Burnaby’s Loop Energy, a designer and manufacturer of hydrogen fuel cell solutions, is laying off a majority of its staff.
“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 of directors has determined that it is in the best interests of the company to immediately execute an additional operating cost reduction program,” a statement issued by the company reads.
Loop Energy, announced a staggering “65 per cent global headcount reduction by the end of the year and the closing of production in China,” which equates to about 70 employees based on recent figures.
The company has lost 98% of its value since first trading on the Toronto Stock Exchange in 2021, with shares down from an initial public offering price of $16 to less than one dollar per share today.
Loop cited a “tightening of capital markets” as negatively impacting the firm’s ability to raise funds, while “overall inflationary pressure” has delayed key projects.
Moving forward, Credit Suisse will help Loop navigate potential “strategic alternatives” such as licensing opportunities or joint developments.
Loop Energy posted a $15 million loss in the first six months of 2023. With a leaned-out workforce, the company says it can stay afloat through 2024 as its seeks out alternative fundraising options.