TERADYON, ISRAEL - March 23, 2004 B.O.S. Better On-line Solutions Ltd. (the "Company" or "BOS") (NASDAQ: BOSC, TASE:BOS) announced today its financial results for the fourth quarter and the year 2003.
Revenues for 2003 were $5.7 million compared to $9.4 million in 2002 a decrease of 39% mainly due to the fact that in 2003 the Company began marketing through a master distributor and not through its subsidiaries.
The Company's research and development plan for 2003 was approved by the Office of the Chief Scientist and as a result the Company recognized $283,000 as a reduction of its R&D costs.
Net loss for the 2003 from the continuing segment was 2.4 million (or -$0.66 per share), compared to a net loss of $243,000 (or -$0.08 per share) for 2002. The net loss of year 2003 includes expenses of $678,000 due to restructuring cost and $840,000 due to impairment of investment in a company.
Total cash and investments were $6.7 million as of December 31, 2003.
Fourth Quarter 2003 - Consolidated Statement of Operation (continuing segment):
Net loss for the fourth quarter of 2003 from the continuing segment was $680,000 (or -$0.17 per share), compared to a net profit of $122,000 (or $0.04 per share) for the fourth quarter of 2002. The Company reported cost of $840,000 derived from an impairment of long-term investment in a company. Revenues for the fourth quarter of 2003 were $1.5 million, lower than the fourth quarter of 2002 by 47%, the reduction in comparison to 2002 mainly due to the fact that in 2003 the Company began marketing through a master distributor and not through its subsidiaries.
Gross profit margin for the fourth quarter of 2003 was 74% compared to 76% for the fourth quarter of 2002.
Operation income for the fourth quarter of 2003, excluding restructuring cost totaled $229,000 compared to $142,000 for the fourth quarter of 2002.
Net income from the continuing segment for the fourth quarter of 2003, excluding impairment of investment and restructuring totaled $246,000, compared to net income of $122,000 for the fourth quarter of 2002.
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").
Adiv Baruch, B.O.S.' CEO stated:
"Year 2003 took in consideration the slow down that impacted the IT industry and the Telecom sector in particular, We have been able to monitor the expenses of the Company and generate positive cash flow in the fourth quarter, while continuing to support the extensive development of our VOIP products."
Edouard Cukierman the Chairman of the Board stated:
"We are continuing to progress according to our restructuring plan, while the Company generates cash from its operation. We will be able to drive the Company forward with greater focus on marketing and business development."
Fourth Quarter and the year 2003 - Discontinued Segment
The Company discloses the financial information related to its US subsidiary, Pacific Information Systems, Inc. ("Pacinfo") in accordance with accounting standards for "discontinued operations".
The net loss from the discontinued segment for the fourth quarter of 2003 was $78,000 (or -$0.02 per share) compared to a net loss of $1.35 million for the fourth quarter of 2002 (or -$0.43 per share), and a net earning of $2.0 million (or $0.55 per share) for the year 2003, compared to a net loss of $7.7 million (or -$2.46 per share) for 2002.
Net loss from continuing and discontinued segment for the fourth quarter of 2003 was $758,000 (or -$0.19 per share) compared to net loss a net loss of $1.2 million (or -$0.39 per share) for the fourth quarter of 2002), and a net loss of $396,000 (or -$0.11 per share) for the year 2003, compared to a net loss of $7.9 million (or -$2.54 per share) for 2002.
Through its wholly owned subsidiary, BOScom, the Company develops, produces and markets multi-functional, cross-enterprise communication and networking products. Marketed under the BOS?NOVA brand, these products are renowned for their simplicity of use, quality, and reliability.
The IP Telephony line offers innovative convergence migration solutions that leverage a corporation's existing equipment infrastructure.
The legacy line 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. Nehemia Kaufman
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