balance Sheet Highlights (in thousands) | Metric | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | **$2,344** | **$1,763** | | Total current assets | **$22,018** | **$20,574** | | Goodwill | **$4,895** | **$4,895** | | Total assets | **$32,481** | **$30,595** | | **Liabilities & Equity** | | | | Total current liabilities | **$10,904** | **$11,195** | | Total liabilities | **$13,642** | **$13,961** | | Total shareholders' equity | **$18,839** | **$16,634** | [Consolidated Statements of Cash Flows](index=80&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Operating activities generated **$1.83 million** in cash in 2023, contributing to a **$0.58 million** increase in cash and cash equivalents despite investing and financing outflows Consolidated Statements of Cash Flows Highlights (in thousands) | Metric | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | **$1,829** | **$1,283** | **$9** | | Net cash (used in) investing activities | **$(772)** | **$(3,091)** | **$(379)** | | Net cash provided by (used in) financing activities | **$(389)** | **$1,584** | **$1,311** | | Increase (decrease) in cash | **$668** | **$(224)** | **$941** |

BOS Reports Financial Results for the Fourth Quarter and the Year 2023 ● Revenues grew by 6.5% to $44.2 million from $41.5 million in the year 2022 ; Exhibit 99.1 RISHON LE ZION, Israel, March 28, 2024 – BOS Better Online Solutions Ltd. ("BOS" or the "Company") (NASDAQ: BOSC) reported its financial results for the fourth quarter and the year 2023. ● Operating profit increased to $2.5 million from $1.9 million in the year 2022; ● Financial expenses decreased to $441,000 from $647,000 in the year 2022. Fourth ...

B.O.S. Better Online Solutions Ltd. (NASDAQ:BOSC) Q4 2023 Earnings Conference Call March 28, 2024 9:00 AM ET Company Participants Eyal Cohen - CEO Ziv Dekel - Chairman Conference Call Participants Todd Felte - Advisory Group Equity Services Operator Ladies and gentlemen, thank you for standing by. Welcome to the B.O.S Conference Call. A participants are at present in listen-only mode. As a reminder, this conference call is being recorded and will be available on the B.O.S website as of tomorrow. Before I tu ...

RISHON LE ZION, Israel, March 11, 2024 (GLOBE NEWSWIRE) -- BOS Better Online Solutions Ltd. ("BOS" or the "Company") (NASDAQ:BOSC) announced today that its Intelligent Robotics Division has received a €615,000 order for a robotic production line from an Israeli defense-industry customer. This order will be delivered in March 2025. Eyal Cohen, BOS' CEO, stated: "Our strategic growth plan for the Intelligent Robotics division focuses on customers from the Israeli defense market, which have a great potential f ...

B.O.S. Better Online Solutions Ltd. (NASDAQ:BOSC) Q3 2023 Results Conference Call November 30, 2023 9:00 AM ET Company Participants Eyal Cohen - CEO Conference Call Participants Todd Felte - Advisory Group Equity Services Operator Ladies and gentlemen, thank you for standing by. Welcome to the B.O.S. Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded and will be available on the B.O.S. website as of tomorrow. Before I turn the call over to Mr. Cohen, I would like ...

[Condensed Interim Consolidated Financial Statements](index=1&type=section&id=Condensed%20Interim%20Consolidated%20Financial%20Statements) [Condensed Interim Consolidated Balance Sheets](index=2&type=section&id=Condensed%20Interim%20Consolidated%20Balance%20Sheets) As of June 30, 2023, B.O.S. Better Online Solutions Ltd. reported total assets of **$32.53 million**, an increase from **$30.60 million** at the end of 2022, driven by increases in current assets (inventories) and non-current assets (intangible assets), with total liabilities slightly increasing to **$14.50 million** and total shareholders' equity growing to **$18.03 million** from **$16.63 million** Balance Sheet Summary (in thousands USD) | Account | June 30, 2023 (Unaudited) | December 31, 2022 (Audited) | | :--- | :--- | :--- | | **Total Current Assets** | $21,920 | $20,574 | | **Total Non-Current Assets** | $10,609 | $10,021 | | **Total Assets** | **$32,529** | **$30,595** | | **Total Current Liabilities** | $11,848 | $11,195 | | **Total Non-Current Liabilities** | $2,647 | $2,766 | | **Total Equity** | $18,034 | $16,634 | | **Total Liabilities and Equity** | **$32,529** | **$30,595** | - Inventories increased to **$7.67 million** from **$6.43 million**, while trade receivables remained relatively stable at **$11.01 million**[20](index=20&type=chunk) - Intangible assets, net, significantly increased to **$1.17 million** from **$486 thousand** at the end of 2022[91](index=91&type=chunk) [Condensed Interim Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Interim%20Consolidated%20Statements%20of%20Operations) For the six months ended June 30, 2023, the company reported revenues of **$23.48 million**, an **11%** increase year-over-year, with net income growing significantly to **$1.27 million**, or **$0.22** per diluted share, compared to **$472 thousand**, or **$0.09** per diluted share, in the same period of 2022, driven by higher gross profit and lower financial expenses Statement of Operations Highlights (in thousands USD, except per share data) | Metric | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | | **Revenues** | $23,478 | $21,138 | | **Gross Profit** | $5,069 | $4,471 | | **Operating Income** | $1,609 | $1,001 | | **Net Income** | $1,266 | $472 | | **Diluted Net Income Per Share** | $0.22 | $0.09 | [Condensed Interim Consolidated Statements of Comprehensive Income](index=5&type=section&id=Condensed%20Interim%20Consolidated%20Statements%20of%20Comprehensive%20Income) For the six months ended June 30, 2023, the company's comprehensive income was **$1.27 million**, equal to its net income, with no other comprehensive income or loss items during the period, marking an increase from **$472 thousand** in the prior-year period Comprehensive Income (in thousands USD) | Period | Net Income | Other Comprehensive Gain/Loss | Comprehensive Income | | :--- | :--- | :--- | :--- | | **Six Months Ended June 30, 2023** | $1,266 | $0 | $1,266 | | **Six Months Ended June 30, 2022** | $472 | $0 | $472 | [Condensed Interim Consolidated Statements of Changes in Shareholders' Equity](index=6&type=section&id=Condensed%20Interim%20Consolidated%20Statements%20of%20Changes%20in%20Shareholders%27%20Equity) Shareholders' equity increased from **$16.63 million** at the beginning of 2023 to **$18.03 million** as of June 30, 2023, primarily driven by a net income of **$1.27 million** and proceeds from the exercise of stock options, which added **$85 thousand** to additional paid-in capital - Total shareholders' equity increased by **$1.4 million** during the first six months of 2023, reaching **$18.03 million**[54](index=54&type=chunk) - Key changes in equity for the six months ended June 30, 2023 include net income of **$1,266 thousand**, share-based compensation of **$49 thousand**, and proceeds from option exercises of **$85 thousand**[54](index=54&type=chunk) [Condensed Interim Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Interim%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2023, the company generated **$876 thousand** in cash from operating activities, a significant turnaround from the **$331 thousand** used in the same period of 2022, while cash used in investing activities was **$581 thousand**, primarily for asset acquisitions, and financing activities used **$113 thousand**, resulting in cash and cash equivalents increasing by **$182 thousand** to end the period at **$2.08 million** Cash Flow Summary (in thousands USD) | Cash Flow Activity | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | | **Net Cash from Operating Activities** | $876 | $(331) | | **Net Cash used in Investing Activities** | $(581) | $(1,050) | | **Net Cash (used in) provided by Financing Activities** | $(113) | $514 | | **Change in Cash and Cash Equivalents** | $182 | $(867) | | **Cash at End of Period** | $2,075 | $1,250 | [Notes to Condensed Interim Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Interim%20Consolidated%20Financial%20Statements) The notes provide additional details on the company's accounting policies, business segments, and specific financial statement line items, including the composition of inventories and intangible assets, lease obligations, segment performance, and shareholder equity transactions, with the company operating in three segments: Intelligent Robotics, RFID, and Supply Chain Solutions [Note 1: General](index=9&type=section&id=NOTE%201%3A%E2%80%93%20GENERAL) This note describes the company's corporate structure as an Israeli NASDAQ-listed corporation (BOSC) and its three operating segments: Intelligent Robotics, RFID (through BOS-Dimex Ltd.), and Supply Chain Solutions (through BOS-Odem Ltd. and Ruby-Tech Inc.) - The company operates through three main segments: Intelligent Robotics, RFID, and Supply Chain Solutions[58](index=58&type=chunk) - The RFID segment (BOS-Dimex) provides turn-key Automatic Identification and Data Collection (AIDC) solutions and inventory count services[33](index=33&type=chunk) - The Supply Chain Solutions segment (BOS-Odem) distributes electronic components, primarily to the aerospace and defense industries[59](index=59&type=chunk) [Note 2: Significant Accounting Policies](index=10&type=section&id=NOTE%202%3A%E2%80%93%20SIGNIFICANT%20ACCOUNTING%20POLICIES) The financial statements are prepared under U.S. GAAP, requiring management to make significant estimates regarding inventory valuation, goodwill impairment, allowance for doubtful accounts, and revenue recognition, with **570,000** outstanding options and warrants excluded from the diluted EPS calculation as they were anti-dilutive for the six months ended June 30, 2023 - Financial statements are prepared under U.S. GAAP, requiring management to make significant estimates for items like inventory value, goodwill, and revenue recognition[37](index=37&type=chunk) - For the first half of 2023, **570,000** weighted average outstanding options and warrants were excluded from diluted EPS calculation due to being anti-dilutive[62](index=62&type=chunk) - The company states that no recently issued accounting pronouncements are expected to have a significant impact on its financial statements[64](index=64&type=chunk) [Note 4: Inventories](index=11&type=section&id=NOTE%204%3A-%20INVENTORIES) Total net inventories increased to **$7.67 million** as of June 30, 2023, from **$6.43 million** at year-end 2022, with the increase primarily in finished goods, which rose to **$6.97 million**, while inventory in progress decreased Inventory Composition (in thousands USD) | Component | June 30, 2023 (Unaudited) | December 31, 2022 (Audited) | | :--- | :--- | :--- | | Raw materials | $31 | $177 | | Inventory in progress | $955 | $1,750 | | Finished goods | $6,973 | $5,788 | | Net – advances from customers | $(292) | $(1,282) | | **Total** | **$7,667** | **$6,433** | [Note 5: Intangible Assets, Net](index=12&type=section&id=NOTE%205%3A%E2%80%93%20INTANGIBLE%20ASSETS%2C%20NET) Net intangible assets increased to **$1.17 million** from **$486 thousand**, mainly due to new acquisitions, including Proteus's share in a joint activity for **$723 thousand** in April 2023 and distribution rights from Microwave Ltd. for **$38 thousand** in May 2023 - On April 2, 2023, the company acquired Proteus's share in a joint activity for **$723 thousand**, recognized as a 'Suppliers relationship' intangible asset[44](index=44&type=chunk) - On May 31, 2023, the company purchased distribution rights for certain products from Microwave Ltd. for **$38 thousand**[45](index=45&type=chunk) - Amortization expense for intangible assets was **$73 thousand** for the six months ended June 30, 2023[68](index=68&type=chunk) [Note 6: Leases](index=13&type=section&id=NOTE%206%3A%E2%80%93%20LEASES) The company has non-cancellable operating leases for offices and vehicles with terms expiring between 2023 and 2034, with total operating lease cost of **$198 thousand** for the first half of 2023 and a present value of total future lease liabilities of **$909 thousand** as of June 30, 2023 Operating Lease Costs - H1 2023 (in thousands USD) | Category | Cost | | :--- | :--- | | Vehicles | $91 | | Facilities rent | $107 | | **Total** | **$198** | Maturities of Operating Lease Liabilities (in thousands USD) | Period | Lease Payments | | :--- | :--- | | Remainder of 2023 | $178 | | 2024 | $206 | | 2025 | $140 | | 2026-2034 | $627 | | **Total Payments** | **$1,151** | | **Present Value** | **$909** | [Note 7: Segments and Geographical Information](index=14&type=section&id=NOTE%207%3A%E2%80%93%20SEGMENTS%20AND%20GEOGRAPHICAL%20INFORMATION) The Supply Chain Solutions segment is the largest contributor to both revenue and operating income, generating **$15.35 million** in revenue and **$1.39 million** in operating income for H1 2023, while the RFID segment contributed positively with **$6.95 million** in revenue and **$699 thousand** in operating income, and Israel is the largest geographical market accounting for **$19.77 million** (**84%**) of total revenue Segment Performance - H1 2023 (in thousands USD) | Segment | Revenues | Gross Profit | Operating Income (Loss) | | :--- | :--- | :--- | :--- | | RFID | $6,948 | $1,796 | $699 | | Supply Chain Solutions | $15,351 | $3,253 | $1,394 | | Intelligent Robotics | $1,257 | $20 | $(110) | | **Consolidated** | **$23,478** | **$5,069** | **$1,609** | Segment Performance - H1 2022 (in thousands USD) | Segment | Revenues | Gross Profit | Operating Income (Loss) | | :--- | :--- | :--- | :--- | | RFID | $7,693 | $1,915 | $662 | | Supply Chain Solutions | $12,873 | $2,575 | $990 | | Intelligent Robotics | $572 | $(19) | $(290) | | **Consolidated** | **$21,138** | **$4,471** | **$1,001** | Revenues by Customer Location (in thousands USD) | Region | H1 2023 | H1 2022 | | :--- | :--- | :--- | | Israel | $19,765 | $16,686 | | United States | $1,080 | $1,733 | | India | $1,060 | $641 | | Europe | $838 | $399 | | Far East | $707 | $1,536 | | Others | $28 | $143 | | **Total** | **$23,478** | **$21,138** | [Note 8: Shareholders' Equity](index=16&type=section&id=NOTE%208%3A%E2%80%93%20SHAREHOLDERS%27%20EQUITY) This note details changes in shareholders' equity, including the exercise of **39,000** options for proceeds of **$85 thousand** in June 2023 and a May 2022 registered direct offering where the company sold **450,000** units at **$2.20** each, raising net proceeds of **$911 thousand** - In June 2023, a total of **39,000** stock options were exercised, resulting in proceeds of **$85 thousand**[77](index=77&type=chunk) - In May 2022, the company completed a registered direct offering of **450,000** units (one share and one-half warrant) at **$2.20** per unit, for net proceeds of **$911 thousand**[88](index=88&type=chunk) [Note 9: Subsequent Events](index=16&type=section&id=NOTE%209%3A%E2%80%93%20SUBSEQUENT%20EVENTS) The company reports that subsequent to the reporting period, in July 2023, an additional **17,853** options were exercised for proceeds of **$18 thousand** - In July 2023, after the close of the reporting period, **17,853** options were exercised for proceeds of **$18 thousand**[79](index=79&type=chunk)

Financial Data and Key Metrics Changes - In the first half of 2023, revenues grew by 11%, EBITDA increased by 56%, net income rose by 168%, and EPS improved by 144% compared to the first half of 2022 [5] - Over a three-year perspective, revenue has grown by 31% to $44 million compared to 2020 [5] - EBITDA increased by 342% to $3.1 million, with net income turning from a loss of $1 million in 2020 to an income of $2.5 million in the last 12 months ended June 2023 [28] Business Line Data and Key Metrics Changes - The Robotics division is transitioning towards the Israeli defense market, with most projects attributed to a major defense company in Israel [6] - The RFID division experienced a slowdown in revenues due to a decline in the Israeli civil market [6][35] - The Supply Chain division benefited from intense demand driven by military conflicts in Europe and the Middle East, supporting growth in this segment [12] Market Data and Key Metrics Changes - The Israeli civil market is currently in a standby phase, impacting the RFID division's performance [42] - The growth in the defense segment is primarily driven by sales to Israeli manufacturers and their subcontractors globally [19] Company Strategy and Development Direction - The growth strategy includes both organic growth and M&A, focusing on strengthening competitiveness and expanding into new markets [29] - The M&A strategy targets companies with a strong competitive position, a track record of profitability, and a significant portion of recurrent revenues [30] - The company aims to penetrate the defense market further to enhance profitability [23] Management's Comments on Operating Environment and Future Outlook - Management noted that the devaluation of the shekel primarily affects operational expenses, with a strong dollar positively impacting performance [18] - The company expects continued growth in the defense market, which has a more favorable budget environment compared to the civil industry [23] - There is optimism regarding the stabilization and potential growth of the RFID division, despite current challenges [42] Other Important Information - The company is engaging with agents to identify attractive M&A targets and is currently in the process of defining the scope of potential acquisitions [8][14] Q&A Session Summary Question: Impact of shekel devaluation on revenues - Management explained that most revenues are quoted in dollars, and the devaluation mainly affects operational and financial expenses, with a net positive effect on performance [18] Question: Growth sources and new business segments - Growth is attributed to the defense segment and the transition of the Robotics division to the defense market, with strong demand from Israeli manufacturers [19] Question: Future profitability of the Robotics and RFID divisions - The Robotics division is expected to become profitable as it transitions to the defense market, while the RFID division is linked to the Israeli GDP and is anticipated to stabilize despite current market conditions [41][42]