Ladies and gentlemen, thank you for standing by. Welcome to the DarioHealth Corporation's Third Quarter 2017 Results Conference Call. All participants are presently in listen mode, following management's prepared remarks instructions will be given for the question-and-answer session. As a reminder, this conference is being recorded. By now you should have all received the company's press release. If you have not received it, please visit the Investor Relations section of DarioHealth website at www.dariohealth.com or contact the Investor Relations team of Hayden IR. I would now like to turn the call over to Stephen Hart of Hayden IR. Mr. Hart, would you like to please begin.

Thank you, operator. I'd like to welcome everyone to DarioHealth’s third quarter 2017 results call. 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 now introduce Erez Raphael, Chief Executive Officer. Erez, the call is yours.

Thanks, Stephen. Good morning and welcome to DarioHealth’s third quarter 2017 results call. Thank you all for joining us this today. I'd like to start with the third quarter results where we showed again that we managed to deliver the record quarterly revenues we managed to empower sales and deeper the penetration into the U.S. We also managed to showing parallel that we are reducing our burn rate, we reduced the burn rate by around $350,000 which is 13% compared to the second quarter of 2017 and this is our second consecutive quarter where we are reducing the burn rate. We think that we can continue the momentum and go with the sales and reduce the burn rate as we move forward and I'm going to talk about the other catalyst later on this call. And we managed to sell more than 10,000 devices overall in the U.S. we managed to almost get to 45,000 devices, and in parallel we showed that we can increase the disposables sales and we have shown 71% of our quarterly revenue comes from disposables and other consumables. We showed that these disposable sales will increase by 40% comparing to Q2. So, all in all it's very important to show that we're going to sales but it's also important to show that these sales are coming from users that are operating on the platform, and most of them are under subscription and they are generating recurring revenue which is very important parameter to show that we will be able to continue reducing the burn rate and drive the business towards profitability. On top of that we also showed that the gross profit of 20% and this is again as a result of more sales of the disposables and also by some higher average general sales…

Thank you, Erez. As Erez have mentioned before during the third quarter of 2017 we sold more than 10,500 Dario blood glucose monitoring systems in the U.S. Revenue for the three months ended September 30, 2017 was $1,375,000 an 89% increase on the $728,000 for the three months ended September 30, 2016 and 14% increase sequentially from the second quarter of 2017. The increase in revenues is mainly a result of our continuous market penetration into the American states. Revenues were derived mainly from the sales of the Dario Components, including the smart meter itself so direct sales to consumers located mainly in the United States and Australia, through our online store and through distributors. Gross profit of $275,000 was recorded in the third quarter ended September 30, 2017, an increase of $200,000 compared to a gross profit of $76,000 in the third quarter of 2016. This represents a gross profit of 20% as a result of increase in quantities sold and higher average sale prices, together with an increase in consumable sales. During this quarter we recorded a one-time write-off of old production fixtures and related inventories amounting to $102,000 that reduced our gross profit accordingly. Operating loss for the three months ended September 30, 2017 increased by $263,000 to around $3 million, compared to a $2.7 million operating loss in the three months ended September 30, 2016. This increase is mainly due to the increase in our operating expenses partially offset by the increase in the gross profit. The third quarter of 2017 operating loss declined by $1.5 million from $4.1 million loss in the second quarter of 2017. Net loss for the three months ended September 30, 2017 increased by $2.4 million to $3 million, compared to a loss of $600,000 for the three months ended September…

Thanks, Zvi. So, as you can see we have continue to make our meaningful projects against our long-term growth strategy and we are encouraged by the overall results we've seen a significant growth in the overall user base in our subscription this is something that gives us the comfort that we have some significant revenue also secured there continue into Q4 and into next year because of the razor blade models. In parallel we manage also to launch the product in another territory Germany with those clearance of the Android in the state. We also worked the CE 2007 and 2008 for Europe so this is something that will help us drive sales forward as we move into Q4 and also into next year. In parallel we managed to show that we can improve the overall profitability and we are in a -- we are selling more and more disposable, so this is also something that works with our strategy. And now we can move forward and also introduce some B2B builds that will help us accelerate the growth in our users which is something that can take the business to the next level and put us in a much higher run rate and revenue and everything what we actually need to be done in a very efficient way as we want to make the business more and more profitable and reduce the burn rate. The introduction was that Dario engage platform will help us for more of this B2B strategy and to accelerate and base under which we are collecting users into the platform. So, we are very positive that the business is mature enough to move to the next level and to the next level in the [flat] cycle into the B2B it's going to be mainly in the U.S. we are going to walk with employers with other health provider partners and overall, we think that our investors would be able to see a how numbers are being impact by these additional strategies. So, we are going to have the two main China's direct-to-consumer and also B2B and this is something that will intensively conveyed it to our way access in the next few quarters. With that I would like to know to open the call for questions. Operator?

Thank you. The floor is now open for questions. [Operator Instructions] Our first question comes from Ben Haynor from Aegis Capital. Ben. state your question.

First from me I know last quarter you spoke about following the Android [margin], you got a number of leads on the B2B side of the strategy, can you really talk a little bit about the reception you've gotten so far with the Dario Engage and how soon should we expect patients to be kind of onboard the B2B on and off of your strategy?

So, the overall reception is very good, so when we are talking about companies that how to deliver coaching and services to people with diabetes, obviously the fact that we've a digital platform where you can get data directly to the coaches and also, we can provide the capabilities to communicate with the patient on two directions, coaches can send messages, coaches can get information from the users themselves. So, this is something that makes the overall solutions that we have very appealing and you need to remember that our solution is 100% running in real time. The practicality is that our piece of electronic integrated to smartphone directly, so when user a might have a severe event the coach can get it in real time, which is something that gives us a very big advantage. Also, the cost of our device is relatively low if you're comparing us to other players in the market. So practically when we're partnering with coach providers and others, medical device distributors or those that want to provide service on top of the platform, we have a big advantage, and when it comes to the overall cost, the overall user experience and also the real time connectivity that we have, so practically we're the few [linked] here and we're discussing it with few potential partners, we're very-very positive that we're going to close something very shortly and we think that it's going to be reflected somehow between Q4 to Q1, and next year in terms of the numbers. And we're talking about potential few 1,000s -- tons of 1,000s of users that we want to get into the platform, this is -- this activity overall involves also some kind of implementation work, because we need to integrate the systems there of our partners, one, we already started to integrate one of our partner's system and once we have something that is concrete in terms of numbers that investors that translate, users [indiscernible] then we can -- we will provide certain information the market, but this is something that is very close, like around the corner.

And with the Android approval, are you seeing any difference in the ability to support devices, so many different flavors of Android, so many different handsets out there, as opposed to the kind of the walled garden of the Apple ecosystem, is there any impact that you have to support cost or how should we think about that?

Yes, so you are right that the iPhone is much more closed, and less open than the android from the first place because we have experienced from other market like Australia, UK and so on we knew where we can get users that are more engaged and so on and when we approached the FDA in order to clear our android handsets we were choosing from the first place specific from families that are very wide and in the phase for example in Samsung. So practically in terms of how we can translate this one to numbers it's something that when thinking about the B2C we believe that will continue the growth and the growth can be accelerated with the Android but I think when you are looking on the overall picture you need to look at it from May from a B2B perspective because now when we can provide the solution from both Android and iOS we can move faster in terms of closing the B2B business because so ethically nothing can prevent us from providing our solutions to a wider population and this is something that makes it more appealing to the potential partners that we have where we can offer it to everyone. So, looking at the overall value of this market after the clearance of the android we are like two or three months into running with the full solution and I think that looking on the overall sales cycle of B2B and forward to eight months cycle closing ability something that's something that these are realistic and we are will be three to four months into the process. So, the Android will accelerate direct-to-consumer however it's much more powerful in terms of helping our stakes closing the B2B business. This is how I think investors should be look at it.

And then lastly from me. Just any additional color on the launch in Germany that you can provide I know it's still relatively early days but just wanted to see if there are any details you can give that might help investors.

Yes, so in Germany and this is something that for us it put ourselves but first you want to gain market interaction you need to win the belief and the feedbacks from the consumers and this is why also in Germany we are starting in a direct-to-consumer. Our day-to-day day decision making is well to put the sales and marketing budget whether it's an early in the stage Germany, UK, Canada, Australia and so on we are doing it in a way according to the best now as we can get at the same time. So far, we've just started in Germany and we are trying to [correct the panel] and something in terms of digital marketing and direct-to-consumer is something that works in UK or works in the States it doesn’t mean that it's going to work in Germany and usually it takes like two months before you get the sense and the overall system is running and then you start to ramp-up sales. So practically with the Dario sales in Q3 so you don’t see the numbers of Germany reflected into Q3, in Q4 we're going to start to see the number, big numbers will get into Q1. We've enough things that we did, which is mainly the Android in the space to fill up the sales of Q4, and when it comes to the end of Q4, Q1, we're going to see the B2B and then Germany. So, the short answer is that big numbers will get into Q1 when it comes to Germany, and overall, the average user in Germany is educated on direct to consumer and digital marketing, so we're very positive that we can do something that is in terms of customer acquisition, and user engagement something that is not that far out from what we're doing in the U.S.

And our next question comes from Michael [indiscernible] from [Westpark Capital]. Michael state your question.

Looking to see when you guys see you're going to having a meaningful contribution of revenue from the Android approval?

So, in Q3 the numbers were very low, we just started because from the moment that we hear until we lost it took us few weeks, so the numbers would be reflected in Q4 and into Q1, and again if talking about the overall catalyst, so investors should expect sales goals, they are going to see it in Q4, and Q1, and because of the Android, because of the B2B, because of the launch in Germany, so there're few elements that can give us the [total] that we can grow the sales significantly also in Q1 and -- Q4 and Q1 next year.

If you -- so my follow-up a bit, what is the revenue contribution look like by country? I mean U.S. versus everywhere else it's been approved.

So, the U.S. is at the moment I don't know the exact numbers but generally we're like 65% to 75% in favor of the U.S. I suspect that with introduction of Android and with introduction of the B2B strategy it's even going to go higher in favor of the U.S., so as [indiscernible] company we need to make a very -- day to day decision where we want to put the budget into sales and marketing, and for [indiscernible] this is the U.S., talking about 300 million people living there, one every three people are either diabetic or pro-diabetic, so it’s a huge market and this is the best potential for us at this point and we're going to do it, intensively into the U.S.

Did you see any of these other countries, catching up or picking up in a meaningful way going forward?

We believe a lot in the other three countries that are like all four countries that we have. I'm talking about the UK; the Australian market and also the German market, and so we're going to ensure that this company will be global. Some of the partners that we are assigning require a global presence so if for example you are signing with an employer that have employees both in the U.S. and in the UK then our overall umbrella is something that is very helpful in order for us to close and B2B complex some of our competitors are not global and this is something that gives us the advantage. And so, this is something that is very important and specifically some B2B opportunities we have and few of them are also in other countries it's not only in the U.S. so where we do want to grow this major five markets in parallel and obviously the U.S. would be the biggest.

And there appears to be no further questions. I'll turn the floor back over to Erez Raphael.

Thank you. Thank you everyone and I would like to thank those who joined us this morning for the call. I'm looking forward to share the next update along by March and I'm sure that the company will continue communicate with the market and on ongoing base as we move forward with other and news and with other specific deals that I believe we are going to signed that will give investors the understanding about the focus of the business. So, thanks everyone and have a good day.

Thank you. This does conclude today’s teleconference. We thank you for your participation. You may disconnect your lines at this time. Have a great day.