ENVIRONMENTAL CLEAN TECHNOLOGIES LIMITED. — Earnings Release 2003

Feb 20, 2003

ENVIRONMENTAL SOLUTIONS INTERNATIONAL LTD

A.B.N. 28 009 120 405 21 Teddington Road, BURSWOOD WA 6100

ASX RELEASE

20 February 2003

A M E N D E D - please read well \$1.17 million instead of \$1.7 million

The Directors of Environmental Solutions International Ltd ("ESI") announced today that the Company incurred a trading loss of \$1.17 million during the half year ended 31 December 2002. The Company will not pay a half-yearly dividend to shareholders.

The primary reasons for the variance from last year's results include:

• The expenditure on marketing and commercialisation of ENERSLUDGE™.
• Delays in the award of the four water/wastewater contracts recently announced by FSL
• Increased tendering costs for larger local and overseas wastewater/water projects for which the Company has bid alone or in joint venture with others.

Whilst the sewage sludge market for the ENERSLUDGE™ technology is slower to emerge than most expected the global trend away from land based disposal routes continues. The Company is examining the application of its thermal processing knowhow for the treatment of other waste streams e.g. rubber tyres, plastics, organic fraction of municipal solid wastes, agri-wastes.

The half yearly result does not include contracts totalling some \$22M from tenders which the Company has been advised have been accepted. The revenue from these contracts will start to flow in the second half. The Company expects to break even in the second half but this position could improve if the Company wins its share of tenders which are outstanding, currently in excess of \$50 million. Past history would indicate that ESI should win a reasonable share of these tenders. If that occurs, next year should be a very good year for the water/wastewater division.

Whilst the loss is disappointing for the Board and Shareholders, the Directors are confident the increased attention being given to water recycling in Australia and to the supply of a better quality drinking water in S E Asian countries augers well for the Company's long-term future.

For further information contact Mr Denis Glennon, ESI Managing Director on Tel: 08-9470 4004 or by email: lornaf@environ.com.au.