Financial Data and Key Metrics Changes - Cash operating expenses for Q1 fiscal 2026 were $2,600,000, a reduction of $2,200,000 or 46% compared to the same quarter last year [14] - Cash used in operating activities for the quarter was $3,100,000, including working capital outflows of $800,000 [14] - The company ended the quarter with available liquidity of $12,300,000 [14] Business Line Data and Key Metrics Changes - The company is advancing discussions with leading global apparel brands and consumer packaged goods (CPG) brands for textile-to-textile recycling solutions [5][6] - European beverage brands are seeking high-quality recycled PET due to declining quality from mechanical recycling [7][8] - The confirmed CapEx for the Indian facility is $176,000,000, which includes a polymerization unit and all financing costs [9] Market Data and Key Metrics Changes - The Indian textile industry provides a plentiful supply of waste polyester fiber, which is advantageous for the company's operations [6] - The low-cost structure in India allows the company to offer high-quality PET at competitive prices [8][9] Company Strategy and Development Direction - The company is focused on the development of Infinite Loop manufacturing facilities in India and Europe, leveraging local joint venture partners [4][5] - Modularization of projects is expected to significantly reduce CapEx by 50%, enhancing the company's competitive position [12][13] - The long-term vision includes driving significant shareholder value through the rollout of manufacturing facilities and generating multiple revenue streams [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in securing customer contracts and financing for the Indian facility, with a focus on long-term agreements [21][22] - The company is optimistic about the future, citing strong relationships with customers and the potential for additional facilities in India [56][57] Other Important Information - The company is working with KPMG to syndicate debt financing for the Indian facility [30] - The total equity contribution required for the Indian facility is $25,000,000, with a funding gap of approximately $15,000,000 [50][52] Q&A Session Summary Question: Can you provide details on your offtake agreements? - The company is advancing discussions with customers for long-term contracts, which may take longer to finalize due to internal processes [21][22] Question: What is the capital intensity of Loop's facilities? - The gross CapEx per pound for Loop's technology is 61¢, excluding certain costs [36][38] Question: What are the next steps for the project? - The company is focused on securing customer contracts and finalizing land selection in Gujarat [31][32] Question: What is the timeline for the facility's construction? - The facility is expected to be operational by the end of 2027, with an 18-month construction period [43][44] Question: How does the company plan to finance the project? - The company is evaluating several opportunities to cover the $15,000,000 funding gap needed for the project [52] Question: Can you update on the licensing pipeline? - The company is optimistic about potential licensing opportunities, especially with reduced CapEx for future projects [54][56]

Financial Data and Key Metrics Changes - Cash operating expenses for Q1 fiscal 2026 were $2,600,000, a reduction of $2,200,000 or 46% compared to the same quarter last year [15] - Cash used in operating activities for the quarter was $3,100,000, including working capital outflows of $800,000 [15] - The company ended the quarter with available liquidity of $12,300,000 [16] Business Line Data and Key Metrics Changes - The company is advancing discussions with leading global apparel brands and consumer packaged goods (CPG) brands for textile-to-textile recycling solutions [6][7] - European beverage brands are seeking high-quality recycled PET due to declining quality from mechanical recycling [8][9] - The company confirmed a $176,000,000 CapEx for the Indian facility, with a total install cost of $95,000,000 for Loop's technology, the lowest in the industry [10] Market Data and Key Metrics Changes - The Indian facility is positioned to provide high-quality PET made from 100% recycled content at competitive prices due to India's low-cost structure [9][10] - The company is focusing on site selection in Gujarat, India, with two locations narrowed down [11][35] Company Strategy and Development Direction - The company aims to drive significant shareholder value through the rollout of manufacturing facilities and generating revenue from licensing, engineering, and modularization [18] - Modularization is expected to reduce CapEx by 50%, allowing for more projects to be built at competitive prices [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in securing customer contracts and financing for the Indian facility, with a focus on long-term agreements [22][30] - The company is optimistic about the future, citing strong relationships with customers and the potential for additional facilities in India [68] Other Important Information - The company is working with KPMG to syndicate debt financing for the Indian facility [32][70] - The total equity contribution required for the India facility is $25,000,000, with a funding gap of approximately $15,000,000 [60][63] Q&A Session Summary Question: Can you provide details on your offtake agreements and their timing? - Management is advancing discussions with customers and expects to secure contracts, although the process may take longer due to internal steps within customer organizations [22][23] Question: What is the structure of the contracts with customers? - The company is offering fixed-price contracts to customers, which provides predictability and stability in pricing [30] Question: What are the next steps for financing and construction? - The company is focused on securing customer contracts and finalizing land selection in India, with a goal to break ground by the end of the year [36][61] Question: What is the capital intensity of Loop's facilities? - The CapEx per pound for Loop's technology is 61¢, excluding certain costs, and is expected to decrease further as facilities scale [40][44] Question: How does the company plan to handle permitting and utilities for the new sites? - The sites are in industrial zones with permitting included in the land acquisition, and the company will provide necessary utilities for the facilities [77][81]

Loop Industries, Inc. (LOOP) came out with a quarterly loss of $0.07 per share in line with the Zacks Consensus Estimate. This compares to a loss of $0.11 per share a year ago. These figures are adjusted for non- recurring items. A quarter ago, it was expected that this company would post a loss of $0.09 per share when it actually produced earnings of $0.14, delivering a surprise of +255.56%. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days a ...

[PART I. Financial Information](index=2&type=section&id=PART%20I.%20Financial%20Information) This section presents the company's interim financial statements and management's analysis of its financial condition and operations [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Loop Industries' unaudited interim condensed consolidated financial statements for Q1 2025 and 2024, including balance sheets, operations, equity, cash flows, and notes [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position at specific dates, detailing assets, liabilities, and equity | Metric | May 31, 2025 (in thousands) | February 28, 2025 (in thousands) | | :--------------------------------- | :-------------------------- | :----------------------------- | | Cash and cash equivalents | $9,748 | $12,973 | | Total current assets | $11,315 | $13,852 | | Total assets | $15,921 | $18,578 | | Total current liabilities | $4,024 | $3,959 | | Series B Convertible Preferred stock | $10,987 | $10,647 | | Total liabilities | $18,645 | $18,211 | | Total stockholders' equity | $(2,724) | $367 | - Total assets decreased from **$18,578 thousand** as of February 28, 2025, to **$15,921 thousand** as of May 31, 2025[12](index=12&type=chunk) - Total stockholders' equity shifted from a positive **$367 thousand** to a negative **$(2,724) thousand** during the same period[12](index=12&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) This section details the company's revenues, expenses, and net loss over specific periods, reflecting operational performance | Metric (in thousands) | Three Months Ended May 31, 2025 | Three Months Ended May 31, 2024 | | :-------------------- | :------------------------------ | :------------------------------ | | Revenues | $252 | $6 | | Research and development | $1,374 | $2,237 | | General and administrative | $1,649 | $2,911 | | Loss on equity accounted investment | $302 | $- | | Total expenses | $3,425 | $5,285 | | Net loss | $(3,447) | $(5,189) | | Basic and diluted net loss per share | $(0.07) | $(0.11) | - Revenues significantly increased to **$252 thousand** in Q1 2025 from **$6 thousand** in Q1 2024[14](index=14&type=chunk)[15](index=15&type=chunk) - Net loss decreased by **$1,742 thousand**, from **$(5,189) thousand** in Q1 2024 to **$(3,447) thousand** in Q1 2025, primarily due to reduced R&D and G&A expenses, partially offset by increased interest expenses and loss from equity accounted investment[14](index=14&type=chunk)[15](index=15&type=chunk)[144](index=144&type=chunk) [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) This section outlines the changes in the company's equity components over a period, including net loss and stock transactions | Metric (in thousands) | Balance, Feb 28, 2025 | Issuance of shares | Stock options issued | Restricted stock units issued | Foreign currency translation | Net loss | Balance, May 31, 2025 | | :-------------------- | :-------------------- | :----------------- | :------------------- | :---------------------------- | :--------------------------- | :------- | :-------------------- | | Total Stockholders' Equity | $367 | $- | $486 | $(111) | $(19) | $(3,447) | $(2,724) | - Total stockholders' equity decreased from **$367 thousand** at February 28, 2025, to **$(2,724) thousand** at May 31, 2025, primarily due to a net loss of **$(3,447) thousand**[17](index=17&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section reports the cash inflows and outflows from operating, investing, and financing activities over specific periods | Cash Flow Activity (in thousands) | Three Months Ended May 31, 2025 | Three Months Ended May 31, 2024 | | :-------------------------------- | :------------------------------ | :------------------------------ | | Net cash used in operating activities | $(3,082) | $(3,915) | | Net cash used in investing activities | $(115) | $(176) | | Net cash (used) provided by financing activities | $(55) | $2,492 | | Net decrease in cash | $(3,225) | $(1,667) | | Cash and cash equivalents, end of period | $9,748 | $5,291 | - Net cash used in operating activities decreased by **$833 thousand** YoY, from **$(3,915) thousand** in Q1 2024 to **$(3,082) thousand** in Q1 2025[20](index=20&type=chunk)[21](index=21&type=chunk) - Net cash from financing activities shifted from a positive **$2,492 thousand** in Q1 2024 to a negative **$(55) thousand** in Q1 2025, primarily due to no new borrowings under the credit facility in 2025[20](index=20&type=chunk)[21](index=21&type=chunk)[161](index=161&type=chunk)[163](index=163&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and additional information supporting the financial statements, including accounting policies and key transactions - The Company is in the pre-commercialization stage, relying on equity financing and expecting continued net losses[23](index=23&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk) - Management assesses liquidity to be sufficient for at least twelve months from the financial statements issuance date, but future strategic development and facility construction depend on securing additional financing[30](index=30&type=chunk)[31](index=31&type=chunk) - The India JV with Ester Industries Ltd. incurred losses of **$604 thousand** in Q1 2025, with Loop recording its **50% share of loss** at **$302 thousand**[51](index=51&type=chunk) - The carrying value of Loop's investment in ELITe was **$979 thousand** as of May 31, 2025[51](index=51&type=chunk) - Series B Convertible Preferred Stock accrued PIK dividends of **$340 thousand** in Q1 2025, contributing to the increase in interest and other financial expenses[52](index=52&type=chunk)[143](index=143&type=chunk) - Revenues for Q1 2025 totaled **$252 thousand**, primarily from **$244 thousand** in engineering fees for the India JV and **$8 thousand** from sales of Loop™ PET resin[139](index=139&type=chunk)[60](index=60&type=chunk)[61](index=61&type=chunk) - This marks a significant increase from **$6 thousand** in Q1 2024, which was solely from PET resin sales[61](index=61&type=chunk) - Research and development expenses decreased by **$863 thousand** to **$1,374 thousand** in Q1 2025, mainly due to a **$623 thousand** decrease in external engineering expenses and a **$313 thousand** decrease in employee compensation, partially offset by a **$183 thousand** increase in stock-based compensation[140](index=140&type=chunk)[62](index=62&type=chunk) - General and administrative expenses decreased by **$1,262 thousand** to **$1,649 thousand** in Q1 2025, primarily due to an **$894 thousand** decrease in professional fees (related to partnership legal costs in 2024) and a **$178 thousand** decrease in stock-based compensation[141](index=141&type=chunk)[63](index=63&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=14&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Loop Industries' Q1 2025 financial condition and operational results, covering pre-commercialization, strategic partnerships, liquidity, and capital resources [Introduction](index=15&type=section&id=Introduction) This section introduces Loop Industries' core business, technology, and commercialization strategy for sustainable plastics - Loop Industries is a technology company focused on depolymerizing waste PET plastic and polyester fiber into virgin-quality Loop™ branded PET resin, aiming to accelerate the shift towards sustainable plastics and a circular economy[84](index=84&type=chunk) - The company plans to commercialize its Infinite Loop™ technology through direct investments with strategic partners to operate commercial facilities and by licensing its technology[85](index=85&type=chunk) - Loop is executing its commercialization strategy through a **50/50 joint venture** in India with Ester Industries Ltd. for an Infinite Loop™ manufacturing facility and a technology license sale to Reed Societe Generale Group for a facility in Europe[87](index=87&type=chunk) [Background](index=16&type=section&id=Background) This section outlines the challenges in PET recycling and highlights the advantages of Loop's Infinite Loop™ Technology - The industry faces challenges with mechanical recycling of PET due to impurity issues, degradation of material properties, and inability to effectively handle polyester fiber waste, leading to 'downcycling' and reliance on virgin materials[92](index=92&type=chunk)[93](index=93&type=chunk)[94](index=94&type=chunk) - Loop's Infinite Loop™ Technology offers advantages by depolymerizing a wider range of contaminated PET plastic and polyester fiber waste at low temperatures and no added pressure, producing virgin-quality material that can be recycled infinitely without degradation[96](index=96&type=chunk)[97](index=97&type=chunk)[98](index=98&type=chunk)[99](index=99&type=chunk) [Agreements with Reed Societe Generale Group](index=17&type=section&id=Agreements%20with%20Reed%20Societe%20Generale%20Group) This section details the partnership with Reed Societe Generale Group for European facilities and the financial proceeds received - Loop entered into an Amended and Restated Share Purchase Agreement with Reed Societe Generale Group, forming Infinite Loop Europe (**90% Reed, 10% Loop**) to develop manufacturing facilities in Europe[101](index=101&type=chunk) - The Company received **$20.8 million (€20.0 million)** cash proceeds, including an initial upfront royalty payment of **$10.4 million (€10.0 million)** for a technology license for one European facility and **$10.4 million (€10.0 million)** from the sale of Series B Convertible Preferred Stock[102](index=102&type=chunk) - Proceeds are funding the India JV project and Loop's operational cash flow needs, validating the commercial readiness of Loop's technology[103](index=103&type=chunk)[104](index=104&type=chunk) [Joint Venture with Ester](index=18&type=section&id=Joint%20Venture%20with%20Ester) This section describes the 50/50 India joint venture with Ester Industries Ltd. for an Infinite Loop™ manufacturing facility - Loop formed a **50/50 India joint venture** with Ester Industries Ltd. to build and operate an Infinite Loop™ manufacturing facility in India with a planned production capacity of **70,000 tons per year** of Loop branded PET resin and polyester fiber[107](index=107&type=chunk)[109](index=109&type=chunk) - The India JV will be financed by a combination of debt and equity, with Loop and Ester each contributing **50% of the equity capital**[111](index=111&type=chunk) - As of May 31, 2025, each partner contributed **$1.9 million** in cash[111](index=111&type=chunk) - The estimated total investment cost for the India facility is approximately **$176 million**, with groundbreaking expected in the second half of calendar 2025 and commercial operations projected to commence in calendar 2027[117](index=117&type=chunk) - Loop generated **$0.2 million** in engineering services revenue in Q1 2025 from its agreement to provide engineering services to the India JV[115](index=115&type=chunk) [Commercialization Strategy](index=19&type=section&id=Commercialization%20Strategy) This section outlines Loop's approach to commercializing its technology through direct investments, licensing, and modular construction - Loop's commercialization strategy involves direct investments with strategic partners in low-cost manufacturing regions and licensing its Infinite Loop™ Technology globally[118](index=118&type=chunk)[123](index=123&type=chunk)[127](index=127&type=chunk) - Revenue generation is expected from profits from commercial facility operations, royalties for technology licensing, and exclusive sales and marketing responsibilities, as well as engineering services during project development[125](index=125&type=chunk)[127](index=127&type=chunk)[129](index=129&type=chunk) - The company is implementing a modular construction strategy to reduce capital expenditures, optimize operating expenses, and accelerate project timelines for global expansion[131](index=131&type=chunk) [Recent Development – ATM Offering](index=20&type=section&id=Recent%20Development%20%E2%80%93%20ATM%20Offering) This section reports on the company's recent At-the-Market Offering Agreement to sell common stock - On July 3, 2025, Loop entered into an At the Market Offering Agreement to sell up to **$15 million** of common stock through Roth Capital Partners, LLC[133](index=133&type=chunk) [Human Capital](index=20&type=section&id=Human%20Capital) This section provides an overview of the company's employee count and departmental distribution - As of May 31, 2025, Loop had **44 employees**: **18** in R&D, **17** in engineering and operations, and **9** in administrative functions[134](index=134&type=chunk) [Results of Operations](index=20&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance, including revenues, expenses, and net loss for the period | Metric (in thousands) | Three Months Ended May 31, 2025 | Three Months Ended May 31, 2024 | Change (favorable / (unfavorable)) | | :-------------------- | :------------------------------ | :------------------------------ | :--------------------------------- | | Revenues | $252 | $6 | $246 | | Research and development | $1,374 | $2,237 | $863 | | General and administrative | $1,649 | $2,911 | $1,262 | | Loss on equity accounted investment | $302 | $- | $(302) | | Interest and other financial expenses (income) | $419 | $60 | $(359) | | Net loss | $(3,447) | $(5,189) | $1,742 | - Revenues increased significantly by **$246 thousand**, driven by engineering fees (**$244 thousand**) and PET resin sales (**$8 thousand**)[139](index=139&type=chunk) - Net loss decreased by **$1,742 thousand**, primarily due to a **$1,262 thousand** decrease in G&A expenses and an **$863 thousand** decrease in R&D expenses, partially offset by a **$359 thousand** increase in interest and other financial expenses and a **$302 thousand** loss on equity accounted investment[144](index=144&type=chunk) [LIQUIDITY AND CAPITAL RESOURCES](index=22&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) This section discusses the company's cash position, funding needs, debt obligations, and compliance with financial covenants - As of May 31, 2025, the Company had **$9,748 thousand** in cash and cash equivalents[145](index=145&type=chunk) - Management believes current liquidity is sufficient for at least twelve months, but additional financing is required for strategic development and manufacturing facility construction, particularly for the India JV[146](index=146&type=chunk)[147](index=147&type=chunk) - The Series B Convertible Preferred Stock, issued for **$10,395 thousand**, accrues a **13% cumulative fixed annual PIK dividend** and is convertible to common stock at **$4.75 per share** or redeemable in cash[149](index=149&type=chunk) - The Investissement Québec financing facility's interest rate was increased to **4.36%** and repayment terms were modified, with total annual principal repayments of **$301 thousand** for FY2026 and **$519 thousand** for FY2027[154](index=154&type=chunk) - The Company was not in compliance with the minimum equity covenant of its Canadian bank credit facility as of May 31, 2025[156](index=156&type=chunk) - An amendment on July 4, 2025, modified the covenant to include Series B Convertible Preferred Stock, bringing the Company into compliance[157](index=157&type=chunk) | Cash Flow Activity (in thousands) | Three Months Ended May 31, 2025 | Three Months Ended May 31, 2024 | | :-------------------------------- | :------------------------------ | :------------------------------ | | Net cash used in operating activities | $(3,082) | $(3,915) | | Net cash used in investing activities | $(115) | $(176) | | Net cash provided by (used in) financing activities | $(55) | $2,492 | | Net decrease in cash | $(3,225) | $(1,667) | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=24&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exempt from providing quantitative and qualitative disclosures about market risk as a smaller reporting company - The Company is exempt from providing quantitative and qualitative disclosures about market risk as it qualifies as a 'smaller reporting company'[164](index=164&type=chunk) [Item 4. Controls and Procedures](index=24&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded the company's disclosure controls and procedures were effective as of May 31, 2025, with no material changes in internal control - The Chief Executive Officer and Interim Chief Financial Officer concluded that the Company's disclosure controls and procedures were effective as of May 31, 2025[166](index=166&type=chunk) - There were no material changes in internal control over financial reporting during the quarter ended May 31, 2025[167](index=167&type=chunk) [PART II. Other Information](index=25&type=section&id=PART%20II.%20Other%20Information) This section covers legal proceedings, risk factors, equity sales, defaults, mine safety, and other relevant disclosures [Item 1. Legal Proceedings](index=25&type=section&id=Item%201.%20Legal%20Proceedings) This section details ongoing legal matters, including an SEC investigation and a complaint identifying the CEO as a relief defendant - The SEC investigation, initiated in October 2020, requested information regarding the Company's technologies and partnerships[168](index=168&type=chunk) - A second subpoena in March 2022 requested additional information, but no further requests have been made[168](index=168&type=chunk) - The SEC filed a complaint in September 2022 against other named defendants, identifying the CEO as a relief defendant for purportedly receiving monies from the defendants, but not alleging wrongdoing by the Company or the CEO[170](index=170&type=chunk) [Item 1A. Risk Factors](index=25&type=section&id=Item%201A.%20Risk%20Factors) This section refers to existing risk factors and introduces an additional risk related to the recent At-the-Market (ATM) offering - No material changes to existing risk factors occurred during the three months ended May 31, 2025, as disclosed in the 2025 Annual Report[173](index=173&type=chunk) - An additional risk factor is the potential for dilution and a decrease in common stock price due to the sale or issuance of shares in the At-the-Market (ATM) offering of up to **$15 million**[174](index=174&type=chunk)[175](index=175&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=26&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities or use of proceeds occurred during the reporting period - No unregistered sales of equity securities or use of proceeds occurred during the period[176](index=176&type=chunk) [Item 3. Defaults Upon Senior Securities](index=26&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported during the period - No defaults upon senior securities occurred during the period[177](index=177&type=chunk) [Item 4. Mine Safety Disclosures](index=26&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to the company - Mine safety disclosures are not applicable[178](index=178&type=chunk) [Item 5. Other Information](index=26&type=section&id=Item%205.%20Other%20Information) No Rule 10b5-1 trading arrangements were adopted or terminated by directors or officers during Q1 2025 - No director or officer adopted or terminated a 'Rule 10b5-1 trading arrangement' or 'non-Rule 10b5-1 trading arrangement' during the three months ended May 31, 2025[179](index=179&type=chunk) [Item 6. Exhibits](index=26&type=section&id=Item%206.%20Exhibits) This section lists all required exhibits, including corporate foundational documents and certifications - The exhibits include foundational corporate documents such as Articles of Incorporation, Certificate of Designation of Series B Convertible Preferred Stock, and By-laws, along with certifications required by the Sarbanes-Oxley Act[181](index=181&type=chunk)

Company Overview - Loop Industries has developed a patented technology to produce virgin-quality polyester from 100% recycled content[10] - The technology depolymerizes waste PET into DMT and MEG monomers, which are then purified and recombined[11] - Loop's technology reduces GHG emissions by up to 81% compared to traditional polyester production[12] - The company has been operating a production facility in Canada for 5 years[28] Commercialization Strategy - Loop will deploy its technology through direct investment and licensing[28] - The company sold its first technology license to Reed Societe Generale Group in December 2024[28] - Loop generates revenue through royalties, engineering services, and sales of plant modules[66, 69] - Loop has a 50/50 joint venture with Ester Industries to build a 70kta commercial facility in India, expected to be operational in 2027[72, 73] Market Opportunity - Humankind has produced 83 billion tonnes of plastics since the 1950s[6] - 49 billion tonnes of plastic (60%) have been disposed of in landfills or the environment[6] - Approximately 25 million tonnes of plastic textiles are landfilled or incinerated annually[6] - Estimated Global Demand for PET Tire cord is 518 KTA[115]

Group 1 - Healthcare Services (HCSG) is currently outperforming the Business Services sector with a year-to-date return of approximately 22.7%, while the sector has returned an average of -0.3% [4] - The Zacks Consensus Estimate for HCSG's full-year earnings has increased by 13.5% over the past quarter, indicating improved analyst sentiment and a stronger earnings outlook [4] - HCSG holds a Zacks Rank of 1 (Strong Buy), suggesting it has characteristics that may lead to outperformance in the market over the next one to three months [3] Group 2 - The Business Services sector includes 271 individual stocks and currently holds a Zacks Sector Rank of 3 among 16 different sector groups [2] - The Business - Services industry, which includes HCSG, consists of 26 companies and is ranked 32 in the Zacks Industry Rank, with an average year-to-date gain of 18.3% [6] - Loop Industries, Inc. (LOOP) is another stock in the Business Services sector that has performed well, returning 30.8% year-to-date and also holding a Zacks Rank of 1 (Strong Buy) [5]

Core Viewpoint - Loop Industries, Inc. (LOOP) has been upgraded to a Zacks Rank 1 (Strong Buy), indicating a positive outlook driven by rising earnings estimates, which significantly influence stock prices [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the correlation between changes in earnings estimates and stock price movements, making it a valuable tool for investors [2][3]. - Institutional investors utilize earnings estimates to determine the fair value of stocks, leading to significant price movements based on their buying or selling actions [3]. Company Performance and Outlook - The upgrade for Loop Industries reflects an improvement in its underlying business, suggesting that investor sentiment may drive the stock price higher [4]. - Over the past three months, the Zacks Consensus Estimate for Loop Industries has increased by 2.2%, indicating a positive trend in earnings estimates [7]. Zacks Rank System - The Zacks Rank system categorizes stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [6]. - Loop Industries' upgrade to Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, suggesting strong potential for near-term price appreciation [9].

Financial Data and Key Metrics Changes - The company reported $10,800,000 in revenue for Q4, marking the first quarter of material income, primarily from a technology license sale to Reed Societe Generale Group for CAD10.4 million [5][15] - Operating expenses were reduced to $2,600,000, a decrease of $2,100,000 or 44% year-over-year [16] - The company enhanced its liquidity position with initial proceeds of $20,800,000 from the transaction with Reed Societe Generale Group [16] Business Line Data and Key Metrics Changes - The Infinite Loop India facility is expected to produce both virgin quality polyester fiber grade PET and virgin quality bottle grade PET resin, diversifying customer segments [9] - The CapEx for the India project is estimated at $176,000,000, which includes all installation costs and financing [46] Market Data and Key Metrics Changes - The company is in advanced discussions with several brand companies to secure off-take supply agreements for the Indian facility, which are crucial for project financing [10] - The company is focusing on modular construction for its European facility, which will reduce overall CapEx and shorten construction timelines [12] Company Strategy and Development Direction - The company is pursuing a low-cost manufacturing strategy, with a focus on building facilities in low-cost countries to reduce CapEx and OpEx [7][12] - Modular construction is a key focus moving forward, allowing for quicker project execution and better overall performance [12][14] Management's Comments on Operating Environment and Future Outlook - Management expressed excitement about the future, highlighting that the India project fits the financial metrics for success and will deliver top-quality materials at competitive prices [18] - The company expects to have sufficient liquidity for the next five to six quarters, with no immediate liquidity concerns [25] Other Important Information - The company has executed an engineering services agreement with its India joint venture for $600,000 to support the FEED engineering study [6] - The company anticipates generating an additional $750,000 in engineering revenue by the end of the year [6] Q&A Session Summary Question: What is the latest timeline for the India JV execution? - The facility is expected to break ground in the second half of this year, with customer contracts being the gating item for project financing [22] Question: What is the cash burn and liquidity outlook? - The company has five to six quarters of liquidity on hand and is discussing with strategic partners to fill a financing gap [25][26] Question: Can you comment on the land selection process for the India facility? - The land selection in Gujarat has been finalized, and negotiations with the local government are ongoing [30][32] Question: What is the CapEx for the India plant? - The total CapEx for the India project is $176,000,000, which includes all costs associated with the project [46] Question: What are the expected margins from the joint venture? - The company expects robust margins from day one, with a 5% licensing fee covering back office expenses [68]

Financial Data and Key Metrics Changes - The company reported $10.8 million in revenue for Q4 2025, marking its first quarter of material income, primarily from a technology license sale to Reed Societe Generale Group for CAD 10.4 million [5][15] - Operating expenses were reduced to $2.6 million, a decrease of $2.1 million or 44% year-over-year, contributing to improved cash burn [16] - The company ended the quarter with a cash balance of approximately CAD 13 million and an undrawn line of credit of CAD 2.4 million [17] Business Line Data and Key Metrics Changes - The Infinite Loop India facility is expected to produce both virgin quality polyester fiber grade PET and bottle grade PET resin, diversifying customer segments [8] - The CapEx for the India project is estimated at $176 million, which includes all installation costs and financing [44] Market Data and Key Metrics Changes - The company is in advanced discussions with several brand companies to secure off-take supply agreements for the Indian facility, which are crucial for project financing [10] - The European project timeline has advanced, with site selection expected to be completed by late Q3 or early Q4 2025 [36] Company Strategy and Development Direction - The company is focusing on low-cost manufacturing and modular construction to reduce CapEx and construction timelines, enhancing overall project performance [12][14] - The strategy includes securing binding customer contracts to facilitate debt syndication for project financing [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in meeting the 2027 target for commercial operations, emphasizing that securing customer contracts is the key gating item [23] - The company anticipates robust profitability from the joint venture and expects to reinvest cash flow into future facilities [66] Other Important Information - The company has executed a $600,000 engineering services agreement and expects an additional $750,000 in engineering revenue by year-end [6] - The modular construction approach is expected to significantly enhance project delivery and cost-effectiveness [12][14] Q&A Session Summary Question: What is the latest timeline for the India JV? - The facility is expected to break ground in the second half of this year, with customer contracts being the gating item for project financing [22] Question: What is the cash burn and liquidity outlook? - The company has approximately five to six quarters of liquidity on hand and is discussing with strategic partners to close a financing gap [24][25] Question: Can you comment on the land selection process? - The land selection in Gujarat has been finalized, and negotiations with the local government are ongoing [30][32] Question: What is the CapEx for the India plant? - The total CapEx for the India project is $176 million, which includes all costs associated with the project [44] Question: What are the expected margins from the joint venture? - The company expects robust margins from day one, with a 5% licensing fee covering back office expenses [65][66]

Financial Performance - Loop generated $10.8 million in total revenue for Q4 FY2025, a significant increase from $45 in Q4 FY2024, primarily driven by $10.4 million in licensing revenue[3][20] - The net income for Q4 FY2025 was $6.9 million, a turnaround from a net loss of $5.1 million in Q4 FY2024, attributed to increased revenues and reduced expenses[24] - Revenues increased to $10,889 for the year ended February 28, 2025, compared to $153 for the same period in 2024[37] - Net loss decreased by $6,030 to $15,057 for the year ended February 28, 2025, compared to $21,087 for the same period in 2024, primarily due to a $10,736 increase in revenues[32] Expenses - Research and development expenses decreased by $1.7 million to $1.3 million in Q4 FY2025, compared to $3.0 million in Q4 FY2024, mainly due to reduced plant and laboratory operating expenses[21] - General and administrative expenses also decreased by $647,000 to $1.6 million in Q4 FY2025, down from $2.2 million in Q4 FY2024[22] - Research and development expenses decreased by $4,515 to $6,864 for the year ended February 28, 2025, compared to $11,379 for the same period in 2024[28] - General and administrative expenses decreased by $760 to $9,228 for the year ended February 28, 2025, compared to $9,988 for the same period in 2024[29] - Impairment of equipment expense increased by $8,460 for the year ended February 28, 2025, due to the termination of a joint venture agreement[30] Cash and Assets - Cash and cash equivalents increased to $12,973 as of February 28, 2025, compared to $6,958 as of February 29, 2024[34] - Total assets decreased to $18,578 as of February 28, 2025, from $20,553 as of February 29, 2024[35] - Total liabilities increased to $18,211 as of February 28, 2025, compared to $6,411 as of February 29, 2024[35] Facility Development - Loop's Infinite Loop™ India facility is projected to have an annual production capacity of 70,000 metric tons of polyester fiber and PET resin, with a total estimated investment of $176 million[8][6] - Groundbreaking for the Infinite Loop™ India facility is expected in the second half of 2025, with commercial operations anticipated to start in 2027[9] - Loop is actively negotiating off-take supply agreements with apparel and textile companies for the anticipated output from the India facility[8] - The company is exploring potential locations for its first Infinite Loop™ facility in Europe, focusing on site selection and engineering studies[12] - Loop plans to adopt a modular approach for its European facilities to reduce capital expenditures and construction timelines significantly[13] Strategic Focus - The company plans to focus on the development of large-scale commercial manufacturing facilities following the successful scaling of its technology[28] - The company aims to contribute to a circular economy by reducing plastic waste and recovering waste plastic for sustainable future[40]