Loop Industries(LOOP) - 2025 Q4 - Annual Report

Technology and Production - Loop Industries has successfully operated its Terrebonne, Québec depolymerization production facility for the past five years, demonstrating the effectiveness of its technology and supplying Loop PET resin and polyester fiber to customers [220]. - The planned production capacity of the Infinite Loop™ manufacturing facility in India is 70,000 tons per year of Loop branded PET resin and polyester fiber [221]. - The Infinite Loop™ Technology is positioned to respond to the global transition towards a circular economy, allowing for the recycling of waste polyester that would otherwise be disposed of [224]. - The modular construction strategy aims to reduce overall capital expenditures and operating expenses while improving project timelines [234]. - The Company plans to continue the commercialization of its Infinite Loop™ Technology and execute partnerships and commercial agreements with customers [295]. Financial Performance - Revenues for the three-month period ended February 28, 2025 increased to $10,809 from$45 for the same period in 2024, primarily driven by $10,395 in licensing revenue [258]. - For the fiscal year ended February 28, 2025, revenues increased to$10,889 from $153 in 2024, with significant contributions from licensing revenue and engineering fees [267]. - Net income for the three-month period ended February 28, 2025 was$6,882, an increase of $11,973 compared to a net loss of$5,091 for the same period in 2024 [263]. - The net loss for the fiscal year ended February 28, 2025 decreased to $15,057 from$21,087 in 2024, driven by increased revenues and decreased expenses [272]. - The company reported a net loss of $15,057,000 for the year ended February 28, 2025, compared to a net loss of$21,087,000 for the previous year [349]. Expenses and Cost Management - Research and development expenses decreased to $1,306 for the three-month period ended February 28, 2025, down from$3,018 in the same period in 2024, mainly due to a reduction in plant and laboratory operating expenses [259]. - General and administrative expenses for the three-month period ended February 28, 2025 decreased to $1,574 from$2,221 for the same period in 2024, attributed to lower employee compensation and insurance expenses [261]. - Research and development expenses for the fiscal year ended February 28, 2025 decreased significantly to $6,864 from$11,379 in 2024, reflecting a shift towards large-scale commercial manufacturing [268]. - General and administrative expenses for the fiscal year ended February 28, 2025 decreased to $9,228 from$9,988 in 2024, primarily due to reduced insurance and employee compensation expenses [269]. - The Company incurred total expenses of $25.076 million for the year ended February 28, 2025, compared to$21.902 million in the prior year [339]. Cash Flow and Liquidity - The company had cash and cash equivalents of $12,973 as of February 28, 2025, indicating a liquidity position subject to risks and uncertainties [273]. - Net cash used in operating activities decreased to$2,121 for the year ended February 28, 2025, compared to $18,046 for the previous year, attributed to increased revenues and decreased operating expenses [291]. - The Company requires capital to fund its equity contributions to the India JV for the construction of the planned Infinite Loop™ facility in India [359]. - The Company has incurred net losses and negative cash flow from operating and investing activities since its inception, expecting additional net losses as it advances its commercialization efforts [298]. - The Company has determined that current available liquidity will be sufficient to meet its obligations for at least twelve months from the issuance date of the financial statements [358]. Investments and Joint Ventures - Loop received an initial down payment of €10 million for its first technology license sold to Reed Societe Generale Group, with additional milestone payments expected as the project advances [221]. - The total funding required for the India JV is expected to be financed by a combination of debt and equity capital, with Loop and Ester each contributing 50$1,954 in its joint venture in India during the year ended February 28, 2025, with total net cash used in investing activities amounting to $2,036 [292]. - The company has a 50$13.852 million as of February 28, 2025, up from $7.988 million as of February 29, 2024 [337]. - The total liabilities as of February 28, 2025, were$18.211 million, a significant increase from $6.411 million the previous year [337]. - Cash and cash equivalents increased to$12,973 million as of February 28, 2025, compared to $6,958 million as of February 29, 2024 [337]. - The accumulated deficit as of February 28, 2025, amounted to$192.027 million, an increase from $176.970 million the previous year [337]. Research and Development - Research and development expenses are primarily related to process development, customer trials, and machinery expenditures, and are charged to expense as incurred [377]. - The Company is eligible for reimbursable Provincial research and development tax credits, which are recorded as a reduction of research and development expenses [381]. - The company recorded research and development tax credits of$85 million for the year ended February 28, 2025, down from $263 million in 2024 [407]. Intellectual Property - The company is focused on protecting its intellectual property and limiting expenses to optimize its liquidity position [303]. - As of February 28, 2025, the net value of patents increased to$1.708 billion from $1.548 billion in 2024, reflecting a growth of approximately 10.3$2.446 billion, up from $1.996 billion at the end of 2024, indicating an increase of 22.5% [415]. - The company continued to develop the Infinite Loop™ technology and filed various patents globally during the fiscal year ending February 28, 2025 [415].