Quarterly Update
Quarterly Update
Perth, Oct 31, 2018 AEST (ABN Newswire) - Nanollose Limited (ASX:NC6) ("Nanollose" or the "Company") is pleased to provide its Appendix 4C cash flow statement for the quarter ending 30 September 2018, together with the following operational update.


- Successful creation of test garment made from the Company's Nullarbor(TM) fibre

- Awarded Advanced R&D Findings from the Department of Industry, Innovation and Science

- Confirmed viability of additional wastes streams for the production of microbial cellulose

Successful creation of test garment made from Nullarbor(TM) fibre

The Company recently created a test garment using the latest 3D sweater-knit technology. This marks the first time a piece of clothing has been made using our Tree-Free rayon fibre, and is a drastic departure from clothing made from traditional rayon fibre that comes from environmentally challenging wood pulp processing. Our Nullarbor fibre performed extremely well and successfully withstood the industrial manufacturing process.

This milestone is a significant step in Nanollose's journey from converting its Nullarbor fibre into a piece of clothing, validating that the Company's technology could offer a commercially viable, eco-friendly manufacturing solution for the clothing industry who are urgently seeking alternatives to rayon and cotton fibres. Furthermore, throughout all steps the fibre, fabric and garment were produced using standard industrial equipment currently used by textile and clothing manufacturers.

Awarded Advanced R&D Findings from the Department of Industry, Innovation and Science

The Company was recently awarded favourable findings from the Department of Industry, Innovation and Science ("Innovation and Science Australia"), which will enable the Company to claim tax rebates on certain overseas research and development expenditure up to $1.419 million over the next three years. This represents potential tax rebates of $617,000 (at the current rate of 43.5%) over the next three years, subject to Nanollose undertaking these overseas R&D activities, and will be in addition to rebates claimed from the Company's Australian based R&D expenditure.

The certificates enable partial recovery of expenses for overseas R&D work that cannot be undertaken in Australia. These include refinement of Nanollose's fibre spinning technology, creation of additional fibre types and development of the Company's pilot plant, which is being established to optimise production and processing conditions for microbial cellulose.

Combined with tax rebates from the Company's R&D undertaken in Australia, these additional tax rebates on overseas expenditure will be an important source of non-dilutive funding for Nanollose.

Confirmed viability of additional wastes streams for the production of microbial cellulose

Nanollose has continued its R&D towards improving the growing and processing of microbial cellulose with a particular focus on scale-up methodology. Recent results have been positive with a number of wastes from the beer and sugar industries successfully used to produce microbial cellulose in good yields. Further work is ongoing into developing scalable processes to convert the raw microbial cellulose into a form and purity readily acceptable to the textile industry.

Nanollose signs a policy with Canopy

The Company has recently been recognised as a next generation solution provider by Canopy, a global leader in forest conservation. Canopy works to protect the world's forests, species and climate by collaborating with business leaders, scientists and decision-makers to help create sustainable supply chains and foster innovative solutions to environmental challenges.

Canopy works with over 750 of the forest industry's largest customers, from book publishers and printers to leading clothing brands and fashion designers, to help shape their purchasing practices and create permanent solutions for the world's threatened forests. Canopy's brand partners include H&M, Sprint, Penguin-Random House, Zara/Inditex, TC Transcontinental, Levi Strauss & Co., Stella McCartney, The Globe and Mail and Guardian Media Group.



The next 3-6 months will see Nanollose focus on the following objectives:

- Commence pilot scale production of microbial cellulose while continuing to develop improved processes to increase the throughput and reduce the cost of production.

- Select and develop commercial relationships with companies which align with Nanollose's commercialisation strategy.

- Convert our existing stockpile of 250kg of microbial cellulose into Nullarbor fibre to be offered up to brands to create limited edition offerings.

About Nanollose Ltd

Nanollose Limited (ASX:NC6) is an innovative Australian company that uses a low cost and eco-friendly fermentation process to grow fibres that could become a sustainable alternative to conventional plant-derived cellulose fibres. The Company’s process, which uses streams from various large-scale industries like sugar, wine and food, has the ability to produce ‘Plant-Free’ Cellulose. Cellulose is the hidden building block polymer most consumers know nothing about, but forms a huge part of items used in their everyday life such as clothing, paper and hygiene products.



Alfie Germano
CEO & Managing Director
Email: alfie.germano@nanollose.com
Phone: +61-411-244-477

Michael Wills
Media and Investor Relations
Email: michael.wills@nanollose.com
Phone: +61-468-385-208

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