What is your confidence level in securing the necessary financing for the reduced equity component, and can you elaborate on the process?

The special committee is actively engaged with advisors and investors. While nothing is guaranteed until done, the project's attractive economics are generating interest. The goal is to have financing in place before Q1 CY27 to allow for construction to begin. “We're engaged with advisers and actively working in discussions. But as you can probably imagine, we can't promise anything until it's done. You never know until it's done, but that is a very primary focus.”

Does downscaling the initial facility impact the debt financing being sought in India, and if so, how?

Downscaling is viewed positively by debt lenders. It reduces the amount of debt needed, and existing LOIs and contracts for output are sufficient. The lower size was extremely well received by the debt lenders. “I would say to that, Gerry, that it is only viewed as a positive by the debt lenders. So obviously, the amount of debt needed for the project is lower.”

What percentage of the 45,000 kiloton capacity of the downsized plant is already contracted out?

Over 50% of the 45,000 kiloton facility's output is committed through signed LOIs and contracts. “But between the LOIs that we have signed and the contracts that we have signed and the commitments we have today, we are over a threshold of 50% of the facility sold?”

LOOP

Loop Industries (LOOP) Q2 FY27 earnings call: guidance and Q&A

Earnings call· Aug 2026 (Q2 FY27)· Materials· Oct 16, 2026

Source: earnings call transcript

Executive summary

Loop Industries Q2 FY27 — India Project Rescaling and Financing Efforts

Loop Industries is focused on securing financing for its India joint venture, having recently downscaled the first facility's capacity to reduce capital requirements and accelerate construction. The company is actively engaged in discussions with potential investors and an Indian bank for project debt, while maintaining tight cost controls. Management remains confident in its technology and long-term value creation potential.

Highlights

Capacity of the first India facility reduced from 70,000 kilotons to 45,000 kilotons per annum, significantly lowering capital cost and accelerating construction.
Cash operating expenses for the quarter reduced by $800,000 year-over-year to $1.6 million.
Positive discussions progressing with a major Indian bank for the project debt facility, with technical due diligence successfully completed.

Concerns

Total available liquidity of $1.9 million as of August 31, necessitating external financing for operations and project equity.
Need to secure Loop's equity contribution for the India joint venture, estimated to be in the range of $17 million to $18 million (after prior contributions).

Guidance & targets

Category	Target	Timeline	Confidence
India facility construction start	Q1 calendar of 2027 high materiality	Q1 · CY27	Medium
India facility construction completion	end of 2028 calendar year high materiality	Q4 · CY28	Medium
India facility construction and commissioning timeline	20 months medium materiality	20 months from start	High

Deals & partnerships

Ester Industries 50-50 joint venture for a PET resin and polyester fiber facility in India

Joint venture partner for the India commercialization project. Both partners are contributing equity and seeking project debt.

Major Indian bank Discussions for project debt facility for India JV

The bank is conducting a Technical Economic Viability (TEV) study, including a successful technology assessment at Loop's Montreal facility, to support the loan.

Capital programs

India facility (Phase 1) underway significantly lower than $165M-$170M

Spent to date: $3M-$5M (Loop's contribution)

Funding: Loop's equity contribution, Ester's equity contribution, project debt from Indian bank

Start: Q1 calendar of 2027

Benefit:45,000 kilotons per annum

The capacity of the first facility was reduced from 70,000 kilotons to 45,000 kilotons per annum to lower capital costs and accelerate the construction timeline. Toyo Engineering is finalizing new cost estimates.

Risks & headwinds

Securing financing for equity contribution Before Q1 CY27

Need to raise $17M-$18M for Loop's equity portion of India JV

Mitigation:Board formed a special committee to evaluate equity, debt, and non-dilutive financing alternatives; project rescaling reduces the required amount.

Low total available liquidity Ongoing

$1.9M as of August 31, 2026

Mitigation:Strong focus on cost control, reducing cash operating expenses; actively pursuing financing alternatives.

What to watch in Q3 FY27

Final cost estimate for India facility

before year-end calendar year

Current TBD

Target Specific cost estimate

Why it matters

The final cost estimate will determine the precise capital requirements and Loop's equity contribution for the India project.

So the Toyo Engineering Group that has been hired to complete the final cost estimate will be completing that in the coming weeks. So definitely before year-end, calendar year-end. Yes.

Find out whether LOOP delivers this. Inve re-checks your case every morning.

Q&A highlights

Can you provide an estimate for the revised total cost of the India project and the new equity contribution required from Loop?

The final cost estimate is being completed by Toyo Engineering in the coming weeks, but it will be significantly lower than the initial 70,000-ton plant. Loop's equity contribution is expected to be around 15% of the total project cost, which will be lower than the previous estimate of $25M-$30M.

“So the Toyo Engineering Group that has been hired to complete the final cost estimate will be completing that in the coming weeks. So we don't have the final number yet, but as soon as we do have the final number, we'll be able to share that.”

asked by Jon Hickman · answered by Spencer Hart

2 min read 6 chapters

Detailed narrative

India Project Rescaling and Accelerated Timeline

Loop Industries, in partnership with Ester Industries, has decided to reduce the capacity of the first facility in India from 70,000 kilotons to 45,000 kilotons per annum. This strategic adjustment is expected to significantly lower the capital cost and associated debt and equity financing needs.

The smaller facility is also projected to allow for a faster construction timeline, with an anticipated start in Q1 calendar 2027 and completion by the end of 2028, contingent on securing capital.

Financing Efforts and Special Committee

To address capital needs and secure funding for Loop's equity contribution to the India joint venture, the Board formed a special committee in September 2026. This committee is actively evaluating various financing alternatives, including equity, debt, and non-dilutive options. Management indicated that the required equity contribution for Loop's portion of the JV is estimated to be in the range of $17 million to $18 million, after accounting for prior contributions of $3 million to $5 million.

Debt Financing Progress in India

Discussions with a major Indian bank regarding the project debt facility are progressing positively. The bank has initiated its Technical Economic Viability (TEV) study, which includes technical due diligence. A team from India recently visited Loop's Montreal facility, successfully completing the technology assessment portion of the TEV study, which will support the debt lender's loan documentation.

The reduction in facility size was well-received by the debt lenders.

Technology and Economic Advantages

The smaller India facility is still expected to provide attractive economic returns due to Loop's low-temperature, no-pressure added technology. This technology produces virgin-quality PET resin and polyester fiber at very low operating costs. The location in India further enhances profitability by offering a low-cost environment and access to plentiful textile waste feedstock.

Cost Control and Liquidity

The company has maintained a strong focus on cost control, resulting in a year-over-year reduction of $800,000 in cash operating expenses, which totaled $1.6 million for the quarter. These savings were achieved through targeted reductions in personnel, insurance, and other operating expenses, as well as the waiver of cash compensation by outside directors. As of August 31, Loop reported total available liquidity of $1.9 million.

Future Expansion Plans

The current India facility is envisioned as the first of two on the same site. The second facility is planned to be substantially larger than the first, potentially reaching 125,000 tons, bringing the total site capacity to 170,000 tons. This expansion would follow a successful start-up of the initial facility, leveraging sufficient feedstock availability in the region.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.