Greetings and welcome to the DarioHealth Fourth Quarter 2017 Earnings Conference Call. At this time, all participants are presently in listen mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder this call is being recorded. Hosting the call today are Erez Raphael, Chief Executive Officer, and Zvi Ben-David, Chief Financial Officer Before I turn the call over to management, I’d like to remind everyone that this conference call may contain projections or other forward-looking statements regarding future events or the future performance of the Company. DarioHealth does not assume any obligation to update that information. Actual events or results may differ materially from those projected as a result of changing market trends, reduced demand, and the competitive nature of DarioHealth’s industry as well as other risks identified in the documents filed by the Company with the Securities and Exchange Commission. In addition, certain non-GAAP financial measures will be discussed during this call. These non-GAAP measures are used by management to make strategic decisions, forecast future results and evaluate the Company’s current performance. Management believes the presentation of these non-GAAP financial measures is useful to investors understanding and assessment of the Company’s ongoing core operations and prospects for the future. And with that, I’d like to introduce Erez Raphael, Chief Executive Officer of DarioHealth. Mr. Raphael, please go ahead.

Thank you, Kevin [ph]. Thanks everyone for the interest in DarioHealth’s and for joining us this morning to discuss the fourth quarter and the full year 2017 results. As you can see from the press release, we continued strong growth in our sales. We gained 15% increase in Q4 comparing to Q3 with sequential increase and we managed also to grow our overall yield sales by 84%, closing the year with $5.2 million in total revenue. We are very excited about the opportunity ahead of us and therefore we can -- we think that we can achieve a growth in 2018 of the 60% to 80% and this is the focus that we are also mentioning in this press release. Looking on the overall financials, I think we can also be very optimistic from the overall improvement in few figures from the report. First of all, we can see that the gross profit is continuing to improve. We did improve this from 20% to 36% between Q3 to Q4, and for the overall year, we increased our overall profit by 188%. The overall -- for the overall year, we reached $1.3 million, which is 258% year-over-year compared to 2016. Overall, we show that once this platform is reaching more and more users, the gross profit is improving and we can improve the margin as we forward; although, we think that with this business we can take the gross profit of this company to be close to 70%. So, this is something that we anticipate is going to continue to improve as we move forward into 2018. The recent things that we did in the Company also include more awareness around -- among investors that will have more insight into what is happening into the Company. We recently hired Westwicke as…

Thank you, Erez. On the call this morning, I will review DarioHealth’s fourth quarter and full year 2017 financial results. I will provide some commentary around our recent capital raise and I will provide our initial outlook for 2018. During the fourth quarter of 2017, we sold about 11,500 Dario Blood Glucose Monitoring Systems in the U.S. Revenue for the fourth quarter was $1.6 million, an increase of 88% compared to the fourth quarter of 2016, and a 15% sequential increase over the sale of third quarter of 2016. This increase was primarily a result of continued growth in the United States as well as encouraging initial sales in Germany and product sales to distributors in the United Kingdom and Canada. Gross profit reached $569,000 in the fourth quarter of 2017, an increase of more than $1.2 million compared to the fourth quarter of 2016. This represents a gross profit of 36% in this quarter. This improvement is a result of increasing quantities sold and higher average selling prices and the write-offs of one-time items that were recorded in the last quarter of 2016. Operating loss in the quarter decreased by $700,000 to $3.1 million compared to a loss of $3.8 million in the first quarter of 2016. This improvement in operating loss was mainly due to the improvement in the gross profit partially offset by the increase in our operating expenses. Net loss attributable to holders of common stock decreased by $600,000 to $3.26 million in the first quarter of 2016, as compared to $3.86 million in the first quarter of 2016. Turning to the full year of 2017, revenues reached a record of $5.2 million, an increase of 84% compared to the $2.8 million in 2016. Our revenues in 2017 were derived from sales of the value components…

Thank you, Zvi. So as you can see, we have a lot things going on and we are looking forward to build the momentum even strongly into 2018. We have all the foundation, and as we mentioned, we recently raised $6.6 million. The fundraise was led by a fund tech investor -- a fundamental investor that led the whole deal. And together with existing shareholders, we raised overall $6.6 million. So the Company had the fund to move forward into next year and we also have all the foundation in terms of regulation, technology, and also the trend that will beat. So it’s that we are very excited and very optimistic about our opportunity to create a real change in the healthcare market, a change that will put users and customers in the front, help them improve the clinical outcome. I see this overall need in the market and I see -- I am very excited that we can really create the change. This is something that everyone can think. If you are looking on the overall social media and all over the place, people are happy with the product. And we believe that this is something that will be recognized by the sales like employer and eventually the business will be able to scale up to hundreds of thousands of users that will create very big company, DarioHealth. With that, I would like to open the call for questions. Operator?

Thank you. We will now be conducting a question-and-answer session. [Operator Instructions] Our first quarter is coming from Yo Simio [ph] a Private Investor. Your line is now live.

Erez, you mentioned in the PR that the investment movement but it by a specific -- read it specialized healthcare technology fund. Can you tell us with the fund or what is like it's going to be a strategic investor in Dario or it's with investor?

Thanks for the question. So, the investor is investor that is from Israel, the investor allocated significant amount of money that we’ll be able to fund the Company as we move forward based on the overall performance of the Company. The investor is specializing in digital health and also healthcare technology, and this investor is not a usual investor that he is playing in the public market. He is more playing on the private market and he stands behind significant investment behind healthcare companies in Israel. Some of them already exited and he has also followers that were following his investment. So for us, it’s a very good sign. Unfortunately, OCI will also not be able to disclose the name at this point but this is something that people will be able to see in our -- as he bought more than 5% in the Company. So, this is something that will be disclosed in our -- probably now next report. In general, I can tell you that the fact that such an investor got into a big position in the Company together with other investor that already invested in the Company and also joined this round. We can see that in the last 18 months investors that were investing in Dario are more and more fundamental and are more long term investors. And I believe that it will also help us moving forward building a real value in the market and creating also high returns for our investors. This is what we believe should happen and we’re very proud that this investor decided to take a step. If you notice also from the press release, I mean and the 8-K that we put around this financials, this investment was done by [indiscernible] was led by the Company. So, we are using some advisors, but other than that there was banker that led this investment. We chose that the Company have a true capability to attract re-investors and in this lower relation we managed to do it by ourselves without involvement of the banker in this overall round.

[Operator Instructions] Our next question today is coming from Mark Lanier from Pegasus Capital. Your line is now live.

And my question has to do with two aspects. Would you discuss a little bit more your plans for the United States in 2018 including the addition of employees in this country? As well as I wanted to ask whether you expect to enter any new countries in 2018?

Hi, Mark. Thanks for the question. Yes, so we do believe that given the fact that the Company already built the technology and also regulation, we are going to see more budget, going into the sales and marketing, this is number one. And within the sales and marketing, we’re going to route budget to more B2B activities. As you know the majority of the user base that we built was done by direct-to-consumer channel. As we already announced on the deal that we signed in Philadelphia and also with the pharmaceutical company, I believe that investors are going to see more this like the last few, and also with employers or with distributors that have relationship with employers that will help us penetrate into this market. And to achieve that, we will have to reroute budget from the DTC, from the direct-to-consumer to the B2B activities. And therefore, we are going to see our company expanding the size the team in the United States where already working with our partners in order grow the team, and I believe in the next few weeks the team will be expanded, and we are going to see a higher deal flow of B2B within the United States. So, we are going to definitely grow the team here. It's also work in process and this is something that will be resolved in deals that will happen in the next few weeks and as we move forward deeply into 2018. With regards to the other countries, actually the fund that led the deal has a lot of relationship in China. And together with them, we are looking into this country. We don’t have a decision yet. But given the relationships that are extensive in China, it’s an Israeli fund with a lot of relationship in China. So we are looking deeply into China. We didn't want to go into China without the right partner and without the right financial backup. Now, we feel that we have it with this fund. And this is something that will help to make a decision in the next couple of months. Another market that is very hot and recently we presented the themes in Las Vegas like two weeks ago and we got a lot of requests and comments from Brazil, so this is another country that we are looking into, but we don’t have a concrete decision to penetrate into this market in 2018. This is something that we’ll have to decide. Just to remind you Mark, we’re already operating in seven countries, and we recently launched also into Germany. So, we believe that we have a lot to achieve in this market and the question that the CEO asked himself everyday is focus. So with a lot of opportunities, it's very easy to be unfocused. So, this is something that we will have to explore and I believe that in the next quarter will have a concrete decision with regards to this two countries China and Brazil.

Thank you. [Operator Instructions] Our next question today is coming from Grant Shaffer [ph], a Private Investor. Your line is now live.

Congratulations on the quarter. I think noticing -- thank you. I am noticing quarter-over-quarter your R&D has gone from 800 roughly 3.3 million. I’m wondering, if you can speak to your roadmap of products or features coming out for the future?

Yes, sure. So when we are looking on the overall roadmap that for the R&D, along the last two years, we transformed more budgets into the software capabilities. We believe that in future, it is going to be the software and the features that will help us gain very good IP and differentiation from the market and here we have few powers. We have the power that is funding the user what everyone can see, which is the application. We have what we are calling the digital care delivery, which is the front end that we are providing to clinician and we have what we are calling the backend of the Dario Intelligence, which is a very strong backend that help us analyze data and create artificial intelligence on top of this data. Specifically for example, we can by collecting the data and analyzing the data that’s related to food, medication, blood sugar levels and so on. We can create prediction model for other diseases -- for other complication of the chronic condition, we can create prediction on blood sugar levels, you can create prediction on [indiscernible] and other severe events, and we can also provide our clinician insight that will help them manage a big population of people with diabetes. So as we move forward, we’re going to invest more and more into the big data and into the artificial intelligence that we leverage on the overall data collection. The device that we have is an integral part of the overall system and without the device, we wouldn’t have the data. So it’s very important to integrate the device, directed to the Smartphone, collecting the data in real time, having the time spent on the blood sugar level and the time spent to the other data points that we have on the smartphone, capturing into the platform and then implement AI on top of this data and providing this features or capabilities to the users whether it’s going to be the in-patient or it’s going to be the clinician. And this is a capability that we built and this is where we see the future of R&D. So, our users are getting a new application to the [indiscernible] ASCO every quarter and our clinicians are getting also a dozen of our Form-10 every quarter. But on the back end of all this, we are investing more and more into the AI, the artificial intelligence, which is something that we believe will create a real differentiator, and as we collect more users, the stronger the AI that we are developing. So, it goes hand-in-hand with growing the user base.

And just one final question. Can you give any guidance on the timeline to breakeven?

This is something that at the moment will be hard for me to provide this guideline. The Company is growing and for companies that are fast growing, we need to decide whether we want to gain as many users as possible as fast as possible, which is sometimes not going hand in hand with getting to breakeven. The number that will put the Company in a breakeven point is somewhere around $3.5 million to $4 million a quarter which is something that can happen not too far. But I am not sure yet about our strategy whether we want to do it this year or we are going to continue with extensive growth. And generally speaking, keeping 250,000 users will generate for the Company around $100 million in sales. This is the goal that we see.

Thank you. Ladies and gentlemen, we have reached the end of our question-and-answer. I would like to turn the floor back over for any further or closing comments.

Okay, thanks everyone for joining us today. I am looking forward to communicate again in the quarter from now. Thanks.

Thank you. That does conclude today’s teleconference. You may disconnect your lines at this time and have a wonderful day. We thank you for your participation today.