• Record quarterly revenue of US$1,749K representing 243% YOY increase

• Strong profitability with net income of US$696K and adjusted EBITDA1 of US$754K

• Continuing progress for new Santa Ana facility to increase manufacturing capacity

Los Angeles, California--(Newsfile Corp. - July 9, 2024) - California Nanotechnologies Corp. (TSXV: CNO) (OTC Pink: CANOF) ("Cal Nano" or the "Company") is pleased to announce record quarterly revenues of US$1,748,826 for the fiscal quarter ending May 31, 2024. This represents an increase of 243% compared to the same period last year.

Net income for the quarter was US$696,042, compared to US$35,467 in the same period last year, while adjusted EBITDA1 was US$754,465, compared to US$112,653 for the same period last year. Diluted earnings per share for the quarter increased to $0.01 compared to $0.00 for the quarter ended May 31, 2024.

Adjusted EBITDA1 showed significant improvements due to higher revenue generation from manufacturing services and Spark Plasma Sintering (SPS) equipment sales, which was partly offset by higher overhead costs to support larger operations. Net income saw improvements for the reasons above and benefited from a US$141,829 unrealized gain on share purchase warrants2, which was partly offset from higher depreciation and interest expenses related the Company's new Santa Ana manufacturing facility lease. The financial statements are available on SEDAR+ at  and on the Company's website.

"We continued our momentum this quarter as we work towards commissioning our new Santa Ana facility," stated CEO Eric Eyerman. "Our team has been working hard to set up the infrastructure to support the new SPS and cryomilling equipment while maintaining our growth trajectory with our existing Cerritos-based operations. The new capacity in Santa Ana is expected to allow us to process larger part sizes and higher material volumes, contributing to revenues in Q3/FY2025 and onwards."

Financial Highlights

The increase in revenue for Q1/FY2025 was attributed to the ramp-up of manufacturing programs and two SPS equipment deliveries to University of Connecticut and Embry-Riddle University, valued at approximately US$525,000. The green steel cleantech customer's program continues its execution and accounts for the majority of manufacturing revenues year-to-date. In addition, Cal Nano is in the pilot production stage with several customers in the aerospace, industrial, and automotive markets who have the potential to grow their manufacturing programs from pilot scale ones.

Gross margin increased year-over-year due to operational efficiencies but was lower compared to recent quarters due to a higher share of lower margin equipment sales during the quarter. Adjusted EBITDA1 and net income generation were strong in part to higher revenue generation, maintaining gross margins across manufacturing services, and contributions from gross margins on equipment sales. It is anticipated that profitability will fluctuate quarter-over-quarter as the Company continues to invest in advance of capacity expansion and business development.

Over the last 18 months, Cal Nano has committed approximately US$1.5 million of capital for the acquisition and installation of equipment to increase its service capacity. The equipment includes: two used cryomills, two SPS machines, a system enabling 3D material printing using SPS technology, and the supporting infrastructure. The Company expects in the near term that additional capital commitments will be incremental to satisfy targeted capacity requirements. The new equipment is not yet operational and contributing to the Company's operating results.

Subsequent to the quarter, the Company repaid a further US$50,000 of its borrowings from Omni-Lite Industries Canada Inc., continuing its debt reduction plan.