H2O INNOVATION INC.
TSX VENTURE : HEO

H2O INNOVATION INC.

December 17, 2009 07:59 ET

H2O Innovation: Professional Water Technologies Records Double-Digit Sales Growth, Increases International Reach

QUEBEC CITY, CANADA--(Marketwire - Dec. 17, 2009) - H2O Innovation Inc. (TSX VENTURE:HEO)(ALTERNEXT:MNEMO:ALHEO) ("H2O Innovation" or the "Company"), a complete water treatment solutions company providing custom designed systems along with water additives and specialty chemicals for membrane filtration systems, announces that its California business unit Professional Water Technologies ("PWT") has recorded double-digit sales growth for the eighth year in a row. This growth is the result of an increased presence in the Middle East and Mexico as well as the signing of several contracts with major municipalities, particularly in the Western United States, Florida, Israel, and Australia. The rapid integration of PWT's product line into the H2O Innovation customer base has also had a positive effect on PWT's sales.

PWT's sales for the 2009 calendar year are on track for a 19% growth over the 2008 calendar year with no significant increases in overhead or additional capital costs, maintaining PWT's high gross margins. Prior to PWT's acquisition by H2O Innovation on June 19, 2009, PWT's fiscal year ended December 31. As of the acquisition date, PWT's results have been consolidated into H2O Innovation's results.

"PWT's growth globally can be attributed to the unique technological advantages of our dendrimer-based antiscalant products," says Stephen Dunham, H2O Innovation's Vice-President, After-Market Sales and Maintenance Solutions and former President of PWT. "We are consistently winning new contracts in PWT's core markets as well as newer high-growth markets like the Middle East and Australia," concluded Stephen Dunham. PWT enjoyed significant interest in its product offerings during the International Desalination Association 2009 World Congress on Desalination and Water Reuse in Dubai last month. During the event, numerous large water treatment plants were identified as prospective customers for PWT's dendrimer technology.

PWT's dendrimers have sizable advantages compared to standard antiscalants. Most notably, PWT's dendrimers are super-concentrated instead of diluted, what makes them 90% smaller and lighter to ship - a significant advantage in international markets. "Any time you can reduce the customers' chemical handling requirements from forty containers per year to only four, you're creating major economic and logistics advantages for them," according to David Russell, PWT's Sales Director. In addition to the advantages of reducing freight and drum disposal, PWT's dendrimer line is also phosphate-free, making it more desirable in environmentally conscious markets.

Prospective disclosures

This press release may contain prospective disclosures representing current expectations of H2O Innovation which are subject to certain risks and uncertainties. For details of these risks and uncertainties, please refer to the Company's Annual Information Form dated September 28, 2009 available on SEDAR (www.sedar.com). H2O Innovation rejects any obligation to revise or update the prospective disclosures contained in this press release.

About H2O Innovation

Exclusively dedicated to water treatment, H2O Innovation is establishing itself as a key player in sustainable development and the field of clean technologies. H2O Innovation designs, develops, produces, and integrates state-of-the-art custom-built water treatment systems for the production of drinking water, the reclamation of water, the treatment of wastewater and industrial process water in the municipal, commercial, industrial, mining, and energy markets. Additionally, the Company offers complete operating and maintenance solutions for membrane filtration and reverse osmosis systems. H2O Innovation has approximately 100 employees and eight offices including three manufacturing and assembly plants in Canada and the United States. Shares of H2O Innovation are listed on the TSX Venture Exchange (HEO) as well as on the NYSE Euronext Alternext Exchange (MNEMO: ALHEO). For more information about H2O Innovation, visit the Company's website at www.h2oinnovation.com

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) nor the Alternext Exchange accepts responsibility for the adequacy or accuracy of this release.

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