Biorem is concentrating its efforts on two major new market segments.

Guelph, Ontario[WorldofBioenergy.com]

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BIOREM Inc. (TSX-V: BRM) With Biorem now entering new markets with innovative and advanced technological breakthroughs, the Company has decided to provide details of its new strategy for its future growth and its outlook for fiscal years 2010/11.

Biorem is concentrating its efforts on two major new market segments; renewable energy (biogas purification) and the industrial sector focussed on volatile organic compounds (VOC), whose combined markets are estimated to be $425 million annually in North America alone, while at the same time maintaining and increasing its market share in its core odor control business.

The Company is in the final stages of its product release for biogas sweetening (the removal of H2S from raw biogas) by combining engineering expertise obtained from Europe with its own biofiltration technology expertise. The first commercial biogas units will be operating in North America by midyear with a product rollout through the Company’s well established municipal sales channels already underway. Biogas purification plants would most typically be used on landfill gas and anaerobic digesters found at municipal waste water treatment plants.

Biorem has already invested in a sales force to enter and gain a foothold in the VOC removal market in North America, which is a $285million annual market and has grown historically at a 7.5% annual rate. The market is currently dominated by thermal oxidation, chemical scrubbers and activated carbon solutions, which now have 85% of the market. The Company’s aggressive product development programs over the past few years have lead to a competitive capital cost position compared to the market leading thermal oxidation technologies along with a significantly lower (33%) annual operating cost.

“Revenue from both the renewable energy (biogas) and industrial (volatile organic compounds) markets are expected to make a material contribution in 2011,” said Peter Bruijns, President and CEO. “Biorem has committed to the investment in its growth through expansion of its sales capacity and a continued commitment to product development. Although the investment in this growth initiative will impact the Company’s profitability in 2010, it also sets the stage for exceptional growth prospects for the coming years.”

The biogas and VOC markets are also significant in China and Biorem is investing to pursue project opportunities there. To support its efforts in China, Biorem has recruited additional sales staff and has filed for the establishment of a WFOE (Wholly Foreign Owned Enterprise) to be established in China, which enables the Company to secure local currency contracts and also to enter into local supply chain contracts allowing the Company to gain cost parity with local competitors. These corporate structuring initiatives are expected to significantly increase Biorem’s market penetration into China.

“We are pleased with how the company weathered the weak economic conditions of 2009 having achieved record revenue growth of 31% in 2009 over 2008; although the recession had the effect of lowering our overall bookings performance in 2009 to $16 million and reduced our backlog to $10 million,” said Bruijns. “However, we are pleased that we are experiencing a rebound in core odour control bookings in 2010 and expect solid bookings growth for the entire year with growth in our new target markets expected to provide their first bookings by Q4 2010. This should result in $18 to $20 million in total core market bookings, which would be a record for the Company and will contribute to a healthy backlog at the end of 2010. This strong backlog is expected to result in increased revenue growth and improved profitability in 2011.”

In terms of 2010 financial performance, the Company’s reduced backlog in 2009 along with increased spending on growth will result in a weak first quarter with revenue reduction and losses. However, for the fiscal year 2010 Biorem still expects to achieve approximately $18 million in total revenue with most of the losses generated by increased spending on growth. As a result of the inherent fluctuations in quarterly revenue (due to customers amending the installation dates for the Company’s Biofilters in its core odor control business) it is possible that the 2010 results may vary from those projected either to the positive or negative side. Biorem views its 2010 financial performance as its transition year towards the full implementation of its new markets growth strategy which management anticipates will result in exceptional results in the years ahead.

About BIOREM Inc.
Biorem designs and manufactures air pollution control systems, including biofiltration and biotrickling systems that safely remove harmful contaminants such as Hydrogen Sulfide, Reduced Sulfur compounds, and VOC’s from the air. Our systems are environmentally friendly, clean and sustainable all the while reducing green-house gas emissions. With more than 600 installed systems worldwide, continued extensive research efforts and more than 15 years of experience, Biorem not only offers state of the art technology based products but also peace of mind for municipalities and industrial companies and their surrounding communities. Additional information on Biorem is available at www.biorem.biz.

Source: www.biorem.biz