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 August 2003
B.O.S. BETTER ON-LINE SOLUTIONS, LTD.
(Translation of Registrant's Name into English)
100 BOS ROAD, TERADION 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 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
1. The Registrant has received notice from the Nasdaq Stock Market indicating
that for 30 consecutive trading days the Registrant's ordinary shares have
not maintained a minimum market value of publicly held shares of $5,000,000
as required for continued inclusion on the Nasdaq National Market under
Marketplace Rule 4450(a)(2), and will be provided until November 26, 2003
to regain compliance. Should the Registrant not regain compliance, the
Registrant's securities may be delisted from the Nasdaq National Market,
and the Registrant may be eligible to transfer its securities to the Nasdaq
SmallCap Market.
2. Attached hereto and incorporated by reference is the following Registrant's
press release:
B.O.S. Better On-line Solutions Ltd. Announces Financial Results of
Operations for the Second Quarter of 2003; Dated August 21, 2003.
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/ ISRAEL GAL
---------------------
Israel Gal
President and CEO
Dated: September 1, 2003
B.O.S. - BETTER ON-LINE SOLUTIONS LTD.
--------------------------------------------------------------------------------
B.O.S. BETTER ON-LINE SOLUTIONS LTD. ANNOUNCES FINANCIAL RESULTS OF OPERATIONS
FOR THE SECOND QUARTER OF 2003
TERADYON, ISRAEL - August 21, 2003 - B.O.S. Better On-line Solutions Ltd. (the
"Company" or "BOS") (NASDAQ: BOSC, TASE:BOS) announced today its financial
results for the quarter ended June 30, 2003.
Revenues for the second quarter of 2003 were $1.49 million, higher by 5% than
the first quarter of 2003 and lower than the second quarter of 2002 by 44%.
Net loss for the second quarter of 2003 from continuing segments was $969,000
(or $0.25 per share), compared to a net profit of $272,000 (or $0.09 per share)
for the second quarter of 2002.
Total cash and investments were $6.76 million as of June 30, 2003.
The Company reported a $267,000 in restructuring costs, derived from closing non
profitable sales offices as per its cost reduction plan.
As of January 1, 2003 the Company has been preparing consolidated financial
statements in accordance with United States Generally Accepted Accounting
Principles ("U.S. GAAP").
Gross profit margin for the second quarter of 2003 was 69%, compared to 68% for
the first quarter of 2003 and 75% for the second quarter of 2002. The software
vs. hardware sales breakdown within the Company's Legacy products line was
distributed differently this year, with more of the sales being generated from
the lower-profit margin hardware products than in previous years. As a result,
there was a decrease in the gross margin percentage, compared to 2002.
Operating expenses for the second quarter of 2003, excluding restructuring
costs, totaled $1.79 million, compared to $1.90 million during the first quarter
of 2003. Additionally, the Company recognized $267,000 in closure costs derived
from closing non profitable sales offices around the world according to its cost
reduction plan, so that total operating expenses for the second quarter of 2003
totaled $2.06 million.
Net loss from continuing operations for the second quarter of 2003 totaled
$969,000, compared to net loss of $949,000 for the first quarter of 2003.
ISRAEL (IZZY) GAL, B.O.S.' CEO STATED:
"During the second quarter the Company continued to reduce costs by closing
non-profitable operations, adjusting salaries, and reducing the total number of
employees.
In order to compensate for the slower-than-expected ramp-up of sales for the new
product line, the Company has adjusted its expenses and intends to reach
profitability towards the end of the current year.
Based on market acceptance to date, BOS' management is optimistic about the
future of the BOSaNOVA Claro product line. We know that we have an excellent
concept, manifested in a proven product, with a reasonable probability for
business success".
SECOND QUARTER 2003 - DISCONTINUING SEGMENT
During the fourth quarter of 2002, based on the poor economic climate and upon
its severe financial situation, the Company initiated a plan to cease the
operations of its wholly owned U.S. subsidiary, Pacific Information Systems,
Inc. ("Pacinfo") and is trying to reach an arrangement with Pacinfo's creditors.
As a result, the financial statements of the Company disclose the financial
information related to the Pacinfo in accordance with accounting standards for
"discontinued operations".
The net income from the discontinuing segment for the second quarter of 2003 was
$165,000 (or $0.04 per share) compared to net income of $1.51 million in the
first quarter of 2003 (or $0.48 per share), and a net loss of $316,000 for the
second quarter of 2002 (or $0.1 per share).
Net loss from continuing and discontinuing operations for the second quarter of
2003 was $804,000 (or $0.21 per share) compared to net income of $558,000 in the
first quarter of 2003 (or $0.16 per share) and a net loss of 44,000 (or $0.01
per share) for the second quarter of 2002.
ABOUT B.O.S.
Through its wholly owned subsidiary, BOScom, the Company develops, produces and
markets multi-functional, cross-enterprise communication and networking
products. Marketed under the BOSaNOVA brand, these products are renowned for
their simplicity of use, quality, and reliability.
The IP Telephony line (www.boscom.com) offers innovative convergence migration
solutions that leverage a corporation's existing equipment infrastructure.
The legacy line (www.bosweb.com) provides solutions for IBM midrange-to-PC and
LAN connectivity and GUI emulation, and printing solutions that are operating
system-independent.
B.O.S. (www.boscorporate.com) was established in 1990 and became a public
company traded on the Nasdaq National Market in 1996 (Nasdaq:BOSC), and on the
Tel Aviv Stock Market in 2002 (TASE:BOS).
For further information, please contact:
Mr. David Chouchena
Tel. +972-3- 6950666 x1302
e-Mail: david.c@cukierman.co.il
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.
CONSOLIDATED STATEMENTS OF OPERATIONS
--------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA
JUNE 30 DECEMBER 31
---------------------------------
2003 2002 2002
---------------- -------------- -----------------
UNAUDITED AUDITED
--------------------------------- -----------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 3,650 $ 1,195 $ 5,246
Restricted cash - - 700
Short-term bank deposits - 5,007 -
Short-term marketable securities 614 - 819
Trade receivables 981 1,853 1,523
Other accounts receivable and prepaid expenses 327 444 382
Inventories 1,171 461 855
---------------- -------------- -----------------
TOTAL CURRENT ASSETS 6,743 8,960 9,525
---------------- -------------- -----------------
LONG-TERM INVESTMENTS:
Long term marketable securities 2,497 2,879 2,226
Long term prepaid expenses 15 17 15
Severance pay funds 684 507 563
Other investment 3,952 2,042 2,042
---------------- -------------- -----------------
TOTAL LONG-TERM INVESTMENTS 7,148 5,445 4,846
---------------- -------------- -----------------
PROPERTY AND EQUIPMENT, NET 821 1,188 965
---------------- -------------- -----------------
OTHER ASSETS, NET 741 737 741
---------------- -------------- -----------------
ASSETS RELATED TO DISCONTINUING SEGMENT 117 7,262 1,115
---------------- -------------- -----------------
TOTAL ASSETS $ 15,570 $ 23,592 $ 17,192
================ ============== =================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade payables $ 957 $ 997 $ 1,044
Accrued and other liabilities 2,425 2,711 2,501
---------------- -------------- -----------------
TOTAL CURRENT LIABILITIES 3,382 3,708 3,545
---------------- -------------- -----------------
ACCRUED SEVERANCE PAY 932 740 794
---------------- -------------- -----------------
LIABILITIES RELATED TO DISCONTINUING SEGMENT 1,170 7,386 4,131
---------------- -------------- -----------------
SHAREHOLDERS' EQUITY:
Share capital 4,227 3,632 3,690
Additional paid-in capital 42,162 41,037 41,103
Deferred stock compensation 80 59 66
Accumulated deficit (36,383) (32,970) (36,137)
---------------- -------------- -----------------
TOTAL SHAREHOLDERS' EQUITY 10,086 11,758 8,722
---------------- -------------- -----------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 15,570 $ 23,592 $ 17,192
================ ============== =================
CONSOLIDATED STATEMENTS OF OPERATIONS
--------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA
THREE MONTHS ENDED SIX MONTHS ENDED YEAR ENDED
JUNE 30, JUNE 30, DECEMBER 31,
------------------ ---------------- ----------
2003 2002 2003 2002 2002
---- ---- ---- ---- ----
Revenues $ 1,487 $ 2,640 $ 2,897 $ 4,403 $ 9,441
Cost of revenues 464 667 918 1,016 2,300
----------- ----------- ----------- ----------- -----------
Gross profit 1,023 1,973 1,979 3,387 7,141
----------- ----------- ----------- ----------- -----------
Operating expenses:
Research and development, net 656 493 1,263 1,017 2,182
Selling and marketing 843 938 1,725 1,759 3,705
General and administrative 294 468 705 802 1,697
Restructuring and related costs 267 - 267 - -
----------- ----------- ----------- ----------- -----------
Total operating expenses 2,060 1,899 3,960 3,578 7,584
----------- ----------- ----------- ----------- -----------
Operating loss (1,037) 74 (1,981) (191) (443)
Financial income )expenses(, net 18 198 13 188 295
Other income (expenses) 50 - 50 (61) (95)
----------- ----------- ----------- ----------- -----------
Net loss from continuing segments (969) 272 (1,918) (64) (243)
Net income (loss) related to discontinuing
segment 165 (316) 1,672 (4,686) (7,674)
----------- ----------- ----------- ----------- -----------
Net income (loss) $ (804) $ (44) $ (246) $ (4,750) $ (7,917)
=========== =========== =========== =========== ===========
Basic and diluted net earning (loss) per share
from continuing segment $ (0.25) $ 0.09 $ (0.55) $ (0.02) $ (0.08)
=========== =========== =========== =========== ===========
Basic and diluted net earnings (loss) per share
from discontinuing segment $ 0.04 $ (0.1) $ 0.48 $ (1.51) $ (2.46)
=========== =========== =========== =========== ===========
Basic and diluted net earnings (loss) per share $ (0.21) $ (0.01) $ (0.07) $ (1.53) $ (2.54)
=========== =========== =========== =========== ===========
Weighted average number of shares used in
computing basic and diluted loss per share 3,804,156 3,100,631 3,488,019 3,100,631 3,115,236
=========== =========== =========== =========== ===========