Mr. Rahim Suleman reports

NEO PERFORMANCE MATERIALS SHIPS FIRST MAGNET SAMPLES PRODUCED AT NEW EUROPEAN FACILITY TO ITS TIER 1 TRACTION MOTOR CUSTOMER

Neo Performance Materials Inc.'s new permanent magnet facility in Estonia has shipped sintered magnet samples for a Tier 1 traction motor customer meeting specific magnetic properties. This milestone marks a significant step forward in Neo's commitment to providing high performance materials for the electric vehicle market.

Key highlights:

• Neo has produced 18,000 assembled magnet pieces as part of the initial production samples.
• The magnets are EV traction motor grade and represent an important technical milestone.
• The magnet samples will be assembled into traction motors for performance testing by the Tier 1 customer and original equipment manufacturer. Production part approval process products are scheduled for the first half of 2026, with mass production to start later in that year.

With over 30 years of experience in rare earth magnetics, Neo has built a reliable global supply chain that enhances its ability to serve the automotive sector. This deep industry expertise is expected to position Neo to scale its new sintered magnet facility in Narva, Estonia, and support growing demand. The facility is strategically located near Neo's rare earth separation facility in Sillamae, Estonia, which is expected to allow for vertical integration of operations and efficient production processes in the future.

Neo's chief executive officer, Rahim Suleman, said: "We are excited to announce this major milestone at our European magnet facility. Delivering the first product from a new facility is a momentous occasion. We take pride in our team's dedication and hard work in winning the award, completing construction on time and on budget, and successfully transitioning the facility into operational mode. This was a global effort for Neo with our engineering and production teams in Estonia working hand in hand with our R&D and development teams in Singapore, Thailand and Europe. We also sincerely thank our customers for their unwavering support and partnership throughout this journey. Their collaboration has been instrumental in helping us achieve this milestone."

The facility is projected to have an initial production capacity of 2,000 metric tonnes annually, with plans to scale to 5,000 metric tonnes annually. This $75-million (U.S.) facility was supported by an up-to-18.7-million-euro grant from the European Union's Just Transition Fund and a $50-million (U.S.) credit facility from Export Development Canada, with construction to be completed in 2025. European Commission President Ursula von der Leyen recognized the facility as a significant advancement for Estonia and Europe at the groundbreaking in June, 2023. The facility represents one of Europe and the world's most strategic critical material projects in rare earth magnetics outside of Asia. The expansion will help Neo meet strong demand for high performance magnets in EVs and other applications.

About Neo Performance Materials Inc.

Neo manufactures the building blocks of many modern technologies that enhance efficiency and sustainability. Neo's advanced industrial materials -- magnetic powders, rare earth magnets, magnetic assemblies, specialty chemicals, metals and alloys -- are critical to the performance of many everyday products and emerging technologies. Neo's products fast-forward technologies for the net-zero transition. The business of Neo is organized along three segments: Magnequench, chemicals and oxides, and rare metals. Neo is headquartered in Toronto, Ont., Canada, with corporate offices in Greenwood Village, Colo., United States; Singapore; and Beijing, China. Neo has a global platform that includes manufacturing facilities in Canada, China, Estonia, Germany, Thailand and the United Kingdom, as well as a dedicated research and development centre in Singapore.

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