Loop Industries Announces Net Loss of $6.7 million for the Third Quarter 2018, including $4.4 million Non-Cash Compensation Costs
Pilot Plant Expansion to Increase Capacity and Demonstrate Continuous Operations
Private Common Stock Issuance of $7.4 million
MONTREAL, January 12, 2018 (GLOBE NEWSWIRE)-- Loop™ Industries, Inc. (NASDAQ: LOOP) (the “Company” or “Loop”), an innovative technology company leading the sustainable plastic revolution, today announced financial results for its third quarter of fiscal 2018, ended November 30, 2017, and provided an update on its financing plans.
Third Quarter 2018 Financial Results
Loop Industries reported a net loss of $6.7 million for the three months ended November 30, 2017, an increase in net loss of $6.0 million compared to a net loss of $0.7 million for the same period in the prior year. The increase in net loss is primarily explained by non-cash stock-based compensation expense of $4.4 million of which $3.2 million relates to the immediate vesting of equity grants during the quarter which management doesn’t expect to repeat in the future.
Other factors impacting the quarter were an increase in professional advisory services of $0.4 million, increase in staff compensation of $0.4 million, and $0.3 million in connection with increased research and development expenses.
Research and development expenses were $3.9 million for the three months ended November 30, 2017, compared to $0.4 million for the prior year period. The increase was driven primarily by higher non-cash stock-based compensation expense and other design and planning costs related to the Company’s pilot plant.
General and administrative expenses were $2.7 million for the three months ended November 30, 2017, compared to $0.3 million for the prior year period. The increase was driven by higher non-cash stock-based compensation expense, increased legal and accounting fees, as well as filing fees related to Loop’s recent listing on the NASDAQ Capital Market exchange.
Pilot Plant Expansion
On December 11, 2017, the Company entered into a promise to purchase the land and building housing our pilot plant in Terrebonne, Quebec, which is the site of Loop’s Innovation Hub and corporate office, for a total consideration of $2.2 million. The pilot plant was built to optimize and demonstrate Loop’s disruptive depolymerization technology, and will be expanded to increase capacity and demonstrate continuous operations in preparation of the Company’s next phase of large scale commercialization.
Private Placement of Common Stock
On January 9, 2018, the Board approved plans to complete an equity private placement wherein the Company expects to raise between $7 and $8 million. As of January 11, 2018, the Company has raised $7.4 million and management expects that current cash on hand will be sufficient to fund ongoing operations for the next twelve months, including funding the purchase of the pilot plant facility.
CEO Commentary
“We appreciate the support of our shareholders who have continued to finance the Company’s growth strategy and provide their support for the potential of Loop’s technology to disrupt the global polyester plastics market,“ said Daniel Solomita, Loop’s founder and CEO. “We are excited as we move towards commercialization of our revolutionary technology in 2018, supported by offtake contracts with global consumer goods companies for Loop™ branded PET resin.”
As stated in the Plan of Operations in Management’s Discussion and Analysis on Form 10-Q that was filed with the SEC today, the Company currently intends to commercialize its operations primarily by adopting a model of licensing its technology to selected world-class multi-national supply chain manufacturing partners with whom it will work in close collaboration.
About Loop Industries, Inc.
Loop’s mission is to accelerate the world’s shift toward sustainable plastic and away from our dependence on fossil fuels. Loop has created a revolutionary technology poised to disrupt the plastics industry. This ground-breaking technology decouples plastic from fossil fuels by depolymerizing waste polyester plastic to its base building blocks (monomers). The monomers are then repolymerised to create virgin-quality polyester plastic that meets FDA requirements for use in food-grade packaging. Loop™ branded polyester resin allows consumer goods companies to meet and exceed their stated sustainability goals and circular ambitions.
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