Q4 2024 B.O.S. Better Online Solutions Ltd Earnings Call
This meeting is being recorded.
Eyal Cohen, Moshe Zeltzer, Ziv Dekel
Ladies and gentlemen, thank you for standing by.
Welcome to the BOS conference call.
All participants are at present in listen only mode.
As a reminder, 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 over the respective companies business, financial condition, and results of its operations are subject to risk 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
Risk 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 and good morning everyone and thank you for taking the time to join in today's meeting
It is a pleasure to connect with you again, joining me as always Mr. Moshe Zeltzer or CFO . Let's move into the presentation.
BOS integrates cutting-edge technologies to streamline and enhance applied to an operation across three specialized divisions.
replacing manual labor with robotic solutions. Now, if I did the vision optimize inventory management by targeting and tracking inventory throughout the supply chain. Under supply chain, the vision integrates our franchise electro-mechanical components directly into our client support. Let's explore each division in more details.
Our supply chain division is dedicated to integrating franchise electromechanical component into the product of fleeting defense and high-tech components.
Our engineering team walks hand in hand with our customers on the department to ensure senseless integration into innovative designs generating long-term OEM revenues as product moving to a production.
The primary grossed livery here is a number of components we embed into our client's product. That's why expanding our integration capabilities is central to our strategy.
Over the last two years, we have doubled our engineering team and tripled the number of factors we represent. Strengthening our market position and doors to trajectory.
We are proud to serve global defense leaders such as Israel with aerospace industries,
This network served our lunch pad for global expansion, without the need for costly
Our Earth-Aided Division enhanced inventory management across the supply chain by integrating preparatory software with the cutting edge of the shell's equipment.
We deploy recognized solutions for industrial and logistics operations such as Hendel computers, forklift mounted tablets, industrial scanners, thermal printers, RFID readers, and wireless systems from top brands like Zebra and Honeywood.
Our preparatory interfaces ensure that every onsite inventory transaction is instantly reported to the client, TRP, WMS, or Mia System, in real time.
As the value added service, our expertise performs inventory counts for warehouses and stores using specialized hardware and software.
Our business model is designed to generate recurrent revenues, including...
The annual service contract from Harvard and Software, Inventory Count Services, and ongoing demands for consumers like the bulk of labels on FD tags and reborts.
We are proud to serve a top two enterprises across Israel, like Superstar Lee in the Food Retail, Lee K.R., Non-Food Retail, and Teva in the industrial sector.
Our body division swimlines industrial and logistics processes by automating labor or intensive task.
Our military discipline includes mechanical and control engineers, programmers and production crews specializing in mechanical assembly.
Together, with the labor robotic cells that had used the better dependency on labor, increased production capacity, and it pulled accuracy all within three years or one.
Eyal Cohen, Moshe Zeltzer, Ziv Dekel
We offer two main types of robotic solutions.
First, our custom-built robotic cells, they are designed and built from ground up to meet each client unique needs. Second, we provide off-the-shelf robotic arms, using top-tier models from Faloukaniya Scarwa. We customize them, we specialize gripper and programming, adapting them perfectly to our clients' production and logistics processes.
Today, 90% of our BOTX project serve the defense sector, word production.
is still heavily reliant on labor and facing increasing pressure on faster and higher quality
This shift presents both challenge to the industry and a major opportunity for us.
Our flagship client here is Elbit Systems, with additional high-tech lines validating our capabilities in this space.
Eyal Cohen, Moshe Zeltzer, Ziv Dekel
Team and leadership, BOS is led by a skilled executive team of 8 and 4 and both of 4 members.
Given the importance of technology, we employ two dedicated studios, one for the robotics and one for the RFID. Our total team include AC professionals with 30% being engineers and technicians.
Avidan Zelicovsky, BOS Better Onlin
Financial
Our growth strategy.
Has two pillars, strengthening our proposition and expanding internationally.
Strengthen our proposition will deepen the relationship with a different client by broadening our offering such as the recent addition of cabling light.
Our Friday Division will increase its sales force to capture the rebound in these rallies driven market and will add to each portfolio off the shelf ocular machines for logistics centers.
Expand overseas, we will leverage our Israeli defense client base.
In line with their global southern tract <unk>.
The strategy all had to inform the Angola and overseas says in year 'twenty full of our selection issues. Our bumping division is preparing for fast installation of for Baltic production line in Europe.
In the first subtle stressed out public this year.
Now, let's stay to look at our valuation and our position in the capital market.
Out of today, our market capitalization needs that $23 million.
When we fought through our cash and debt our enterprise value comes to $21 million.
Yeah.
In terms of valuation multiples compared to the Russell 2000.
Okay.
Our price to earnings ratio is 10, while araceli seats at a a team our price to book ratio is 1.1 compared to <unk>.
So 0.1.
This clearly indicates that boss is trading of this significant discount compared to the go to market.
Investor Relations.
To further our presence in the U S capital market, we are a partner with the U S based investor Relations.
On significantly ramp up our outreach since September last year, I've been Austin weekly Investor calls.
Similarly, sharing our story and engaging with investment for music.
We have also participated in major events, including the LD Micro conference in October of last year.
And the emerging growth conference in February this year.
And the results speak for themselves our average daily trading volume have grown from 4000 shares in lots of demo to 58000 shares mishmash.
Okay.
To conclude.
Bose is a solid position for continued success.
We have demonstrated consistent profitability, we said closing net income year after year.
Looking ahead.
We are projecting 10% decreasing both revenues and net income for year 'twenty five reinforcing our swung trajectory.
Financially.
We are in excellent shape with $21 million in equity zero bank debt.
We have the flexibility to growth strategically.
Okay.
Tom evaluations and them find Basel trading adjust 10 times net income offering compelling opportunity compared to the broader market benchmark.
We have also significantly expanded our investor relations effort.
In creating our visibility on engagement with the investment community.
Okay.
On behalf of <unk> most importantly.
We have a strong and growing presence in the global defense industry market that continued to accelerate.
With our solid foundation focused strategy on stronger momentum.
We believe Boston is well positioned to deliver long term value for our shareholders.
Thank you for your attention and I'm happy to take care of crashes.
You can on mute if you want to ask a question.
Okay.
And a question.
Good morning, Yale Congratulations on a strong quarter.
Just wanted to talk to you about.
To give some guidance on he said you had a new robotics launch starting in Europe.
Can you talk about your your defense business in Europe, and and how that has been.
Sector by the worn Ukraine.
Yeah actually we are we are we don't have any say in direct sales in Europe, where we are aligning with our major client in Israel L. Beaches, then is why the aircraft industry.
Andre: Andre fell.
Where each on an exporter.
Andre: The global leaders in the defense segment.
Andre: And usually when they have.
Andre: A contract overseas.
Andre: The we are getting into the picture because that part of the year.
Andre: Production of the port so they must.
Andre: Must be produced locally in the in the in the customers and the customer insight.
Andre: And in that case, our supply chain division provide to the local subcontractors components and power a robotics AI division.
Andre: <unk> provided without automatic production 19 KC aided.
Andre: If it's a duplication of a for example, Australia, citing Israel.
Andre:
Andre: So this is the business model in Europe.
Andre: Overseas in general.
Andre: Okay. Thank you and are also in euro valuation I know you didn't mention the tax loss carryforward.
Andre: Im looking at your financials I believe have over a 60 million dollar a tax loss carryforward, which should equate to a $10 a share is that correct from I'm missing something.
Andre: Yes.
Speaker Change: A offers I E. We have approximately $30 million being named a carryforward tax losses.
Rich: Rich good day, a provide up to $6 million low in future tax saving assuming a 22% corporate tax rate.
Speaker Change: Okay.
O'shea: And as a conservative meta we recognize only $1 million this potential benefits as an asset in the fourth quarter O'shea.
O'shea: Often the year of this year.
O'shea: A out of the 6 million dollar.
O'shea: But on the other hand day in visa income didn't effect on that but on the bottom line because of the a.
O'shea: Because we recorded an impairment charge of $1 $2 million related to good weighted.
O'shea: So it is saw this resulted in net feedback tune on this quarter on this year near 24 of it 200000, GUL and me on the net income per share 24 because of.
While funding increase of $1 $2 million in Alberta, and expensive near to the impairment of goodwill that offered by $1 million in tax income related to the deferred assets a funding shortfall.
O'shea: Okay.
Speaker Change: Thank you and then just a last question I've noticed recently you had brought on the head of procurement from the idea from 2017.
Speaker Change: To 'twenty three do you expect them to be able to bring in help bring in additional <unk>.
Speaker Change: Defense contracts for boss and if so will you update your guidance during the year.
Speaker Change: I think we are the strategic decision.
Speaker Change: A decision is reached.
Speaker Change: Several years ago, we focus too we have been focused on V. A defense segments or 19 keys.
Speaker Change: He will be a major element in helping us to to capitalize the pertinent is industry in this market to guide us to lead us in this market.
Speaker Change: And they absolutely if they're really in a significant development. During this year. So we will give an update.
Speaker Change: Thank you very much.
Speaker Change: You too.
And if other crusher.
Speaker Change: Okay.
Speaker Change: Thank you again for joining us today.
Speaker Change: If you need more details or would like a follow up please feel free to reach out.
Speaker Change: And a wishing you all the great trading day. Thank you.
Speaker Change: Thank you.