Loop Energy Provides Further Corporate Update, Considering Divestiture of its Module Business, Potential New Investors
Burnaby, BC, October 24, 2023--(T-Net)--Loop Energy (TSX: LPEN), a leading hydrogen fuel cell stack designer, developer and manufacturer, today provided a corporate update, including an update on the previously announced review and evaluation of strategic alternatives.
Following its corporate update on September 19, 2023 where the Company announced the continuation of its previously disclosed strategic review process combined with a cost reduction program, including a reduction in its workforce, as well as a greater business development focus on fuel cell stack design, development, production and testing, Loop has now provided a further update:
- Divestiture of the module business. The Company has executed its first non-binding letter of intent and is considering other non-binding proposals for the acquisition of components of its module business. It is anticipated that any potential acquirers may become customers of the company's hydrogen fuel cell stack business.
- Third-party Development Engagements. The Company has responded to a request for proposal to develop a new hydrogen fuel cell stack and is actively in discussions with a number of other parties with respect to fuel cell stack engineering and design services.
- New Investment. The Company is engaged in discussions with potential new investors interested in supporting a smaller and more tightly focused company.
- Update on Strategic Alternatives. The change in ownership of the Company's financial advisor and the strategic direction of its new owner has required a termination of its engagement as financial advisor to Loop for the strategic alternative review process. Going forward, interested parties are encouraged to contact the Company directly.
The Company also annunced that it will be releasing its third quarter financial results after the close of markets on November 9, 2023.
About Loop Energy Inc.
Loop Energy is a leading designer and manufacturer of hydrogen fuel stacks targeted for the electrification of commercial vehicles such as buses and trucks, as well as stationary power applications. Loop Energy's products feature the company's proprietary eFlow technology in the fuel cell stack's bipolar plates.
eFlow™ technology enables customers to achieve superior performance and higher fuel efficiency when using Loop Energy's fuel cell stacks, which lowers operating cost for end users while enabling OEMs to achieve lower capital cost and faster time to market. Loop Energy works closely with its partners to enable the production of hydrogen electric solutions.
Forward Looking Information
This press release may contain forward-looking statements with respect to us and the fuel cell industry. Such statements reflect our current expectations and projections regarding future events. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company's control and could cause actual results and events to vary materially from those that are disclosed, or implied, by such forward-looking information. [ MORE ]
Forward Looking Information
This press release may contain forward-looking statements with respect to us and the fuel cell industry. Such statements reflect our current expectations and projections regarding future events. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company's control and could cause actual results and events to vary materially from those that are disclosed, or implied, by such forward-looking information.
Such risks and uncertainties include, but are not limited to, the ability of the Company to execute on its strategy and the factors discussed under "Risk Factors Company's Annual Information Form dated March 30, 2021. Also refer to the section entitled "Cautionary Statement Regarding Forward Looking Information" in our current Management's Discussion and Analysis for more information. Loop does not undertake to update, correct, or revise any forward-looking statements as a result of any new information, future events or otherwise, except as may be required by applicable law.
Non-IFRS Financial Measures
Product back-log is a non-IFRS financial measure intended to provide additional information and should not be considered a substitute for measures of performance prepared in accordance with IFRS. In addition, this measure does not have a standardized meaning under IFRS and therefore may not be comparable to a similar measure presented by other companies. This non-IFRS measure is used by management, and we believe that it assists investors and other users of our financial reports in assessing our financial performance and monitoring our ongoing financial position.
Our product backlog represents the estimated aggregate value of all future conditional orders, binding and non-binding commitments and memorandums of understanding from customers who have placed at least one committed purchase order with us for at least one fuel cell stack or module with written intention (including binding and non-binding commitments) of follow-on unit orders. Our product backlog is currently comprised of a relatively limited number of contracts and a relatively limited number of customers and there can be no assurance that any such conditions will be fulfilled, or that our product backlog will be equal to our future revenues.
Given the relative immaturity of our industry and customer deployment programs, our product backlog is potentially vulnerable to risk of cancellation, deferral or non-performance by our customers for a variety of reasons, including: risks related to continued customer commitment to a fuel cell program; risks related to customer liquidity; credit risks; risks related to changes, reductions or eliminations in government policies, subsidies and incentives; risks related to macro-economic conditions including trade, public health (including the ongoing impact of the COVID-19 pandemic), and other geopolitical risks; risks related to slower market adoption; risks related to vehicle integration challenges; risks related to the development of effective hydrogen refueling infrastructure; risks related to the ability of our products to meet evolving market requirements; and supplier-related risks.
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