Eco Investor Update

A Weekly News Update for Environmental Investors

5 March 2012 - No 70

____ Core Securities ____

ASX 100

DUET Group
AMP has reduced its holding in DUET Group from 12.8 to 11.8 per cent. AMP co-manages DUET with Macquarie. (ASX: DUE)

Sims Metal Management
Further to its acquisition of 16 per cent of the shares of Chiho-Tiande Group Ltd (CTG) and the option to acquire another 2 per cent, Sims Metal Management has subscribed for a three-year HK$316 million convertible bond. This has a 4 per cent coupon and is convertible into 53 million CTG shares at a conversion price of HK$6 per share.

Sims was also issued three-year warrants for 13 million new CTG shares at an exercise price of HK$6 per warrant.

To support CTG's growth plans, founder chairman Ankong Fang and Delco Participation B.V. have also subscribed for a convertible bond on equivalent terms, so that CTG received in total HK$816 million from the issue of all convertible bonds.

Sims Metal Management and Nyrstar NV have completed the sale of Australian Refined Alloys' secondary lead producing facility in Sydney. The sale was first announced on 15 November 2011 but needed approval from the Australian Competition and Consumer Commission and the Foreign Investment Review Board to proceed.

ARA Sydney was sold to companies associated with Renewed Metal Technologies (RMT) for $80 million. SimsMM expects to achieve a profit on its 50 per cent share of around $32 million.

SimsMM and Nyrstar retain ARA's secondary lead producing facility in Melbourne, which produces about 17,200 tonnes per year and will continue to be operated as a 50/50 joint venture.

Sims director Makoto Sukagawa has acquired 3,000 shares at an average price of $14.99. (ASX: SGM)

ASX 200

GWA Group
The early closure of the Renewable Energy Bonus Scheme (REBS) by the Federal Government may affect GWA Group as its Dux and EcoSmart water heaters were eligible for the scheme.

Under the Renewable Energy Bonus Scheme—Solar Hot Water Rebate, the Government offered rebates of $1,000 to install a solar hot water system or $600 to install a heat pump hot water system.

GWA's Dux and EcoSmart branded solar water heaters and heat pumps qualified for the rebate. However GWA has not said how it expects closure of the scheme to affect sales.

The Government said it is continuing to support households to install climate-friendly hot water systems through the Small-scale Renewable Energy Scheme. Under this scheme, solar and heat pump hot water systems are assigned Small-scale Technology Certificates (STCs) and retailers usually offer an discount on systems in exchange for the STCs.

The Dux and EcoSmart products are eligible for STCs.

The REBS closed on 28 February without warning but was slated to close on 30 June. To be eligible for the REBS Solar Hot Water rebate, a system must have been installed, purchased or ordered and a deposit paid up to 28 February.

The Government said that since the introduction of rebates for climate friendly hot water systems in 2007, it has funded over 250,000 rebates in excess of $320 million and the scheme has played an important role helping households to reduce their emissions and cut their power bills. (ASX: GWA)

ASX 300

Tassal Group
Tassal Group director Allan McCallum has directly and indirectly acquired 12,874 shares at $1.24 per share. (ASX: TGR)

Tox Free Solutions
Tox Free Solutions said it received an overwhelmingly response to its share purchase plan with 1,485 applications totaling over $13.1 million.

The company scaled back acceptances by 50 per cent, resulting in the issue of 3,257,500 shares raising $6.5 million in working capital.

The plan was profitable for shareholders as the shares were issued at $2 and are now at a year high of $2.70.

Tox Free directors Richard Allen, Steve Gostlow and Douglas Wood participated in the share purchase plan. (ASX: TOX)

Emerging Companies

Gale Pacific
Gale Pacific reported a profit after tax of $4.1 million for the half year to 31 December 2011, a $0.5 million or 14 per cent increase on the previous corresponding half year.

Diluted earnings per share rose to 1.39 cents from 1.24 cents. The fully franked interim dividend is 1.2 cents per share, up from 1 cent for the December 2010 interim dividend.

Half year sales jumped 18 per cent to $55.1 million, mainly due to "significant growth in the Middle East, Japanese and South African markets and sales generated from the Australian businesses acquired in June 2011, Zone Hardware Pty Ltd and Riva Window Fashions Pty Ltd".

"Sales in the USA were ahead of last half year but other areas of our business generally have suffered from subdued consumer demand and poor weather conditions in Australia and New Zealand," said managing director and chief executive, Peter McDonald.

In terms of outlook, "Subdued consumer spending and cool and wet weather conditions in New South Wales and Queensland will negatively impact the second half performance of the Australian business unit. Sales of Zone and Riva branded products will provide a year on year sales boost. The Company is cautious about any recovery of the USA economy and any increase in the level of consumer spending for retail shade products. The outlook for increased sales in the Middle East and international markets remains strong," he said

"Further positive cash generation is expected in the second half as we reduce inventory levels in the business. This will further reduce net debt and result in lower interest costs.

"In what will be a difficult global market environment, Gale expects sales growth for the full year will be approximately 15 per cent ahead of last year and to deliver positive earnings growth over the prior year.

"Gale continues to generate strong positive cash flows and operates a solid balance sheet with the capacity to support further growth opportunities which it continues to explore," said Mr McDonald.

Gale Pacific's shares continue to trade around their three year high of 27 cents. (ASX: GAP)

Interest Rate Securities

Transpacific SPS Trust
Transpacific SPS Trust's securities reached a new three year high of $84.90 on 1 March.

The net tangible asset backing per unit is $101, up from $99 in June 2011.

The Trust will pay a distribution for the six month period ending 31 March 2012 of $3.69. (ASX: TPA)

____ Satellite Securities____

ASX 200

Energy World Corporation
Energy World Corporation made a net profit after tax for the December half year of US$5.47 million. The December 2010 half profit was US$21.57 million.

The foreign exchange gain for the half year was US$1.4 million compared to US$14.3 million in 2010.

Sales revenue was US$55.8 million, up from US$51.6 million.

Energy World is developing new power generation capacity fueled by LNG and natural gas to meet Asia's growing demand for efficient and clean power.

"We are considering possibilities of developing further power plants, which include renewable power generation as well as further developing highly efficient gas-fueled power plants consistent with our existing power operations, either on a standalone basis or in conjunction with the development of an LNG facility." said the company.

Energy World lists the development of wind farm and hydro-electric power plants among its principal activities. (ASX: EWC)

Qube Logistics
Shares in Qube Logistics jumped to a nine month high of $1.695 on 28 February. Less than two weeks earlier they were around $1.40. (ASX: QUB)

Transpacific Industries Group
Transpacific Industries is cautious about re-instating a dividend in the near future, according to a report in the Financial Review that quotes the company's chief financial officer, Stewart Cummins.

"The dividend won't appear in the current financial year and we will be very cautious in the 21 months after that," he is quoted as saying. "What we think is more valuable to shareholders is to improve profitability, our capital efficiency and return on capital."

UBS AG has become a substantial shareholder in Transpacific Industries with 6.4 per cent.

Transpacific director Emma Stein has indirectly acquired 30,300 shares at 81 cents each. (ASX: TPI)

ASX 300

Infigen Energy
Infigen Energy reported a statutory loss for the December 2011 half year of $35.2 million, similar to the $34.4 million loss in the prior corresponding period. Group revenue was $125.7 million, down 1 per cent or $0.8 million.

Infigen said its performance was affected by lower production due to unfavourable wind conditions in the US and Australia, and increased costs from wind farms transitioning off warranty.

These offset contributions from the addition of new capacity at Woodlawn in NSW and an improvement in wholesale electricity prices and Large-scale Generation Certificate (LGC) prices.

Net operating cash flow improved substantially to $25.9 million from $6.9 million in the prior corresponding period and contributed to the significant reduction in borrowings during the period.

Infigen's managing director, Miles George, said that notwithstanding lower first half production, Infigen expects to meet its full year revenue guidance based on second half production and price expectations.

"Consistent with long-term seasonal variation, second half production is expected to increase in the US and to decrease in Australia, with full year production in Australia now expected to be approximately 5 per cent lower than original lower guidance.

"The majority of Infigen's production in the US and Australia is contracted through the 2012 financial year and beyond at average prices above current market prices. The balance of
production is subject to prevailing wholesale electricity and LGC prices. Based on spot and forward prices in these markets, the full year average portfolio price in each country should be similar to that realized in the first half.

"Infigen remains on track to repay $250 million of Global Facility borrowings across the 2011 and 2012 financial years," said Mr George. (ASX: IFN)

Emerging Companies

AFT Corporation
AFT Corporation reported a net profit after tax of $0.97 million for the full year to 31 December 2011. This was slightly down on the $1 million profit for the 2010 year.

Revenue was $17.2 million, up from $14.1 million. However, the company said that while the first half was very successful, the second half saw a slow down in sales due to the closure of the solar feed-in-tariff scheme in NSW and other states.

First half revenue was $13.3 million and first half profit was $0.8 million.

To expand its product range, the company has begun distributing LED lighting and sales are expected to grow in 2012. "While they will not completely replace the loss of revenue from solar panels, they play a significant part in the foundations of the company's revenue," it said.

AFT is looking for other energy saving products to build revenue. (ASX: AFT)

CBD Energy
CBD Energy reported a large consolidated loss for the December half year of $10.96 million.

The 2010 December half profit was $2.37 million.

CBD said the loss was primarily from three factors. The solar residential installation market, which represented 70 per cent of CBD's solar revenue in FY 2011, experienced a dramatic industry-wide downturn from unanticipated changes in state and federal government policies. CBD is accelerating the diversification of its business into other areas of renewable energy to reduce its reliance on home markets, which it says are highly susceptible to shifts in government policies.

Secondly, non-recurring charges totaled $8.7 million. These were unrealised loss on revaluation of RECS $1.4 million, realised loss on sale of RECS $3.4 million, impairment of transaction costs $2.5 million, currency exchange effect on valuation of foreign receivables $0.3 million, and unrecoverable patent defence costs $1.1 million.

Thirdly, the timing of recognition of revenue for services provided had a material impact. The international solar projects division of eco-Kinetics delivered services in Italy worth 7 million. "This fee is due to be received on upon settlement of conditions precedent and execution of the Sale and Purchase Agreement (SPA) by the vendors and purchasers of the solar projects... which is not scheduled until the end of March 2012."

Recognition of this fee is expected to occur in the second half of the 2012 financial year.

In terms of outlook, managing director Gerry McGowan said "CBD has made advances in establishing diversified paths for profitable growth in the renewable energy markets in Australia and overseas. It has a project pipeline in excess of 2,000 MW which will give the Company approximately five years of project flow.

"Company management expects a positive contribution from the investments made in its international solar, Australian wind and solar businesses will be reflected in a much improved result for the second half of the 2012 financial year and the full 2013 financial year." (ASX: CBD)

CMA Corporation
Recycling group CMA Corporation made a loss after tax of $18.2 million for the December 2011 half year. The 2010 interim loss was $125.9 million.

CMA said its adjusted earnings before interest, tax and depreciation (EBITDA) were $1 million, an improvement of $6.3 million compared to the adjusted loss of $5.3 million in the previous corresponding half.

The company said the turnaround reflects its comprehensive restructuring over the past year.

Revenue from continuing operations fell 32.6 percent to $132.6 million. No interim dividend was declared.

CMA plans to sell the Meretec business and US assets to Scholz and its associates, CMA's largest shareholder, for an indicative price of US$4 million. The funds will be used for working capital investments to boost trading and repay existing US debt.

CMA has entered into a non-binding conditional term sheet for the sale. The sale, which will be among resolutions to be put to an extraordinary general meeting around 27 April, will also involve a private placement of shares to Scholz and its associates under a $10 million debt-to-equity conversion at a price of 40 cents per share.

Shareholders will also be asked to approve the cancellation of 1.6 million shares held in a wholly owned subsidiary following a settlement reached with former managing director Doug Rowe.

John Pedersen, who took over as managing director in January, said that if approved, the proposals will help to reduce overheads, rationalize loss making activities and improve efficiency.

"Cost savings from the restructuring will amount to approximately $15 million in the current year and these are expected to continue," said Mr Pedersen. "This is in addition to the $4 million to $5 million we expect to save in annual interest costs as a result of the capital raised last August and the refinancing," he said. (ASX: CMV)

Environmental Group
The Environmental Group reported a net after tax loss for the December half of $362,678, an improvement of 54 per cent over the previous corresponding period.

Revenue rose 31 per cent to $16.9 million, and earnings (EBITDA) rose 198 per cent to $694,173, reversing a loss of $711,705 in the prior period.

"Robust earnings from the Company's air pollution control (APC) and mining services (Mine Assist) divisions were adversely impacted by the longstanding dispute between EGL's controlled entity, EGL Management Services Pty Limited (EGLMS), and South East Queensland regional water authority, Unitywater," said the company.

"At balance date the directors adopted a conservative view to the dispute with Unitywater, expensing all legal costs, fully providing for the performance bond and impairing all intangible assets associated with that division... Combined these initiatives incurred a charge to current period profits in excess of $1 million."

Chairman John Read said the Air Pollution Control & Mine Assist divisions were both profitable during the half year with higher sales and profitability than the previous corresponding period.

"EGL's Air Pollution Control division has the most comprehensive air pollution control offering in Australasia with both particulate and gas and vapour products housed in one specialist division," he said.

"EGL's focus to fiscal year end is threefold. First and foremost, to continue to improve the economic performance of its key APC and Mine Assist divisions. Both divisions have higher enquiry levels than in the corresponding period last year.

"Secondly, to continue its corporate program to crystalize shareholder value by either acquiring an additional value accretive business or realizing for value one or more of its existing businesses.

"Finally, to protect shareholder value and pursue its longstanding dispute with Unitywater," said Mr Read. (ASX: EGL)

Greencap said December half year revenues were up 13 per cent to $32.2 million, generating a net profit after tax of $1.6 million or 9.3 per cent lower than the same period last year.

"Outside of the resources, agribusiness and infrastructure sectors, the demand for risk management services has weakened and competition for the lower levels of work on offer has increased. This has placed pressure on margins in our large traditional markets which we have not been able to equally off-set through growth in the resources, agribusiness and infrastructure sectors during the first half," said the company.

Management has been diversifying the historically high proportion of revenue from property sector clients. While this is not fully reflected in the half year results projects, wins including work for Landmark (agribusiness), Spotless (government services) and the WA water utility (infrastructure) support a stronger performance expectation in the second half, it said.

Based on the first half results and full year expectations the company declared a fully franked dividend of one quarter of a cent (0.25 cents). (ASX: GCG)

Hydromet Corporation
Hydromet has raised $5.5 million of working capital through a $2.9 million placement and a $2.6 million share purchase plan.

Hydromet placed 76 million shares at 3.85 cents each to Sell and Parker Pty Ltd, which has become a substantial shareholder with 12.7 per cent.

Sell & Parker is a large privately owned scrap metal recycler established which was in 1966 and employs 190 staff at six collection yards around NSW.

It collects and processes ferrous and non-ferrous scrap, including secondary lead and lead acid batteries. The company is a major supplier of ferrous scrap to Bluescope and regularly export non-ferrous metals to China, India, Korea, Thailand, Japan, Indonesia, Malaysia, Pakistan, Bangladesh and the Netherlands.

Sell and Parker director Morgan Parker has joined the Hydromet board. Mr Parker has been with Sell & Parker since 2000 and before that spent 13 years in the investment banking industry.

The share purchase plan raised $2.6 million. Hydromet directors Timothy Allen and Stephen Kwan participated in the plan.

After steadily increasing its substantial shareholding, Simon Henry has seen its stake fall from 18.2 to 14 per cent due to dilution from the placement and share purchase plan. (ASX: HMC)

Novarise Renewable Resources International
Shares in plastics recycler Novarise Renewable Resources fell to a one year low of 15 cents on 1 March after the company announced its 2011 full year results. The fall was despite the company increasing its profit after tax to $17 million from $15.2 million in 2010.

Revenue also rose, to $82 million from $74.6 million, and net assets rose to $71.8 million from $52.3 million.

However the divided fell as no dividend was declared despite the 1 cent dividend for 2010. Basic earnings per share fell marginally to 4.11 cents from 4.14 cents.

The share price fall and lack of a dividend may be explained by the foreshadowing of capital raising.

In addition, the Nan'an Facility in China which was expected to be put into trial production in November 2011 has been delayed to June 2012.

Also, in 2011 the company borrowed additional funds totalling A$46.4 million. "These funds were partly used to fund the development of the Nan'an project. In addition, the Company took advantage of a short term opportunity to arbitrage interest rates and lend a total of A$43.9 million to a company based in Xiamen called Leiqiang Company," it said.

"The terms of this loan agreement were favourable to the Company and the funds will be repaid in full in the third quarter of 2012. The Company carefully assessed the risk of default on this unsecured loan and believed that it was in the best interest of the Company to take advantage of this opportunity."

However no further details were provided.

Despite providing this loan, the company said "With the growth and expansion of its business, the company will need to raise more capital to fund its growth. The company is looking at raising more capital through options such as private placements." (ASX: NOE)

Quantum Energy
Quantum Energy made a December half loss after tax of $1.8 million, down from an interim loss of $3.6 million in 2010.

Revenue fell marginally to $21 million from $21.6 million.

The loss from continuing operations fell 82 per cent to $527,000 from $2.8 million.

The company said the results were significantly impacted by the closure of its retail Solar Division. It tried to dispose of the remaining assets of the Solar Division including solar panels and inverters but the market value of these has significantly decreased and large discounts are needed to move them.

"The Environmental Services Division continued to be impacted by the lingering uncertainty concerning the level of government assistance provided to consumers in the renewable energy sector," it said. "However there has been a recent improvement in sales activity and the Group expects the results for the Environmental Services Division to improve in the second half of the year.

"The high end Medical Distribution Division had a strong first half with good sales and a return to profitability. The Group expects the good sales activity to continue in the second half of the year." (ASX: QTM)

Shares in Solco hit a one year low of 4.6 cents on 29 February, the day before it confirmed a December half loss after tax of $2.6 million. The December 2010 half year profit was $0.9 million.

Revenue more than halved from $25.3 million to $11.2 million. This was due to the downturn in the first quarter in the residential solar market following the reduction or withdrawal of residential solar rebates by several State Governments.

Executive chairman David Richardson said he believed that the company had aggressively worked to improve its bottom line and see the company prosper in the second half.

"While we are obviously disappointed with this result, we believe that we have addressed the issues to ensure that the Company is able to function more efficiently in this new environment," he said.

Solco is continuing to focus on the commercial projects space and announced it has secured two more commercial projects worth more than $1 million.

"We are continuing to focus on refining our wholesale business and increasing our market share of commercial projects which will assist us to win back our leadership position in the market," he said.

The new contracts are to install a total of 50 kW on two council buildings in Mildura, Victoria and a 65 kW stand alone remote system for KJ Johnson Electrical Engineers and Contractors in the North West of WA. (ASX: SOO)

____ Pre-Profit Securities ____

ASX 300

Ceramic Fuel Cells
Ceramic Fuel Cells more than tripled its 2011 December half revenue to $3.3 million from $0.9 million in 2010.

The company recorded sales of 67 units, a five-fold increase compared to the December 2010 half year, and cumulative orders doubled from July to December 2011 to a total of 614 units.

However, the loss after tax rose from $8.4 million to $12.4 million.

Research and product development costs also rose $4 million to $10.8 million, and other income fell $4 million. (ASX: CFU)

Micro Cap Companies

Australian Renewable Fuels
Australian Renewable Fuels saw a big jump in its first half revenue from continuing operations - to $18.6 million from $2.7 million for the 2010 interim period.

However the cost of raw materials rose almost as much and the loss after tax increased to $4.7 million from $3.1 million.

"Total production levels for the business increased significantly during the half year to a total of 9.8 million litres for the period, with the key contributing factors being the commencement of biodiesel sales into the export market and the inclusion of the BPL business for the period from 1 November 2011," said chairman Philip Garling. (ASX: ARW)

Carbon Conscious
Carbon Conscious reversed a loss of $0.66 million in the December 2010 half year to record a profit of $0.94 million for the December 2011 half year.

Revenue tripled from $2 million to $6 million.

The company has given earnings guidance for the full year of revenue of $16 million, net profit after tax of $3.5 million and earnings pre share of 3.6 cents. (ASX: CCF)

Hydrotech International
Hydrotech International has been presented with a Management Buyout Offer for its loss making waterproofing business.

The Hydrotech management team proposing the MBO is led by executive directors Dr Francis Lung and Tony McKee.

The directors who are not associated with the MBO have voted unanimously to accept the proposal subject to shareholder approval. An independent experts report will be required.

The offer is to acquire the operating business and certain subsidiaries from 1 April 2012. Consideration for the offer is that the MBO party will take over the US$100,000 Philip Gray loan provided to start up the waterproofing business.

If shareholders approve the transaction, HTI will be a listed company with limited assets, Philip Gray's US$500,000 convertible note and US$150,000 loan plus sundry creditors mainly associated with holding the proposed shareholders meeting to approve the transaction.

The waterproofing business has continued to incur ongoing losses and under the cost structure of an ASX listed company the profit outlook at best looks marginal, said director, Mike Hendriks.

"The board therefore considers shareholder wealth is best served by selling the loss making waterproofing business, recapitalizing the balance sheet and seeking a new business opportunity that can add shareholder value.

The board is in discussion with a number of parties that are interested in assisting with
this endeavour. Any change of business will require shareholder approval."

On news of the buyout offer, shares in Hydrotech International fell to an all time low of 0.1 cent.

HTI increased its December half revenue from continuing operations to $1.1 million, up from $0.5 million in the December 2010 half. The loss after tax rose to $0.6 million. (ASX: HTI)

Intec reported a loss after tax for the half-year to 31 December 2011 of $3.2 million. This reversed a profit of $2.8 million in the previous corresponding half.

The company said revenues were generated from the low-grade zinc blending projects in Tasmania and Victoria, interest on environmental bonds and minor sources.

As of balance date, the Group had net assets of $5.2 million and cash of $288,000. (ASX: INL)

Mission NewEnergy
Mission NewEnergy has further downgraded its revenue forecast, saying that all remaining shipments to be made under its six month European contract have now been cancelled. The downgrade in contract revenue is 70 per cent from an anticipated US$40 million to around US$12 million.

A first downgrade was announced on 14 February 2012, with the customer canceling shipments for March and April 2012.

Mission said the customer again cited the availability of cheaper supplies from elsewhere when cancelling the remaining shipments for May and June 2012. Instead of receiving product the customer will pay Mission a cancelation fee.

Mission said that given current unfavourable cost and price dynamics and competition from biodiesel produced in tax advantaged countries such as Argentina and Indonesia, Mission has no further visibility on sales into Europe.

Mission made a net profit after tax of $3.7 million for the December half, turning around a loss of $14 million for the December 2010 half year.

Included in the $20.3 million of revenue is recognition of a gain of $10.3 million from the buyback of the company's 2012 convertible note. This gain was the primary driver for the net profit, said the company. (ASX: MBT)

Pacific Energy
Pacific Energy has been added to the All Ordinaries Index in the latest quarterly rebalance by Standard & Poors.

Pacific Energy made a profit after tax for the six months to 31 December 2011 of $2.8 million, reversing a loss of $2.4 million in the December 2010 half year.

The power generation company announced record earnings from its Kalgoorlie Power Systems (KPS) business. This generated revenue of $15.6 million, an increase of 17 per cent on the previous corresponding period.

Managing director, Adam Boyd said Pacific Energy has delivered robust earnings growth underpinned by the solid momentum of new contract wins which resulted in 38 MW of new power station capacity commissioned in the past 12 months.

"KPS' unique electricity supply solutions, which deliver reliable, low cost, low fuel consumption generation capacity to the Australian resource sector, continues to resonate with clients evidenced by the company's contracted capacity exceeding 190 MW across 19 power stations in WA, SA and NT," he said.

"Looking forward we have a strong pipeline of new power stations under construction with the planned commissioning of new generation capacity at three power stations totaling 36 MW over the next six-months. Based on the related electricity supply contract terms these new power stations will make an earnings contribution during H2 FY12 and more substantially into FY13 and beyond.

"KPS will also commission its exclusive waste heat recovery technology across 20 MW of our existing fleet during H2 FY12. This fuel efficiency technology will deliver a significant reduction in fuel consumption by the KPS power stations at Regis Resources' gold processing operations and generate a positive contribution to H2 2012 and FY13 earnings."

"During the period, we also further advanced commercial proposals with existing KPS clients for the retro-fit of our exclusive waste heat recovery technology. Opportunities to reduce power station fuel costs for our clients via the conversion of existing KPS diesel fueled power stations through the retro-fit of the KPS Dual Fuel (gas:diesel) conversion technology were also advanced."

Over the next 18 months forecast free cash flow combined with the new credit facilities will provide $55-60 million to fund growth, he said. (ASX: PEA)

Phoslock Water Solutions
Phoslock Water Solutions has a major project with The Royal Parks to treat three of the UK's most well-known water bodies. This includes The Serpentine Lake in Hyde Park, one of London's famous landmarks and a popular venue for millions of visitors each year for swimming, rowing and boating. The Serpentine is also a venue for high profile sporting events.

The project is nearing completion. The other two sites are the Long Water and Round Pond in adjacent Kensington Gardens.

In the December half year, Phoslock's revenue rose 73 per cent to $1.2 million. The loss for the period fell to $0.7 million. (ASX: PHK)

Refresh Group
Refresh Group saw its December half loss fall 90 per cent to $0.1 million. Revenue was $2.9 million, down 16 per cent.

The company said it performed much better and for the first time operations in all four states reported profits.

"However, after corporate expenses, earnings before interest and tax still comes to a $59,000 loss. Being in a seasonal business, we sell more in summer than in winter. As such, the first half has always been a weaker half and an operating profit for the full year is still achievable," it said. (ASX: RGP)

WestSide Corporation
WestSide Corporation has advised that the indicative, conditional, non-binding and confidential proposal to acquire its shares for cash 65 cents each was received from LNG Limited (ASX: LNG).

WestSide said the LNG proposal involved financial backing from reputable international parties.

WestSide has entered into a confidentiality agreement with LNG and granted due diligence access on a non-exclusive basis. LNG has only recently begun due diligence, which may take some time.

WestSide said it continues to assess the Indicative Proposal alongside other strategic options it has. "The Board has not formed a view, at this stage, as to the merits of the Indicative Proposal and continues to recommend that shareholders take no action in relation to the Indicative Proposal," it said. (ASX: WCL)

____ Pre-Revenue Securities ____

ASX 200

Dart Energy
Dart Energy International Pte Ltd, the international operating arm of Dart Energy, is opening new gas opportunities in China. The company has signed a Letter of Intent (LOI) with Henan CBM (HCBM) and Hong Kong Prosperous Clean Energy Company (HPEC) to establish potential new foreign cooperation Production Sharing Contracts (PSCs).

Dart, HCBM and HPEC will negotiate exclusively and seek Government approvals for foreign cooperation PSCs over unconventional gas assets held by HCBM. These are four coal bed methane projects with a total area of 2,000 square kilometres in Henan Province, and one shale gas project in Sichuan Province.

Dart and HPEC have also entered a Memorandum of Understanding on the key commercial terms to collaborate on these potential PSCs and downstream activities.

HCBM is a Chinese state-owned enterprise and one of four companies approved to enter into foreign co-operations PSCs for coal bed methane in China. HPEC is a substantial privately-owned company which mainly focuses on clean energy in Henan Province, including operation of LPG and CNG gas stations and other natural gas facilities. (ASX: DTE)

Lynas Corporation
Lynas Corporation has closed the second tranche of its US$225 million unsecured convertible bond issue announced on 24 January.

The deal is with Mount Kellett Capital Management LP, a US-based investment firm.

Lynas received the first tranche of US$50 million on 25 January and it was agreed that the balance of the US$175 million convertible bonds would be paid on the satisfaction of certain conditions, which have now been satisfied.

The parties have also agreed to increase the number of convertible bonds to be issued as part of the second tranche from 175 million to 225 million and for the first tranche of 50 million convertible bonds to be redeemed early. The redemption of the Tranche 1 Convertible Bonds and the issue of the Tranche 2 Convertible Bonds occurred simultaneously. (ASX: LYC)

Micro Cap Companies

Advanced Engine Components
Advanced Engine Components said that further to the announcement on 9 February, it has reached a settlement with the former employee and the winding–up application due to be heard in the Supreme Court of WA has been discontinued. (ASX: ACE)

La Jolla Cove Investors has converted another $100,000 of its convertible note into 330,688 Algae.Tec shares. The price was 30.24 cents per share. Algae.Tec's shares are currently trading around 37 cents. (ASX: AEB)

AnaeCo appears to have alleviated its short and medium term funding requirements by raising another $1.25 million through placing the shortfall from its recent share purchase plan, and securing access to $10 million of debt and equity from director Ian Campbell.

The placement was 31.4 million shares at 4 cents each.

The funding facility to be provided by Mr Campbell is part equity and part loan. The company and Mr Campbell are still to agree on all the terms and conditions of the facility, and given that he is a related party and already holds 19.6 per cent of the company, shareholder approval will be needed for the deal, said AnaeCo.

Managing director and chief executive, Patrick Kedemos, said "The SPP shortfall has been well supported by a combination of new and existing shareholders. The confirmation of substantial funding support from Ian Campbell is significant as it underpins the Company's operations for the remainder of the WMRC DiCOM Expansion Project, and for the work AnaeCo will commit to a proposed detailed feasibility study on a project being jointly evaluated with Transpacific Cleanaway on the east coast of Australia." (ASX: ANQ)

Shares in Dyesol fell to an all time low of 18 cents on the same day that its half year report cast doubt on the company's ability to continue as a going concern, and one day after it announced a share purchase plan (SPP) at 18 cents per share.

The auditor drew attention to Dyesol's need to raise additional capital, so the share purchase plan is a response to that. The SPP will raise $3 million, and is fully underwritten by Austock Securities. The company will accept additional share subscriptions to a maximum of $6 million.

At 31 December Dyesol had cash of $2.6 million and net assets of $12.1 million.

Dyesol has also canceled the equity line of credit established in 2011, and at zero cost to the company. Dyesol said the move is due to "significant progress made recently in the planning for commercialization of the company's technology with its major project partners".

"Moreover, we expect this will relieve the downwards pressure on the Company's share price and allow it to be positively re-rated in coming months," said chairman, Richard Caldwell.

The company has also undertaken an organizational restructure and cost reduction initiatives that should reduce the monthly cash burn by approximately 30 per cent.

The company is looking at significant cost minimization where staff and activities are relocated from headquarters to overseas joint-ventures and collaborations where government support and funding heavily subsidizes project development. Other areas are corporate overhead and business development.

"The Company's independent directors have agreed to defer all directors fees until we see these reductions materialize," said Mr Caldwell. "As part of our measures we are also seeking to move from a fixed cash remuneration structure for senior management to alternative, long-term, non-monetary compensation."

To progress the proposed transformation, the executive and board roles of the company founders must be changed, and discussions are underway, he said.

In terms of commercialization, recent testing in real solar conditions in partner projects in the UK and Korea has confirmed the effectiveness of DSC in the built environment, and showed that DSC consistently outperformed a range of competing PV technologies.

"In UK conditions outperformance was typically in the vicinity of 30 per cent. The Company has realized that we need to get this compelling and unambiguous message out more effectively and we have commenced by publishing technology papers in our new e-Newsletter and will continue doing this in forthcoming editions. These papers also allow more effective marketing to a range of stakeholders," said Mr Caldwell.

In further good news, professor Michael Grätzel has won the 2012 Albert Einstein World Award of Science. The Award is for professor Grätzel's invention and development of the Grätzel Cell, the dye-sensitised solar cell that Dyesol' says is regarded by many as the single most important breakthrough in the development of sustainable energy.

The Interdisciplinary Committee of the World Cultural Council selected professor Grätzel, who is director of the Laboratory of Photonics and Interfaces at Ecole Polytechnique Federale de Lausanne (EPFL) in Switzerland, because of the capability of dye solar cells to significantly increase the spread of sustainable, renewable energy throughout the world and make a major impact in renewable energy distribution across the globe.

Dyesol director, Gordon Thompson, said "Dyesol has strong ties to professor Grätzel. Professor Grätzel is the chairman of Dyesol's Technology Advisory Board, and Dyesol is a pioneer licensee of the DSC technology developed at EPFL. Our team has been developing this invention to a range of commercial product solutions since 1994.

"Today, Dyesol is at the cutting edge in the photovoltaic industry as the leading global supplier of DSC materials, technology and know-how to multinational manufacturing partners and researchers across the globe.

"Our DSC photovoltaic technology enables metal, glass and polymeric based products in the building, transport and electronics sectors to generate energy and to improve energy efficiency. These are exciting times for the company," said Mr Thompson. (ASX: DYE)

Earth Heat Resources
Shares in Earth Heat Resources are in a trading pending as the company is finalizing negotiations for a substantial placement to raise from $3 million to $5 million. This is the equivalent of up to 27.2 per cent of the current issued capital. (ASX: EHR)

EcoQuest recorded revenue of $130,243 for the December half year. The company said "Sales of biodegradable nappies had not been meeting budget because the company did not get shelf space in Woolworths or Coles.'

"Subject to the Board's decisions about the future of its biodegradable nappy business, the Company has wound back its marketing initiatives in this area."

The company is pursuing opportunities for the acquisition of other eco-products.

The loss for the half-year ended 31 December was $1,627,852, included a one-off write down of assets of $850,979, mostly for inventory. The corresponding 2010 loss was $1,385,733. (ASX: ECQ)

Shares in Enerji fell to a one year low of 1 cent on 28 February.

The company continues to raise capital and on 29 February raised $650,000 in a placement of 54 million shares at 1.2 cents each. The proceeds will be used to fund the Carnarvon project

Enerji made a loss of $3.1 million for the full year to 31 December 2011.

During the year it raised a total of $2,954,437 through the issue of securities. (ASX: ERJ)

Solar tower developer EnviroMission has raised $468,499 through the issue of 13,385,714 shares with an issue price of 3.5 cents.

6,692,857 unlisted options were also issued with an exercise price of 7 cents and an expiry date of 15 September 2014. (ASX: EVM)

Geodynamics' fall continues with the company removed from the All Ordinaries Index in the latest quarterly rebalance by Standard & Poors. (ASX: GDY)

Greenearth Energy
Greenearth Energy director Robert Annells has indirectly acquired 28,666 shares at an average price of 6 cents each. (ASX: GER )

Intelligent Solar
Intelligent Solar director Kevin Chin has transfered 3 million unlisted options to fellow director David Keefe, who exercised them at $45,000 or 1.5 cent per option. (ASX: ISL)

Island Sky
The signs are not good for water for air maker Island Sky which has net assets of only $53,858 after making a loss of $1.9 million for the full year ended 31 December 2011.

The accounts are also noteworthy for the lack of any discussion on the company and its situation by directors. (ASX: ISK)

Liquefied Natural Gas
Liquefied Natural Gas has identified itself as the party that has approached coal seam gas developer WestSide with an indicative takeover proposal at 65 cents per share.

Nothing definitive has been concluded, nor is there any certainty that any binding transaction will be agreed between the companies, it said.

Liquefied Natural Gas has been removed from the All Ordinaries Index in the latest quarterly rebalance by Standard & Poors. (ASX: LNG)

Lithex Resources
Shares in rare earths and lithium explorer Lithex Resources hot a new low of 10.5 cents on 29 February. (ASX: LTX)

La Jolla Cove Investors converted another $100,000 of its convertible note into MediVac shares. MediVac said that "At the instruction of La Jolla the shares were sold off market and issued direct to the Copulos Group on payment of $100,000 by Copulos Group."

MediVac chairman Paul McPherson has indirectly acquired 1.3 million shares at 1 cent each. (ASX: MDV)

Metgasco has been added the All Ordinaries Index in the latest quarterly rebalance by Standard & Poors. (ASX: MEL)

Panax Geothermal
Panax Geothermal is looking at other funding options following a decision not to extend the term of the Heads of Agreement with Molten.

Panax said it will continue to work with Molten over the coming weeks to ensure that formal commitments for the required financing are able to be put in place, and that it remains quite confident that Molten will be successful in securing the required funding to facilitate the arrangement with Panax. However, it is clear that Molten still requires additional time to secure its formal financing commitments.

Panax will now more aggressively pursue other funding alternatives that it has been reviewing in recent weeks.

"Panax continues to be approached, on a regular basis, by investment groups who see the strong potential and commercial viability and long term economic value of the portfolio of
projects that Panax had assembled in Indonesia," it said.

Panax is seeking to finalize these discussions in the near term. (ASX: PAX)

Torrens Energy
Torrens Energy has appointed Anthony Wooles as a director and raised $586,628 in a placement to AEW Capital Trust, of which Mr Wooles is executive chairman.

AEW Capital is a private investment firm and now holds 12.1 per cent of Torrens.

Torrens said Mr Wooles has significant experience and knowledge in corporate finance and energy sectors including the recent establishment and sale of energy service company PearlStreet Ltd.

The placement was 11,732,568 shares at 5 cents each in two tranches: 10,560,484 shares issued immediately and 1,172,084 shares subject to AGL Ltd's decision not to exercise its right to "top up" to maintain its interest in Torrens Energy under its 2008 Subscription Agreement.

Directors said the placement and Mr Wooles' appointment are significant steps for the company that will provide an enhanced range of growth options and add stability to the share registry.

Mr Wooles said "I am looking forward to working with the Torrens Board in order to assist directly in the evaluation of future growth opportunities. I continue to be attracted to the quality of the board and the breadth of strategic options in the sector." (ASX: TEY)

International Micro Cap Companies

Ocean Power Technologies
Wave energy developer Ocean Power Technologies, Inc. has appointed Timothy Stiven as managing director of Ocean Power Technologies Ltd (OPT), the company's UK-based wholly-owned subsidiary.

He succeeds Angus Norman, who is stepping down as chief executive for personal reasons but will remain an advisor to the company and will serve on the Board of Advisors.

Mr Stiven joined OPT in 2010 as director of Business Development and Marketing for UK & Europe. He will report to Charles F. Dunleavy, chief executive of Ocean Power Technologies, Inc., and will be responsible for all OPT Ltd operations including project engineering, sales and marketing, customer contracts and other activities in the UK and Europe.

Mr Dunleavy said Mr Stiven will drive the commercialization strategy in the UK and continental Europe. "Since joining the Company, he has been a strong contributor to OPT's business development success." (Nasdaq: OPTT)

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