Press Release
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LAKE FOREST, Calif.--(BUSINESS WIRE)--Feb. 28, 2006--Liquidmetal(R) Technologies Inc. (OTCBB:LQMT) today announced financial results for the three months ended December 31st, 2005.
Revenue for the fourth quarter was $5.5 million compared to $4.3 million in the third quarter of 2005, an increase of $1.2 million or 28%.
John Kang, Chairman of Liquidmetal Technologies stated, "We are very pleased with the revenue growth during the fourth quarter. Our 28% growth exceeded the 20% growth that we had targeted at the company. We saw solid development in our business as both segments of our business saw good demand growth. This follows a solid third quarter growth as well. We are very encouraged by our increased revenues and expect this trend to continue. We experienced good growth in the orders from our key customers, Samsung, SanDisk, Vertu and Motorola throughout the quarter. The most significant of the orders was the order for antennas from Motorola. This was a project that we have been working on for close to a year. We finally received the purchase order and put it into production in December. This marks a new major product category for us. We expect an increase in business as these key customers will be continuing with the projects they currently have and will be adding new projects in the coming quarters."
Bulk Alloy revenues were $3.5 million for the fourth quarter compared to $2.8 million in the third quarter, an increase of $0.7 million, which is primarily attributable to the introduction of new products by its customers. Loss before interest expense, discontinued operations, impairment of long lived assets and expensing of options was $0.3 million compared to $0.6 million in the prior quarter.
Coatings revenues were $2.0 million for the fourth quarter compared to $1.5 million in the prior quarter, showing growth of 33% in business. Income before interest expense and discontinued operations was $0.6 million compared to $0.4 million in the prior quarter, which also shows stable profitability.
During the quarter, selling general and administrative costs was $2.0 million compared to $2.4 million in the third quarter, a decrease of $0.4 million or 17%. This decrease was due primarily to company's efforts to manage costs. Research and development costs came in at $0.3 million compared to $0.2 million in the third quarter.
The Company had a loss from operation of $2.6 million in the fourth quarter vs $2.0 for the third quarter, an increase of $0.6 million which was due to an impairment charge of $1.1 million for inventory of raw material which is not expected to be used within the next 12 months.
While having an operating loss, the company had a net income of $1.7 million in the fourth quarter compared to a net loss of $2.3 million in the third quarter. This was mainly due to an accounting treatment for the beneficial conversion feature of the convertible notes issued in the third quarter of this year. Accounting for this feature will also cause a positive restatement to the third quarter financial results of $1.0 million which will be amended to reflect this item.
Commenting on the operations, Mr. Salas, President and CEO, noted, "While I have been in my position for only two months, it is exciting to see the improvements we are making in the company. In the fourth quarter, we saw the evidence of the turn we have made in our business. We saw solid revenue growth which will continue into the first quarter. Our operating expenses were maintaining at the level that was expected and is sustainable. As a result, we actually saw the combined business units of the bulk alloy and coatings have a positive contribution of $0.3 million. Due to the improved performance of our business units, we were able to maintain our cash position of $1.4 million at the end of the year, slightly higher than at the end of the third quarter. As revenues continue to increase this quarter with increased utilization of our plant, we expect to see continued improvement in our business. I am excited to be on board and help the company reach its potential."
As previously announced, Liquidmetal Technologies will host a conference call at 4:30 pm (EDT) on Tuesday, February 28, 2006 to discuss the results.
Listeners may access the conference call live over the Internet from Liquidmetal Technologies' website http://ir.liquidmetal.com or at http://www.companyboardroom.com.
For the Three Months Ended
Unaudited Unaudited Unaudited Unaudited
Amended
Consolidated Statements of
Operations Data: 12/31/05 09/30/05 06/30/05 03/31/05
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Revenue 5,453 4,342 3,727 2,843
Cost of sales 4,576 3,756 3,962 2,835
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Gross (loss) profit 877 586 (235) 8
Operating expenses
Selling, general, and
administrative 2,013 2,364 1,567 2,590
Research and
development 314 196 213 397
Impairment of long
lived assets 1,118 - 3,394 -
---------- ---------- ---------- ----------
Total expenses 3,445 2,560 5,174 2,987
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Loss from operations (2,568) (1,974) (5,409) (2,979)
Loss from extinguishments
of debt - (1,247) - -
Change in value of
warrants, net 2,840 1,112 (100) 133
Change in value of
beneficial conversion
feature 2,867 982 - -
Interest expense (1,490) (1,159) (909) (1,257)
Interest income 3 7 1 6
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Gain (loss) from
continuing operations 1,653 (2,279) (6,417) (4,097)
Net loss 1,653 (2,279) (6,417) (4,097)
Other comprehensive loss
Foreign exchange
translation gain (loss) 222 (306) 62 321
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Comprehensive
gain (loss) 1,875 (2,585) (6,355) (3,776)
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Net loss per common share -
basic and diluted:
Gain (loss) per share
basic and diluted 0.04 (0.08) (0.15) (0.10)
========== ========== ========== ==========
Number of weighted average
shares - basic and diluted 42,180 41,933 41,610 41,610
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CONTACT: Liquidmetal Technologies Inc., Lake Forest
Otis Buchanan, 949-206-8020
otis.buchanan@liquidmetal.com
SOURCE: Liquidmetal Technologies Inc.