Mr. Richard Perron reports

5N PLUS REPORTS 2023 FIRST QUARTER FINANCIAL RESULTS

5N Plus Inc. has released its financial results for the first quarter (Q1) of fiscal year (FY) 2023, which ended March 31, 2023. All amounts in this news release are expressed in U.S. dollars unless otherwise stated.

The company delivered solid first quarter financial results, generating 56-per-cent year-over-year consolidated adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) growth. This performance was supported by an increase in revenue and adjusted EBITDA under specialty semiconductors, resulting from sustained demand from the terrestrial renewable energy and solar space power markets. The company's first quarter performance was also supported by a 70-per-cent increase in adjusted EBITDA under performance materials, which now benefits from an improved product mix following the company's exit from the manufacturing of low-margin extractive and catalytic products in the second half of 2022.

Looking ahead, management remains very optimistic about the near-term outlook for the company and, in particular, for its specialty semiconductors segment. 5N Plus remains a partner of choice that works with the world's leading companies to support critical technology advancements, both on earth and in space.

Q1 2023 highlights and subsequent events:

• Revenue in Q1 2023 reached $55.3-million, compared with $64.4-million for the same period last year. The decrease is primarily attributable to the company's exit from the manufacturing of low-margin extractive and catalytic products in the second half of 2022.
• Adjusted EBITDA in Q1 2023 reached $8.8-million, compared with $5.6-million for the same period last year, an increase of 56 per cent, with specialty semiconductors increasing by 27 per cent to $7.2-million, supported by higher demand, and performance materials increasing by 70 per cent to $4.5-million, impacted by a more favourable product mix.
• Adjusted gross margin in Q1 2023 was 29.8 per cent, compared with 21.9 per cent in Q1 2022.
• On March 31, 2023, the backlog represented 306 days of annualized revenue, 53 days higher than the previous quarter and 110 days higher than the same period last year. The increase is attributable to favourable negotiations of long-term contracts.
• Net debt stood at $79.6-million on March 31, 2023, slightly higher than the $78.3-million at the end of fiscal 2022.
• On April 14, 2023, 5N Plus confirmed its role in the European Space Agency's mission to Jupiter and NASA's intention to employ AZUR's solar cells in its future mission to Jupiter.
• On April 26, 2023, the company announced its plans to increase AZUR's production capacity by 30 per cent over the course of 2023 and 2024, through productivity improvements, the installation of new equipment and the commissioning of co-investment equipment.

"Despite a complex global environment, 5N Plus continues to capitalize on its momentum as a partner of choice in high-growth and value-added end markets, as reflected in our solid adjusted EBITDA and margin performance, as well as our record backlog. We continue to secure long-term commercial partnerships and are increasing our production capacity to meet our extensive pipeline of contracted work under specialty semiconductors. At the same time, we are also seeing the positive margin impact of our improved product mix under performance materials. As such, we remain highly optimistic in our outlook in our target markets and confident in our ability to meet our financial objectives for FY 2023 and FY 2024," said Gervais Jacques, president and chief executive officer of 5N Plus.

Outlook

Management remains focused on building on its momentum to reap the full potential of its strategy by meeting customer demand in value-added markets and for products that offer high-growth potential and superior margins. The company continues to expect strong demand in its target markets, including terrestrial renewable energy and space solar power under specialty semiconductors and in the health and pharmaceutical sector under performance materials.

Management maintains its previously disclosed adjusted EBITDA guidance range of between $35-million and $40-million for FY 2023, with a higher contribution expected to be generated in the second half of the year, and a projected adjusted EBITDA range of between $45-million and $50-million for FY 2024.

Conference call

5N Plus will host a conference call on Thursday, May 4, 2023, at 8 a.m. Eastern Time, to discuss results of the first quarter for fiscal 2023. All interested parties are invited to participate in the live broadcast on the company's website.

To participate in the conference call

Toronto area:  416-764-8659

Toll-free:  1-888-664-6392

Enter access code:  77601730

A replay of the conference call will be available two hours after the event and until May 11, 2023. To access the recording, please dial 1-888-390-0541 and enter access code 601730.

2023 virtual-only annual meeting of shareholders

5N Plus will also hold its annual general meeting of shareholders on May 4, 2023, in virtual format only, at 10 a.m. EDT.

About 5N Plus Inc.

5N Plus is a leading global producer of specialty semiconductors and performance materials. The company's ultrapure materials often form the core element of its customers' products. These customers rely on 5N Plus's products to enable performance and sustainability in their own products. 5N Plus deploys a range of proprietary and proven technologies to develop and manufacture its products. The company's products enable various applications in several key industries, including renewable energy, security, space, pharmaceutical, medical imaging and industrial. Headquartered in Montreal, Que., 5N Plus operates research and development, manufacturing, and commercial centres in strategically located facilities around the world, including Europe, North America and Asia.

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