Translation: Original published in Finnish on 4/15/2025 at 7:13 am EEST.

On Monday, Canatu announced that it has signed a one-year joint development agreement with automotive technology and component supplier DENSO (also a major shareholder of Canatu). The agreement aims to improve the electrical conductivity of carbon nanotubes and it builds on the Memorandum of Understanding announced by Canatu in December 2024.

In accordance with Canatu's disclosure policy, the agreement is "medium", i.e., with a revenue effect of 1-5 MEUR, and according to Canatu, the value of the agreement falls into the upper quartile of the range (>3.75 MEUR). Canatu expects the revenue to be recognized during the one-year term of the agreement between April 2025 and March 2026. Canatu believes that joint development work has significant potential for future commercialization opportunities in the longer term (e.g. solar cells), if the development work is successful. The announced agreement did not come as a complete surprise, as the company commented in the outlook section of its financial statement report that it expects its cooperation and future solar cell development work to progress, which would have a positive impact on automotive revenue this year.

The agreement partly supports our forecasts, which assume that Automotive Industry’s revenue will grow by 36% to 3.1 MEUR this year. However, the biggest variable in Canatu's 2025 revenue is the potential new reactor deals in the semiconductor sector and their timing. We have explained this in more detail in our update a few weeks ago. Our view on Canatu remains unchanged following yesterday's news.