Liquidmetal Technologies Reports Third Quarter 2018 Results

Liquidmetal Technologies, Inc. (OTCQB: LQMT), the leading developer of amorphous alloys and composites, reported results for its third quarter ended September 30, 2018.

Management Commentary

Dr. Bruce Bromage, the Companys Chief Operating Officer, stated that the third quarter of 2018 showed the Companys continued execution of our commercialization strategy. Early production orders shipped during the quarter for Amorphous Metal Molding (AMM) and Metal Injection Molding (MIM) customers. In addition, the Company has active development projects with top-tier medical, automotive and consumer products companies, each with potential for volume, multi-year production.

Dr. Bromage continued that several projects are underway in collaboration with Yihao Metals, taking advantage of Liquidmetals amorphous metals expertise and proximity to US customers to develop parts that can be produced in high volumes in Asia. Liquidmetal and Yihao are working together to improve the cost of commercial AMM machines, alloys and processing methods to open markets globally.

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Q3 2018 Financial Summary

During the third quarter of 2018, the Company generated $253 thousand in revenue through completion of the production tooling portion of commercial orders for both our AMM and MIM platforms. During the third quarter of 2018, we finished validation procedures for the Companys first eight-cavity mold, highlighting our development efforts and continued emergence as a volume manufacturer.

Cost of goods sold was $884 thousand in Q3 2018 and $87 thousand in Q3 2017. This increase was primarily attributable to markdowns of raw materials inventory, which was slightly offset by improved production throughput.

Selling, marketing, general and administrative expense was $1.4 million in Q3 2018 and $1.7 million in Q3 2017. The decrease is primarily due to slightly lower costs associated with employee compensation, inclusive of non-cash stock-based compensation.

Research and development increased to $601 thousand from $500 thousand in Q3 2017. The increase is mainly due to increases in internal projects related alloy and molding machine development.

Cash and restricted cash totaled $36.4 million at September 30, 2018, as compared to $41.3 million at December 31, 2017.

For a more detailed and complete analysis of the Companys financial results, please refer to the Companys September 30, 2018 Form 10Q, which was filed earlier today.

About Liquidmetal Technologies

Lake Forest, California-based Liquidmetal Technologies, Inc. is the leading producer 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 2017 Annual Report on Form 10-K.

LIQUIDMETAL TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except par value and share data)

 
September 30, December 31,
2018   2017  
(Unaudited) (Audited)

ASSETS

 
Current assets:
Cash and cash equivalents $ 36,348 $ 41,309
Restricted cash 5 5
Trade accounts receivable, net of allowance for doubtful accounts 172 157
Inventory 19 391
Prepaid expenses and other current assets   348     326  
Total current assets $ 36,892 $ 42,188
Property and equipment, net 11,884 12,465
Patents and trademarks, net 343 408
Other assets   14     14  
Total assets $ 49,133   $ 55,075  
 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 
Current liabilities:
Accounts payable 196 92
Accrued liabilities 292 365
Deferred revenue   13     7  
Total current liabilities $ 501 $ 464
 
Long-term liabilities:
Warrant liabilities, long-term 1,599 2,192
Other long-term liabilities   856     856  
Total liabilities $ 2,956 $ 3,512
 
Shareholders’ equity:
Preferred Stock, $0.001 par value; 10,000,000
shares authorized; 0 shares issued and outstanding at
September 30, 2018 and December 31, 2017, respectively
Common stock, $0.001 par value; 1,100,000,000 shares authorized; 909,972,342
and 908,768,116 shares issued and outstanding at September 30, 2018
and December 31, 2017, respectively 910 909
Warrants 18,179 18,179
Additional paid-in capital 278,773 277,924
Accumulated deficit (251,611 ) (245,376 )
Non-controlling interest in subsidiary   (74 )   (73 )
Total shareholders’ equity 46,177 51,563
   
Total liabilities and shareholders’ equity $ 49,133   $ 55,075  
 
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,

2018

2017

2018

2017

 
Revenue
Products $ 205 $ 36 $ 340 $ 142
Licensing and royalties   48         48      
Total revenue 253 36 388 142
 
Cost of sales   884     87     1,026     216  
Gross loss (631 ) (51 ) (638 ) (74 )
 
Operating expenses
Selling, marketing, general and administrative 1,381 1,739 4,493 4,791
Research and development   601     500     1,855     1,331  
Total operating expenses   1,982     2,239     6,348     6,122  
Operating loss (2,613 ) (2,290 ) (6,986 ) (6,196 )
 
Change in value of warrant liabilities, gain (loss) 585 (1,674 ) 593 (2,563 )
Interest income   89     13     157     42  
 
Net loss and comprehensive loss (1,939 ) (3,951 ) (6,236 ) (8,717 )
 
Net loss attributable to non-controlling interest   1         1     3  

 

Net loss and comprehensive loss attributable to Liquidmetal Technologies shareholders

$ (1,938 ) $ (3,951 ) $ (6,235 ) $ (8,714 )
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   909,972,342     899,432,109     909,366,218     894,198,803  

Liquidmetal Technologies, Inc.
Bryce Van
Media Relations
949-635-2107
[email protected]

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