Loop Energy Provides Corporate Update
News provided byACCESSWIRE
Sep 19, 2023, 7:45 PM ET
Announces Further Costing Reduction Activities and Updates to Strategic Review Process
VANCOUVER, BC / ACCESSWIRE / September 19, 2023 / Loop Energy™ ("Loop" or the "Company") (TSX:LPEN), a leading hydrogen fuel cell manufacturer, today provides an update on the previously announced review and evaluation of strategic alternatives.
As previously disclosed on March 29, 2023, Loop conducted its review of strategic alternatives, including investigating strategic partnerships, licensing opportunities, joint development and outsourcing opportunities, and other ways to bring new capital, expertise and resources to the business and to identify growth opportunities and ways to support Loop's expansion plan.
Following the public announcement of the strategic review and at the direction of the Board of Directors of the Company, Loop conducted a comprehensive outreach to over 130 potential counterparties and while discussions are ongoing with certain parties, no offer or proposal is currently under consideration.
Due to challenging capital market conditions, including significant stock price declines in the hydrogen fuel cell sector since the beginning of the year, and after careful consideration of its alternatives, the Board has determined that it is in the best interests of the Company to immediately execute an additional operating cost reduction program. This program includes, among other things, an approximate 65% global headcount reduction by the end of the year and the closing of production in China. Going forward, the Company will be focusing its staffing and business development efforts on fuel cell stack design, development, production and testing based on the Company's proprietary eFlow™ technology. Business development efforts will include finding potential partners to support the existing install base and exploring options for its fuel cell modules and systems business.
The Company estimates that the implementation of the operating cost reduction program will extend the Company's cash runway to the end of the first quarter, 2024. This will allow the continuation of the strategic review process and outreach to potential counterparties and engagement with parties that previously expressed interest.
In addition, as part of the operating cost reduction program, the Company will be reducing product shipments through to the end of the year and accordingly may not meet prior year revenues.
About Loop Energy Inc.
Loop Energy™ is a leading designer and manufacturer of hydrogen fuel cell systems 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 cells, 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 OEMs and major vehicle sub-system suppliers to enable the production of hydrogen electric solutions with our global network and integration support. For more information about how Loop Energy is driving towards a zero-emissions future, visit www.loopenergy.com.
This press release contains forward-looking information within the meaning of applicable securities legislation, which reflect management's current expectations and projections regarding future events including statements regarding the Company's estimates regarding the anticipated reduction in operating costs resulting from implementation of its operating cost reduction program and resulting benefits, expectations regarding future results, performance, achievements and the markets in which we operate, the conversion of prospects into customers and the realization of other opportunities. Forward-looking information also includes our assessment of the ability of the Company's eFlow™ technology to maintain uniform operation over time, the impact of such technology on fuel cell durability and the achievement of cost reduction, profitability and revenue targets; our future growth prospects and business outlook including without limitation the expected demand for our products, the allocation of resources and funds, the expected timeline for profitability, the planned growth of our customer base and the expected growth of our operations globally. Forward-looking information is based on a number of assumptions (including without limitation assumptions with respect the current and future performance of the Company's products, growth in demand for the Company's products and the Company's ability to execute on its current strategy, 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, risks associated with, and uncertainty regarding, the realization of costs savings from implementation of the Company's operating cost reduction program and benefits derived therefrom, the realization of electrification of transportation and hydrogen adoption rates, the elimination of diesel fuel and ongoing government support of such hydrocarbon fuels, the expected growth in demand for fuel cells in the commercial transportation market, our ability to obtain future patent grants for our proprietary technology and the effectiveness of current and future patents in protecting our technology as well as the other risk factors discussed under "Risk Factors" in the Company's Annual Information Form dated March 28, 2023 and in its other disclosure documents. Loop Energy disclaims any obligation to update these forward-looking statements.
Loop Energy Investor Inquiries:
Natalie Arseneau | Tel: +1 604.222.3400 Ext. 418 | email@example.com
Loop Energy Media Inquiries:
Ethan Hugh | Tel: +1.604.222.3400 ext. 304 | firstname.lastname@example.org
SOURCE: Loop Energy Inc
View source version on accesswire.com:
NOTE: This content is not written by or endorsed by "WJW", its advertisers, or Nexstar Media Inc.