MTLK Metalink, Ltd. (MM)

YAKUM, Israel, May 14 /PRNewswire-FirstCall/ -- Metalink Ltd. (NASDAQ: MTLK), a global provider and developer of high-performance broadband communication silicon solutions, today announced its unaudited financial results for the first quarter of 2009. FINANCIAL HIGHLIGHTS FOR THE FIRST QUARTER OF 2009: Revenues for the first quarter of 2009 were $1.8 million, the majority of which consisted of legacy DSL sales, compared to $0.7 million for the first quarter of 2008. Net loss for the period was $(3.5) million, or $(0.15) per share, compared to $(9.8) million, or $(0.42) per share, for the first quarter of 2008. Net loss for the first quarters of 2009 and 2008 includes stock-based compensation expenses of $0.2 million and $0.5 million, respectively. CASH STATUS: Metalink's cash, cash equivalents, and short-term investments as of March 31, 2009 were $8.6 million. LOAN STATUS: As previously announced, in January 2009, Metalink received an additional $2.25 million in a short-term secured loan from an institutional investor after having received a $3.5 million short-term secured loan from the institutional investor in the third quarter of 2008. This brought the Company's balance of outstanding loans to $5.75 million. According to the loan agreement, Metalink may request an additional loan of up to $2.25 million, subject to certain conditions. FINANCIAL EXPENSES: Financial Expenses, net, in the first quarter of 2009 were $0.96 million, compared to Financial Income, net, of $0.4 million in the fourth quarter of 2008. The increase in financial expenses primarily reflects a non-cash expense attributable to the increase in the fair value of the warrants granted under the loan agreement to the institutional investor, carried in fair value. COMMENTS OF MANAGEMENT: Commenting on the results, Metalink's CEO, Tzvika Shukhman, said, "In the first quarter of 2009, we benefitted from the restructuring activities carried out in 2008, which have allowed us to reduce our operating expenses significantly while maintaining our leadership position in our focus markets. Our WLAN products are currently being 'designed in' as components of a number of major carrier-class 802.11n residential gateways, routers, video bridges and set-top boxes that are aiming at major deployments worldwide. We have started shipping our WLAN products for initial deployments, and we are cautiously optimistic that order volumes will ramp up during the latter part of 2009. We are on the verge of sampling our Generation 3 WLAN products which will allow us to further improve both our performance edge and the cost structure of our products. Our entire team is committed to turning our best-of-breed technology and market traction into shareholder value." ABOUT METALINK Metalink Ltd. (NASDAQ:MTLK) is a provider of high performance wireless and wireline broadband communication silicon solutions. Metalink's WLAN and DSL technologies are designed to enable true broadband connectivity in every home, and its products change the broadband experience by facilitating the convergence of telecommunication, networking and entertainment. Metalink's WLANPLUS(TM) is a high-throughput, 802.11n-draft-compliant wireless LAN technology optimized for the networked home entertainment environment. Featuring advanced MIMO technology and full support of QoS, and operating in both 2.4GHz and 5GHz bands, WLANPLUS enables multi-room networking of multiple high-definition video streams. Further information is available 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. For example, when we discuss our expectation for order volumes to ramp up, we are using a forward looking statement. 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: our need to raise additional funds in order for us to implement our current business plan, including our liquidity requirements, which funds may not be timely available to us which may lead to insolvency; our inability to regain compliance with NASDAQ'S requirements for continued listing; any unforeseen developmental or technological difficulties with regard to our products; changes in the competitive landscape, including new competitors or the impact of competitive pricing and products; and the impact on revenues of economic and political uncertainties and weaknesses in various regions of the world, including the commencement or escalation of hostilities or acts of terrorism. 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 SEC, including Metalink's Annual Report in Form F-20. Readers are autioned 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 March 31, December 31, 2009 2008 (Unaudited) (in thousands except share data) ASSETS Current assets Cash and cash equivalents $ 7,892 $ 5,166 Short-term investments 700 677 Trade accounts receivable 506 2,515 Other receivables 902 1,529 Prepaid expenses 331 209 Deferred charges 282 242 Inventories 2,425 2,508 Total current assets 13,038 12,846 Severance pay fund 1,170 1,195 Property and equipment, net 3,046 3,338 Total assets $ 17,254 $ 17,379 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Trade accounts payable $ 907 $ 739 Other payables and accrued expenses 3,293 3,257 Short-term loan 4,703 2,101 Warrants to issue shares 517 196 Total current liabilities 9,420 6,293 Accrued severance pay 2,027 2,098 Shareholders' equity Ordinary shares of NIS 0.1 par value (Authorized - 50,000,000 shares, issued and outstanding - 24,752,232 and 24,752,232 shares as of March 31, 2009 and December 31, 2008, respectively) 711 711 Additional paid-in capital 156,663 156,500 Accumulated other comprehensive loss - (124) Accumulated deficit (141,682) (138,214) 15,692 18,873 Treasury stock, at cost; 898,500 as of March 31, 2009 and December 31, 2008 (9,885) (9,885) Total shareholders' equity 5,807 8,988 Total liabilities and shareholders' equity $ 17,254 $ 17,379 METALINK LTD. CONSOLIDATED STATEMENTS OF OPERATIONS Three months ended March 31, 2009 2008 (Unaudited) (Unaudited) (in thousands, except share and per share data) Revenues $ 1,833 $ 660 Cost of revenues: Costs and expenses 828 504 Royalties to the Government of Israel 56 23 Total cost of revenues 884 527 Gross profit 949 133 Operating expenses: Gross research and 2,942 8,492 development Less - Royalty bearing and 352 798 other grants Research and development, net 2,590 7,694 Selling and marketing 357 1,757 General and administrative 512 708 Total operating expenses 3,459 10,159 Operating loss (2,510) (10,026) Financial income (expenses), net (958) 241 Net loss $ (3,468) $ (9,785) Loss per ordinary share: Basic $ (0.15) $ (0.42) Diluted $ (0.15) $ (0.42) Shares used in computing loss per ordinary share: Basic 23,853,732 23,486,726 Diluted 23,853,732 23,486,726 Yuval Ruhama CFO Metalink Ltd. Tel: +972-9-9605555 Fax: +972-9-9605544 DATASOURCE: Metalink Ltd CONTACT: Yuval Ruhama, CFO, Metalink Ltd., Tel: +972-9-9605555, Fax: +972-9-9605544,

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