Liquidmetal® Technologies, Inc. (OTCQB: LQMT), a leading authority on commercial applications of amorphous alloys, reported results for its third quarter ended September 30, 2020.
Management Commentary
Our third quarter results reflect the completion of initial volume production orders under our outsourced manufacturing model. Since July, we have delivered 10,000 parts per month to fill a customer pipeline for a dental application. We expect continued deliveries, at similar volumes, to continue into the middle of 2021. This has allowed us to further validate Yihao as a trusted supplier and technology partner. These successful initial volume production runs are expected to further drive customer confidence in our technology, identify areas of improvement in our operating model, and increase market confidence in the viability of our breakthrough technology in critical fielded products. Concurrently, we continue to execute aggressive sales and marketing programs to add new projects to our pipeline and are developing opportunities for additional licensed manufacturers with domestic operations.
Q3 2020 Financial Summary
During the third quarter of 2020, the Company generated $327 thousand in revenue through monthly part deliveries under production orders. Existing purchase orders will run through the first half of 2021.
Cost of goods sold was $171 thousand in Q3 2020 and $284 thousand in Q3 2019. This decrease was primarily attributable to lower production part deliveries due to the recent transition in the Company’s manufacturing strategy and a build-up of existing customer inventories in the latter part of 2019. However, the Company did see an improvement in gross margin percentages following refinement of supply chains from the Company’s third party contract manufacturer.
Selling, marketing, general and administrative expense was $1.1 million in Q3 2020 and $1.4 million in Q3 2019. The decrease is primarily due to lower costs associated with employee compensation, inclusive of non-cash stock-based compensation.
Research and development decreased to $30 thousand in Q3 2020, from $284 thousand in Q3 2019. The decrease is mainly due to headcount and internal project reductions as a result of the recently completed restructuring plan.
Cash and cash equivalents, restricted cash, and investments in debt securities totaled $29.3 million at September 30, 2020, as compared to $31.0 million at December 31, 2019.
For a more detailed and complete analysis of the Company’s financial results, please refer to the Company’s September 30, 2020 Form 10Q, which was filed earlier today.
About Liquidmetal Technologies
Lake Forest, California-based Liquidmetal Technologies, Inc. is a leading authority and 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 2019 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,
|
|
|
2020
|
|
2019
|
|
|
(Unaudited)
|
|
(Audited)
|
| ASSETS |
|
|
|
|
|
|
|
|
|
| Current assets: |
|
|
|
|
| Cash and cash equivalents |
|
$
|
5,438
|
|
|
$
|
19,543
|
|
| Restricted cash |
|
|
5
|
|
|
|
5
|
|
| Investments in debt securities- short term |
|
|
11,566
|
|
|
|
4,415
|
|
| Trade accounts receivable, net of allowance for doubtful accounts |
|
|
182
|
|
|
|
303
|
|
| Inventory |
|
|
47
|
|
|
|
12
|
|
| Prepaid expenses and other current assets |
|
|
600
|
|
|
|
322
|
|
| Total current assets |
|
$
|
17,838
|
|
|
$
|
24,600
|
|
| Investments in debt securities- long term |
|
|
12,279
|
|
|
|
7,074
|
|
| Property and equipment, net |
|
|
8,694
|
|
|
|
8,819
|
|
| Patents and trademarks, net |
|
|
177
|
|
|
|
239
|
|
| Equipment held for sale |
|
|
-
|
|
|
|
585
|
|
| Other assets |
|
|
235
|
|
|
|
14
|
|
| Total assets |
|
$
|
39,223
|
|
|
$
|
41,331
|
|
|
|
|
|
|
| LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
| Current liabilities: |
|
|
|
|
| Accounts payable |
|
|
316
|
|
|
|
132
|
|
| Accrued liabilities |
|
|
310
|
|
|
|
775
|
|
| Total current liabilities |
|
$
|
626
|
|
|
$
|
907
|
|
|
|
|
|
|
| Long-term liabilities |
|
|
|
|
| Other long-term liabilities |
|
|
899
|
|
|
|
856
|
|
| Total liabilities |
|
$
|
1,525
|
|
|
$
|
1,763
|
|
|
|
|
|
|
| Shareholders' equity: |
|
|
|
|
| Preferred Stock, $0.001 par value; 10,000,000 shares authorized; 0 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively |
|
|
-
|
|
|
|
-
|
|
| Common stock, $0.001 par value; 1,100,000,000 shares authorized; 914,449,957 and 914,449,957 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively |
|
|
914
|
|
|
|
914
|
|
| Warrants |
|
|
18,179
|
|
|
|
18,179
|
|
| Additional paid-in capital |
|
|
287,088
|
|
|
|
286,832
|
|
| Accumulated deficit |
|
|
(268,449
|
)
|
|
|
(266,284
|
)
|
| Accumulated other comprehensive income |
|
|
42
|
|
|
|
2
|
|
| Non-controlling interest in subsidiary |
|
|
(76
|
)
|
|
|
(75
|
)
|
| Total shareholders' equity |
|
$
|
37,698
|
|
|
$
|
39,568
|
|
|
|
|
|
|
| Total liabilities and shareholders' equity |
|
$
|
39,223
|
|
|
$
|
41,331
|
|
|
|
|
|
|
|
|
|
|
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,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
| Revenue |
|
|
|
|
|
|
|
|
| Products |
|
$
|
288
|
|
|
$
|
373
|
|
|
$
|
367
|
|
|
$
|
728
|
|
| Licensing and royalties |
|
|
39
|
|
|
|
48
|
|
|
|
64
|
|
|
|
48
|
|
| Total revenue |
|
|
327
|
|
|
|
421
|
|
|
|
431
|
|
|
|
776
|
|
|
|
|
|
|
|
|
|
|
| Cost of sales |
|
|
171
|
|
|
|
284
|
|
|
|
242
|
|
|
|
566
|
|
| Gross profit (loss) |
|
|
156
|
|
|
|
137
|
|
|
|
189
|
|
|
|
210
|
|
|
|
|
|
|
|
|
|
|
| Operating expenses |
|
|
|
|
|
|
|
|
| Selling, marketing, general and administrative |
|
|
1,096
|
|
|
|
1,380
|
|
|
|
2,953
|
|
|
|
4,088
|
|
| Research and development |
|
|
30
|
|
|
|
284
|
|
|
|
86
|
|
|
|
1,179
|
|
| Impairment of long-lived assets |
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,676
|
|
| (Gain) on disposal of long-lived assets |
|
|
-
|
|
|
|
(7
|
)
|
|
|
(35
|
)
|
|
|
(2
|
)
|
| Total operating expenses |
|
|
1,126
|
|
|
|
1,657
|
|
|
|
3,004
|
|
|
|
6,941
|
|
| Operating loss |
|
|
(970
|
)
|
|
|
(1,520
|
)
|
|
|
(2,815
|
)
|
|
|
(6,731
|
)
|
|
|
|
|
|
|
|
|
|
| Lease income |
|
|
132
|
|
|
|
-
|
|
|
|
352
|
|
|
|
-
|
|
| Interest and investment income |
|
|
61
|
|
|
|
125
|
|
|
|
297
|
|
|
|
344
|
|
|
|
|
|
|
|
|
|
|
| Loss before income taxes |
|
|
(777
|
)
|
|
|
(1,395
|
)
|
|
|
(2,166
|
)
|
|
|
(6,387
|
)
|
|
|
|
|
|
|
|
|
|
| Income taxes |
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
| Net loss |
|
|
(777
|
)
|
|
|
(1,395
|
)
|
|
|
(2,166
|
)
|
|
|
(6,387
|
)
|
|
|
|
|
|
|
|
|
|
| Net loss attributable to non-controlling interest |
|
|
1
|
|
|
|
-
|
|
|
|
1
|
|
|
|
1
|
|
| Net loss attributable to Liquidmetal Technologies shareholders |
|
$ |
(776 |
) |
|
$ |
(1,395 |
) |
|
$ |
(2,165 |
) |
|
$ |
(6,386 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Per common share basic and diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net loss per common share attributable to Liquidmetal Technologies shareholders, basic and diluted |
|
$ |
(0.00 |
) |
|
$ |
(0.00 |
) |
|
$ |
(0.00 |
) |
|
$ |
(0.01 |
) |
|
|
|
|
|
|
|
|
|
| Number of weighted average shares - basic and diluted |
|
|
914,449,957
|
|
|
|
914,359,124
|
|
|
|
914,449,957
|
|
|
|
914,332,758
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20201110006206/en/
Bryce Van
Media Relations
Liquidmetal Technologies, Inc.
949-635-2107
bryce.van@liquidmetal.com