GRA NanoXplore Inc

NanoXplore Inc. (“NanoXplore” or the “Company”) (TSX: GRA and OTCQX: NNXPF), a world-leading graphene company, announced today that it has acquired all of the issued and outstanding shares of Canuck Compounders Inc. (“Canuck”) for a total cash consideration of approximately $9.3 million subject to post-closing adjustments, which represents a multiple of approximately five times of the average EBITDA(1) of the last three years.

Canuck, a privately held plastic recycling compounder for the past 30 years, provides sustainable and engineered recycled plastic compounds for use in transportation, building and construction, agriculture and packaging markets. Canuck’s manufacturing facility, based in Cambridge, Ontario, has a production capacity of approximately 40 million pounds annually.

“I am very pleased with this acquisition and would like to welcome Canuck’s team to the NanoXplore family,” said Dr. Soroush Nazarpour, Chief Executive Officer of NanoXplore. “This acquisition is strategically aligned with our growth initiatives and significantly increases our graphene compounding capability, especially in recycled plastics and will enable us to form strategic partnerships with end customers. In addition, Canuck has a strong relationship with recycled plastic suppliers that ensures a smooth and reliable supply of post-consumer and post-industrial recycled plastics. This transaction will enhance our technical expertise in recycled plastic compounds and bolster our top-line by approximately $20 million annually, without considering revenues derived from graphene inclusion.”

NanoXplore paid $7.3 million in cash at the closing of the transaction, while $1 million in cash will be paid in one year and another $1 million will be paid in two years. Following the transaction, William Dickinson, CEO and founder of Canuck, will continue in a role as General Manager, alongside approximately 40 employees.

“We are delighted to join forces with NanoXplore, given the inherent technological and cultural fit between the two companies,” Mr. Dickinson said. “Graphene from NanoXplore is highly complementary with our recycled plastic compounds to create innovative solutions like enhanced masterbatch and mixtures, while both management teams are dedicated to delivering best-in-class products across a broad number of growth industries.”

As demonstrated by the Canuck acquisition, NanoXplore is seeking to expand its downstream, value-added product offering through enhanced masterbatch and compounds, Anode and Cathode pastes, battery materials for the Li-ion battery market, formulated thermoset resins, and admixtures for cement.

“This expansion of activities positions NanoXplore, not only as a world-leading graphene company, but also as a provider of graphene-enhanced, ready-to-use solutions,” Dr. Nazarpour added. “Such value-added formulations support the Company’s profitability in the long term and provides a competitive advantage over other graphene producers in the future. We anticipate that such expansion of activities will be carried out through a combination of acquisitions and partnerships.”

Financial Guidance

“For fiscal 2022 ending June 30, 2022, we expect annual revenues of about $85 million,” said Luc Veilleux, Chief Financial Officer of NanoXplore. “We anticipate that revenues in the second quarter will be in-line with the first quarter of fiscal 2022, followed by progressive growth in the third and fourth quarters due to the Canuck acquisition and improved outlook provided by customers. We also expect to achieve positive EBITDA(1) in the fourth quarter of 2022.”

About NanoXplore

NanoXplore is a graphene company, a manufacturer and supplier of high-volume graphene powder for use in industrial markets. The Company provides standard and custom graphene-enhanced plastic and composite products to various customers in transportation, packaging, electronics, and other industrial sectors. NanoXplore is headquartered in Montreal, Quebec with manufacturing facilities in Canada, the United States and Europe.

Forward-looking Statements

This press release contains forward-looking statements, including but not limited to statements related to expected future revenues and expected EBITDA. All forward-looking statements are based on our beliefs as well as assumptions based on information available at the time the assumption was made and on management’s experience and perception of historical trends, current conditions and expected future developments, as well as other factors deemed appropriate in the circumstances. No assurance can be given that these assumptions and expectations will prove to be correct. Forward-looking statements are not facts, but only predications and can generally be identified by the use of statements that include phrases such as “anticipate”, “believe”, “continue”, “could”, “estimate”, “foresee”, “grow”, “expect”, “plan”, “intend”, “forecast”, “future”, “guidance”, “may”, “predict”, “project”, “should”, “strategy”, “target”, “will” or similar expressions suggesting future outcomes .

Forward-looking information is not a guarantee of future performance and involves a number of risks and uncertainties. Such forward-looking information necessarily involves known and unknown risks and uncertainties, (including some of the factors discussed in the Company’s Annual Information Form and other public filings for its most recent financial year end which can be found at www.sedar.com) which may cause NanoXplore’s actual results to differ materially from any projections of future results expressed or implied by such forward-looking information. Any forward-looking information is made as of the date hereof and, except as required by law, NanoXplore does not undertake any obligation to publicly update or revise such information to reflect new information, subsequent or otherwise.

(1) Non-IFRS Measures

EBITDA means net earnings (loss) before interest expenses, income taxes, depreciation and amortization. We use EBITDA because we believe it is a meaningful measure of the operating performance of our ongoing business without the effects of certain expenses. The definition of this non-IFRS measure used by the Company may differ from that used by other companies.

For more information, please contact:

Soroush NazarpourPresident & CEONanoXplore Inc.info@NanoXplore.ca(514) 935-1377