Ann: AGM Presentation, page-29

Mickem

I hope the below answers your questions. Stage 1 of the wetlands project worth $6.5m is complete, but we get the cash with a long lag as is normal in China. (I assume it was billed last year so the revenue would be counted as in 2017-18.) Stage 2 is due to finish this month and the value was revised down from $8 million to $7 million and the timing delayed. The $1.5 m contract appears to be maintenance on the canal project.

Business Progress July: "Work was completed on the first of two wetland projects in Beijing, with a contract value of$6.5m. This project involved the movement of 55,000 tons of materials via rail and over 2,000truck movements to the project site. The second wetland project, with a value of $8m, isexpected to start in late August and be completed by October. This will involve the movementof over 70,000 tons of material."

Business Update Sept: "Work on a second wetland project in south Beijing has commenced.This project involves the movement of over 60,000 tons of materials viarail and over 2,000 truck movements to the site. As with the first wetlandproject, this is a huge logistical and project management exercise.This new wetland project has a value of ~ $7m and is expected to becompleted by November. "

Business Progress October: "The second $7m wetland is nearing completion in Beijing. This project involves the movementof 60,000 tonnes of materials to the site. The project is expected to be completed by lateNovember 2018.

Work continues on the South Beijing canals, with Phoslock, zeolites and bacterial productsbeing applied. A new $1.5m order was received during the quarter for additional product; thewater quality results continue to be outstanding.

The China team is currently tendering on several large projects in southern China. All willrequire the full range of products and services. More information on their scope will beannounced in due course."

I have been pushing Robert to provide orders outstanding in aggregate and the value of tenders. This would provide us with some actual data on progress year to date to compare with the forecasts, which is done by well over a dozen other companies.

The company is only prepared to provide its forecasts. The track record is not inspiring. They forecast revenue of  $18.5 m in July 2017 for 2017-18, revised up to $22m in Sept 2017 and then $21-23 m in Feb 2018. The outcome was $16.2 m, or less than the first forecast.

I am frustrated by this lack of clarity and I am now a seller. If the company is not prepared to tell us actual orders and tenders, but only its own forecasts, this is simply too uncertain for me to continue to have a large holding. Others may take a different view and be prepared to trust the company forecasts (despite the track record). We already know from the AGM that two thirds of the forecast revenue is now predicted to be in the second half of the year and (in answer to a question) is not all locked in. Thus whether we reach the forecast revenue of $27-30m for this year must be classed as uncertain.