Fast Growth for Water Treatment Technologies due to World-wide Water Shortage

Fast Growth for Water Treatment Technologies due to World-wide Water Shortage Clorox, Hendrx, ITT, and Siemens Identify Opportunities in Point of Use Systems and Waste Water Treatment Fei Wang, www.Water-Stocks.com January 2006 Water is a booming business. According to an English publication Global Water Intelligence, worldwide annual industry revenues are estimated at $420 billion, with the United States accounting for around $100 billion. This number is expected to grow as water becomes scarcer and markets begin to mature. Two of the fastest growing segments are: point of use/point of entry (POU/POE) systems and waste water treatment. How do companies involved in this arena see their future? In addition, over the past several years, the industry has undergone considerable consolidation and acquisition, a trend that is believed to continue. How will this impact the development of the water market? Water Shortage Of a population of roughly 6.1 billion, more than 1 billion lack access to potable water. This situation is expected to get much worse in the future. Countries and firms are actively looking for alternative solutions to address this problem. Point of use/point of entry systems and waste water recycling are two of the most popular solutions. Point of Use/ Point of Entry Systems: Figure 1: Quoted from www.epa.gov/ord Both POU and POE devices purify water coming from the distribution system to a home or facility. POU purifies water to a desired level at the tap to which it is connected, while POE is one single device which purifies all the water coming into the building. As water prices increase, people start to pay more attention to the quality of the water they are getting. Therefore, with more publicity and awareness on the issue, POU/POE, which is said to be a cheaper way to insure the quality of water than other alternatives (e.g. bottled water), starts to attract more and more attention from both industrial and residential users. Hendrx Corp (OTCBB: HDRX), a manufacturer of water purification technology, is addressing the water quality issue by providing highly purified drinking water for both residential and industrial markets. Hendrx CEO Robert De Costa said, "We at Hendrx believe strongly that POU systems will gain in significance providing pure drinking water for the future. The water / sewage infrastructure worldwide is in need of massive repair and there simply is not enough money to properly fix these systems. In the United States alone we're talking about hundreds of Billions of dollars and this estimate goes up dramatically every year. We're also learning that currently used water treatment methods like chlorination may not be as safe as we once thought. Any time you introduce an additive or cleanser to the water we drink, there's the possibility of short term and long term complications. Today's consumer is becoming increasingly health conscious and they know that proper hydration is a major factor in maintaining a health life style. For all of these reasons we think that micro-water systems, POU systems will play an ever increasing roll in the supply of personal drinking water. Hendrx is in a unique position since we are the leading manufacturer of Atmospheric Water Generators (AWGs). These devices collect pure water from the naturally occurring moisture in the atmosphere. Once you get an AWG, the only thing you need is the proper temperature, humidity and power to run the machine. Although atmospheric water devices will not work everywhere, we're very positive about the future of AWGs in many regions of the globe." Brita water filtration system is a POU product as well. According to the Clorox Company (NYSE: CLX), Brita