Press Release

New Prototype Shipments Increased 67% Sequentially in Q1 2013, Reflecting Growing Interest in the Unique Applications and Capabilities of Liquidmetal Alloy

RANCHO SANTA MARGARITA, Calif.--(BUSINESS WIRE)--May. 14, 2013-- Liquidmetal® Technologies, Inc. (LTI) (OTCQB: LQMT), the leading developer of amorphous alloys and composites, reported results for the quarter ended March 31, 2013.

Q1 2013 Operational Highlights

• During the first quarter, LTI delivered five new Liquidmetal prototype shipments to five different customers, which was up 67% from the prior quarter and compared to zero in the same year-ago period. Each shipment contained multiple prototype parts.
• Most of the prototype shipments were to new customers in the oil and gas industry for use in exploration and development activities, which represents a new market for the company.
• The company increased its prototype activity with a major customer in the aerospace and defense industry by shipping additional parts of existing active prototypes for further testing and evaluation.
• At the end of the first quarter of 2013, there were 18 prototypes actively being evaluated by customers, up from 13 at the end of the previous quarter and four at the end of Q1 2012.
• At quarter-end, the company’s IP portfolio included 56 owned or licensed U.S. patents, with an additional 56 patent applications pending. Its patent applications relate to the composition, processing, and application of Liquidmetal alloys.

Management Commentary

“During the first quarter, we made steady progress in our transition from a development stage to a commercial products company,” said Tom Steipp, president and CEO of Liquidmetal Technologies. “This is demonstrated by the five new prototype parts shipped during the quarter, as well as the 18 active prototypes currently in development. The increasing number of active prototypes undergoing extensive evaluation by customers shows a growing interest in Liquidmetal alloy’s distinctive performance characteristics.

“As we continue to collaborate with customers to perfect their Liquidmetal alloy parts, we expect to see a number of these prototypes progress to commercial production over the course of the year. We will also continue to pursue opportunities for IP licensing.

“We believe progress in these areas will result in a broader base of customers, a stronger foundation for licensees and partners, and ultimately increased value to shareholders.”

Q1 2013 Financial Summary

In Q1 2013, the company generated nominal revenues as it focused on the development of prototype parts for its customers.

Selling, marketing, general and administrative expense was $1.3 million compared to $1.0 million in Q1 2012. The increase was primarily due to additional headcount to support the company’s sales and business development efforts.

Research and development expense was $236,000 compared to $188,000 in Q1 2012. The increase reflects the escalation of prototype activity, as well as additional research and development of manufacturing techniques for Liquidmetal alloys.

Total operating expenses were $1.6 million compared to $1.1 million in Q1 2012.

Cash totaled $5.5 million at March 31, 2013, as compared to $7.2 million at December 31, 2012.

Conference Call

Liquidmetal Technologies management will hold a conference call later today (May 14, 2013) to discuss these results. The company’s President and CEO Tom Steipp and CFO Tony Chung will host the call starting at 4:30 p.m. Eastern time. A question and answer session will follow management’s presentation.

Date: Tuesday, May 14, 2013
Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time)
Dial-In Number: 1-877-941-1427
International: 1-480-629-9664
Conference ID: 4613351

The conference call will be broadcast simultaneously and available for replay via the investor section of the company's website at www.liquidmetal.com.

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Liolios Group at 1-949-574-3860.

A replay of the call will be available after 7:30 p.m. Eastern time on the same day through June 14, 2013.

Toll-Free Replay Number: 1-877-870-5176
International Replay Number: 1-858-384-5517
Replay PIN Number: 4613351

About Liquidmetal Technologies

Rancho Santa Margarita, California-based Liquidmetal Technologies, Inc. is the leading developer of bulk alloys and composites that utilize the performance advantages offered by amorphous alloy technology. Amorphous alloys are unique materials that are distinguished by their ability to retain a random structure when they solidify, in contrast to the crystalline atomic structure that forms in ordinary metals and alloys. Liquidmetal Technologies is the first company to produce amorphous alloys in commercially viable bulk form, 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 2012 Annual Report on Form 10-K.

LIQUIDMETAL TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except par value and share data)
					March 31,				December 31,
						2013				2012
					(Unaudited)				(Audited)
ASSETS
Current assets:
		Cash			$	5,506			$	7,162
		Trade accounts receivable, net of allowance for doubtful accounts of $14 and $11, respectively				123				64
		Prepaid expenses and other current assets				637				689
			Total current assets		$	6,266			$	7,915
Property and equipment, net						181				161
Patents and trademarks, net						840				869
Other assets						28				28
			Total assets		$	7,315			$	8,973
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current liabilities:
		Accounts payable				81				154
		Accrued liabilities				286				248
		Accrued dividends				-				222
		Deferred revenue				5				-
		Convertible notes, net of debt discount of $2,167 and $4,635, respectively				1,833				2,365
		Embedded conversion feature liabilities on convertible notes				2,256				3,934
			Total current liabilities		$	4,461			$	6,923
Long-term liabilities
		Warrant liabilities				2,256				2,766
		Other long-term liabilities				856				856
			Total liabilities		$	7,573			$	10,545
Shareholders' deficit:
		Convertible, redeemable Series A Preferred Stock, $0.001 par value; 10,000,000
		shares authorized; 0 and 506,936 shares issued and outstanding at
		March 31, 2013 and December 31, 2012, respectively				-				-
		Common stock, $0.001 par value; 500,000,000 shares and 400,000,000 authorized
		at March 31, 2013 and December 31, 2012, respectively; 305,762,752
		and 242,074,324 shares issued and outstanding at March 31, 2013
		and December 31, 2012, respectively				306				242
		Warrants				18,179				18,179
		Additional paid-in capital				174,635				169,891
		Accumulated deficit				(193,378	)			(189,884	)
			Total shareholders' deficit		$	(258	)		$	(1,572	)
			Total liabilities and shareholders' deficit		$	7,315			$	8,973

LIQUIDMETAL TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(unaudited)
				Three Months Ended March 31,
					2013				2012
Revenue
	Products			$	117			$	183
	Licensing and royalties				5				13
		Total revenue			122				196
Cost of revenue, products					82				81
	Gross margin				40				115
Operating expenses
	Selling, marketing, general and administrative				1,314				959
	Research and development				236				188
		Total operating expenses			1,550				1,147
Operating loss					(1,510	)			(1,032	)
	Change in value of warrants, gain				510				-
	Change in value of embedded conversion feature liabilities, gain				1,678				-
	Debt discount amortization expense				(4,034	)			-
	Interest expense				(141	)			(39	)
	Interest income				3				4
Loss before income taxes					(3,494	)			(1,067	)
	Income taxes				-				-
Net loss					(3,494	)			(1,067	)
Per common share basic and diluted:
	Loss per share			$	(0.01	)		$	(0.01	)
Number of weighted average shares					282,675,201				153,707,246

Source: Liquidmetal Technologies, Inc.

Liquidmetal Technologies, Inc.
Otis Buchanan
Media Relations
949-635-2120
otis.buchanan@liquidmetal.com
or
Liolios Group, Inc.
Matt Glover or Michael Koehler
Investor Relations
949-574-3860
LQMT@liolios.com