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Title: www.chinaciwt.com


1
China Industrial Waste Management, Inc.OTCBB
CIWT
We care about our environment
Investor Presentation 2009
  • www.chinaciwt.com

2
Safe Harbor Statement
  • This investor presentation does not summarize all
    of the matters relevant to or necessary for a
    person to make an investment decision concerning
    China Industrial Waste Management, Inc.
    Accordingly, prior to making any investment
    decision, prospective investors and their
    advisors should conduct their own due diligence
    investigation of China Industrial Waste
    Management, Inc., including asking questions of,
    and obtaining additional information from, China
    Industrial Waste Management, Inc. concerning its
    business and prospects, the terms and conditions
    of any potential investment and any other
    relevant matters.
  • This presentation contains forward-looking
    statements, including financial projections. In
    some cases, you can identify forward looking
    statements by terms such as may, will,
    should, could, would, expects, plans,
    anticipates, believes, estimates,
    projects, predicts, potential, and similar
    expressions. The forward looking statements
    reflect China Industrial Waste Managements
    current views with respect to future events and
    are based on assumptions and are subject to risks
    and uncertainties.
  • The forward looking statements set forth in this
    presentation are our managements projection of
    possible future operations, developments, and
    results based upon numerous assumptions, and are
    dependent on many factors over which we have no
    control. We cannot guarantee that any of the
    assumptions on which forward looking statements
    are based will prove to be correct, or that we
    will achieve the results set forth in the forward
    looking statements.
  • We make no expressed or implied representation or
    warranty as to whether we can attain the
    projected financial information or the accuracy
    of any other forward looking statements set forth
    in this Executive Summary or as to the accuracy
    or completeness of the assumptions from which the
    forward looking statements are derived. We do not
    have any obligation to update or revise any
    forward looking statement to reflect any change
    in our expectations or any change in events,
    conditions, or circumstances on which any such
    statement is based. Given these uncertainties,
    you should not place undue reliance on such
    forward-looking statements.

3
Company Overview
  • Founded in 1991, as first industrial waste
    treatment company in China - headquartered in
    Dalian, Liaoning province, PRC
  • Leading environmental protection, pollution
    treatment and solutions provider, and industrial
    waste processor for commercial and municipal
    customers with recurring, high margin revenues
  • Ministry of Environmental Protection of China
    (MEPC) licensed industrial waste processor plus
    local government approvals
  • Over 650 customers, including major multinational
    corporations supported by 400 full-time
    employees

Industrial Waste
Municipal BOT
Engineering
4
Corporate Structure - Ownership
China Industrial Waste Management, Inc. (CIWT)
90
Dalian Dongtai Industrial Waste Treatment Co.,
Ltd.
80
49
70
75
Dongtai Water Recycling Co. Ltd.
Dongtai Organic Waste Treatment Co., Ltd.
Zhuorui Resource Recycling Co., Ltd.
Dalian Lipp Environmental Energy Engineering
Technology Co., Ltd.
5
Financial Introduction
6
Investment Highlights
  • REGULATORY DRIVERS - Increasing government
    regulation and support strengthens ecological and
    environmental protection in PRC.
  • HIGH BARRIERS TO ENTRY - Lengthy lead times to
    acquire licenses from the Chinese State
    Environmental Protection Administration (SEPA)
    and provincial government.
  • INDUSTRY LEADER with strong track record in
    developing and operating industrial waste
    treatment systems.
  • DIVERSIFIED BUSINESS including several municipal
    Build-Operate-Transfer (BOT) projects with
    long-term, recurring revenue streams.
  • STRATEGICALLY LOCATED in Dalian, Liaoning
    Province which is one of the largest industrial
    centers and waste producers in China
  • EXPERIENCED AND DEDICATED MANAGEMENT TEAM that
    possess industry focused technical capabilities,
    have invested significant dollars and maintain a
    large ownership stake

7
Market Overview
  • The Environmental Protection Industry in China is
    estimated to grow by 25 per year more than 2x
    Chinas GDP growth
  • The environmental protection industry in China is
    expected to double and reach 120 billion by
    2010
  • In the 11th Five-year Plan (2006-2010), MEPC
    committed 190 billion for industrial companies
    for cleanup
  • All companies have to meet stringent license
    requirements from MEPC and local governments
  • Highlighted as a critical component of Chinas
    586 billion stimulus plan
  • Liaoning is one of the countrys largest
    industrial centers and waste producers. The
    Company has five key locations throughout Dalian.

Local Waste Volume
2001 2002 2003 2004 2005 2006 2007
2008
Source MEPC
8
Business Overview
  • INDUSTRIAL WASTE
  • Industrial Waste Treatment and Recycling Services
    Dalian Dongtai Industrial Waste Treatment, Ltd.
    (Dongtai) full service waste treatment
    facilities majority of revenues to date and
    currently under expansion
  • Waste Catalyst Recycling Dalian Zhuorui
    Resource Recycling Co., Ltd - generates valuable
    metals and slag used for cement
    commercialization to commence in 2009
  • MUNICIPAL BUILD-OPERATE-TRANSFER (BOT)
  • Waste Water Treatment Dalian Dongtai Water
    Recycling Co. Ltd. - for the city of Dalian
    commenced production in June 2008
  • Municipal Sludge Treatment Dalian Dongtai
    Organic Waste Treatment Company - process sludge
    by anaerobic fermentation to generate methane and
    fertilizer, expect production to commence Q3 2009
  • ENVIRONMENTAL ENGINEERING
  • Dalian Lipp Environmental Energy Engineering
    Technology Co., Ltd. - JV with German Lipp -
    sales of fermentation tanks system for waste
    water and sludge treatment equipment design and
    manufacturing to commence in 2009

9
Industrial Waste - Project I
  • Dalian Dongtai Industrial Waste Treatment, Ltd.
    90 owned by CIWT
  • Waste treatment facility includes Electronic
    Waste Dismantling facility, Etchant Reuse
    facility, Waste Incineration facility, Hazardous
    Waste Safety Landfill Site, and General
    Industrial Waste Landfill Site
  • One-stop shop for industrial and commercial
    waste treatment services
  • Clients include major multinational corporations.
    International clients contribute approximately
    67 of Dongtais revenue
  • Business model 1) Service fees
  • 2) Sales of cupric sulfate
  • 3) Sales of recycled commodities

Scrap Material Recycled Products
10
Industrial Waste - Project I (contd.)
  • Expansion Plan Underway One-stop service center
    for hazardous waste management
  • Sponsored by National Development and Reform
    Commission as part of a plan to construct 55
    hazardous waste treatment centers in key
    locations throughout China
  • Total investment is approximately 16 million to
    build out the 634,000 square foot new facility
  • Most advanced in China and on par with
    international standards for solid waste treatment
    facility
  • Increase capacity of incinerator from 3,300
    tons/year to 9,000 tons/year
  • Increase capacity by adding a new hazardous waste
    landfill, an industrial effluent treatment system
    and an organic solvent recycling system in
    addition to current facilities
  • Capacity expansion is expected to be on-line by
    the fourth quarter of 2009

11
Diversified Customer Base
12
Industrial Waste - Project II
  • Dalian Zhuorui Resource Recycling Co., Ltd. 70
    owned by Dongtai
  • Total investment of approximately 10 million.
  • Leading technology used to recycle scrap catalyst
    from refineries and generate valuable metals
    including Molybdenum, Nickel, Cobalt, and
    Vanadium. Annual scrap catalyst generated in
    Northeastern China is about 10,000 tons.
  • Current annual processing capacity is 5,000
    tons/year, yielding 1,400 tons of metal compound
    which are sold into the market. Additionally
    waste slag is sold as a raw material for cement.
  • Partnership with two major oil refineries to
    secure supply of waste catalyst at low cost which
    benefits margins significantly

Dalian Zhuorui Resource Recycling Co., Ltd.
13
Recycle Process Flow
Collect Hazardous Waste Catalyst from Oil
Refineries
  • Patented Plasma Furnace to Process
  • Melting (1800 C )
  • Crushing, Milling, Oxidation, Separation
  • Electricity intense
  • Metal Alloy
  • Ammonium Metavanadate
  • Ammonium Molybdate
  • Cobalt Sulfate
  • Nickel Sulfate
  • Vitreous Slag
  • Raw material for cement
  • Processed waste yields approximately 20-30
    metal alloys and 70 -80 vitreous slag
  • Denoted as Key National Environmental Protection
    Practical Technology in 2005
  • Received three patents in China
  • Received subsidies through government funding

14
Municipal BOT - Project I
  • Dalian Dongtai Water Recycling Co. Ltd 80
    owned by Dongtai
  • Processes waste water generated by the City of
    Dalian
  • Receive fixed quarterly payments from the local
    government approximately 0.27 million per
    quarter with average net margins of approximately
    17
  • Total investment was approximately 6.6 million
    and commenced operations on June 21, 2008
  • Phase I annual processing capacity of 30,000
    metric tons per day
  • Phase II III to increase capacity to 100,000
    metric tons per day, expected completion by 2011
  • 20 years of stable recurring income backed by
    tax revenue and franchise agreement

Foundation Construction Operation
15
Municipal BOT - Project II
  • Dalian Dongtai Organic Waste Treatment 49
    owned by Dongtai
  • Municipal sludge treatment in Dalian utilizing
    German Lipps Technology
  • Total Investment 18 million, expected to
    commence operations in Q3 2009
  • Processes sludge through anaerobic fermentation
    and generates methane and fertilizer which are
    reused
  • Expected to generate approximately 1.1 million
    in quarterly revenue including processing fees
    from the local government and sale of methane and
    fertilizer
  • Average net profit margins estimated at 25-30
  • Current capacity is 600 tons per day with
    expansion to meet increasing demand

16
Engineering
  • Dalian Lipp Environmental Energy Engineering
    Technology Co., Ltd. 75 owned by Dongtai
  • A joint venture between Dongtai and German based
    Lipp Company
  • Target waste management companies and BOT
    projects Addressing huge waste water and sludge
    treatment market
  • Engaged in sales of Fermentation Tank System and
    post-sale technical service. Plans to pursue
    equipment design and manufacturing during 2009
  • Average sale price of a ferment tank is
    approximately 0.67 million
  • Competitive advantages
  • Superior quality
  • Onsite assembly
  • Short construction period
  • Lower cost and maintenance expense

17
Competitive Landscape
  • Highly regulated industry and stringent license
    requirements both from SEPA and local governments
  • Sole company in Liaoning and one of the only few
    Companies in China that offers one-stop
    comprehensive waste treatment services such as
    recycling ,incineration and landfill
  • Only a few reputable environmental companies with
    successful BOT experience in the market
  • First company in the industry in China to utilize
    German Lipp technology for municipal sludge
    treatment

18
Growth Strategy
  • Expand industrial waste processing capacity as
    new global companies open facilities in Dalian
    and surrounding areas
  • Seek new Municipal Build-Operate-Transfer (BOT)
    projects and expand capacity of existing projects
    to increase long-term, recurring revenue stream
  • Work with global industrial leader (Germany Lipp
    Co.) to capture incremental environmental
    engineering opportunities
  • Penetrate new geographic markets in China by
    leveraging existing operating experience and
    core, patented technologies
  • Continue to place great emphasis on technical
    research and development while leveraging key
    university partnerships
  • Commercialize the Waste Catalyst Treatment
    segment, Dalian Zhuorui Resource Recycling Co.
  • Maintain stringent cost controls to optimize
    margins
  • Pursue complementary acquisition targets for
    expansion

19
Project Pipeline
  • Industrial Waste
  • New industrial waste treatment Facilities in two
    key locations in Liaoning Province
  • Centralized Hazardous Waste Treatment Facility in
    Hunan Province
  • Municipal BOT
  • Two municipal waste water treatment plants in
    Dalian
  • Two sewage sludge treatment projects in Liaoning
    Province
  • Engineering
  • Organic waste treatment project in Liaoning
    Province, Jiangsu Province, Fujian Province,
    Shanghai
  • The Company will utilize different sources
    including bank loan, joint venture, co-operation
    with local operators, etc. to finance future
    projects
  • These projects are in different stage of
    negotiation and none of these contracts has been
    signed

20
Qualifications
Permit for comprehensive operation on hazardous
waste issued by provincial environmental
protection authority
Certificate for operation of environmental
protection facilities granted by National
Environmental Protection Bureau
Certificate of ISO14001 ,ISO9000, ISOl8000
Management System
21
Research Development
  • Established Dongtai Industrial Waste Disposal
    Technology Center in conjunction with Dalian
    University of Technology 22 engineers and 9
    analysts
  • The RD team is comprised of specialists in
    environmental technology
  • Closely cooperates with several Chinese
    universities and research institutes including
    Dalian Institute of Chemical Physics of the
    Chinese Academy of Sciences
  • The Company has been granted multiple local
    government awards and is recognized by SEPA and
    the Ministry of Science and Technology as a key
    environmental technology provider
  • Currently owns 5 patents in China
  • The Disposal of Powered Ink Waste from Copy
    Machines
  • Consecutive Destructive Distillation Stove
  • Plasma Fusion Pyrolysis Device
  • The Disposal of Waste Catalyst
  • Method and Equipment for High-Efficiency
    Solid-Liquid Separation Under High Pressure

22
Revenue Composition
During the year of 2008, revenue came primarily
from the Industrial Waste Treatment and Recycling
Services segment (Dongtai). Revenue streams
will be further diversified in 2009.
23
Competitive Advantages
  • High Barriers to Entry Licenses granted by the
    central government to engage in industrial waste
    treatment business in Dalian and surrounding
    areas
  • One of the first companies to be granted a permit
    to conduct an industrial waste treatment business
    by SEPA, and provincial license to operate
    hazardous water treatment and disposal facilities
  • The Companys facility expansion and geographic
    location is prominently featured in the current
    national centralized hazardous waste disposal
    facility plan established by the National
    Development and Reform Commission
  • Reputation leading environmental protection
    company in Liaoning Province
  • Long-term Stable Relationships Over 17-year
    operating history based upon a commitment to
    provide high quality products and services
  • Diversified Customer Base more than 650
    customers including private enterprises,
    municipal institutions and universities
  • Recurring Revenues New BOT projects provide
    visibility through long-term recurring revenues

24
Competitive Advantage
  • Comprehensive Services One of a few companies
    in China, and the only one in the Liaoning
    province, which provides a comprehensive array of
    services including solid waste treatment, waste
    collection and transportation, environmental
    protection services, storage, landfill and
    on-site management.
  • Extensive Investment in Facilities and
    Technologies Designs and develops proprietary
    processes and technologies to meet customer
    needs.
  • Experienced Management Strong industry
    backgrounds supported by environmental protection
    expertise.

25
Management Team
  • Jinqing Dong Chairman of the Board, CEO
  • Founded the Company in 1991 and possesses over 20
    years of experience in the waste management
    industry.
  • Between 1982 and 1991, Mr. Dong worked for the
    Dalian Environmental Science Academy, where he
    was primarily engaged in research relating to the
    disposal of waste gas, waste water and industrial
    residue and the evaluation of the environmental
    effects of industrial projects.
  • Mr. Dong graduated from Dalian University of
    Technology in 1982 with a bachelors degree in
    environmental engineering.
  • Jun Li Chief Operating Officer and Director
  • Appointed as Chief Operating Officer in March
    2008. He has served on the Companys board of
    directors since October 2006. Mr. Li has also
    served as the COO of Dalian Dongtai since 1998.
  • From 1982 to 1993, he was employed by Dalian
    Vacuum Flask Factory and Dalian Yili
    International Chemical Co. Ltd as its Director of
    Technology and Chief Production Manager.
  • Mr. Li holds a bachelor degree in environmental
    engineering from Dalian University of Technology.
  • Xin Guo Chief Financial Officer and Director
  • Served as the Companys Chief Financial Officer
    and a member of the board of directors since
    March 2008.
  • Ms. Guo has served as Chief Accounting Officer
    for Dalian Dongtai since October 2003
  • Ms. Guo graduated from Beijing University of
    Commerce in 1992 majoring in Auditing, and
    received her masters degree in Administration
    from Chinas Northeastern University in 2002.
  • Darcy Zhang Corporate Secretary
  • Joined the Company in 2004 and has been engaging
    in Investor Relations management for several
    years.
  • Mr. Zhang received a Masters degree in
    International Banking and Financial Studies from
    the University of Southampton, UK in 2004.

26
Strong Growth Profitability
Revenues (000)
Net Income (000)
29
40
  • 2005 2008 Revenue and net income grew at 40.0
    and 60.0 CAGR, respectively.
  • 2008 EPS was 0.35, up 25 from 2007.
  • 2007 Net profit margins were 38.7 and 35.5 for
    the year of 2008.
  • Operating Margins greater than 40
  • Net cash provided by operating activities for
    2008 was 4.9 million.
  • Dongtai receives tax reductions Effective Tax
    Rate for 2008 9, 2009 10, 2010 11

27
Key Financial Metrics
Year ended December 31, 2008
Based on 12 month 2008 performance unless marked
otherwise
28
Year-Over-Year Results
29
Balance Sheet Summary
30
Investment Summary
  • Chinas industrial waste treatment industry is
    still in its infancy while economic and
    regulatory drivers support future growth
  • Highly regulated industry and stringent license
    requirements both from SEPA and local governments
    create high barriers to entry
  • Dongtai possesses all necessary operating
    licenses and approvals
  • 2005 2008, revenue and net income CAGR grew
    40.0 and 60.0 respectively.
  • The management expects core waste treatment
    business to grow about 20 annually
  • Significant growth opportunity with new BOT
    projects, which are operated for 20-25 years and
    generate high visibility through recurring
    revenues.
  • Additional growth opportunities including Lipp
    joint venture, geographic expansion, and
    complementary acquisition opportunities
  • The waste catalyst treatment segment will
    commence production and generate revenue in 2009,
    while driving future growth and enhancing overall
    margins
  • Strong RD has created patented, proprietary
    systems and solutions
  • 17 years of industry experience, strong
    management team with significant inside ownership
    (69.8) aligns their goals with the shareholders

31
Contact Us
  • Company Contact
  • Ms. Guo Xin, CFO
  • Tel 86-411-8581-1229
  • E-Mail hellenguo_at_chinaciwt.com
  • Mr. Zhang Dazhi, Company Secretary
  • Tel 86-411-8259-5339
  • E-Mail darcy.zhang_at_chinaciwt.com
  • Web http//www.chinaciwt.com
  • Investor Relations
  • Matt Hayden, President
  • HC International, Inc.
  • Tel 1 (561) 245-5155
  • E-Mail matt.hayden_at_hcinternational.net
  • Web http//www.hcinternational.net

32
Thank You
  • www.chinaciwt.com
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