Edited Transcript of BOSC.OQ earnings conference call or presentation 27-May-20 2:30pm GMT

Q1 2020 BOS Better Online Solutions Ltd Earnings Call

Teradyon Jul 9, 2020 (Thomson StreetEvents) — Edited Transcript of BOS Better Online Solutions Ltd earnings conference call or presentation Wednesday, May 27, 2020 at 2:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Eyal Cohen

B.O.S. Better Online Solutions Ltd. – CEO

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Conference Call Participants

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* Todd Felte

RHK Capital, LLC – VP of Investments

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Presentation

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Operator [1]

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Ladies and gentlemen, thank you for standing by. Welcome to the BOS First Quarter 2020 Results Conference Call.

(Operator Instructions)

As a reminder, this conference call is being recorded and will be available on the BOS website as of tomorrow.

With us online today is Mr. Eyal Cohen, CEO. 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, change in economic conditions, risks and product and technology development and the effect of the company’s accounting policies as well as certain of the 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. Mr. Cohen, please go ahead.

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Eyal Cohen, B.O.S. Better Online Solutions Ltd. – CEO [2]

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Thank you. Dear shareholders, our RFID and Supply Chain businesses did very well in the first quarter of the year. The backlog of our Supply Chain continued to grow in the first quarter of the year. The growth attributed mainly to the expansion of our Supply Chain businesses in the U.S. Our RFID business performed — performance in the first quarter of the year was outstanding and above expectations.

It is mainly attributed to the cost reduction we started to implement in the first quarter this year. And it will be fully reflected in the second quarter. Our primary and most crucial challenge for the year ’20 is to make significant penetration of our robotic business to the U.S. market, our strategic market with the highest potential for our robotics business. To achieve that target, me and the robotic team invest enormous efforts to support our U.S. sales office. It is not an easy task, especially with the current situation of the corona in the U.S., but we need to complete this mission by the end of this year.

That completes my financial review — business review and now I will take your questions. Thank you.

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Questions and Answers

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Operator [1]

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(Operator Instructions) The first question is from [Igor Wasserman] of SIG.

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Unidentified Analyst, [2]

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Hello, hello?

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Eyal Cohen, B.O.S. Better Online Solutions Ltd. – CEO [3]

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Yes.

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Unidentified Analyst, [4]

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I had a question about backlog. How the current backlog is compared to the backlog at the year-end?

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Eyal Cohen, B.O.S. Better Online Solutions Ltd. – CEO [5]

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Okay. The backlog that I mentioned in the press release actually reflect the backlog for delivery of the year-end ’20. So the total backlog as of March ’20 amounted to $16 million, which, as I said, which $12 million expected to be delivered during this year. And comparing to total backlog, as of December ’19, which was $13 million. So we have a growth of $3 million in the backlog during the first quarter of year ’20 from $13 million to $16 million.

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Unidentified Analyst, [6]

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Okay. And another question, what industries do you target with your robotics products?

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Eyal Cohen, B.O.S. Better Online Solutions Ltd. – CEO [7]

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Okay. We are targeting the plastic manufacturer industry for the food in the U.S. This is a target market. This is a target client, and this is a target territory. In that territory, we have about a 100 target clients that meets our criteria, that needs our robot, that use the robot of our competitors, which are European competitors. And we believe we have place, and we can take a market share in the U.S. market, which is relatively the biggest market in the world.

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Operator [8]

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The next question is from Todd Felte of RHK Capital.

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Todd Felte, RHK Capital, LLC – VP of Investments [9]

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Congratulations first on your return to profitability. It was also nice to see the outlook given in the press release forecasting sales growth from 2019, which should make 2020 revenues another all-time record for the company. My question is that in the United States, there have been many food processing plants shutting down due to the spread of COVID-19 among the workers in these facilities. Can you talk about the opportunity and growth potential that BOS has in the sector?

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Eyal Cohen, B.O.S. Better Online Solutions Ltd. – CEO [10]

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Yes. So in general, robots can replace workforce — human workforce. And the current period proved the necessity of using robot. Especially it increased efficiency as well. BOS Roberts enable plastic manufacturer to produce food packing by In Mold Label technology. And by that technology, the label is an integral part of the plastic package and not attached to it. And I think we have — we are in the right time in the U.S. because the U.S. government support the local industry. And the food industry is relatively stable market with stable demand for food. And adding to that, the trading war with China, so we have the ideal condition for penetrating to the U.S. market.

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Operator [11]

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(Operator Instructions)

There are no further questions at this time. Before I ask Mr. Cohen to go ahead with his closing statement, I would like to remind participants that a replay of this call will be available on the company’s website, www.boscorporate.com by tomorrow.

Mr. Cohen, would you like to make your concluding statement?

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Eyal Cohen, B.O.S. Better Online Solutions Ltd. – CEO [12]

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Yes. Thank you. Thank you for joining our call today. We have 2 months for our next call, which will be in August. And I hope we will have significant progress in our plans for the robotics business, and I will keep you posted. Thank you very much.

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Operator [13]

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This concludes BOS First Quarter 2020 Results Conference Call. Thank you for your participation. You may go ahead and disconnect.

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