Dr. Sankar Das Gupta reports

ELECTROVAYA REPORTS Q2 FY2016 REVENUE UP 650% OVER Q2 FY2015

Electrovaya Inc. has released its second quarter financial results for the quarter ending March 31, 2016. All numbers are in U.S. dollars.

Financial highlights:

• Revenues -- second quarter 2016 revenue was $4.3-million ($5.6-million (Canadian)), a growth of 653 per cent over second quarter 2015 revenue of $600,000 ($800,000 (Canadian));
• Cash from operating activites -- in the second quarter of 2016, generated $1.8-million cash ($2.3-million (Canadian)) from operating activities, compared with negative $900,000 ($1.2-million (Canadian)) for second quarter 2015;
• Net working capital increases -- net working capital was $10.8-million ($14-million (Canadian)) at March 31, 2016, compared with negative $3.9-million ($5.1-million (Canadian)) at March 31, 2015;
• Cash balance -- March 31, 2016, cash balance was $4.3-million ($5.6-million (Canadian)), as compared with $700,000 ($900,000 (Canadian)) at March 31, 2015, and $3.3-million ($4.3-million (Canadian)) at Dec. 31, 2015.

Business highlights:

Announcements:

• The announcement of a $4.2-million ($5.4-million (Canadian)) contract for the supply of lithium-ion cells (40 ampere hours) for energy storage;
• Electrovaya has been showcasing its technologies at a number of industry events in Europe, North America and Asia.

Product development and investment in research and development (R&D):

The company continues to invest heavily in new product development, innovative chemistries and solutions for key vertical markets. This intense product innovation is being built upon the fundamental technology breakthroughs in Canada and Germany, and leading to a number of new applications in electromobility and energy storage industries.

Commenting on the results, Electrovaya's executive vice-president and chief financial officer, Richard Halka, stated: "We are pleased with the Q2 results. We are carefully managing our cash and working capital positions, while at the same time investing in business development and new product opportunities. We are building a scalable and sustainable growth model."

Dr. Sankar Das Gupta, chairman and chief executive officer, stated: "Electrovaya is committed to being at the forefront of the energy storage market with superior products and technologies. We have invested 42 per cent of sales in R&D to tailor those products to specific verticals and markets, and we will continue to develop new and innovative solutions leveraging our position of leadership in cost, safety and cycle life."

Conference call details:

The company will hold a conference call on Monday, May 16, 2016, at 8 a.m. ET to discuss the second quarter 2016 results for the period ended March 31, 2016, and to provide a business update.

Conference ID:  13637632

United States and Canada toll-free:  877-407-8291

International:  1-201-689-8345

To help ensure that the conference begins in a timely manner, please dial in 10 minutes prior to the start of the call.

For those unable to participate in the conference call, a replay will be available for two weeks beginning on May 16, 2016, through May 30, 2016. To access the replay, the U.S. dial-in number is 877-660-6853 and the non-U.S. dial-in number is 1-201-612-7415. The replay conference ID is 13637632.

Financial summary:

The company's complete second quarter 2016 financial statements and management's discussion and analysis are available on SEDAR and on the company's website.

            FINANCIAL HIGHLIGHTS FOR THE THREE MONTHS ENDED MARCH 31  
                        (in thousands of U.S. dollars)  
                                                                        
                                                     Q2 2016         Q2 2015

Revenue                                            $   4,317       $     573
Adjusted EBITDA(1)                                    (2,421)         (1,112)
Net earnings (loss) attributable to
common shareholders                                   (3,099)           (955)
Cash and cash equivalents -- March 31                  4,288             721

(1) Adjusted EBITDA (earnings before interest, taxes, depreciation and 
    amortization) does not have a standardized meaning under IFRS 
    (international financial reporting standards). Therefore, it is unlikely 
    to be comparable with similar measures presented by other issuers. The
    company defines adjusted EBITDA as gain from operations less stock-based 
    compensation expense, finance cost and amortization. The company 
    believes that certain investors and analysts use adjusted EBITDA to 
    measure the performance of the business.

We seek Safe Harbor.