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Liquidmetal Technologies Reports Second Quarter 2016 Results

RANCHO SANTA MARGARITA, Calif.--(BUSINESS WIRE)--Aug. 9, 2016-- Liquidmetal® Technologies, Inc. (OTCQB: LQMT), the leading developer of amorphous alloys, reported results for its second quarter, ended June 30, 2016.

Q2 2016 Operational Highlights

On March 10, 2016, Liquidmetal Technologies, Inc. (the “Company”) entered into a Securities Purchase Agreement (“Agreement”) for $63.4 million with Liquidmetal Technology Limited, a Hong Kong company (the “Investor”). Investor is a newly formed company owned by Mr. Yeung Tak Lugee Li (“Mr. Li”). Also on March 10, 2016, the Company and DongGuan Eontec Co., Ltd. (“Eontec”) entered into a parallel License Agreement to cross-license their respective technologies. Eontec is a publicly held Hong Kong corporation listed on the Shenzhen Exchange, of which, Mr. Li is the Chairman and majority stockholder.

Under the Agreement, Investor initially purchased 105,000,000 shares for an aggregate purchase price of $8.4 million. On May 19, 2016, the Company’s shareholders approved a charter amendment increasing the Company’s authorized shares to 1.1 billion shares, thereby obligating the Investor to purchase the remaining 300,000,000 shares of the Company’s common stock for the purchase price of $55 million.

“Our collaboration with Eontec has begun, and we are all very excited about the ongoing synergies between LQMT and EONTEC as we seek to develop and grow the market for Liquidmetal on a global basis. We are working closely with Mr. Li to finalize the remaining $55 million of funding and look forward to elevating the relationship to the next level,” said Thomas Steipp, President and CEO at LQMT.

Q2 2016 Financial Summary

In Q2 2016, the Company generated revenues of $34 thousand as it continued to focus on the development of prototype and commercial parts for its customers and partnering with licensees on the development of the Company’s technology and production processes.

Selling, marketing, general and administrative expense was $1.8 million in Q2 2016, as compared to $1.9 million in Q2 2015. Research and development expense was $623 thousand in Q2 2016, compared to $455 thousand in Q2 2015.

Cash and restricted cash totaled $9.1 million at June 30, 2016, as compared to $4.7 million at December 31, 2015.

About Liquidmetal Technologies

Rancho Santa Margarita, California-based Liquidmetal Technologies, Inc. is the leading developer of bulk alloys 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 2015 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,
  2016     2015  
(Unaudited) (Audited)

ASSETS

 
Current assets:
Cash $ 8,054 $ 2,773
Restricted cash 1,006 2,008
Trade accounts receivable, net of allowance for doubtful accounts 9 30
Inventory 138 83
Prepaid expenses and other current assets   142     408  
Total current assets $ 9,349 $ 5,302
Property and equipment, net 1,184 1,370
Patents and trademarks, net 543 570
Other assets   36     31  
Total assets $ 11,112   $ 7,273  
 

LIABILITIES AND SHAREHOLDERS' EQUITY

 
Current liabilities:
Short-term debt 700 700
Accounts payable 146 250
Accrued liabilities 775 947
Deferred revenue - 77
Warrant liabilities 983 -
Option liabilities   -     -  
Total current liabilities $ 2,604 $ 1,974
 
Long-term liabilities:
Warrant liabilities 2,284 59
Other long-term liabilities   856     856  
Total liabilities $ 5,744 $ 2,889
 
Shareholders' equity:
Preferred Stock, $0.001 par value; 10,000,000
shares authorized; 0 shares issued and outstanding at
June 30, 2016 and December 31, 2015, respectively - -
Common stock, $0.001 par value; 1,100,000,000 shares authorized; 582,332,818
and 477,149,485 shares issued and outstanding at June 30, 2016
and December 31, 2015, respectively. 582 477
Warrants 18,179 18,179
Additional paid-in capital 214,616 203,735
Accumulated deficit (227,943 ) (217,945 )
Non-controlling interest in subsidiary (66 ) (62 )
   
Total shareholders' equity 5,368 4,384
   
Total liabilities and shareholders' equity $ 11,112   $ 7,273  
 
 
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 June 30,

For the Six Months
Ended June 30,

  2016     2015     2016     2015  
 
Revenue
Products $ 10 $ 15 $ 175 $ 38
Licensing and royalties   24     24     27     27  
Total revenue 34 39 202 65
 
Cost of sales   13     133     171     152  
Gross profit 21 (94 ) 31 (87 )
 
Operating expenses
Selling, marketing, general and administrative 1,765 1,891 3,782 3,743
Research and development   623     455     1,182     937  
Total operating expenses   2,388     2,346     4,964     4,680  
Operating loss (2,367 ) (2,440 ) (4,933 ) (4,767 )
 
Change in value of warrant liabilities, gain (loss) (879 ) 349 (2,448 ) 188
Change in value of option liabilities, gain (loss) 2,426 - (2,613 ) -
Interest expense (4 ) - (8 ) -
Interest income   -     6     -     14  
 
Net loss and comprehensive loss (824 ) (2,085 ) (10,002 ) (4,565 )
 
Net loss attributable to non-controlling interest   2     2     4     4  
Net loss and comprehensive loss attributable to
Liquidmetal Technologies shareholders $ (822 ) $ (2,083 ) $ (9,998 ) $ (4,561 )
 
 
 
Net loss per common share attributable to Liquidmetal
Technologies shareholders, basic and diluted $ (0.00 ) $ (0.00 ) $ (0.02 ) $ (0.01 )
 
Number of weighted average shares - basic and diluted   582,271,707     466,371,708     547,210,596     465,427,263  
 

Source: Liquidmetal Technologies, Inc.

Liquidmetal Technologies, Inc.
Otis Buchanan
Media Relations
949-635-2120
otis.buchanan@liquidmetal.com