from Loop Industries, Inc. (NASDAQ:LOOP)
Loop Industries Reports First Quarter Fiscal 2025 Results and Provides Update on Commercialization Plans
Loop Management to hold update call at 8:30 am ET on July 16, 2024
MONTREAL, QC / ACCESSWIRE / July 15, 2024 / Loop Industries, Inc. (Nasdaq:LOOP) (the "Company," "Loop," "we," "us," or "our"), a clean technology company whose mission is to accelerate a circular plastics economy by manufacturing 100% recycled polyethylene terephthalate ("PET") plastic and polyester fiber, today provided an update on its activities and reported its consolidated financial results for the first quarter for fiscal year 2025.
Commercialization Update
Loop and its joint venture partner, Ester Industries Ltd. ("Ester"), continue to make significant progress towards the planned Infinite Loop™ manufacturing facility in India. The joint venture has identified an abundance of low-cost polyester fiber waste from the textile industry in India, which we believe will enable Loop to sell polyester to its customers in need of a solution for textile-to-textile recycling. We have begun the process of securing offtake agreements with our global customers for the Infinite Loop™ India facility. The joint venture has retained a leading engineering firm to secure the optimal site for the facility, in proximity to the polyester fiber waste and the availability of clean renewable energy.
The Company continues to be confident with the progress being made towards fulfilling the closing conditions in the agreement with Reed Management SAS ("Reed") previously announced on May 30th, 2024, and continues to expect this financing transaction to close by the end of the second quarter of the current fiscal year. Due to the Company's current liquidity position, Loop is reviewing contingency plans for bridge financing in the event that the closing extends beyond the end of the second quarter.
Financial Results and Expense Breakdown
The Company's financial results for the quarter ended May 31, 2024 include $5.2 million of total expenses, which include the significant legal expenses incurred to execute the final agreements with Ester and Reed, and project costs related to the deployment of Loop's technology. Excluding these items, and non-cash expenses, the remaining expenses amount to $3.2 million for the current quarter. The Company projects that the prospective run rate for cash expenses will be approximately $1 million per month for the balance of fiscal 2025, excluding project costs.
CEO Comment
Daniel Solomita, Founder and CEO of Loop, commented on the recent updates, saying: "We continue to be highly positive about our ongoing communications with Reed management and our shared vision for the future of Loop. We look forward to consummating the Reed financing, along with the parallel government financing, and breaking ground on the India project at the end of the fiscal year. The planned Infinite Loop™ India facility combines an experienced like-minded chemical manufacturing partner with low capital investment and low-cost manufacturing, with a plentiful supply of waste plastics which today cannot be recycled and is in close proximity to our customer's supply chain.
The partnership with Ester reflects a strategic focus going forward to concentrate capital investments in global low-cost manufacturing environments, and the Infinite Loop™ India facility is expected to provide very attractive economic returns. As recycling is eventually needed in all countries to tackle the ongoing plastic waste crisis, Loop intends to license its technology to partners in higher cost manufacturing countries"
Corporate Update Call
Senior Management of Loop will host a corporate update call, followed by a question-and-answer session, which can be accessed via the dial-in numbers below. Slides supporting Senior Management's remarks will be available via the Investors section of Loop's website at http://loopindustries.com/en/investors/overview.
Date: Tuesday, July 16, 2024
Time: 8:30 am Eastern Time
Participant joining details (by Telephone):
Joining by Telephone:
United States (Local): +1 404 975 4839
United States (Toll-Free): +1 833 470 1428
Access Code: 978353
OR
Registration Link: https://www.netroadshow.com/events/login?show=96a88ec2&confId=68199
- Avoid wait time - Bypass speaking with an operator to join the call
- Receive a Calendar Invitation with call access details including your unique PIN
Results of Operations
The following table summarizes our operating results for the three-month periods ended May 31, 2024 and 2023, in thousands of U.S. Dollars.
Three months ended May 31, | ||||||||||||
2024 | 2023 | Change favorable / (unfavorable) | ||||||||||
Revenue from contracts with customers | $ | 6 | $ | 27 | $ | (21 | ) | |||||
Expenses | ||||||||||||
Research and development | ||||||||||||
Machinery and equipment expenditures | 3 | 1,236 | 1,233 | |||||||||
External engineering | 628 | 1,155 | 527 | |||||||||
Employee compensation | 1,015 | 1,286 | 271 | |||||||||
Stock-based compensation | 129 | 160 | 31 | |||||||||
Plant and laboratory operating expenses | 270 | 469 | 199 | |||||||||
Other | 192 | 184 | (8 | ) | ||||||||
Total research and development | 2,237 | 4,490 | 2,253 | |||||||||
General and administrative | ||||||||||||
Professional fees | 1,255 | 619 | (636 | ) | ||||||||
Employee compensation | 635 | 637 | 2 | |||||||||
Stock-based compensation | 241 | 196 | (45 | ) | ||||||||
Insurance | 492 | 703 | 211 | |||||||||
Other | 288 | 310 | 22 | |||||||||
Total general and administrative | 2,911 | 2,465 | (446 | ) | ||||||||
Depreciation and amortization | 137 | 133 | (4 | ) | ||||||||
Interest and other financial expenses | 60 | 54 | (6 | ) | ||||||||
Interest income | (126 | ) | (99 | ) | 27 | |||||||
Foreign exchange gain | (24 | ) | (15 | ) | 9 | |||||||
Total expenses | 5,195 | 7,028 | 1,833 | |||||||||
Net loss | $ | (5,189 | ) | $ | (7,001 | ) | $ | 1,812 | ||||
First Quarter Ended May 31, 2024
Revenues
Revenues for the three-month period ended May 31, 2024 decreased $21 to $6, as compared to $27 for the same period in 2023. The revenues resulted from the delivery of initial volumes to customers of Loop™ PET resin produced using monomers manufactured at the Terrebonne Facility.
Research and Development
Research and development expense for the three-month period ended May 31, 2024 decreased $2,253 to $2,237, as compared to $4,490 for the same period in 2023. The decrease was primarily attributable to a $1,233 decrease in purchases of machinery and equipment used at the Terrebonne Facility, a $527 decrease in external engineering costs for design work for our Infinite Loop™ manufacturing process, a $271 decrease in employee compensation expenses, and a $199 decrease in plant and laboratory expenses at our Terrebonne Facility.
General and administrative expenses
General and administrative expenses for the three-month period ended May 31, 2024 increased $446 to $2,911, as compared to $2,465 for the same period in 2023. The increase was primarily attributable to a $636 increase in professional fees which is mainly attributable to legal costs related to our partnerships with Reed and Ester. This increase was partially offset by a $211 decrease in insurance costs.
Net Loss
The net loss for the three-month period ended May 31, 2024 decreased $1,812 to $5,189, as compared to $7,001 for the same period in 2023. The decrease was primarily due to the decrease of $2,253 in research and development expenses and partially offset by increased general and administrative expenses of $446.
Loop Industries, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
(in thousands of U.S. dollars, except per share data) | Three Months Ended | |||||||
May 31, 2024 | May 31, 2023 | |||||||
Revenue from contracts with customers | $ | 6 | $ | 27 | ||||
Expenses : | ||||||||
Research and development | 2,237 | 4,490 | ||||||
General and administrative | 2,911 | 2,465 | ||||||
Depreciation and amortization | 137 | 133 | ||||||
Total expenses | 5,285 | 7,088 | ||||||
Other (income) loss : | ||||||||
Interest and other financial expenses | 60 | 54 | ||||||
Interest income | (126 | ) | (99 | ) | ||||
Foreign exchange gain | (24 | ) | (15 | ) | ||||
Total other income | (90 | ) | (60 | ) | ||||
Net loss | (5,189 | ) | (7,001 | ) | ||||
Other comprehensive (loss) income - | ||||||||
Foreign currency translation adjustment | (55 | ) | 20 | |||||
Comprehensive loss | $ | (5,244 | ) | $ | (6,981 | ) | ||
Net loss per share | ||||||||
Basic and diluted | $ | (0.11 | ) | $ | (0.15 | ) | ||
Weighted average common shares outstanding | ||||||||
Basic and diluted | 47,535,413 | 47,516,104 | ||||||
Loop Industries, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands of U.S. dollars, except per share data) | As at | |||||||
May 31, 2024 | February 29, 2024 | |||||||
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 5,291 | $ | 6,958 | ||||
Sales tax, tax credits and other receivables | 242 | 351 | ||||||
Inventories | 99 | 102 | ||||||
Prepaid expenses and other deposits | 525 | 577 | ||||||
Total current assets | 6,157 | 7,988 | ||||||
Investment in joint venture | 381 | 381 | ||||||
Property, plant and equipment, net | 10,533 | 10,636 | ||||||
Intangible assets, net | 1,671 | 1,548 | ||||||
Total assets | $ | 18,742 | $ | 20,553 | ||||
Liabilities and Stockholders' Equity | ||||||||
Current liabilities | ||||||||