Press Release
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Revenue for the full 2006 year was $27.7 million, up 69% over 2005 revenue of $16.4 million. The Company's gross margin also increased to 19%, up from 8% in 2005. During the year, selling general and administrative costs were $10.0 million compared to $8.5 million in 2005. Research and development costs came in at $1.0 million compared to $1.1 million in 2005. The Company had Adjusted EBITDA of negative $0.4 million in 2006 compared to a negative $5.0 million in 2005. Under GAAP, the Company had net loss of $14.5 million in 2006 compared to a net loss of $7.1 million in 2005. Changes in net income fully reflect the accounting treatment for the outstanding warrants and conversion features of convertible notes.
Revenue for the fourth quarter of 2006 was $6.0 million, compared to revenue of $5.5 million in 2005, a 9% increase. The Company's gross margin was 15%, slightly down from the 16% of 2005. The selling, general and administrative costs were $2.6 million compared to $2.0 million in the fourth quarter of 2005. Research and development costs came in at $0.2 million compared to $0.3 million in the fourth quarter of 2005. The adjusted EBITDA for the fourth quarter of 2006 was a negative $0.7 million compared to a negative $0.6 million for the same period in 2005. Under GAAP, the Company had a net loss of $0.7 million for the fourth quarter of 2006 compared to a net income of $4.1 million for the same period in 2005.
Larry Buffington, President and CEO, commented, "Liquidmetal Technologies achieved several milestones during the past year in the adoption and commercialization of our revolutionary technology. In 2006, our customers incorporated Liquidmetal into several key products which have been introduced into commercial markets. We successfully demonstrated our supplier capabilities by manufacturing large quantities to meet product demand while also maintaining the quality standards of our world class customers. Achieving ISO certification in our manufacturing operations and complying with Rule 404 of the Sarbanes Oxley Act are further indications of the foundation established in all areas of our Company. As we look ahead in 2007, we are laying the groundwork to make Liquidmetal a more pervasive technology by combining the superior performance characteristics of our technology with a highly cost-competitive position and efficient, capable manufacturing expertise."
Conference Call
As previously announced, Liquidmetal Technologies will host a conference call at 4:30 pm (EDT) on Thursday, March 15, 2007 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.
Use of Non-GAAP Numbers
The financial results disclosed in this release include certain measures calculated and presented in accordance with generally accepted accounting principles in the United States of America ("GAAP"). In addition to the GAAP financial measures, Liquidmetal Technologies provides supplemental, non-GAAP financial measures to facilitate evaluation of Liquidmetal Technologies' operating performance. Management believes that Adjusted EBITDA is a useful financial measure that facilitates evaluating the past and future performance of Liquidmetal Technologies' operations on a comparable basis. Liquidmetal Technologies reports Adjusted EBITDA as an alternative method for assessing total company performance. Included in this press release is a reconciliation of the non-GAAP financial measures to their most directly comparable GAAP financial measure as provided with the financial statements attached to this press release.
Liquidmetal Technologies, Inc.
Consolidated Statements of Operations Data
(In thousands, except per share data)
For the twelve months For the three months
ended ended
----------------------- -----------------------
12/31/2006 12/31/2005 12/31/2006 12/31/2005
----------- ----------- ----------- -----------
(Restated) (Restated)
(Unaudited)
Revenue $27,669 $16,365 $5,984 $5,453
Cost of sales 22,418 15,129 5,081 4,576
----------- ----------- ----------- -----------
Gross profit 5,251 1,236 903 877
Operating expenses
Selling, general
and administrative
expenses 9,962 8,534 2,599 2,013
Research and
development
expenses 950 1,120 197 314
Impairment of long
lived assets - 4,487 - 260
----------- ----------- ----------- -----------
Total operating
expenses 10,912 14,141 2,796 2,587
----------- ----------- ----------- -----------
Loss before interest,
other income and
income taxes (5,661) (12,905) (1,893) (1,710)
Loss from
extinguishments of
debt - (1,247) - -
Change in value of
warrants, gain 279 3,985 1,633 2,840
Change in value of
conversion
feature, (loss)
gain (226) 9,118 1,707 4,621
Other income 572 - - -
Interest expense (9,509) (6,021) (2,148) (1,644)
Interest income 23 17 6 3
----------- ----------- ----------- -----------
(Loss) income before
income taxes (14,522) (7,053) (695) 4,110
Income taxes - - - -
----------- ----------- ----------- -----------
Net (loss) income $(14,522) $(7,053) $(695) $4,110
=========== =========== =========== ===========
Net (loss) income per
share - basic and
diluted $(0.33) $(0.17) $(0.02) $0.10
=========== =========== =========== ===========
Weighted average
common shares - basic
and diluted 43,809 41,833 44,245 42,180
=========== =========== =========== ===========
Liquidmetal Technologies, Inc.
Reconciliation of EBITDA and Adjusted EBITDA
(In thousands)
For the twelve months For the three months
ended ended
----------------------- -----------------------
12/31/2006 12/31/2005 12/31/2006 12/31/2005
----------- ----------- ----------- -----------
(Restated) (Restated)
(Unaudited)
Net (loss) income as
reported $(14,522) $(7,053) $(695) $4,110
Add Back:
Interest expense,
net 9,486 6,004 2,142 1,641
Depreciation &
amortization 3,574 3,401 916 885
----------- ----------- ----------- -----------
EBITDA $(1,462) $2,352 $2,363 $6,636
Add Back:
Loss from
extinguishment of
debt - 1,247 - -
Change in value of
warrants, (gain)
loss (279) (3,985) (1,633) (2,840)
Change in value of
conversion
feature, (gain)
loss 226 (9,118) (1,707) (4,621)
Impairment of long-
lived assets - 4,487 - 260
Stock based
compensation 1,075 41 244 -
----------- ----------- ----------- -----------
Adjusted EBITDA $(440) $(4,976) $(733) $(565)
=========== =========== =========== ===========
This press release may contain "forward-looking statements" that involve risks and uncertainties, including statements regarding our plans, future events, objectives, expectations, forecasts, or assumptions. Any statement in this press release that is not a statement of historical fact is a forward-looking statement, and in some cases, words such as "believe," "estimate," "project," "expect," "intend," "may," "anticipate," "plans," "seeks," and similar expressions identify forward-looking statements. These statements involve risks and uncertainties that could cause actual outcomes and results to differ materially from the anticipated outcomes or result, and undue reliance should not be placed on these statements. These risks and uncertainties may include: our limited operating history in developing and manufacturing products from bulk amorphous alloys; the adoption of our alloys by customers; the commercial success of our customer's products; our ability to identify, develop, and commercialize new applications for our alloys; competition with suppliers of incumbent materials; the development of new materials that render our alloys obsolete; the ability to manage our anticipated growth; our limited direct experience in manufacturing bulk alloy products; scaling-up our manufacturing facilities; protecting our intellectual property; problems associated with manufacturing and selling our alloys outside of the United States; and other risks and uncertainties discussed in filings made with the Securities and Exchange Commission (including risks described in subsequent reports on Form 10-Q, Form 10-K, Form 8-K, and other filings). Liquidmetal Technologies disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
SOURCE: Liquidmetal Technologies Inc.
Liquidmetal Technologies Otis Buchanan, 949-206-8020 otis.buchanan@liquidmetal.com