BOS Better Online Solutions Ltd (BOSC) 2024 Q4 法說會逐字稿

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.

女士們、先生們，感謝你們的支持。歡迎參加 BOS 電話會議。所有參與者目前都處於只聽模式。提醒一下，本次電話會議正在錄音，並將於明天在 BOS 網站上發布。

Before I turn the call over to Mr. Cohen, I would like to remind everyone that forward-looking statements for the respect to 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, changing economic conditions, risks and product and technology development, these 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.

在我將電話轉給科恩先生之前，我想提醒大家，有關公司業務、財務狀況和經營業績的前瞻性陳述受風險和不確定性的影響，這可能導致實際結果與預期結果有重大差異。此類前瞻性陳述包括但不限於產品需求、定價、市場接受度、不斷變化的經濟條件、風險和產品及技術開發、這些會計政策以及某些其他風險因素，這些因素在公司不時向各證券機構提交的文件中詳細說明。

I'd like to turn the call over to Mr. Eyal Cohen, CEO. Mr. Cohen, please go ahead.

我想將電話轉給執行長 Eyal Cohen 先生。科恩先生，請繼續。

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, our CFO. Let's move into the presentation.

大家早安，感謝大家抽出時間參加今天的會議。很高興再次與您聯繫。與我一起出席的還有我們的財務長 Moshe Zeltzer 先生。讓我們開始示範。

BOS integrate cutting-edge technologies to streamline and enhance supply chain operation across three specialized divisions. The robotics division automate inventory process replacing manual labor with robotic solutions, RFID division optimize inventory management by tug-in and tracking inventory throughout the supply chain, and the supply chain division integrate our franchise electromechanical components directly into our clients' product. Let's explore division in more details.

BOS 整合尖端技術來簡化和加強三個專業部門的供應鏈運作。機器人部門透過機器人解決方案實現庫存流程自動化，取代體力勞動；RFID 部門透過在整個供應鏈中拖曳和追蹤庫存來優化庫存管理；供應鏈部門將我們的特許機電元件直接整合到客戶的產品中。讓我們更詳細地探討除法。

Our supply chain division is dedicated to integrating franchise electromechanical company into the products of leading defense and high-tech components. Our engineering team works hand-in-hand with our customers' R&D department to ensure seamless integration into innovative designs, generating long-term OEM revenues as products move into production. The primary growth lever here is a number of components we embed into our clients' product, that's why expanding our integration capabilities is central to our strategy.

我們的供應鏈部門致力於將特許機電公司整合到領先的國防和高科技組件產品中。我們的工程團隊與客戶的研發部門攜手合作，確保無縫整合到創新設計中，並在產品投入生產時產生長期的 OEM 收入。這裡的主要成長槓桿是我們嵌入到客戶產品中的許多組件，因此擴展我們的整合能力是我們策略的核心。

Over the last two years, we have doubled our engineering team and tripled the number of manufacturers we present, strengthening our market position and growth trajectory. We are proud to serve global defense leaders such as Israel aerospace industries, Elbit Systems and Rafael. Our network extends both directly to these companies and indirectly via their subcontractor across the USA, India and Europe. This network served our launch pad for global expansion without the need for costly overseas sales offices.

在過去的兩年裡，我們的工程團隊規模擴大了一倍，製造商數量增加了兩倍，從而鞏固了我們的市場地位和成長軌跡。我們很榮幸能夠為以色列航空航太工業、埃爾比特系統公司和拉斐爾公司等全球國防領導者提供服務。我們的網路直接延伸至這些公司，並透過其在美國、印度和歐洲的分包商間接延伸至這些公司。這個網路是我們進行全球擴張的平台，無需昂貴的海外銷售辦公室。

Our RFID division enhanced has inventory management and product live chain by integrating proprietary software with cutting edge off-the-shelf equipment. We deploy ruggedized solution for industrial and logistics operations such as handheld computers, forklift-mounted tablet, industrial scanners, thermal printers, RFID readers and wireless system from top brands like Zebra and Honeywell. Our proprietary interfaces ensure that every on-site inventory transaction is instantly reported to the client TRP, WMS or EMEA system in real time. As a value-added service, our expert team performs inventory count for warehouses and stores using specialized hardware and software.

我們的 RFID 部門透過將專有軟體與尖端的現成設備結合，增強了庫存管理和產品即時鏈。我們為工業和物流營運部署加固解決方案，例如來自 Zebra 和 Honeywell 等頂級品牌的手持電腦、堆高機安裝平板電腦、工業掃描器、熱感式印表機、RFID 讀取器和無線系統。我們的專有介面可確保每個現場庫存交易立即即時報告給客戶 TRP、WMS 或 EMEA 系統。作為一項增值服務，我們的專家團隊使用專門的硬體和軟體為倉庫和商店進行庫存盤點。

Our business model is designed to generate recurring revenues, including the annual service contract from hardware and software, inventory count services and ongoing demand for consumables like bar code labels and RFID tags and ribbons. We are proud to serve top-tier enterprises across Israel like ShuferSal in the food retail; IKEA, non-food retail; and Teva in the industrial sector.

我們的商業模式旨在產生經常性收入，包括硬體和軟體的年度服務合約、庫存盤點服務以及對條碼標籤、RFID 標籤和色帶等消耗品的持續需求。我們很榮幸能夠為以色列各地的頂級企業提供服務，例如食品零售領域的 ShuferSal、非食品零售領域的宜家和工業領域的 Teva。

Our robotic division streamlines industrial and logistics process by automating labor-intensive task. Our disciplinary team includes mechanical and control engineers, programmers and production crews specializing in mechanical assembly. Together, we deliver robotic cells that reduce the dependency on labor, increased production capacity and improved accuracy all within three years ROI.

我們的機器人部門透過自動化勞動密集型任務來簡化工業和物流流程。我們的專業團隊包括機械和控制工程師、程式設計師和專門從事機械組裝的生產團隊。我們共同提供機器人單元，以減少對勞動力的依賴，提高生產能力並提高準確性，所有這些都在三年內實現投資回報。

We offer two main types of robotic solutions. First, our custom-built robotic cells that are designed and built from ground up to meet each client's unique needs. Second, we provide off-the-shelf robotic arms using top-tier models from FANUC and the SCARA. We customize them with specialized programming, adopting them perfectly to our clients' production and logistic processes.

我們提供兩種主要類型的機器人解決方案。首先，我們客製化的機器人單元是從頭開始設計和建造的，以滿足每個客戶的獨特需求。其次，我們提供採用 FANUC 和 SCARA 頂級型號的現成機械手臂。我們透過專門的程式設計對其進行客製化，使其完美地適應客戶的生產和物流流程。

Today, 90% of our robotics projects serve the defense sector, where production is still heavily reliant on labor and facing increasing pressure for faster and higher quality output. 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 clients validating our capabilities in this space.

如今，我們 90% 的機器人專案服務於國防部門，該領域的生產仍然嚴重依賴勞動力，並且面臨越來越快、更高品質產出的壓力。這種轉變對產業來說既是挑戰，對我們來說也是重大機會。我們的旗艦客戶是 Elbit Systems。更多高科技客戶驗證了我們在該領域的能力。

Team and leadership, BOS is led by a skilled executive team of eight and Board of four members. Given the importance of technology, we employ two dedicated CTOs, one for the robotics and one for the RFID. Our total team includes 80 professionals with 30% being engineers and technicians.

團隊和領導力，BOS 由一支由八名成員組成的熟練執行團隊和四名成員組成的董事會領導。鑑於技術的重要性，我們聘請了兩名專門的首席技術官，一名負責機器人技術，一名負責 RFID 技術。我們的整個團隊包括 80 名專業人員，其中 30％ 為工程師和技術人員。

Financial, balance sheet as of December '24 shows total assets, $34 million; equity, $21 million; working capital, $14 million; cash, $3.6 million; real estate of $2.1 million; and long-term loans underlying the real estate in the amount of $1.4 million. Operational results and outlook, after a record setting in year '23 with $44 million in revenues, year '24 is stabilized at $40 million, reflecting a return to normalized purchasing after post-COVID restocking.

截至 12 月 24 日的財務資產負債表顯示，總資產為 3,400 萬美元；股東權益為 2,100 萬美元；營運資金為 1,400 萬美元；現金為 360 萬美元；房地產為 210 萬美元；房地產相關的長期貸款為 140 萬美元。營運績效與前景：繼 23 年創下 4,400 萬美元的收入紀錄後，24 年收入將穩定在 4,000 萬美元，這反映出新冠疫情後補貨後採購恢復正常化。

We are optimistic about year '25, aiming for $44 million in revenues and $2.5 million in net income a 10% increase year-over-year. This confidence is backed by a growing backlog, which rose by 35% to $27 million at the end of year '24. A key driver of this growth is our exposure to the booming defense sector. Israel defense budget rose 73% year-over-year, and Europe defense budget rose 16% year-over-year. These trends directly impact our key client and in turn on us.

我們對 25 年充滿信心，目標是實現 4,400 萬美元的收入和 250 萬美元的淨收入，年增 10%。這種信心是由不斷增長的積壓訂單支撐的，截至 24 年底，積壓訂單增長了 35%，達到 2700 萬美元。這一成長的一個關鍵驅動力是我們對蓬勃發展的國防部門的投入。以色列國防預算較去年同期成長73%，歐洲國防預算較去年同期成長16%。這些趨勢直接影響我們的關鍵客戶，進而影響我們。

Our growth strategy has two pillars: strengthening our proposition and expanding internationally. Strengthening our proposition, we will deepen relationship with a defense client by broadening our offer such as the recent addition of cable in line. The RFID division will increase its sales force to capture the rebound in the Israelis civil market and will add to its portfolio off-the-shelf packing machines for logistics centers.

我們的成長策略有兩大支柱：加強我們的主張和國際擴張。為加強我們的主張，我們將透過擴大我們的服務範圍（例如最近增加的線上電纜服務）來加深與國防客戶的關係。RFID 部門將擴大銷售隊伍，以抓住以色列民用市場的反彈機會，並將在其產品組合中增加用於物流中心的現成包裝機。

Expand overseas, we will leverage our Israeli defense client base and in line with the global subcontractors. This strategy already yields $4 million in overseas sales in year '24 of our supply chain division. Our Robotics division is preparing this installation of robotic production line in Europe in the first half of this year. Now, let's take a look at our valuation and position in the capital markets.

向海外擴張，我們將利用我們的以色列國防客戶群並與全球分包商保持一致。這項策略已經為我們的供應鏈部門帶來了 24 億美元的海外銷售額。我們的機器人部門正在準備今年上半年在歐洲安裝這條機器人生產線。現在，讓我們來看看我們的估值和在資本市場中的地位。

As of today, our market capitalization is $23 million. When we factor our cash and debt, our enterprise value comes to $21 million only. In terms of valuation multiples compared to the Russell 2000, our price to earnings ratio is 10 while Russell sits at 18. Our price-to-book ratio is 1.1 compared to Russell's 2.1. This clearly indicates that BOS is trading at a significant discount compared to the broader market.

截至今天，我們的市值為 2300 萬美元。當我們考慮現金和債務時，我們的企業價值僅為 2,100 萬美元。與羅素 2000 指數相比，我們的本益比為 10，而羅素為 18。我們的市淨率為1.1，而羅素的市淨率為2.1。這清楚地表明，BOS的交易價格與大盤相比有顯著折讓。

Investor Relations, to strengthen our presence in the U.S. capital market, we are partnered with the US based Investor Relations firm and significantly ramped up our outreach. Since September last year, I have been hosting weekly investor call, actively sharing our story and engaging with the investment community. We have also participated in major events including LD Micro Conference in October last year and the Emerging Growth Conference in February this year. And the results speak for themselves. Our average daily trading volume has grown from 4,000 shares in last September to 58,000 shares this month.

投資者關係，為了加強我們在美國資本市場的地位，我們與美國投資者關係公司合作，並大大加強了我們的影響力。自去年九月以來，我一直主持每週一次的投資人電話會議，積極分享我們的故事並與投資界互動。我們也參加了包括去年10月的LD Micro Conference、今年2月的Emerging Growth Conference等大型活動。結果不言而喻。我們的日均交易量從去年9月的4,000股成長到本月的58,000股。

To conclude, BOS is a solid position for continued success. We have demonstrated consistent profitability with steady growth in net income year after year. Looking ahead, we are projecting 10% increase in both revenues and net income for year '25, reinforcing our strong trajectory. Financially, we are in excellent shape with $21 million in equity and 0 bank debt. We have the flexibility to grow strategically.

總而言之，BOS 具有持續成功的穩固地位。我們實現了持續獲利，淨收入連年穩定成長。展望未來，我們預計 25 年營收和淨收入將成長 10%，從而鞏固我們強勁的發展軌跡。從財務角度來看，我們的財務狀況非常好，擁有 2,100 萬美元的股權和 0 銀行債務。我們具有策略性發展的靈活性。

From a valuation standard point, BOS is trading at just 10 times net income, offering compelling opportunity compared to the broader market benchmark. We have also significantly expanded our Investor Relations effort, increasing our visibility and engagement with the investment community.

從估值標準來看，BOS 的交易價格僅為淨收入的 10 倍，與更廣泛的市場基準相比，提供了極具吸引力的機會。我們也大力拓展了投資者關係工作，提高了我們在投資界的知名度和參與度。

And perhaps most importantly, we have a strong and growing presence in the global defense industry in markets that continue to accelerate. With our solid foundation, focused strategy and strong momentum, we believe BOS is well positioned to deliver long-term value for our shareholders.

或許最重要的是，我們在全球國防工業市場中擁有強大且不斷成長的影響力，且市場規模不斷擴大。憑藉著堅實的基礎、專注的策略和強勁的發展勢頭，我們相信 BOS 有能力為股東創造長期價值。

Thank you for your attention, and I'm happy to take your questions. You can unmute if you want to ask a question. Any questions?

感謝您的關注，我很樂意回答您的問題。如果您想提問，可以取消靜音。還有其他問題嗎？

Good morning. Congratulations on a strong quarter. Just wanted to talk to you about, if you give some guidance. I know you said you had a new robotics line starting in Europe. Can you talk about your defense business in Europe and how that has been affected by the war in Ukraine?

早安.恭喜本季業績強勁。只是想和你聊聊，希望你能給一些指引。我知道您說過您在歐洲有一條新的機器人生產線。您能談談貴公司在歐洲的國防業務以及烏克蘭戰爭對其有何影響嗎？

Yeah. Actually, we don't have direct sales in Europe. We are aligning with our major client in Israel, Elbit System, in Israel aircraft industry; and Rafael, which are exporter and the global leaders in the defense segment. And usually, when they have a contract overseas, we are getting into the picture because part of the production of the product sold must be produced locally in the customer side. And in that case, our supply chain division provide to the local subcontractor components and our robotic division provide automatic production line in case it needed if it's a duplication of, for example, a site in Israel. So this is the business model in Europe overseas in general.

是的。實際上，我們在歐洲沒有直銷。我們與以色列的主要客戶 Elbit System（以色列飛機製造業）和 Rafael（國防領域的出口商和全球領導者）結盟。通常，當他們有海外合約時，我們就會參與其中，因為所售產品的部分生產必須在客戶當地進行。在這種情況下，我們的供應鏈部門向當地分包商提供零件，我們的機器人部門提供自動生產線，以備不時之需，例如複製以色列的一個工廠。這就是歐洲海外業務的普遍商業模式。

Okay. And also, in your valuation, I know you didn't mention the tax loss carryforward by looking at your financials, I believe you have over a $16 million tax loss carryforward, which would equate to $10 a share. Is that correct or am I missing something?i

好的。而且，在您的估值中，我知道您沒有透過查看您的財務狀況來提及稅收虧損結轉，我相信您有超過 1600 萬美元的稅收虧損結轉，相當於每股 10 美元。這是正確的嗎？還是我遺漏了什麼？

Yes. We have approximately $30 million in carryforward tax losses which could provide up to $6 million in future tax savings, assuming a 23% corporate tax rate. And as a conservative measure, we recognize only $1 million of this potential benefit as an asset in the fourth quarter of this year, out of the $6 million.

是的。假設公司稅率為 23%，我們的結轉稅損失約為 3,000 萬美元，未來可節省高達 600 萬美元的稅金。作為一項保守的衡量標準，我們在今年第四季僅將這 600 萬美元中的潛在收益中的 100 萬美元確認為資產。

But on the other hand, this income didn't affect on the bottom line because we recorded an impairment charge of $1.2 million related to goodwill. So this resulted in net impact on this quarter. On this year in year '24 of $200,000 on the net income of year '24 because of an increase of $1.2 million in operating expenses due to the impairment of goodwill that offset by $1 million in tax income related to the tax deferred assets of $1 million.

但另一方面，這筆收入並沒有影響底線，因為我們記錄了與商譽相關的 120 萬美元的減損費用。因此這對本季產生了淨影響。24 年度的今年，20 萬美元的淨收入是由於商譽減損導致的營運費用增加 120 萬美元，但與 100 萬美元的遞延稅項資產相關的 100 萬美元稅收收入抵消了這一增加。

Okay. And then just a last question. I noticed recently, you had brought on the head of procurement from the IDF from 2017 to '23, do you expect him to be able to bring in -- help bring in additional defense contracts for BOS? And if so, will you update your guidance during the year?

好的。接下來是最後一個問題。我最近注意到，您在 2017 年至 2023 年期間聘請了以色列國防軍的採購主管，您是否期望他能夠幫助 BOS 帶來額外的國防合約？如果是的話，您會在今年更新您的指導嗎？

Yeah. I think as strategic decision several years ago, we have been focused on the defense segment. And I think it will be a major element in helping us to capitalize the opportunities in this market to guide us, to lead us in this market. And absolutely, if there will be any significant development during this year, so we will give an update.

是的。我認為，作為幾年前的戰略決策，我們一直專注於國防領域。我認為它將成為幫助我們利用這個市場機會、指導我們、引領我們進入這個市場的重要因素。當然，如果今年有任何重大進展，我們將會更新。

Thank you very much.

非常感謝。

Thank you.

謝謝。