Mr. Peter Pascali reports

PYROGENESIS ANNOUNCES 2023 SECOND QUARTER RESULTS

PyroGenesis Canada Inc. has released its financial and operational results for the second quarter ended June 30, 2023.

"Despite a relatively flat quarter and the continued fluctuations in our quarterly revenues that we had previously acknowledged as possible, we remain confident in our long-term strategy. The opportunities for the company across the large-scale industrial technology and industrial decarbonization landscapes are significant," said P. Peter Pascali, chief executive officer and president of PyroGenesis. "The barriers to entry for gaining a foothold in these markets has always been high, from both a technology and resource perspective -- particularly in the energy transition segments, where fundamental structural change to long-established underlying energy and fuel systems are conducted with measured and exacting processes, and where delays are common. We firmly believe that this is where our close to 30 years of R&D, and our long-standing industry relationships, provide a long-term advantage, as we persist in step with these trends which have been exacerbated by the uncertain economic environment that continues to create volatility in the capital markets."

"Against much larger competitors, and by using our globally recognized expertise in ultrahigh temperature processes such as plasma, along with robust client relationship building, we continue to experience successes that have enabled us to push past the barriers to entry in several of our strategic business lines," continued Mr. Pascali. "Commercialization results in titanium metal powders, and the opening of new markets for higher power plasma torches (such as the contract which we recently announced with a defense and aeronautics contractor for a next tier 4.5 MW plasma torch), underscores that the strategy to maintain our focus on developing technologies and solutions that we believe are certain to take hold with leading global industrial companies during a period of major paradigm shift -- namely in energy transition and emissions reduction, commodity security and optimization, and waste remediation -- is key to securing PyroGenesis's future.

"Despite the quarterly ups and downs, our commitment to supporting heavy industry with customer-ready, low-carbon footprint technology solutions, remains steadfast," Mr. Pascali added. "Our backlog of signed and/or awarded contracts remains strong, at $33.9-million. Our 37-per-cent gross margin is fully in line with the industrial machinery and components industry and well ahead of the gross margins for the industries we serve, such as aluminum, iron and steel, and even aerospace and defence. We look forward to the remainder of 2023 as our business strategy continues to gain traction."

The information herein represents important highlights from the past quarter, followed by an outline of the company's strategy and outlook for the next quarter.

Q2 production highlights

In Q2 2023, PyroGenesis continued its focus on advancing its updated business strategy that was first outlined in the company's 2022 fourth quarter and year-end results.

As noted, as the variety of uses for the company's core technologies has expanded, and industry interest has increased, the company is concentrating its solution ecosystem under three verticals that align with economic drivers that are key to global heavy industry.

1. Energy transition and emission reduction:

• Fuel switching, utilizing the company's electric-powered plasma torches and biogas upgrading technology to help heavy industry reduce fossil fuel use and greenhouse gas emissions.

2. Commodity security and optimization:

• Recovery of viable metals and optimization of production to increase output to maximize raw materials and improve availability of critical minerals.

3. Waste remediation:

• Safe destruction of hazardous materials, and the recovery and valorization of underlying substances such as chemicals and minerals. Within each vertical the company offers several solutions at different stages to commercialization.

Outlook

Consistent with the company's past practice, and in view of the early stage of market adoption of the company's core lines of business, the company is not providing specific revenue or net income (loss) guidance for 2023. However, various events have occurred that allow for a partial window into the remainder of 2023.

Overall strategy

PyroGenesis provides technology solutions to heavy industry that leverage off of the company's proprietary position and expertise in ultrahigh temperature processes. The company has evolved from its early roots of being a specialty engineering firm to being a provider of a robust technology ecosystem for heavy industry that helps address key strategic goals.

The company believes its strategy to be timely, as multiple heavy industries are committing to major carbon and waste reduction targets at the same time as many governments are increasingly funding environmental technologies and infrastructure projects -- all while both are making efforts to ensure the availability of critical minerals during the coming decades of increased output demand.

While there can be no guarantee, the company believes this evolution of its strategy beyond a greenhouse gas emission reduction emphasis, to an expanded focus that encapsulates the key verticals listed above, both improves the company's chances for success while also providing a clearer picture of how the company's wide array of offerings work in tandem to support heavy industry goals.

PyroGenesis's market opportunity remains large, as major industries such as aluminum, steelmaking, manufacturing, defence, aeronautics and government require factory-ready, technology-based solutions to help steer through the paradoxical landscape of increasing demand and tightening regulations and material availability.

As more of the company's offerings reach full commercialization, PyroGenesis will remain focused on attracting influential customers in broad markets, and ensuring that operating expenses are controlled to achieve profitable growth.

For the remainder of 2023, the company will continue to sharpen its focus on its strategy that structures its solution ecosystem under the three verticals noted previously: energy transition and emission reduction; commodity security and optimization; and waste remediation.

Some key developments to that end, include those mentioned herein.

Enhanced sales and marketing

Against the backdrop of this strategy, the company has been increasing sales, marketing, and R&D efforts in line -- and in some cases ahead of -- the growth curve for industrial change related to greenhouse gas reduction efforts.

In May, during the company's annual general meeting (AGM), the company released a new corporate presentation that provides a significantly better representation of the company, its technology offerings and alignment to customer needs.

The company intends to develop additional visual material throughout 2023.

Comprehensive loss

The comprehensive loss for Q2 2023 of $6.3-million compared with a loss of $13.0-million in Q2 2022, represents a variation of $6.7-million.

About PyroGenesis Canada Inc.

PyroGenesis, a high-technology company, is a proud leader in the design, development, manufacture and commercialization of advanced plasma processes and sustainable solutions which reduce greenhouse gases and are economically attractive alternatives to conventional dirty processes. PyroGenesis has created proprietary, patented and advanced plasma technologies that are being vetted and adopted by multiple multibillion-dollar industry leaders in four massive markets: iron ore pelletization, aluminum, waste management and additive manufacturing. With a team of experienced engineers, scientists and technicians working out of its Montreal office, and its 3,800-square-metre and 2,940-square-metre manufacturing facilities, PyroGenesis maintains its competitive advantage by remaining at the forefront of technology development and commercialization. The operations are ISO 9001:2015 and AS9100D certified, having been ISO certified since 1997.

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