Liquidmetal Technologies Reports Third Quarter 2019 Results

Liquidmetal Technologies, Inc. (OTCQB: 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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