Executive Summary & Business Update Loop Industries reports significant progress in its India and European projects, securing key agreements and advancing towards commercialization, alongside its Q2 FY2026 financial results Company Overview and Mission Loop Industries is a clean technology company dedicated to accelerating a circular economy for polyester by producing 100% recycled PET plastic and textile-to-textile polyester - Loop Industries' mission is to accelerate a circular economy for polyester by manufacturing 100% recycled polyethylene terephthalate ("PET") plastic and textile-to-textile (T2T) polyester2 Key Business Milestones and Progress Loop Industries reported significant progress in its Infinite Loop™ India project, securing crucial offtake agreements, strategic alliances, and a site acquisition, while also advancing its European partnership towards commercialization. The CEO highlighted these achievements as landmark milestones for the company's growth - Loop Industries reported consolidated financial results for the second quarter of fiscal year 2026 and provided an update on key milestones, indicating positive progress towards commercialization12 - CEO Daniel Solomita described the quarter as a 'landmark' for the Infinite Loop India project, with the strategic site secured, foundational anchor customer agreements, and significant progress in project debt financing10 - The European project is also progressing well, nearing final site selection, and is expected to generate new revenue streams from initial engineering services and subsequent milestone licensing payments10 Cash Operating Expenses and Liquidity | Metric | Q2 FY2026 | Q2 FY2025 (estimated) | | :---------------------- | :-------- | :-------------------- | | Cash operating expenses | $2.43M | $4.17M | | Total available liquidity | $9.86M | N/A | Infinite Loop™ India Project The India project achieved major milestones including securing offtake agreements, forming strategic alliances, acquiring a site, and making progress on debt financing - Secured a multi-year offtake agreement with a leading global branded sports apparel company for Twist™ polyester from the Infinite Loop India facility5 - Executed an offtake agreement with Taro Plast S.p.A. for Loop™ DMT from the Infinite Loop India facility5 - Formed strategic alliances with Shinkong Synthetic Fibers Corporation and Hyosung TNC to support the shift to textile-to-textile circular polyester5 - ELITe, the India JV, acquired a 93-acre site in Gujarat, India, for $10.5 million, representing a $5 million reduction in the project cost estimate5 - Positive progress is being made in discussions with potential lenders for project debt financing for the Infinite Loop™ India facility, managed by KPMG5 European Partnership with Reed Societe Generale Group The European partnership is advancing with final site selection, engagement with government entities for incentives, and anticipated engineering revenues in 2026 - Loop and Reed Societe Generale Group are in advanced stages of selecting a final project location for the first Infinite Loop™ facility in Europe9 - Engaging with government entities regarding available subsidies and incentives, and identifying strategic partners for project execution9 - Loop expects to provide engineering services and a modular construction solution for the European project, anticipating engineering revenues in 20269 CEO Commentary The CEO highlights Q2 FY2026 as a landmark quarter for the India project due to site acquisition and customer agreements, with the European project also progressing well towards new revenue streams - CEO Daniel Solomita highlighted Q2 FY2026 as a 'landmark quarter' for the Infinite Loop India project, with the strategic site secured and foundational anchor customer agreements10 - Significant headway is being made in securing project debt financing for the India facility from a strong syndicate of international and local Indian banks10 - The European project is progressing well, with site selection in final stages, and is anticipated to generate meaningful new revenue streams from initial engineering services and subsequent milestone licensing payments10 Financial Highlights & Performance Loop Industries reported a reduced net loss for both the quarter and six-month period, driven by expense reductions, while maintaining sufficient liquidity for operations Second Quarter Fiscal 2026 Financial Highlights For Q2 FY2026, Loop Industries reported a net loss of $3.204 million, a decrease of $1.635 million year-over-year. This improvement was primarily driven by significant decreases in research and development and general and administrative expenses, partially offset by an increase in interest and other financial expenses. Revenues for the quarter were $0 Q2 FY2026 Financial Performance | Metric (in thousands USD) | Q2 FY2026 | Q2 FY2025 | Change (favorable/(unfavorable)) | | :------------------------ | :-------- | :-------- | :------------------------------- | | Revenues | $0 | $23 | $(23) | | Total Research and Development | $843 | $1,945 | $1,102 | | Total General and Administrative | $1,871 | $2,595 | $724 | | Interest and other financial expenses | $419 | $119 | $(300) | | Net Loss | $(3,204) | $(4,839) | $1,635 | - Cash operating expenses for Q2 FY2026 were $2.43 million, reflecting a year-over-year decrease of $1.74 million7 - Total available liquidity at the end of Q2 FY2026 was $9.86 million, which the company believes is sufficient to fund operations while securing additional financing7 Six Months Ended August 31, 2025 Financial Highlights For the six months ended August 31, 2025, Loop Industries reported a net loss of $6.651 million, a decrease of $3.377 million year-over-year. This improvement was primarily due to substantial reductions in general and administrative and research and development expenses, partially offset by increased interest and other financial expenses and a loss on equity accounted investment. Revenues significantly increased to $252 thousand, mainly from engineering fees H1 FY2026 Financial Performance | Metric (in thousands USD) | H1 FY2026 | H1 FY2025 | Change (favorable/(unfavorable)) | | :------------------------ | :-------- | :-------- | :------------------------------- | | Revenues | $252 | $29 | $223 | | Total Research and Development | $2,217 | $4,182 | $1,965 | | Total General and Administrative | $3,519 | $5,506 | $1,987 | | Loss on equity accounted investment | $345 | $0 | $(345) | | Interest and other financial expenses | $837 | $179 | $(658) | | Net Loss | $(6,651) | $(10,028) | $3,377 | - Revenues for the six-month period ended August 31, 2025, included $244 thousand in engineering fees and $8 thousand from sales of Loop™ PET resin21 Detailed Results of Operations This section provides a granular analysis of the company's revenues, research and development, general and administrative, interest, and net loss for the three and six-month periods Three Months Ended August 31, 2025 For the three months ended August 31, 2025, Loop Industries reported a decrease in revenues to $0, while significantly reducing Research and Development and General and Administrative expenses. However, interest and other financial expenses increased due to accrued PIK dividends, resulting in an overall reduced net loss compared to the prior year Revenues Revenues for Q2 FY2026 decreased to zero, reflecting a halt in sales of Loop™ PET resin compared to the prior year | Metric (in thousands USD) | Q2 FY2026 | Q2 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Revenues | $0 | $23 | $(23) | - Revenues decreased by $23 thousand to $0 in Q2 FY2026, compared to $23 thousand from sales of Loop™ PET resin in Q2 FY202514 Research and Development Expenses Research and development expenses significantly decreased in Q2 FY2026, primarily due to reductions in external engineering and employee compensation costs | Metric (in thousands USD) | Q2 FY2026 | Q2 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Total R&D Expenses | $843 | $1,945 | $1,102 | | External engineering | $9 | $651 | $642 | | Employee compensation | $597 | $862 | $265 | - Research and development expense decreased by $1,102 thousand, primarily due to a $642 thousand decrease in external engineering expenses and a $265 thousand decrease in employee compensation expenses15 General and Administrative Expenses General and administrative expenses saw a notable reduction in Q2 FY2026, mainly driven by lower professional fees and employee compensation | Metric (in thousands USD) | Q2 FY2026 | Q2 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Total G&A Expenses | $1,871 | $2,595 | $724 | | Professional fees | $612 | $1,007 | $395 | | Employee compensation | $423 | $585 | $162 | - General and administrative expenses decreased by $724 thousand, mainly due to a $395 thousand decrease in professional fees (legal costs related to partnerships in the prior year) and a $162 thousand decrease in employee compensation16 Interest and Other Financial Expenses Interest and other financial expenses increased in Q2 FY2026, primarily due to accrued PIK dividends on Series B Convertible Preferred Stock | Metric (in thousands USD) | Q2 FY2026 | Q2 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Interest and other financial expenses | $419 | $119 | $(300) | - Interest and other financial expenses increased by $300 thousand, primarily attributable to $341 thousand in accrued PIK dividend on Series B Convertible Preferred Stock17 Net Loss The net loss for Q2 FY2026 decreased due to lower operating expenses, partially offset by increased financial expenses | Metric (in thousands USD) | Q2 FY2026 | Q2 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Net Loss | $(3,204) | $(4,839) | $1,635 | - The net loss decreased by $1,635 thousand, primarily due to decreases in research and development and general and administrative expenses, partially offset by the increase in interest and other financial expenses18 Six Months Ended August 31, 2025 For the six months ended August 31, 2025, Loop Industries experienced a significant increase in revenues, mainly from engineering fees, coupled with substantial reductions in Research and Development and General and Administrative expenses. However, these positive impacts were partially offset by increased interest expenses and a loss from equity accounted investment, leading to an overall reduced net loss for the period Revenues Revenues for the six-month period significantly increased, primarily driven by engineering fees and a small contribution from PET resin sales | Metric (in thousands USD) | H1 FY2026 | H1 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Revenues | $252 | $29 | $223 | - Revenues increased by $223 thousand to $252 thousand, primarily from $244 thousand in engineering fees and $8 thousand from sales of Loop™ PET resin21 Research and Development Expenses Research and development expenses for the six-month period decreased substantially, mainly from reduced external engineering and employee compensation | Metric (in thousands USD) | H1 FY2026 | H1 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Total R&D Expenses | $2,217 | $4,182 | $1,965 | | External engineering | $14 | $1,279 | $1,265 | | Employee compensation | $1,299 | $1,877 | $578 | - Research and development expense decreased by $1,965 thousand, primarily due to a $1,265 thousand decrease in external engineering expenses and a $578 thousand decrease in employee compensation expenses22 General and Administrative Expenses General and administrative expenses for the six-month period decreased significantly, primarily due to lower professional fees and employee compensation | Metric (in thousands USD) | H1 FY2026 | H1 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Total G&A Expenses | $3,519 | $5,506 | $1,987 | | Professional fees | $973 | $2,262 | $1,289 | | Employee compensation | $992 | $1,221 | $229 | - General and administrative expenses decreased by $1,987 thousand, mainly due to a $1,289 thousand decrease in professional fees and a $229 thousand decrease in employee compensation expenses23 Loss on Equity Accounted Investment A new loss on equity accounted investment was recorded for the six-month period, reflecting the India JV's preliminary project costs | Metric (in thousands USD) | H1 FY2026 | H1 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Loss on equity accounted investment | $345 | $0 | $(345) | - Loss on equity accounted investment increased by $345 thousand, relating to the Company's 50% portion of the loss incurred by the India JV for preliminary project costs, mainly engineering fees24 Interest and Other Financial Expenses Interest and other financial expenses for the six-month period increased, largely due to accrued PIK dividends on Series B Convertible Preferred Stock | Metric (in thousands USD) | H1 FY2026 | H1 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Interest and other financial expenses | $837 | $179 | $(658) | - Interest and other financial expenses increased by $658 thousand, mainly attributable to $681 thousand in accrued PIK dividend on Series B Convertible Preferred Stock25 Net Loss The net loss for the six-month period decreased due to reduced operating expenses, partially offset by increased financial expenses and equity investment losses | Metric (in thousands USD) | H1 FY2026 | H1 FY2025 | Change | | :------------------------ | :-------- | :-------- | :----- | | Net Loss | $(6,651) | $(10,028) | $3,377 | - The net loss decreased by $3,377 thousand, primarily due to decreases in general and administrative and research and development expenses, partially offset by increased interest and other financial expenses and loss on equity accounted investment26 Condensed Consolidated Financial Statements This section presents the company's unaudited consolidated statements of operations, balance sheets, and cash flows for the reported periods Condensed Consolidated Statements of Operations and Comprehensive Loss This section presents the unaudited condensed consolidated statements of operations and comprehensive loss for the three and six-month periods ended August 31, 2025 and 2024, detailing revenues, expenses, other income/loss, net loss, and comprehensive loss, along with per share data Consolidated Statements of Operations and Comprehensive Loss | (in thousands of U.S. dollars, except per share data) | Three Months Ended Aug 31, 2025 | Three Months Ended Aug 31, 2024 | Six Months Ended Aug 31, 2025 | Six Months Ended Aug 31, 2024 | | :---------------------------------------------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Revenues | $ - | $ 23 | $ 252 | $ 29 | | Research and development | 843 | 1,945 | 2,217 | 4,182 | | General and administrative | 1,871 | 2,595 | 3,519 | 5,506 | | Depreciation and amortization | 96 | 129 | 197 | 266 | | Loss on equity accounted investments | 43 | - | 345 | - | | Total expenses | 2,853 | 4,669 | 6,278 | 9,954 | | Interest and other financial expenses | 419 | 119 | 837 | 179 | | Interest income | (70) | (6) | (170) | (132) | | Foreign exchange loss (gain) | 2 | 80 | (42) | 56 | | Total other loss | 351 | 193 | 625 | 103 | | Net loss | (3,204) | (4,839) | (6,651) | (10,028) | | Foreign currency translation adjustment | (6) | 43 | (25) | (12) | | Comprehensive loss | $ (3,210) | $ (4,796) | $ (6,676) | $ (10,040) | | Net loss per share Basic and diluted | $ (0.07) | $ (0.10) | $ (0.14) | $ (0.21) | | Weighted average common shares outstanding Basic and diluted | 47,769,800 | 47,573,302 | 47,716,964 | 47,554,357 | Condensed Consolidated Balance Sheets This section provides the unaudited condensed consolidated balance sheets as of August 31, 2025, and February 28, 2025, detailing assets, liabilities, and stockholders' equity (deficit) Consolidated Balance Sheets | (in thousands of U.S. dollars, except per share data) | As at August 31, 2025 | As at February 28, 2025 | | :---------------------------------------------------- | :-------------------- | :---------------------- | | Assets | | | | Cash and cash equivalents | $ 7,310 | $ 12,973 | | Total current assets | 8,800 | 13,852 | | Investments in joint ventures | 936 | 1,281 | | Property, plant and equipment, net | 1,754 | 1,737 | | Intangible assets, net | 1,800 | 1,708 | | Total assets | $ 13,290 | $ 18,578 | | Liabilities and Stockholders' Equity (Deficit) | | | | Total current liabilities | $ 3,901 | $ 3,959 | | Due to customer | 865 | 832 | | Series B Convertible Preferred stock | 11,328 | 10,647 | | Long-term debt | 2,664 | 2,773 | | Total liabilities | 18,758 | 18,211 | | Total stockholders' equity (deficit) | (5,468) | 367 | | Total liabilities and stockholders' equity (deficit) | $ 13,290 | $ 18,578 | Condensed Consolidated Statements of Cash Flows This section presents the unaudited condensed consolidated statements of cash flows for the six-month periods ended August 31, 2025 and 2024, outlining cash flows from operating, investing, and financing activities, and the net change in cash and cash equivalents Consolidated Statements of Cash Flows | (in thousands of U.S. dollars) | Six Months Ended August 31, 2025 | Six Months Ended August 31, 2024 | | :----------------------------- | :------------------------------- | :------------------------------- | | Net cash used in operating activities | $ (5,604) | $ (6,775) | | Net cash used in investing activities | $ (133) | $ (325) | | Net cash (used) provided by financing activities | $ 51 | $ 1,537 | | Net decrease in cash | $ (5,663) | $ (5,563) | | Cash and cash equivalents, beginning of period | $ 12,973 | $ 6,958 | | Cash and cash equivalents, end of period | $ 7,310 | $ 1,395 | Additional Information This section provides details on an upcoming corporate update call, an overview of Loop Industries' mission and technology, and important forward-looking statements Corporate Update Call Details Loop Industries will host a corporate update call on Thursday, October 16, 2025, at 8:45 AM ET, with details provided for telephone access and online registration - Senior Management of Loop will host a corporate update call on Thursday, October 16, 2025, at 8:45 AM Eastern Time11 - Participants can join by telephone using provided dial-in numbers and access code, or register online to bypass wait times and receive a calendar invitation11 About Loop Industries Loop Industries is a technology company focused on sustainable PET plastic and polyester fiber, utilizing patented technology to depolymerize waste into virgin-quality monomers for infinite recycling, thereby contributing to a circular economy - 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 its dependence on fossil fuels33 - The company owns patented technology that depolymerizes low-value waste PET plastic and polyester fiber into base monomers (DMT and MEG), which are then purified and polymerized to create virgin-quality Loop™ & Twist™ branded PET resin33 - Loop™ & Twist™ PET can be recycled infinitely without degradation of quality, helping to close the plastic loop and contributing to a circular economy33 Forward-Looking Statements This section contains forward-looking statements regarding anticipated project timelines, capital requirements, and revenue opportunities, which are inherently subject to various risks and uncertainties, including commercialization ability, partner relationships, and macroeconomic factors. Investors are advised to consult SEC filings for detailed risk factors - The news release contains 'forward-looking statements' regarding anticipated project timelines, capital requirements, and revenue opportunities for projects in India and Europe, as well as expected benefits of agreements and partnerships34 - Forward-looking statements are inherently subject to risks and uncertainties, including the ability to commercialize technology, status of partner relationships, intellectual property, industry competition, and the need for additional funding34 - Investors and security holders are urged to read Loop's Annual Report on Form 10-K and subsequent SEC filings for more detailed information about risk factors34
Loop Industries(LOOP) - 2026 Q2 - Quarterly Results