B.O.S Announces Financial Results for Third Quarter of 2012

B.O.S Announces Financial Results for Third Quarter of 2012

RISHON LEZION, Israel, Nov. 29, 2012 (GLOBE NEWSWIRE) -- B.O.S Better Online
Solutions Ltd. (the "Company", "BOS") (Nasdaq:BOSC), a leading Israeli
provider of RFID and Supply Chain solutions to global enterprises, today
reported its financial results for the three and nine months ended September
30, 2012.

On a GAAP basis, the Company had a net loss of $66,000, for the three months
ended September 30, 2012 as compared to a net loss of $826,000 in the three
months ended September 30, 2011. The Company had a net loss of $586,000 in the
nine months ended September 30, 2012, as compared to a net loss of $1,113,000
in the nine months ended September 30, 2011.

On a non GAAP basis, the Company had a net profit of $124,000 for the three
months ended September 30, 2012, as compared to a net loss of $381,000 for the
three months ended September 30, 2011. The Company had a net loss of $60,000
for the nine months ended September 30, 2012, as compared to a net loss of
$20,000 in the nine months ended September 30, 2011.

EBITDA for the three months ended September 30, 2012, amounted to $175,000 as
compared to breakeven for the three months ended September 30, 2011. EBITDA
for the nine months ended September 30, 2012, amounted to $472,000 as compared
to $705,000 for the nine months ended September 30, 2011.

Yuval Viner, BOS CEO, stated: "We are very pleased with the third quarter
results that reflect continuing improvement in the Company's performance. The
first quarter of year 2012 ended with a non GAAP loss of $185,000, the second
quarter of year 2012 ended with a non GAAP profit of $10,000 and the third
quarter of year 2012 ended with an increase in non GAAP profit, to $124,000."

Eyal Cohen, BOS CFO, added: "In light of the improvement in the financial
results, we were also able to reduce our bank loans by $1.6 million during the
first nine months of year 2012 and we expect a further reduction in the bank
loans by approximately $0.5 million in the next 12 months."

Conference Call

BOS will host a conference call on Monday, December 3, 2012 at 10:00 a.m. EDT,
5:00 p.m. Israel time. A question-and-answer session will follow management's
presentation. Interested parties may participate in the conference call by
dialing the following numbers approximately five to ten minutes before the
call start time:
International + 972-3-9180650

For those unable to listen to the live call, a replay of the call will be
available from the day after the call on BOS's website, at:
http://www.boscorporate.com

About BOS

B.O.S. Better Online Solutions Ltd. (Nasdaq:BOSC) is a leading provider of
RFID and Supply Chain solutions to global enterprises. BOS' RFID and mobile
division offers both turnkey integration services as well as stand-alone
products, including best-of-breed RFID and AIDC hardware and communications
equipment, BOS middleware and industry-specific software applications. The
Company's supply chain division provides electronic components consolidation
services to the aerospace, defense, medical and telecommunications industries
as well as to enterprise customers worldwide.

For more information, please visit: www.boscom.com

Use of Non-GAAP Financial Information

BOS reports financial results in accordance with U.S. GAAP and herein provides
some non-GAAP measures. These non-GAAP measures are not in accordance with,
nor are they a substitute for, GAAP measures. These non-GAAP measures are
intended to supplement the Company's presentation of its financial results
that are prepared in accordance with GAAP. The Company uses the non-GAAP
measures presented to evaluate and manage the Company's operations internally.
The Company is also providing this information to assist investors in
performing additional financial analysis that is consistent with financial
models developed by research analysts who follow the Company. The
reconciliation set forth below is provided in accordance with Regulation G and
reconciles the non-GAAP financial measures with the most directly comparable
GAAP financial measures.

Safe Harbor Regarding Forward-Looking Statements

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. These risk factors and uncertainties
include, amongst others, the dependency of sales being generated from one or
few major customers, the uncertainty of BOS being able to maintain current
gross profit margins, inability to keep up or ahead of technology and to
succeed in a highly competitive industry, inability to maintain marketing and
distribution arrangements and to expand our overseas markets, uncertainty with
respect to the prospects of legal claims against BOS, the effect of exchange
rate fluctuations, general worldwide economic conditions and continued
availability of financing for working capital purposes and to refinance
outstanding indebtedness; and additional risks and uncertainties detailed in
BOS's periodic reports and registration statements filed with the U.S.
Securities Exchange Commission. BOS undertakes no obligation to publicly
update or revise any such forward-looking statements to reflect any change in
its expectations or in events, conditions or circumstances on which any such
statements may be based, or that may affect the likelihood that actual results
will differ from those set forth in the forward-looking statements.

CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands, except per share data
                                                                 
                                      Nine months ended   Three months ended
                                      September 30,      September 30,
                                      2012      2011     2012     2011
                                      (Unaudited)         (Unaudited)
                                                                 
Revenues                               $18,349   $25,735   $5,386    $8,199
Cost of revenues                       14,299    20,282    4,084     6,649
Inventory Write offs                  241       134       106       87
Gross profit                           3,809     5,319     1,196     1,463
                                                                 
Operating costs and expenses:                                     
Research and development              114       335       28        115
Sales and marketing                   2,350     3,259     721       997
General and administrative            1,216     1,643     376       554
Total operating costs and expenses     3,680     5,237     1,125     1,666
                                                                 
Operating profit (loss)                129       82        71        (203)
Financial expenses, net               (598)     (1,008)   (120)     (512)
Other expenses, net                    (80)      (172)     --        (76)
Loss before taxes on income           (549)     (1,098)   (49)      (791)
taxes on income                        (37)      (15)      (17)      (35)
Net Loss                               ($586)    ($1,113)  ($66)     ($826)
                                                                 
Basic and diluted net loss per share  ($0.13)   ($0.40)   ($0.01)   ($0.30)
                                                                 
Weighted average number of shares used
in computing basic net earnings per    4,471,241 2,767,809 4,471,716 2,785,959
share
Weighted average number of shares used
in computing diluted net earnings per  4,471,241 2,767,809 4,471,716 2,785,959
share

                                                           
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except per share amounts)
                                                           
                                         September 30, 2012 December 31, 2011
                                         (Unaudited)        (Audited)
ASSETS                                                      
                                                           
CURRENT ASSETS:                                             
Cash and cash equivalents                $161               $411
Trade receivables                        7,533              8,507
Other accounts receivable and prepaid     448                744
expenses
Inventories                              3,435              4,020
                                                           
Total current assets                      11,577             13,682
                                                           
LONG-TERM ASSETS:                                           
Severance pay fund                        20                 41
Investment in other companies             68                 68
Other assets                              26                 23
                                                           
Total long-term assets                    114                132
                                                           
PROPERTY, PLANT AND EQUIPMENT, NET        982                1,166
                                                           
OTHER INTANGIBLE ASSETS, NET             404                540
                                                           
GOODWILL                                 4,122              4,122
                                                           
                                         $17,199            $19,642

                                                           
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands, except share and per share data
                                                           
                                         September 30, 2012 December 31, 2011
                                         (Unaudited)        (Audited)
                                                           
LIABILITIES AND SHAREHOLDERS' EQUITY                        
                                                           
CURRENT LIABILITIES:                                        
Short-term bank loans                    $6,201             $6,836
Current maturities of long term bank      440                660
loans
Trade payables                           4,257              4,165
Employees and payroll accruals            468                553
Deferred revenues                         440                550
Liability to Dimex Systems               307                300
Accrued expenses and other liabilities   564                694
                                                           
Total current liabilities                 12,677             13,758
                                                           
LONG-TERM LIABILITIES:                                      
Long-term bank loans, net of current      512                1,103
maturities
Income tax accruals                      310                273
Accrued severance pay                     115                163
Liability to Dimex Systems               559                747
                                                           
Total long-term liabilities               1,496              2,286
                                                           
                                                           
COMMITMENTS AND CONTINGENT LIABILITIES                     
                                                           
SHAREHOLDERS' EQUITY:                                       
Share capital                             23,065             23,065
Additional paid-in capital                51,107             51,093
Accumulated other comprehensive profit    (243)              (243)
Accumulated deficit                       (70,903)           (70,317)
                                                           
Total shareholders' equity               3,026              3,598
                                                           
                                                           
Total liabilities and shareholders'       $17,199            $19,642
equity

                                                                  
CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands
                                                                  
                                        Nine months ended Three months ended
                                        September 30,      September 30,
                                        2012       2011    2012      2011
                                                                  
                                                                  
Net Cash provided by (used in) operating $1,351     (94)    $211      (188)
activities
                                                                  
Net Cash used in investing activities    (146)      (537)   (59)      (105)
                                                                  
Net Cashprovided by (used in) financing (1,455)    49      (392)     (569)
activities
                                                                  
Decrease in cash and cash equivalents    (250)      (582)   (240)     (862)
                                                                  
Cash and cash equivalents at the         411        703     401       983
beginning of the period
                                                                  
Cash and cash equivalents at the end of  $161       $121    $161      $121
the period

                                                                  
RECONCILIATION OF NON-GAAP FINANCIAL RESULTS
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(U.S. dollars in thousands, except per share amounts)
                                                                  
                                      Three months ended September 30,
                                      2012                           2011
                                      GAAP (as Adjustments Non-GAAP Non-GAAP
                                       reported)
                                                                  
Revenues                               $5,386    $--        $5,386   $8,199
Gross profit                           1,196     106a       1,302    1,550
                                                                  
Operating costs and expenses:                                      
Research and development              28        --         28       115
Sales and marketing                   721       (46)b     675      902
General and administrative            376       (38)c      338      515
Total operating costs and expenses     1,125     (84)        1,041    1,532
                                                                  
Operating profit                     71        190         261      18
Financial expenses, net               (120)                (120)    (380)
Other expenses,net                    --                   --       16
Profit (loss) before taxes on income   (49)      190         141      (346)
Taxes on income                       (17)      --         (17)     (35)
Net profit (loss)                      ($66)     $190        $124     ($381)
                                                                  
Notes to the reconciliation:                                       
a- Write off of slow moving                                       
inventory
b - Amortization of intangible assets                              
c - Stock based compensation                                       

                                                                  
RECONCILIATION OF NON-GAAP FINANCIAL RESULTS
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(U.S. dollars in thousands, except per share amounts)
                                                                  
                                      Nine months ended September 30,
                                      2012                           2011
                                      GAAP (as  Adjustments Non-GAAP Non-GAAP
                                       reported)
                                                                  
                                                                  
Revenues                               18,349    $--        $18,349  $25,735
Gross profit                           3,809     241a       4,050    5,453
                                                                  
Operating costs and expenses:                                      
Research and development              114       --         114      335
Sales and marketing                   2,350     (137)b    2,213    2,973
General and administrative            1,216     (47)c      1,169    1,514
Total operating costs and expenses     3,680     (184)       3,496    4,822
                                                                  
Operating profit                      129       425         554      631
Financial expenses, net               (598)     (21)d      (577)    (652)
Other expenses, net                    (80)      80e         --       16
Profit (loss) before taxes on income   (549)     526         (23)     (5)
Taxes on income                       (37)      --         (37)     (15)
Net income (loss)                      ($586)    $526        ($60)    ($20)
                                                                  
Notes to the reconciliation:                                       
a- Write off of slow moving                                       
inventory
b - Amortization of intangible assets.                             
c - Stock based compensation.                                      
D- Depreciation of prepaid expenses
and value of warrants attached to                                  
Convertible note.
e - Property write off.                                            

                                                                 
CONDENSED CONSOLIDATED EBITDA
(U.S. dollars in thousands)
                                                                 
                                         Nine months ended Three months ended
                                         September 30,    September 30,
                                         2012     2011     2012     2011
                                         (Unaudited)       (Unaudited)
                                                                 
                                                                 
Operating Profit (loss) from continuing   $129     $82      71       ($203)
operations
Add:                                                              
Amortization of intangible assets        137      283      46       95
Stock based compensation                  47       132      38       39
Depreciation                              159      208      20       69
EBITDA                                    $472     $705     $175     $0

                                                                                  
          RFID and  Supply                               RFID and  Supply
         Mobile    Chain     Intercompany Consolidated Mobile    Chain     Intercompany Consolidated
          Solutions Solutions                            Solutions Solutions
         Nine months ended September 30,                Three months endedSeptember 30,
         2012                                           2012
                                                                                  
                                                                                  
Revenues $6,551    $12,016   ($218)       $18,349       $2,047    $3,544    ($205)       $5,386
                                                                                  
Cost of   $4,634    $9,883    ($218)       $14,299       $1,396    $2,893    ($205)       $4,084
Revenues
                                                                                  
Inventory
write     $126      $115      $ --         $241          $66       $40       $ --         $106
offs
                                                                                  
Gross     $1,791    $2,018    $--        $3,809        $585      $611      $--        $1,196
profit
                                                                                  
          RFID and  Supply                               RFID and  Supply
         Mobile    Chain     Intercompany Consolidated Mobile    Chain     Intercompany Consolidated
          Solutions Solutions                            Solutions Solutions
         Nine months ended September 30,                Three months endedSeptember 30,
         2011                                           2011
                                                                                  
                                                                                  
Revenues $9,867    $16,463   ($595)       $25,735       $2,771    $5,506    ($78)        $8,199
                                                                                  
Cost of   $7,444    $13,433   ($595)       $20,282       $2,040    $4,687    ($78)        $6,649
Revenue
                                                                                  
Inventory
write     $92       $42       $--         $134          $92       ($5)      $ --         $87
offs
                                                                                  
Gross     $2,331    $2,988    $--        $5,319        $639      $824      $--        $1,463
profit

CONTACT: B.O.S. Better Online Solutions Ltd.
         Mr. Eyal Cohen, CFO
         +972-54-2525925
         eyalc@boscom.com