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Liquidmetal Technologies Reports Third Quarter 2019 Results

LAKE FOREST, Calif.--(BUSINESS WIRE)--

Liquidmetal® Technologies, Inc. (LQMT), the foremost authority on commercial applications of amorphous alloys, reported results for its third quarter ended September 30, 2019.

Management Commentary

Our operating results for the third quarter reflect operations related to on-going manufacturing efforts from our Lake Forest, CA facility. These efforts have been executed to provide existing customers with buffer inventories to sustain them through our transition to outsourced manufacturing, both domestically and abroad. As of today, we have shipped all remaining quantities due under these orders to our customers, thus marking the end of our on-site manufacturing. In addition, we are nearing the completion of the remaining elements of our previously announced restructuring plan, with the full effect of associated cost reductions beginning Q1 2019.

Going forward, we will continue to develop domestic and global markets for amorphous metal applications. This will be in partnership with Dongguan Yihao Metal Materials Technology Co. Ltd., which is continuing to see progress in volume production and entrance into new markets.

Q3 2019 Financial Summary

During the third quarter of 2019, the Company generated $421 thousand in revenue primarily as a result of the completion of transition orders with existing customers, as well as continued product development efforts with the goal of furthering the commercialization of the Company’s technology and generating sustained part deliveries.

Selling, marketing, general and administrative expense was $1.4 million in both Q3 2019 and Q3 2018. Expenses for Q3 2019 are inclusive of $272 thousand in additional expense related to our restructuring efforts. Resulting headcount reductions are expected to result in a lower overall cost structure in subsequent periods.

Research and development expense was $0.3 million in Q3 2019, as compared to $0.6 million in Q3 2018. The decrease from the prior year was mainly due to decreases in expenses associated with alloy and application development efforts. Such trend is expected to continue as a result of our restructuring efforts.

Cash and restricted cash totaled $31.2 million at September 30, 2019, as compared to $35.2 million at December 31, 2018.

For a more detailed and complete analysis of the Company’s financial results, please refer to the Company’s September 30, 2019 Form 10Q, which was filed earlier today.

About Liquidmetal Technologies

Lake Forest, California-based Liquidmetal Technologies, Inc. is the leading developer of parts made with amorphous alloys, also known scientifically as Bulk Metallic Glasses or BMGs. The non-crystalline atomic structure of these materials imparts unique performance properties, including the ability to injection-mold with micron-level precision, lustrous finishes, high strength, hardness and corrosion resistance, and remarkable elasticity. Liquidmetal Technologies is the first company to produce amorphous alloy parts commercially, enabling significant improvements in products across a wide array of industries. For more information, go to www.liquidmetal.com.

Forward-Looking Statement

This press release contains "forward-looking statements," including but not limited to statements regarding the advantages of Liquidmetal's amorphous alloy technology, scheduled manufacturing of customer parts and other statements associated with Liquidmetal's technology and operations. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could vary materially from Liquidmetal's expectations and projections. Risks and uncertainties include, among other things; customer adoption of Liquidmetal's technologies and successful integration of those technologies into customer products; potential difficulties or delays in manufacturing products incorporating Liquidmetal's technologies; Liquidmetal's ability to fund its current and anticipated operations; the ability of third party suppliers and manufacturers to meet customer product requirements; general industry conditions; general economic conditions; and governmental laws and regulations affecting Liquidmetal's operations. Additional information concerning these and other risk factors can be found in Liquidmetal's public periodic filings with the U.S. Securities and Exchange Commission, including the discussion under the heading "Risk Factors" in Liquidmetal's 2018 Annual Report on Form 10-K.

 
LIQUIDMETAL TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except par value and share data)
 

June 30,

December 31,

 

2019

 

 

2018

 

(Unaudited)

ASSETS
 
Current assets:
Cash

$

31,219

 

$

35,229

 

Restricted cash

 

5

 

 

5

 

Trade accounts receivable

 

312

 

 

120

 

Inventory

 

86

 

 

31

 

Prepaid expenses and other current assets

 

411

 

 

363

 

Total current assets

$

32,033

 

$

35,748

 

Property and equipment, net

 

9,081

 

 

11,767

 

Patents and trademarks, net

 

259

 

 

322

 

Equipment held for sale

 

585

 

Other assets

 

14

 

 

14

 

Total assets

$

41,972

 

$

47,851

 

 
LIABILITIES AND SHAREHOLDERS' EQUITY
 
Current liabilities:
Accounts payable

$

124

 

$

253

 

Accrued liabilities

 

508

 

 

270

 

Deferred revenue

 

1

 

 

31

 

Total current liabilities

$

633

 

$

554

 

 
Long-term liabilities:
Other long-term liabilities

 

856

 

 

856

 

Total liabilities

$

1,489

 

$

1,410

 

 
Shareholders' equity:
Preferred Stock, $0.001 par value; 10,000,000 shares authorized; 0 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively

 

-

 

 

-

 

Common stock, $0.001 par value; 1,100,000,000 shares authorized; 914,359,124 and 914,206,832 shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively

 

914

 

 

914

 

Warrants

 

18,179

 

 

18,179

 

Additional paid-in capital

 

286,705

 

 

286,276

 

Accumulated deficit

 

(265,240

)

 

(258,854

)

Non-controlling interest in subsidiary

 

(75

)

 

(74

)

 
Total shareholders' equity

$

40,483

 

$

46,441

 

 
Total liabilities and shareholders' equity

$

41,972

 

$

47,851

 

 
LIQUIDMETAL TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(in thousands, except share and per share data)
(unaudited)
 

For the Three Months Ended
September 30,

For the Nine Months Ended
September 30,

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 
Revenue
Products

$

373

 

$

205

 

$

728

 

$

340

 

Licensing and royalties

 

48

 

 

48

 

 

48

 

 

48

 

Total revenue

 

421

 

 

253

 

 

776

 

 

388

 

 
Cost of sales

 

284

 

 

884

 

 

566

 

 

1,026

 

Gross profit (loss)

 

137

 

 

(631

)

 

210

 

 

(638

)

 
Operating expenses
Selling, marketing, general and administrative

 

1,380

 

 

1,381

 

 

4,088

 

 

4,493

 

Research and development

 

284

 

 

601

 

 

1,179

 

 

1,855

 

Impairment of long-lived assets

 

-

 

 

-

 

 

1,676

 

 

-

 

Gain on disposal of fixed assets

 

(7

)

 

-

 

 

(2

)

 

-

 

Total operating expenses

 

1,657

 

 

1,982

 

 

6,941

 

 

6,348

 

Operating loss

 

(1,520

)

 

(2,613

)

 

(6,731

)

 

(6,986

)

 
Interest income

 

125

 

 

89

 

 

344

 

 

157

 

 
Net loss and comprehensive loss

 

(1,395

)

 

(2,524

)

 

(6,387

)

 

(6,829

)

 
Net loss attributable to non-controlling interest

 

-

 

 

1

 

 

1

 

 

1

 

Net loss and comprehensive loss attributable to Liquidmetal Technologies shareholders

$

(1,395

)

$

(2,523

)

$

(6,386

)

$

(6,828

)

 
 
Net loss per common share attributable to Liquidmetal Technologies shareholders, basic and diluted

$

(0.00

)

$

(0.00

)

$

(0.01

)

$

(0.01

)

 
Number of weighted average shares - basic and diluted

 

914,359,124

 

 

909,972,342

 

 

914,332,758

 

 

909,366,218

 

 

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