ENVIRONMENTAL CLEAN TECHNOLOGIES LIMITED. — Annual Report 2009

Aug 27, 2009

Environmental Clean Technologies Limited

ABN 28 009 120 405

PRELIMINARY FINAL ACCOUNTS FOR YEAR ENDED 30 JUNE 2009

Friday, August 28, 2009: Environmental Clean Technologies Limited (ASX:ESI) attaches the company’s Preliminary Financial Statements for the year ended 30 June 2009. These accounts demonstrate a reduction in operating costs, the positive impact of a successful capital raising and acquisition of the Coldry technology, resulting in a Balance Sheet improvement of $8.5million.

The Board and Management are confident of increased sales activity in financial year 2009/10 and provides an overview of the year’s performance:

Operating Performance

ECT has substantially reduced its core operating expenditure during the 2009 Financial Year, whilst reorganising the business to focus on delivering sales of Coldry production licenses into developing economies.

The commercialisation of Coldry has been substantially completed, with the company now anticipating that the Coldry process will deliver initial revenues, via the establishment of Regional Operating Companies with selected partners focusing on the penetration of defined local markets, by the end of the 2010 financial year.

Significant Changes and Key Events

In Financial Year 2009 ECT purchased all rights to the Coldry Intellectual Property, while also extending the term of the Matmor Participation agreement to enable focus to be maintained on the generation of sales revenues from Coldry.

Acquisition of Coldry Intellectual Property

On 29 June 2009, ECT completed the acquisition of all units in the Coldry Trust and shares in Maddingley Coldry via the payment of $1 million cash, 55 million shares and 110 million options. ECT now owns the Coldry IP and is ready to bring this world-class technology to full commercialisation.

This acquisition has resulted in a significant Balance Sheet improvement and the solidification of ECT’s future as the company moves forward in a much stronger position to progress on the many commercial opportunities in which it is engaged, and aligns the interests of all stakeholder parties and shareholders.

Arup, ECT’s global engineering and design partner, and MacDow, have undertaken prefeasibility design and +/-10% feasibility study for the roll-out of Coldry production plants, which have identified substantial construction and OpEx savings that have enabled sales engagement through greater financial certainty with key investment partners.

Matmor Intellectual Property

ECT has continued its research, development and testing of the Matmor process, which has demonstrated positive results. The company now anticipates a faster than anticipated path to commercialisation for this technology, with initial expectations being that the technology will reach the commercialisation stage by April 2010, following the conclusion of a gap analysis being prepared by Hatch and completion of an ensuing feasibility study for the construction of a 6000 t.p.a plant in Bacchus Marsh, Victoria.

Coldry Process

The world’s first economic method for dewatering brown coal, creating a high energy pellet with significantly reduced CO2 emissions compared to brown coal, while being suitable for export as a black coal substitute.

Matmor Process

A one-step method for producing low-carbon iron from inexpensive, abundant brown coals and metal bearing media such as mill scale, nickel tailings and low grade iron ore.

Level 1, 530 Little Collins Street � Melbourne � Victoria 3000 � Australia � +61(0)3 96840888 � www. ectltd.com.au

Accordingly, the company has acted to extend the terms of its Participation Agreement via the issue of 12,500,000 shares at 4.0 cents per share ($500,000), as it strongly believes that this technology will generate significant value for shareholders over the medium to long term, as well as representing an additional sales channel for Coldry pellets via the manufacture of the composite pellets required for the process

Share Purchase Plan & Shortfall Raising

The Share Purchase Plan and subsequent Shortfall raising was the most successful capital raising activity in ECT’s history and was completed on 10 June 2009, delivering a total of $3,487,805.26 out of a maximum that was targeted of $3,500,000.

This fundraising program has enabled the company to purchase the Coldry IP and to employ additional staff, and support resource, (including the imminent appointment of a Coldry Business Manager) that will allow the company to focus on pursuit of its global sales objectives and the establishment of profitable commercial operations.

Coordination Agreement with Thang Long Investment and Commercial Joint Stock Company (TinCom)

ECT has signed a Coordination Agreement with Thang Long Investment and Commercial Joint Stock Company (TinCom), which seals the deal on the establishment of a Special Purpose Vehicle (SPV) to invest funds into a feasibility study for the construction of Coldry plant licensed to produce up to 100 million tonnes per annum of Coldry over the next five decades.

The Future

This Preliminary Financial Statement confirms ECT is moving in a positive direction, ready to commercialise its flagship technology, Coldry, and successfully turn its global sales objectives into tangible results.

ECT has focused its reduced operational expenditure on the pursuit of sales growth in the near term and the Board and management believe that the Company is on track to deliver tangible results in the 2010 financial year, as ECT proceeds to realise its strategic plans from a solid financial base.

For further information contact;

Chief Executive Kos Galtos +61 3 9684 0888.

Page 2 of 2

www.ectltd.com.au

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited - ACN 009 120 405

(formally Environmental Solutions International Limited)

1	Details of the reporting period and the previous	corresponding period.
	Reporting Period	Financial Year ending	30 June 2009
	Previous Corresponding Period	Financial Year ending	30 June 2008
2	Results for announcement to the market
2.1	The amount and percentage change up or down from the previous corresponding period of revenue from
	ordinary activities.
	Revenue from ordinary activities	$	273,811
	Previous corresponding period	$	439,216
	Percentage change up or down from the previous corresponding
	period of revenue from ordinary activities	%	-37.66%
2.2	The amount and percentage change up or down from the previous corresponding period of profit (loss)
	from ordinary activities after tax attributable to	members.
	Loss from ordinary activities after tax	$	(478,932)
	Previous corresponding period	$	(3,473,180)
	Percentage change up or down from the previous corresponding
	period of loss from ordinary activities after tax
	attributable to members.	%	86.21%
2.3	The amount and percentage change up or down from the previous corresponding period of net profit
	(loss) for the period attributable to members.
	Profit (loss) attributable to members	$'000	(478,932)
	Previous corresponding period	$'000	(3,473,180)
	Percentage change up or down from the previous corresponding
	period of net loss for the period
	attributable to members.	%	86.21%

2.4 The amount per security and franked amount per security of final and interim dividends or a statement that it is not proposed to pay dividends.

No dividends proposed relating to the reporting period

Page 1 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

• 2.5 The record date for determining entitlements to the dividends (if any).

Not applicable

• 2.6 A brief explanation of any of the figures in 2.1 to 2.4 necessary to enable the figures to be understood.

Refer to separate media release lodged with this Appendix 4E.

Page 2 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

• 3 A consolidated income statement together with notes to the statement, prepared in compliance with AASB 101.

Income Statement For the year ended 30 June 2009

Notes Revenue from ordinary activities 2 Material and subcontractor expenses Matmor Extension Employee benefits expense Share Based Payments Depreciation and amortisation Occupancy expense Patent fees Corporate costs Consultancy fees Travel and accommodation Insurance expense Finance Costs Other expenses from ordinary activities Loss before Income Tax Expense 3 Income tax benefit 4 Loss attributable to members of Environmental Clean Technologies Limited	Consolidated 2009 2008 $ $ 273,811 439,216 (361,478) (925,740) (500,000) - (477,940) (144,689) - (422,000) (142,194) (211,061) (31,269) (145,197) (17,818) (12,149) (1,054,663) (397,269) (350,941) (825,664) (115,724) (80,659) (28,733) (49,017) (373,779) (344,402) (178,204) (354,549) (3,358,932) (3,473,180) 2,880,000 - (478,932) (3,473,180)	Consolidated 2009 2008 $ $ 273,811 439,216 (361,478) (925,740) (500,000) - (477,940) (144,689) - (422,000) (142,194) (211,061) (31,269) (145,197) (17,818) (12,149) (1,054,663) (397,269) (350,941) (825,664) (115,724) (80,659) (28,733) (49,017) (373,779) (344,402) (178,204) (354,549) (3,358,932) (3,473,180) 2,880,000 - (478,932) (3,473,180)
		(3,473,180) -
		(3,473,180)

The above consolidated income statement should be read in conjunction with the accompanying notes

Page 3 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

• 4 A consolidated balance sheet together with notes to the statement. The balance sheet may be condensed but must report as line items each significant class of asset, liability, and equity element with appropriate sub-totals.

Balance Sheet As at 30 June 2009 Notes Current Assets Cash and Cash Equivalents Assets 5 Trade and Other Receivables 6 Other 7 Total Current Assets Non Current Assets Property Plant & Equipment 8 Intangible Assets 9 Total Non Current Assets TOTAL ASSETS Current Liabilities Trade and Other Payables 10 Borrowings 11 Total Current Liabilities Non Current Liabilities Borrowings 11 Other 12 Total Non Current Liabilities TOTAL LIABILITIES NET ASSETS Equity Contributed Equity 13 Other reserves 14 Accumulated Losses 15 TOTAL EQUITY	Consolidated 2009 2008 $ $ 886,581 324,433 118,325 68,042 89,402 - 1,094,308 392,475 316,465 437,316 9,600,000 - 9,916,465 437,316 11,010,773 829,791 1,063,017 330,199 1,677,749 - 2,740,766 330,199 - 1,427,456 661,000 - 661,000 1,427,456 3,401,766 1,757,655 7,609,007 (927,864) 37,716,486 28,700,683 1,195,346 1,195,346 (31,302,825) (30,823,893)	Consolidated 2009 2008 $ $ 886,581 324,433 118,325 68,042 89,402 - 1,094,308 392,475 316,465 437,316 9,600,000 - 9,916,465 437,316 11,010,773 829,791 1,063,017 330,199 1,677,749 - 2,740,766 330,199 - 1,427,456 661,000 - 661,000 1,427,456 3,401,766 1,757,655 7,609,007 (927,864) 37,716,486 28,700,683 1,195,346 1,195,346 (31,302,825) (30,823,893)
		392,475
		437,316 -
		437,316
		829,791
		330,199 -
		330,199
		1,427,456 -
		1,427,456
		1,757,655
		(927,864)
		28,700,683 1,195,346 (30,823,893)
	7,609,007	(927,864)

The above consolidated balance sheet should be read in conjunction with the accompanying notes

Page 4 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

• 5 a) A statement of changes in equity together with notes to the statement. The statement of changes in equity may be condensed but must comply with the disclosure requirements of AASB 101

Statement of Changes in Equity For the year ended 30 June 2009 Notes Total equity at the beginning of the financial year Cost of Share Based Payments Issue of shares by the Group Net income and expenses recognised directly in equity Loss for the financial year Total recognised income and expenses for the year Total equity at the end of the financial year	Consolidated 2009 2008 $ $ (927,864) (2,159,564) - 422,000 9,015,803 4,282,880 9,015,803 4,704,880 (478,932) (3,473,180) (478,932) (3,473,180) 7,609,007 (927,864)	Consolidated 2009 2008 $ $ (927,864) (2,159,564) - 422,000 9,015,803 4,282,880 9,015,803 4,704,880 (478,932) (3,473,180) (478,932) (3,473,180) 7,609,007 (927,864)
		422,000 4,282,880
		4,704,880
		(3,473,180)
		(3,473,180)
		(927,864)

The above statement of changes in equity should be read in conjunction with the accompanying notes

Page 5 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

• 5 A cash flow statement together with notes to the statement. The cash flow statement may be condensed but must report as line items each significant form of cash flow and comply with the disclosure requirements of AASB 107 Cash Flow Statements, or for foreign entities, the equivalent foreign accounting standard.

Cash Flow Statement

For the year ended 30 June 2009

Notes Cash flows from operating activities Receipts from customers (inclusive of GST) Grants received Payments to suppliers and employees (inclusive of GST) Interest Paid Interest received 2 Net cash outflow from operating activities 16 Cash flows from investing activities Repayment of Borrowings Payments for property plant and equipment Net cash outflow from investing activities Cash flows from financing activities Proceeds from the issuing of shares Net cash inflow from financing activities Net increase (decrease) in cash held Cash at the beginning of the financial year Cash at the end of the financial year 5	Consolidated 2009 2008 $ $ 197,291 10,953 - 25,000 (3,111,129) (3,598,338) (137,553) - 41,186 13,054 (3,010,205) (3,549,331) - (450,000) (35,320) (3,885) (35,320) (453,885) 3,607,673 4,282,880 3,607,673 4,282,880 562,148 279,664 324,433 44,769 886,581 324,433	Consolidated 2009 2008 $ $ 197,291 10,953 - 25,000 (3,111,129) (3,598,338) (137,553) - 41,186 13,054 (3,010,205) (3,549,331) - (450,000) (35,320) (3,885) (35,320) (453,885) 3,607,673 4,282,880 3,607,673 4,282,880 562,148 279,664 324,433 44,769 886,581 324,433
		(3,549,331)
		(450,000) (3,885)
		(453,885)
		4,282,880
		4,282,880
		279,664 44,769
		324,433

The above statements of cash flows should be read in conjunction with the accompanying notes

Page 6 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

Notes to Sections 3, 4 & 5.

1. Summary of Accounting Policies

Statement of compliance

The preliminary final report has been prepared in accordance with ASX Listing Rule 4.3A, the disclosure requirements of ASX Appendix 4E, the Corporations Act 2001, Accounting Standards and Australian Accounting Interpretations and complies with other requirements of the law. Accounting Standards include Australian equivalents to International Financial Reporting Standards (A-IFRS). Compliance with A-IFRS ensures that the consolidated financial statements and notes of the consolidated entity comply with International Financial Reporting Standards (IFRS).

The preliminary final report does not include notes of the type normally included in an annual report and should be read in conjunction with the 30 June 2008 Annual Financial Report.

Basis of Preparation

The preliminary final report is to be read in conjunction with the 2008 annual report, the December 2008 half-year report and any public announcements made by Environmental Clean Technologies Limited and its controlled entities during the year in accordance with the continuous disclosure obligation arising under the ASX Listing Rules.

The preliminary final report has been prepared on the basis of historical cost. Cost is based on the fair values of the consideration given in exchange for assets. All amounts are presented in Australian dollars, unless otherwise noted.

The accounting policies and methods of computation adopted in the preparation of the preliminary final report are consistent with those adopted and disclosed in the company’s 2008 Annual Financial Report for the year ended 30 June 2008, other than as detailed below.

2. Revenue

Notes Revenue Grants received Miscellaneous income Rental revenue from subleases Other revenue Interest received Other	Consolidated 2009 2008 $ $ - 25,000 - 588 - 30,482 - 56,070 41,186 13,054 232,625 370,092 273,811 383,146 273,811 439,216	Consolidated 2009 2008 $ $ - 25,000 - 588 - 30,482 - 56,070 41,186 13,054 232,625 370,092 273,811 383,146 273,811 439,216
		56,070
		13,054 370,092
		383,146
		439,216

3. Operating loss

Net losses and expenses Loss before income tax includes the following specific expenses: Depreciation Plant and equipment Borrowing costs Interest and finance charges paid/payable Rental expense relating to operating leases Minimum lease payments	Consolidated 2009 2008 $ $ (142,194) (211,061) (373,779) (348,796) (31,269) (145,197)	Consolidated 2009 2008 $ $ (142,194) (211,061) (373,779) (348,796) (31,269) (145,197)
		(348,796)
		(145,197)

Page 7 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

Notes to Sections 3, 4 & 5.

4. Income tax

Numerical reconciliation of income tax expense to prima facie tax payable Operating loss before income tax expense Tax at the Australian tax rate of 30% (2007: 30%) Tax effect of amounts which are not deductible (taxable) in calculating taxable income Tax benefit not recognised Tax benefit as a result of an offset against the deferred tax liability booked on acquistion of the I.P Income tax expense/(benefit) Current assets - Cash assets Cash at bank and on hand Current assets - Trade and other receivables Trade debtors Allowance for doubtful debts Prepayments Goods and services tax (GST) recoverable	Consolidated 2009 2008 $ $ (3,358,932) (3,473,180) (1,007,680) (1,041,954) - 1,041,954 (1,872,320) - (2,880,000) - Consolidated 2009 2008 $ $ 886,581 324,433 Consolidated 2009 2008 $ $ 1,500 37,079 - (37,079) 41,193 27,545 75,632 40,497 118,325 68,042	Consolidated 2009 2008 $ $ (3,358,932) (3,473,180) (1,007,680) (1,041,954) - 1,041,954 (1,872,320) - (2,880,000) - Consolidated 2009 2008 $ $ 886,581 324,433 Consolidated 2009 2008 $ $ 1,500 37,079 - (37,079) 41,193 27,545 75,632 40,497 118,325 68,042
		68,042

5. Current assets - Cash assets

6. Current assets - Trade and other receivables

Page 8 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

Notes to Sections 3, 4 & 5.

7. Current assets - Other

Deposits paid Other Debtors Loan - Kos Galtos

Consolidated
2009	2008
$	$
18,489		-
43,163		-
27,750		-
89,402		-

8. Non-current assets

Property, Plant & Equipment Plant and equipment At cost Less: Accumulated depreciation

9. Intangible Assets

Patents/Intellectual Property

10. Current liabilities - Payables

Trade payables Other payables Matmor Extension

Consolidated
2009	2008
$	$
669,721	655,764
(353,256)	(218,448)
316,465	437,316
Consolidated
2009	2008
$	$
9,600,000
9,600,000	-
Consolidated
2009	2008
$	$
353,838	99,308
209,179	230,891
500,000	-
1,063,017	330,199

Page 9 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

Notes to Sections 3, 4 & 5.

11. Borrowings

==> picture [395 x 149] intentionally omitted <==

----- Start of picture text -----

Consolidated
2009 2008
$ $
Unsecured
Convertible notes (classed as current liability from January 2009) 1,677,749 1,427,456
Non Current Liabilities
Consolidated
2009 2008
$ $
Earn Out Creditor 661,000
661,000 -
----- End of picture text -----

12. Non Current Liabilities

13. Contributed equity

Balance at the beginning of the year Issue of shares by the Group Transfer of fair value of options exercised from Options reserve Balance at the end of the financial year	Consolidated 2009 2008 $ $ 28,700,683 24,411,300 9,015,803 4,282,880 - 6,503 37,716,486 28,700,683	Consolidated 2009 2008 $ $ 28,700,683 24,411,300 9,015,803 4,282,880 - 6,503 37,716,486 28,700,683
		28,700,683

14. Other reserves

Share option reserve Balance at the beginning of the year Fair value of options issued during the year Transfer of fair value of options exercised to contributed equity Balance at the end of the financial year Convertible note equity reserve Balance at the beginning of the year Equity component of convertible notes issues Balance at the end of the financial year Total other reserves	Consolidated 2009 2008 $ $ 427,497 12,000 - 422,000 - (6,503) 427,497 427,497 767,849 767,849 - - 767,849 767,849 1,195,346 1,195,346	Consolidated 2009 2008 $ $ 427,497 12,000 - 422,000 - (6,503) 427,497 427,497 767,849 767,849 - - 767,849 767,849 1,195,346 1,195,346
		427,497
		767,849 -
		767,849
		1,195,346

Page 10 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

Notes to Sections 3, 4 & 5.

15. Accumulated losses

Accumulated losses
Accumulated losses at the beginning of the financial year Net loss attributable to members of the Group Accumulated losses at the end of the financial year	Consolidated 2009 2008 $ $ (30,823,893) (27,350,713) (478,932) (3,473,180) (31,302,825) (30,823,893)
		(30,823,893)

16. Reconciliation of operating loss after income tax to net cash inflow from operating activities

Operating loss after income tax Depreciation and amortisation Debt Forgiven Share Options Issued Doubtful Debt Provision Change in operating assets and liabilities (Increase)/Decrease in Trade debtors and receivables (Decrease)/Increase in Trade creditors and accruals Net cash outflow from operating activities	Consolidated 2009 2008 $ $ (478,932) (3,473,180) 142,194 211,061 - (351,527) - 414,473 - 37,079 (102,607) 22,339 3,449,550 (409,576) 3,010,205 (3,549,331)	Consolidated 2009 2008 $ $ (478,932) (3,473,180) 142,194 211,061 - (351,527) - 414,473 - 37,079 (102,607) 22,339 3,449,550 (409,576) 3,010,205 (3,549,331)
		(3,549,331)

Page 11 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

Notes to Sections 3, 4 & 5.

17. Segment reporting

The company operates within one business segment, being the research and development of dewatering and related technology, and in one geographic segment being Australia.

18. Contingent Asset

Environmental CleanTechnologies Limited is yet to lodge its 2007 and 2008 income tax returns and research and development tax concession schedules. The total claim (including the concession) is $979,996 and $906,517 respectively. The company has chosen to claim a refundable tax offset of $367,499 for 2007 and $339,944 for 2008 instead of a deduction.

The above amounts are subject to approval by the Australian Taxation Office.

19. Events Subsequent to Balance Date

There have been no significant events subsequent to Balance Date.

20. Business Combinations

(a) Summary of acquistion

On 29 June 2009 the parent entity acquired the units in the Coldry Trust and the shares in Maddingley Coldry Pty Ltd, the entities which own the Coldry intellectual property.

The acquired business contributed nil revenues and nil net profit to the Group for the period from 29 June 2009 to 30 June 2009.

Details of the fair value of the assets and liabilities acquired and goodwill are as follows:

Purchase consideration (refer to (b) below) Cash paid Earn Out Equity consideration Fair value of net identifiable assets acquired (refer to (c ) below) Goodwill	$ 1,000,000 661,000 5,059,000
	6,720,000
	6,720,000
	-

(b) Purchase consideration

Outflow of cash: Cash consideration Earn out Deferred Tax Liability Equity consideration (shares & options)	Consolidated 2009 2008 $ $ 1,000,000 - 661,000 2,880,000 5,059,000 - 9,600,000 -	Consolidated 2009 2008 $ $ 1,000,000 - 661,000 2,880,000 5,059,000 - 9,600,000 -
		-

( c) Assets and liabilites acquired

The assets and liabilities arising from the acquistion are as follows:

Intangible Assets: patents/intellectual property (Less) Deferred Tax Liablity Net identifiable assets acquired	Acquiree's carrying amount $ - -	Fair Value $ 9,600,000 (2,880,000)
		6,720,000

Page 12 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

• 6 Details of individual and total dividends or distributions and dividend or distribution payments. The details must include the date on which each dividend or distribution is payable and (if known) the amount per security of foreign sourced dividend or distribution.

No payments made

• 7 Details of any dividend or distribution reinvestment plans in operation and the last date for the receipt of an election notice for participation in any dividend or distribution reinvestment plan.

No plans approved

• 8 A statement of retained earnings showing movements.

See Statement of Changes in Equity

9 Net tangible assets per security with the comparative figure for the previous corresponding period.

Reporting Period Cents Previous Corresponding Period Cents	1.30
	(0.30)

• 10 Details of entities over which control has been gained or lost during the period.

10.1 Name of the entity.

Coldry Trust Maddingley Coldry Pty Ltd

10.2 The date of the gain or loss of control.

29 June 2009

10.3 Where material to an understanding of the report – the contribution of such entities to the reporting entity’s profit from ordinary activities during the period and the profit or loss of such entities during the whole of the previous corresponding period.

The acquired business contributed nil revenues and nil net profit to the Group for the period from 29 June 2009 to 30 June 2009.

Page 13 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

• 11 Details of associates and joint venture entities including the following.

• 11.1 Name of the associate or joint venture entity.

Not applicable

• 11.2 Details of the reporting entity’s percentage holding in each of these entities.

Not applicable

• 11.3 Where material to an understanding of the report - aggregate share of profits (losses) of these entities, details of contributions to net profit for each of these entities, and with comparative figures for each of these disclosures for the previous corresponding period.

Reporting Period $'000 Previous Corresponding Period $'000	N/A
	N/A

12 Any other significant information needed by an investor to make an informed assessment of the entity’s financial performance and financial position.

Refer to explanatory notes below

• 13 For foreign entities, which set of accounting standards is used in compiling the report (e.g. International Accounting Standards).

Not applicable

Page 14 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

• 14 A commentary on the results for the period. The commentary must be sufficient for the user to be able to compare the information presented with equivalent information for previous periods. The commentary must include any significant information needed by an investor to make an informed assessment of the entity’s activities and results, which would include but not be limited to discussion of the following.

14.1 The earnings per security and the nature of any dilution aspects.

	Consolidated	Consolidated
	2009	2008
	Cents	Cents
Basic earnings per share	(0.14)	(1.20)
Diluted earnings per share	N/a	N/a
Weighted average number of shares used as the denominator
Weighted average number of shares used as the denominator in	354,009,534	289,872,993
calculating basic earnings per share
Diluted Earnings per share
Weighted average number of shares used as the denominator in
calculating diluted earnings per share	(i)	(i)

(i) Not materially different to basic earnings per share

14.2 Returns to shareholders including distributions and buy backs.

None made

14.3 Significant features of operating performance.

Refer to section 2.6

14.4 The results of segments that are significant to an understanding of the business as a whole.

The consolidated entity operated solely within the research and development of dewatering and related technology industry in Australia during the year.

14.5 A discussion of trends in performance.

Refer to section 2.6

Page 15 of 16

Appendix 4E

Preliminary final report

Environmental Clean Technologies Limited

(formally Environmental Solutions International Limited)

• 14.6 Any other factors which have affected the results in the period or which are likely to affect results in the future, including those where the effect could not be quantified.

Refer to section 2.6

15 A statement as to whether the report is based on accounts which have been audited or subject to review, are in the process of being audited or reviewed, or have not yet been audited or reviewed

This report is based on accounts that are in the process of being audited

16 If the accounts have not yet been audited or subject to review and are likely to be subject to dispute or qualification, a description of the likely dispute or qualification.

No change anticipated from the results reported.

17 If the accounts have been audited or subject to review and are subject to dispute or qualification, a description of the dispute or qualification.

No dispute or qualification known at the date of lodgement of this report.

(Director)

Print Name

Date

Page 16 of 16