Loop Industries, Inc.
MONTREAL, QC / ACCESSWIRE / July 15, 2021 / Loop Industries, Inc. (NASDAQ:LOOP) (the "Company" or "Loop"), a clean technology company focused on accelerating 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 of fiscal year 2022.
SK global chemical Strategic Partnership and Equity Investment
On June 23, 2021, Loop announced announced that it intends to form a strategic partnership with SK global chemical Co. Ltd. ("SKGC"), a subsidiary of South Korea's SK Group, one of Asia's largest conglomerates, to accelerate the commercialization of Loop's sustainable PET plastic and polyester fiber manufacturing technology throughout Asia. Loop and SKGC intend to form a joint venture with exclusivity to build sustainable food-grade PET resin and polyester fiber manufacturing facilities throughout Asia to support global brand companies. Under the terms of the Memorandum of Understanding ("MOU") for the proposed joint venture, SKGC will own 51 percent of the joint venture and Loop will own 49 percent. Loop will also receive a recurring annual royalty fee as a percentage of revenue from each facility for the use of its technology.
In addition, Loop and SKGC have entered into a definitive agreement for SKGC to become a strategic investor in Loop. SKGC will purchase 4,714,813 new treasury common shares of Loop at a price of $12 per share, for total consideration of $56.5 million. SKGC was also granted options to acquire additional shares at successively higher prices, as well as representation on Loop's Board of Directors. Closing of the strategic equity investment will be as soon as practical and no later than 90 days from the June 23, 2021 announcement.
Infinite Loop™ Quebec Project
On May 27, 2021, Loop acquired a 19 million square foot parcel of land in Bécancour, Québec for approximately $4.9 million. The site is located near existing industrial infrastructure, which reduces project costs, permitting time and does not result in the destruction of wetlands or forest. Loop intends to use the proceeds from SKGC's strategic investment toward the funding of its planned Infinite Loop™ manufacturing facility at this recently acquired site.
Management Commentary
Daniel Solomita, Founder and CEO of Loop Industries, said: "As we begin collaboration with our valued partners at SK global chemical, we look forward to accelerating the global commercialization of our sustainable PET plastic manufacturing technology. With an initial investment in four projected facilities in North America, Europe and Asia, including Joint Ventures with Indorama and SUEZ, Loop is well positioned to meet the growing global demand for 100% recycled PET plastic and polyester fiber."
First Quarter Ended May 31, 2021
The following table summarizes our operating results for the three-month periods ended May 31, 2021 and 2020, in U.S. Dollars.
| Three months ended May 31, | ||||||||||||
| 2021 | 2020 | Change | ||||||||||
Revenues | $ | - | $ | - | $ | - | ||||||
Expenses | ||||||||||||
Research and development | ||||||||||||
Stock-based compensation | 395,545 | 352,007 | 43,538 | |||||||||
External engineering | 2,903,448 | 74,932 | 2,828,516 | |||||||||
Employee compensation | 1,690,583 | 467,041 | 1,223,542 | |||||||||
Machinery and equipment expenditures | 2,622,892 | - | 2,622,892 | |||||||||
Demonstration plant operating expenses | 691,537 | 286,103 | 405,434 | |||||||||
Other | 333,900 | 300,505 | 33,395 | |||||||||
Total research and development | 8,637,905 | 1,480,588 | 7,157,317 | |||||||||
General and administrative | ||||||||||||
Stock-based compensation | (383,630 | ) | 659,817 | (1,043,447 | ) | |||||||
Professional fees | 1,631,451 | 221,697 | 1,409,754 | |||||||||
Employee compensation | 845,035 | 483,034 | 362,001 | |||||||||
Directors and officers insurance | 868,647 | 473,574 | 395,073 | |||||||||
Other | 199,068 | 114,959 | 84,109 | |||||||||
Total general and administrative | 3,160,571 | 1,953,081 | 1,207,490 | |||||||||
Depreciation and amortization | 132,001 | 255,974 | (123,973 | ) | ||||||||
Interest and other financial expenses | 30,588 | 126,776 | (96,188 | ) | ||||||||
Interest income | (9,761 | ) | (40,346 | ) | 30,585 | |||||||
Foreign exchange loss | 206,060 | 76,641 | 129,419 | |||||||||
Total expenses | 12,157,364 | 3,852,714 | 8,304,650 | |||||||||
Net loss | $ | (12,157,364 | ) | $ | (3,852,714 | ) | $ | (8,304,650 | ) | |||
First Quarter Ended May 31, 2021
The net loss for the three-month period ended May 31, 2021 increased $8.30 million to $12.16 million, as compared to the net loss for the three-month period ended May 31, 2020 which was $3.85 million. The increase is primarily due to increased research and development expenses of $7.16 million, increased general and administrative expenses of $1.21 million, an increase in foreign exchange loss of $0.13 million and a decrease in interest income of $0.03 million, partially offset by lower depreciation and amortization expenses of $0.12 million and lower interest and other financial expenses of $0.1 million.
The $7.16 million increase in research and development for the three-month period ended May 31, 2021 was primarily attributable to the following:
- $2.83 million increase in external engineering expenses for ongoing design work for our Infinite Loop TM manufacturing process;
- $2.62 million increase in purchases of research and development machinery and equipment. Starting in Q3 of fiscal 2021, we expense research and development machinery and equipment in accordance with ASC 730, Research and Development Costs, and no longer capitalize these costs. The timing of this accounting treatment is related to management's decision to convert our pilot plant to exclusively a demonstration and training facility for our future Infinite Loop™ manufacturing facilities, therefore foregoing any alternative future use of its machinery and equipment assets in other applications;
- $1.2 million increase in employee compensation expenses due to an increase in hiring; and
- $0.41 million increase in demonstration plant and laboratory operating expenses due to increased activity at our demonstration plant.
The $1.21 million increase in general and administrative expenses for the three-month period ended May 31, 2021 was primarily attributable to the following:
- $1.41 million increase in expenses for legal and professional fees due to costs principally associated with the ongoing SEC investigation and class action suits described in "Part II, Item 1. Legal Proceedings";
- $0.40 million increase in insurance expenses mainly due to directors and officers ("D&O") insurance renewal costs; and
- $0.36 million increase in employee compensation expenses due to an increase in hiring.
The listed increases in general and administrative expenses were partially offset by lower stock-based compensation expenses of $1.04 million which are mainly due to forfeitures of RSUs recorded in the three-month period ended May 31, 2021 for a total of $0.94 million.
The $0.12 million decrease in depreciation and amortization expenses for the three-month period ended May 31, 2021 is mainly attributable to the write-down of machinery and equipment assets related to the decision in the third quarter of fiscal 2021 to dedicate the demonstration and training facility to research and development activities. Although the machinery and equipment will continue to be utilized at our demonstration and training facility as it is an integral part of supporting the commercialization of our technology, application of ASC 730, Research and Development Costs requires machinery and equipment assets to be written off and all future costs associated with the demonstration and training facility to be recognized as a research and development expense in the consolidated statements of operations and comprehensive loss.
The $0.12 million increase in foreign exchange loss for the three-month period ended May 31, 2021 is mainly due to the fluctuation in USD/CAD exchange rates. The $0.10 million decrease in interest and other financial expenses for the three-month period ended May 31, 2021 is mainly due to the loss on revaluation of foreign exchange contracts in the three-month period ended May 31, 2020 which was nil in the three-month period ended May 31, 2021. The $0.03 million decrease in interest income for the three-month period ended May 31, 2021 is mainly due to lower interest rates as well as lower cash balances on which we receive interest.
Loop Industries, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
| Three Months Ended | ||||||||
| May 31, 2021 | May 31, 2020 | |||||||
Revenue | $ | - | $ | - | ||||
Expenses : | ||||||||
Research and development | 8,637,905 | 1,480,588 | ||||||
General and administrative | 3,160,571 | 1,953,081 | ||||||
Depreciation and amortization | 132,001 | 255,974 | ||||||
Interest and other financial expenses | 30,588 | 126,776 | ||||||
Interest income | (9,761 | ) | (40,346 | ) | ||||
Foreign exchange loss (gain) | 206,060 | 76,641 | ||||||
Total expenses | 12,157,364 | 3,852,714 | ||||||
Net loss | (12,157,364 | ) | (3,852,714 | ) | ||||
Other comprehensive loss - | ||||||||
Foreign currency translation adjustment | 206,815 | (170,412 | ) | |||||
Comprehensive loss | $ | (11,950,549 | ) | $ | (4,023,126 | ) | ||
Loss per share | ||||||||
Basic and diluted | $ | (0.29 | ) | $ | (0.10 | ) | ||
Weighted average common shares outstanding | ||||||||
Basic and diluted | 42,433,107 | 39,916,838 | ||||||
Loop Industries, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
As at | ||||||||
May 31, 2021 | February 28, 2021 | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 18,037,062 | $ | 35,221,951 | ||||
| Sales tax, tax credits and other receivables | 1,551,702 | 1,763,835 | ||||||
| Prepaid expenses | 1,978,390 | 609,782 | ||||||
Total current assets | 21,567,154 | 37,595,568 | ||||||
Investment in joint venture | 1,500,000 | 1,500,000 | ||||||
| Property, plant and equipment, net | 8,569,606 | 3,513,051 | ||||||
| Intangible assets, net | 881,223 | 794,894 | ||||||
Total assets | $ | 32,517,983 | $ | 43,403,513 | ||||
| Liabilities and Stockholders' Equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued liabilities | $ | 9,057,423 | $ | 8,124,865 | ||||
| Current portion of long-term debt | 971,257 | 938,116 | ||||||
Total current liabilities | 10,028,680 | 9,062,981 | ||||||
| Long-term debt | 1,614,971 | 1,516,008 | ||||||
Total liabilities | 11,643,651 | 10,578,989 | ||||||
| Stockholders' Equity | ||||||||
| Series A Preferred stock | - | - | ||||||
| Common stock | 4,244 | 4,242 | ||||||
| Additional paid-in capital | 113,663,032 | 113,662,677 | ||||||
| Additional paid-in capital - Warrants | 8,826,165 | 8,826,165 | ||||||
| Accumulated deficit | (101,819,334) | (89,661,970) | ||||||
| Accumulated other comprehensive loss | 200,225 | (6,590) | ||||||
Total stockholders' equity | 20,874,332 | 32,824,524 | ||||||
Total liabilities and stockholders' equity | $ | 32,517,983 | $ | 43,403,513 | ||||
Loop Industries, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
| Three Months Ended May 31, | ||||||||
| 2021 | 2020 | |||||||
Cash Flows from Operating Activities | ||||||||
Net loss | $ | (12,157,364 | ) | $ | (3,852,714 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | 132,001 | 256,090 | ||||||
Stock-based compensation expense | 15,357 | 1,011,824 | ||||||
Accretion and accrued interest expenses | 21,408 | 17,963 | ||||||
Loss on revaluation of foreign exchange contracts | - | 98,502 | ||||||
Changes in operating assets and liabilities: | ||||||||
Sales tax and tax credits receivable | 287,116 | 76,410 | ||||||
Prepaid expenses | (1,326,519 | ) | (1,865,216 | ) | ||||
Accounts payable and accrued liabilities | 622,443 | (720,759 | ) | |||||
Net cash used in operating activities | (12,405,558 | ) | (4,977,900 | ) | ||||
Cash Flows from Investing Activities | ||||||||
Investment in joint venture | - | (650,000 | ) | |||||
Additions to property, plant and equipment | (4,867,007 | ) | (394,403 | ) | ||||
Additions to intangible assets | (52,319 | ) | (144,386 | ) | ||||
Net cash used in investing activities | (4,919,326 | ) | (1,188,789 | ) | ||||
Cash Flows from Financing Activities | ||||||||
Repayment of long-term debt | (14,496 | ) | (12,693 | ) | ||||
Net cash (used) provided by financing activities | (14,496 | ) | (12,693 | ) | ||||
Effect of exchange rate changes | 154,491 | (29,534 | ) | |||||
Net decrease in cash | (17,184,889 | ) | (6,208,916 | ) | ||||
Cash, beginning of period | 35,221,951 | 33,717,671 | ||||||
Cash, end of period | $ | 18,037,062 | $ | 27,508,755 | ||||
Supplemental Disclosure of Cash Flow Information: | ||||||||
Income tax paid | $ | - | $ | - | ||||
Interest paid | $ | 9,178 | $ | 10,311 | ||||
Interest received | $ | 9,761 | $ | 40,346 | ||||
About Loop Industries
Loop Industries is a technology company whose mission is to accelerate the world's shift toward sustainable PET plastic and polyester fiber and away from our dependence on fossil fuels. Loop Industries owns patented and proprietary technology that depolymerizes no and low-value waste PET plastic and polyester fiber, including plastic bottles and packaging, carpets and textiles of any color, transparency or condition and even ocean plastics that have been degraded by the sun and salt, to its base building blocks (monomers). The monomers are filtered, purified and polymerized to create virgin-quality Loop™ branded PET resin suitable for use in food-grade packaging and polyester fiber, thus enabling our customers to meet their sustainability objectives. Loop Industries is contributing to the global movement towards a circular economy by reducing plastic waste and recovering waste plastic for a sustainable future.
Common shares of the Company are listed on the NASDAQ Global Market under the symbol "LOOP."
For more information, please visit www.loopindustries.com . Follow Loop on Twitter: @loopindustries , Instagram: loopindustries , Facebook: Loop Industries and LinkedIn: Loop Industries
Forward-Looking Statements
This news release contains "forward-looking statements" as defined in the U.S. Private Securities Litigation Reform Act of 1995. Such statements may be preceded by the words "intends", "may", "will", "plans", "expects", "anticipates", "should", "could", "projects", "predicts", "estimates", "aims", "believes", "hopes", "potential" or "continute" the negative of such terms or similar words. These forward-looking statements include, without limitation, statements about our market opportunity, our strategies, ability to improve and expand our capabilities, competition, expected activities and expenditures as we pursue our business plan, the adequacy of our available cash resources, regulatory compliance, plans for future growth and future operations, the size of our addressable market, market trends, and the effectiveness of the Company's internal control over financial reporting. Forward-looking statements are not guarantees of future performance, are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond Loop's control, and cannot be predicted or quantified and consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, risks and uncertainties associated with among other things: (i) commercialization of our technology and products, (ii) our status of relationship with partners, (iii) development and protection of our intellectual property and products, (iv) industry competition, (v) our need for and ability to obtain additional funding, (vi) building our manufacturing facility, (vii) our ability to scale, manufacture and sell our products in order to generate revenues, (viii) our proposed business model and our ability to execute thereon, (ix) adverse effects on the Company's business and operations as a result of increased regulatory, media or financial reporting scrutiny and practices, rumors or otherwise, (x) disease epidemics and health related concerns, such as the current outbreak of a novel strain of coronavirus (COVID-19), which could result in (and, in the case of the COVID-19 outbreak, has resulted in some of the following) reduced access to capital markets, supply chain disruptions and scrutiny or embargoing of goods produced in affected areas, government-imposed mandatory business closures and resulting furloughs of our employees, government employment subsidy programs, travel restrictions or the like to prevent the spread of disease, and market or other changes that could result in noncash impairments of our intangible assets, and property, plant and equipment, (xi) the outcome of the current SEC investigation or recent class action litigation filed against us, (xii) our ability to hire and/or retain qualified employees and consultants and (xiii) other factors discussed in our subsequent filings with the SEC. More detailed information about Loop and the risk factors that may affect the realization of forward-looking statements is set forth in our filings with the Securities and Exchange Commission ("SEC"). Investors and security holders are urged to read these documents free of charge on the SEC's web site at http://www.sec.gov. Loop assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise.
For More Information:
Media Inquiries:
Stephanie Corrente
Loop Industries, Inc.
+1 (450) 951-8555
scorrente@loopindustries.com
Investor Inquiries:
Greg Falesnik
MZ Group-MZ North America
+1 949-259-4987
LOOP@mzgroup.us
www.mzgroup.us
SOURCE: Loop Industries, Inc.
View source version on accesswire.com:
https://www.accesswire.com/655686/Loop-Industries-Provides-Business-Update-and-Reports-First-Quarter-Financial-Results-of-Fiscal-Year-2022
To view this piece of content from www.accesswire.com, please give your consent at the top of this page.
About ACCESS Newswire
Subscribe to releases from ACCESS Newswire
Subscribe to all the latest releases from ACCESS Newswire by registering your e-mail address below. You can unsubscribe at any time.
Latest releases from ACCESS Newswire
SK tes Announces Grand Opening of New Shannon Facility, Marking a Milestone for Sustainable Technology in Ireland22.12.2025 15:00:00 CET | Press release
SHANNON, IE / ACCESS Newswire / December 22, 2025 / SK tes, a global leader in secure technology lifecycle and IT asset disposition (ITAD) services, is delighted to announce the grand opening of its state-of-the-art facility in Shannon, County Clare. The opening event, to be held on Jan. 15, 2026, marks the culmination of a journey that began with the company's announcement in 2025 of its plans to establish a purpose-built facility in one of Ireland's fastest-growing technology regions. The grand opening will be hosted by Jin Mo Lee, SK tes Group CEO at SK tes and guest of honor, Minister Timmy Dooley will cut the ribbon to officially open the site. Minister Dooley, a Clare native, serves as Minister of State for Climate, Energy and the Environment. Minister Dooley's leadership in climate, energy, and environmental policy is especially relevant as Ireland continues to attract major global data center infrastructure and technology companies, while placing increased emphasis on sustainab
Saat & Saat Acquires Turkish Apparel Leader Aydinli Group, Expanding U.S. Polo Assn. Markets Across Turkey, the Middle East, Eastern Europe, and North Africa22.12.2025 13:00:00 CET | Press release
WEST PALM BEACH, FL AND ISTANBUL, TURKEY / ACCESS Newswire / December 22, 2025 / USPA Global is pleased to announce the acquisition of Aydinli Hazir Giyim San. Tic. A.S. (Aydinli Group) by HRK Holding A.S. (Saat & Saat). Both entities are licensing partners of U.S. Polo Assn., which is USPA Global's multi-billion-dollar sports brand and the official brand of the United States Polo Association (USPA). As one of the brand's largest partners, the acquisition of Aydinli provides access to more than 50 countries across Turkey, the Middle East, Eastern Europe, and North Africa. With this acquisition of Aydinli, Saat & Saat is expanding the company's regional portfolio alongside its very successful watch business by entering the global apparel industry. With more than nearly 450 U.S. Polo Assn. stores and multiple branded digital sites, U.S. Polo Assn. will continue its record growth. Aydinli is currently one of the leading retail powerhouses in the region, with significant growth potential a
Parallel Society Reveals Lineup for 2026 Lisbon Edition - A Cross-Genre Mashup of Cultural and Tech Pioneers22.12.2025 10:30:00 CET | Press release
Apparat (live) Kode9, Moses Boyd, Gilles Peterson and Clark head to Lisbon for new indie festival Parallel Society. LISBON, PT / ACCESS Newswire / December 22, 2025 / Parallel Society has revealed the first wave of artists for its 2026 edition in Lisbon, Portugal. The two-day event begins on 6th March, and the music starts on 7th March with a programme spanning the UK jazz revolution (Moses Boyd), experimental bass culture (Kode9, Calibre), avant-electronic (Apparat), and cultural ambassadors (Gilles Peterson), with many more acts still to be announced. A culture-first counterpoint to the corporate consolidation sweeping the global festival landscape, Parallel Society is independent, led by the community, and not for profit. With more than 60% of the lineup sourced from Lisbon's active and diverse homegrown talent pool, the event actively supports the city's underground music scenes. Ahead of Parallel Society's music and cultural programme on Day 2, Day 1, the "[un]conference", invites
Rainer Maria Morita Named "Transformational Leader of the Year 2025" at UK House of Lords22.12.2025 10:25:00 CET | Press release
Recognized for redefining executive career transition and human value creation in the AI era with his globally renowned Morita Method(R) LONDON, GB / ACCESS Newswire / December 22, 2025 / Global executive advisor and bestselling author, Rainer Maria Morita, has been awarded "Transformational Leader of the Year 2025 in the category of Global Hidden Job Market Advisory at the prestigious Global Leadership Conclave 2025, held at the iconic UK House of Lords, Parliament of the United Kingdom. The award recognizes Rainer's pioneering work in redefining leadership, employment, and human value creation in the age of artificial intelligence. With more than two decades of experience across executive search, executive career transition advisory and leadership consulting, Rainer has become a globally respected authority on the Hidden Job Market - the unadvertised ecosystem where over 90% of executive opportunities are created. As the creator of The Morita Method®, Rainer has guided thousands of s
Air T, Inc. Announces Closing of Regional Express Acquisition18.12.2025 23:10:00 CET | Press release
MINNEAPOLIS, MN / ACCESS Newswire / December 18, 2025 / Air T, Inc. (NASDAQ:AIRT) is pleased to announce the successful closing of its acquisition of Regional Express Holdings Limited (Rex), Australia's leading regional airline. Air T now owns 100% of Rex and looks forward to beginning a new chapter for Rex and the regional communities it serves across Australia. The transaction includes a comprehensive financing structure designed to support Rex's operations and future growth: Air T is providing a $50 million AUD credit facility that is funded by one of our investor partners. We anticipate that Rex will use this facility to bring its fleet fully back into service, from approximately 31 flyers currently to 45 flyers within the next two years. The Commonwealth of Australia will continue to be a secured creditor of Rex. Rex will have access to an additional undrawn $60 million AUD loan from the Commonwealth of Australia to support the overhaul of its current fleet of Saab 340s and genera
In our pressroom you can read all our latest releases, find our press contacts, images, documents and other relevant information about us.
Visit our pressroom
