Metalink Reports Third Quarter 2010 Results

Dec 15, 2010, 11:36 ET from Metalink Ltd

GEALYA, Israel, December 15, 2010 /PRNewswire-FirstCall/ --

- Prepays all Outstanding Loan for a $50,000 Discount

- Appoints Oren Brooks as Chief Financial Officer

Metalink Ltd. (NASDAQ: MTLK), today announced its unaudited financial results for the third quarter of 2010 ended September 30, 2010.

FINANCIAL RESULTS

Financial Highlights for the Third Quarter of 2010: Revenues for the third quarter of 2010 were $0.36 million compared to $0 million for the third quarter of 2009; the revenues are only from Metalink's continuing operation, the legacy DSL sales. Net profit for the period from continuing operation was $0.12 million, or $0.046 per share, compared to net loss of $(1.6) million, or $(0.64) per share, for the third quarter of 2009. Net income for the period from discontinued operation was $0 million, or $0 per share, compared to net loss $(2,343) million, or $(0.92) per share, for the third quarter of 2009.

For the First 9 months of 2010: Revenues for the period were $0.62 million, compared to $3.3 million for the period in 2009; the revenues are only from Metalink's continuing operation, the legacy DSL sales. Net loss for the period from continuing operation was $(0.43) million, or $(0.158) per share, compared to $(3.38) million, or $(1.38) per share, for the first nine months of 2009. Net income for the period from discontinued operation was $6.8 million, or $2.53 per share, compared to net loss $(8.46) million, or $(3.44) per share, for the first nine months of 2009.

Cash Status: Metalink's cash, cash equivalents, as of September 30, 2010 were $3.52 million.

OTHER HIGHLIGHTS

Full Repayment of Loan: As previously announced, the remainder of $350,000 owed to the institutional investor was to be paid in three installments between September 30, 2010 and March 31, 2011. However, as recently agreed with the lender, the Company paid the lender $300,000 on December 13, 2010 as a full repayment of the remaining balance, such that the lender granted the Company a $50,000 discount in consideration for the early prepayment.

Appointment of CFO: Mr. Oren Brooks, 45, is one of the founders at Brooks-Keret Financial Services Ltd, a reputable Israeli provider of financial and accounting services. He is an experienced CPA, who served with controlling and CFO services a various start-up's and other companies, he holds a BA degree in accounting and statistics from TA University. Mr. Brooks will be serving as CFO commencing as of December, 2010, as part of the Company's engagement with Brooks-Keret to provide CFO and other financial and accounting services to the Company. He will replace Mr. Rony Eizenshtein, a senior manager at Brooks-Keret, who served as the Company's CFO since March 31, 2010.

ABOUT METALINK

Metalink shares trade on NASDAQ under the symbol "MTLK". For more information, please visit our website at http://www.MTLK.com.

SAFE HARBOR STATEMENT This press release contains "forward looking statements" within the meaning of the United States securities laws. Words such as "aim," "expect," "estimate," "project," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believe," "predicts," "potential," "continue," and similar expressions are intended to identify such forward-looking statements. Because such statements deal with future events, they are subject to various risks and uncertainties that could cause actual results to differ materially from those in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to: absence of significant operations following the Lantiq transaction; uncertainty as to our future business model and our ability to identify and evaluate suitable business opportunities; and our U.S. shareholders may suffer adverse tax consequences if we will be classified as a passive foreign investment company. Additional factors that could cause actual results to differ materially from these forward-looking statements are set forth from time to time in Metalink's filings with the Securities and Exchange Commission, including Metalink's Annual Report in Form F-20. Readers are cautioned not to place undue reliance on forward-looking statements. Except as required by applicable law, the Company undertakes no obligation to republish or revise forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrences of unanticipated events. The Company cannot guarantee future results, events, and levels of activity, performance, or achievements.

                                  METALINK LTD.
                           CONSOLIDATED BALANCE SHEETS

                                      September 30,     December 31,
                                          2010             2009
                                               (Unaudited)
                                     (in thousands except share data)
    ASSETS
    Current assets
    Cash and cash equivalents            $3,523           $2,273
    Trade accounts receivable               264              461
    Other receivables                     1,997              602
    Prepaid expenses                         29               88
    Inventories                              60            1,068
    Total current assets                  5,873            4,492
    Severance pay fund                       16            1,229
    Property and equipment, net              85            2,145
    Total assets                         $5,974           $7,866

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current liabilities
    Trade accounts payable                 $193           $1,542
    Other payables and accrued expenses   1,422            3,239
    Short-term loan                         350            4,100
    Warrants to issue shares                  -              289
    Total current liabilities             1,965            9,170
    Accrued severance pay                   288            1,798
    Shareholders' equity*
    Ordinary shares of NIS 1.0 par value
    (Authorized - 5,000,000 shares, issued
    and outstanding - 2,780,231 and
    2,663,723 shares as of June 30, 2010 and
    December 31, 2009, respectively)
                                            790              759
    Additional paid-in capital          158,110          157,692
    Accumulated deficit                (145,294)        (151,668)
                                         13,606            6,783
    Treasury stock, at cost; 89,850 as of
    June 30, 2010 and December 31, 2009  (9,885)          (9,885)
    Total shareholders' equity            3,721           (3,102)
    Total liabilities and shareholders'
    equity                               $5,974          $ 7,866


    * The number of shares have been adjusted retroactively to reflect the
      one for ten reverse split of our ordinary shares dated February 22,
      2010.

                                  METALINK LTD.
                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                Three months ended    Nine months ended
                                  September 30,         September 30,
                                  2010         2009      2010   2009
                                   (Unaudited)           (Unaudited)
                                             (in thousands,
                                    except share and per share data)

    Revenues                        $363          $-       $621    $3,288
    Cost of revenues:
    Costs and expenses                37           5         75     1,005
    Royalties to the                   8           -         11        99
    Government of Israel
    Total cost of revenues            45           5         86     1,104
    Gross profit                     318          (5)       535     2,184
    Operating expenses:
    Gross research and                 -           -          -         -
    development
    Less - Royalty bearing and         -           -          -         -
    other grants
    Research and development,          -           -          -         -
    net
    Selling and marketing              -           -          -         -
    General and administrative       270         396        920     1,826
    Total operating expenses         270         396        920     1,826
    Operating profit (loss)           48        (401)      (385)      358
    Financial income                  75      (1,221)       (40)   (3,734)
    (expenses), net
    Net loss from continuing        $123     $(1,622)     $(425)  $(3,376)
    operation
    Discontinued operation
    Operating loss from                0      (2,343)      (108)   (8,457)
    discontinued operation
    Capital gain from sale of          -           -      6,907         -
    discontinued operation
    Net profit (loss) from            $0     $(2,343)    $6,799   $(8,457)
    Discontinued operation
    Net profit (loss)               $123     $(3,965)    $6,374  $(11,833)
    Per share data-               $0.046      $(0.64)   $(0.158)   $(1.38)
    Basic and Diluted loss
    from continuing operations
    Basic and Diluted earnings        $0      $(0.92)    $2.527    $(3.44)
    (loss) from discontinued
    operations
    Basic and Diluted earnings     $0.046      $(1.56)   $2.369    $(4.82)
    (loss)

    Shares used in computing
    loss per ordinary share*:

    Basic and Diluted          2,690,383   2,553,173  2,690,383 2,452,936


    * Shares used for loss per share calculation have been adjusted
      retroactively to reflect the one for ten reverse split of our ordinary
      shares dated February 22, 2010.

    Neta Eshed
    General Counsel
    Metalink Ltd.
    Tel: +972-77-4495900
    Fax: +972-77-4495901
    Neta@Mtlk.com

SOURCE Metalink Ltd