Loop Industries Announces Net Loss of $6.7 million for the Third Quarter 2018, including $4.4 million Non-Cash Compensation Costs
GlobeNewswire 12-Jan-2018 4:05 PM
Pilot Plant Expansion to Increase Capacity and Demonstrate Continuous Operations
Private Common Stock Issuance of $7 .4 million
MONTREAL, Jan. 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 doesnt 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 Companys 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 Loops 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 Loops Innovation Hub and corporate office, for a total consideration of $2.2 million. The pilot plant was built to optimize and demonstrate Loops disruptive depolymerization technology, and will be expanded to increase capacity and demonstrate continuous operations in preparation of the Companys 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.
We appreciate the support of our shareholders who have continued to finance the Companys growth strategy and provide their support for the potential of Loops technology to disrupt the global polyester plastics market, said Daniel Solomita, Loops 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 Managements 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.
Loops mission is to accelerate the worlds 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 repolymerized 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. loopindustries.com
Forward-Looking Statements This news release contains "forward-looking statements." Such statements may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words.These forward-looking statements are based on our current assumptions, expectations and beliefs and are subject to substantial risks, estimates, assumptions, uncertainties and changes in circumstances that may cause the Companys actual results, performance or achievements, as well as the Companys expectations regarding materiality or significance and the restatements quantitative effects, to differ materially from those expressed or implied in any forward-looking statement. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the risk that additional information may arise from the Companys and its audit committees internal review, the risk that the process of preparing and auditing the restated financial statements or other subsequent events would require the Company to make additional adjustments and the time and effort required to complete the restatement of its financial statements, whether the reassessment of the Companys internal controls over financial reporting could lead the Company to conclude that there were deficiencies in its internal control over financial reporting that constitute material weaknesses; the Companys responses to potential comments from the SEC; adverse effects on the Companys business and operations as a result of increased regulatory, media or financial reporting issues and practices, rumors or otherwise; the costs and expenses of the restatement; the initiation of legal proceedings; the volatility of the Companys stock price; and other risks described more fully in the Companys filings with the SEC. In addition, please refer to the risk factors contained in the Companys SEC filings, including the Companys most recent Annual Report on Form 10-K, as amended, and Quarterly Reports on Form 10-Q, as amended. Because the risks, estimates, assumptions and uncertainties referred to above could cause actual results or outcomes to differ materially from those expressed in any forward-looking statements, you should not place undue reliance on any forward-looking statements. Any forward-looking statement speaks only as of the date hereof, and, except as required by law, the Company assumes no obligation and does not intend to update any forward-looking statement to reflect events or circumstances after the date hereof.
ContactsFrank Zitella Chief Financial OfficerLoop Industries, Inc. 450.951.8555FZitella@LoopIndustries.com
Investors: Lauren Crawford 310.622.8239Johan Yokay310.firstname.lastname@example.org
Media: Luke Seiler email@example.com
Loop Industries, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
Three months ended Nine months ended
November 30, November 30,
2017 2016 2017 2016
Revenue $ - $ - $ - $ -
Operating Expenses -
Research and development 3,894,454 368,403 5,341,763 1,217,600
General and administrative 2,720,078 277,951 4,691,294 1,034,007
Depreciation and amortization 98,755 102,244 281,016 290,396
Foreign exchange loss (gain) (9,634 ) 809 88,634 (2,880 )
Total operating expenses 6,703,653 749,407 10,402,707 2,539,123
Net Loss (6,703,653 ) (749,407 ) (10,402,707 ) (2,539,123 )
Other comprehensive gain (loss) -
Foreign currency translation adjustment 155,354 (18,488 ) (2,068 ) (42,846 )
Comprehensive Loss $ (6,548,299 ) $ (767,895 ) $ (10,404,775 ) $ (2,581,969 )
Loss per share
- Basic and Diluted $ (0.20 ) $ (0.02 ) $ (0.32 ) $ (0.08 )
Weighted average common shares outstanding
- Basic and Diluted 32,793,181 31,390,807 32,183,343 31,001,702
Loop Industries, Inc.
Condensed Consolidated Balance Sheets
November 30, February 28,
Cash $ 3,400,973 $ 916,487
Restricted cash 38,795 -
Valued added tax and other receivables 148,905 259,297
Prepayments 15,518 -
Total current assets 3,604,191 1,175,784
Property and Equipment, net of accumulated depreciation of $734,699 and $497,244, respectively 1,659,781 1,566,969
Intellectual Property, net of accumulated amortization of $184,734 and $137,050, respectively 260,316 308,000
Total assets $ 5,524,288 $ 3,050,753
Liabilities and Stockholders' Equity
Accounts payable and accrued liabilities $ 1,162,216 $ 161,536
Accrued officer compensation - 360,000
Advance from majority stockholder 72,880 391,695
Total current liabilities 1,235,096 913,231
Commitments and Contingencies
Series A Preferred stock par value $0.0001; 25,000,000 shares authorized; one share issued and outstanding - -
Common stock par value $0.0001: 250,000,000 shares authorized; 32,807,137 and 31,451,973 shares issued and outstanding, respectively 3,281 3,146
Additional paid-in capital 21,275,564 8,723,390
Common stock issuable, 1,000,000 shares at November 30 and February 28, 2017 800,000 800,000
Accumulated deficit (17,640,510 ) (7,237,803 )
Accumulated other comprehensive loss (149,143 ) (151,211 )
Total stockholders' equity 4,289,192 2,137,522
Total liabilities and stockholders' equity $ 5,524,288 $ 3,050,753