What’s The Priority At BOS Better OnLine Sol (USA) (NASDAQ:BOSC)?


After reporting a 1Q characterized by growth in all divisions, BOS Better OnLine Sol (USA) (NASDAQ: BOSC) has provided a hint about what will be of priority in the coming quarters. Debt reduction is expected to take the center stage at BOSC in the future. The company’s CFO, Eyal Cohen, said that they were able to pay down some debt during 1Q2016, but the hope to double down on debt repayment in the subsequent quarters.

What’s the debt position?

BOS Better OnLine Sol (USA) (NASDAQ: BOSC)’s balance sheet reflected a debt position of $2.8 million at the end of 1Q2016 after adjusting for cash and deposits. The company had total debt of about $3.9 million at the end of the previous quarter. As part of the efforts to improve value for shareholders in the company, management is now giving priority to strengthening the balance sheet. A less leveraged balance sheet should make it easy to obtain funding when needed.

Paying down the outstanding debt should also pave way for the company to funnel excess cash to shareholders in the future without any fear of putting its liquidity at risk.

What caused the decline in cash position?

BOS Better OnLine Sol (USA) (NASDAQ: BOSC) said its cash and equivalents decreased $700,000 in 1Q compared to a similar period last year. But the decrease wasn’t surprising because the management said it was caused by the recent acquisition of iDnext. In any case, BOSC is already seeing the benefits of iDnext acquisition. In 1Q, the company said about $0.5 million of revenue came through the business and it expects to reap more revenue benefits in the coming quarters.

BOS Better OnLine Sol (USA) (NASDAQ: BOSC): What happened in 1Q?

BOS Better OnLine Sol (USA) (NASDAQ: BOSC)’s revenue rose 38% YoY to $8.1 million in 1Q2016. The management attributed to sharp increase in topline to growth across all the company’s divisions. In particular, RFID and Mobile solutions unit posted a 54% YoY increase in revenue to $3.5 million in 1Q.

Net profit for 1Q2016 came in at $220,000, indicating a significant bottom-line improvement considering that BOSC posted a net loss of $23,000 in the like quarter a year ago.


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