This printed article is located at https://leaderet.listedcompany.com/chairman_statement.html
2025 was a defining year that demonstrated the resilience and agility of the Group. Our early venture into the AIWater segment proved to be fruitful.
A key strategic milestone was the successful divestment of our AIWater business segment, which delivered an exceptional return on investment of more than 13 times over its four-year development period. This divestment marks the successful conclusion of this venture and underscores the Group’s disciplined approach to capital allocation, our ability to identify emerging opportunities, and our commitment to crystallising value at the appropriate time. The value realised from the divestment has strengthened the Group’s financial position and supported the Board’s decision to declare and distribute approximately S$44.05 million in FY2025, equivalent to S$0.0287 per share.
The broader operating environment, particularly in China, remained subdued amid a sluggish economic recovery. Despite these headwinds, the Group made meaningful progress in securing new projects and strengthening our market position. We also undertook a decisive realignment of our business priorities to reinforce our focus on the Group’s core sludge and membrane businesses. While the projects secured in 2025 have yet to contribute positively to the financial results, we expect their financial impact to materialise progressively over the coming periods.
In tandem, we implemented a series of structural enhancements across the organisation to refine our operating model, optimise resource deployment, and strengthen accountability. These initiatives have resulted in a leaner, more agile team to support sustainable growth and improve execution efficiency.
As we move forward, we remain focused on strengthening our existing operations, expanding our technology capabilities, and exploring new growth drivers to enhance shareholder value. We are confident that the foundations laid over the years, coupled with our disciplined execution and organisational resilience, will continue to support the Group’s long-term aspirations.
Our sludge treatment demonstration plant in Changi Water Reclamation Plant, Singapore, showcasing our proprietary Continuous Thermal Hydrolysis (“CTH”) and Pyrolysis technology, was successfully completed in July 2025. The results validated that our integrated CTH-Pyrolysis processes can significantly reduce sludge volumes and mass, and improve energy efficiency, while maintaining continuous and stable operations. The CTH–Pyrolysis system offers clear advantages over conventional treatment methods.
Notably, the system converts the sludge into biochar, creating potential pathways for value-added use in areas such as soil remediation, renewable fuel, construction materials, and also for odour and heavy metal control following the material’s upgrading. These outcomes collectively contribute to a reduced carbon footprint and advance our alignment with circular economy objectives.
Traditional sludge treatment methods are becoming increasingly unsustainable. Conventional approaches rely heavily on energy-intensive drying, chemical conditioning, and incineration processes that drive up operating costs, offer limited opportunities for resource recovery, yet contribute to high carbon emissions. At the same time, tightening environmental standards and rising disposal costs across the region continue to challenge the long-term viability of these legacy systems. These structural constraints underscore the urgent need for modern, circular, and cost-efficient solutions.
Successful demonstration of our CTH–Pyrolysis process marks an important milestone in showcasing our technologies and strengthening our positioning within the sludge treatment solutions domain. With a clear value proposition, we are now well placed to pursue greater business opportunities in China, Singapore, and our surrounding regions.
Our membrane business continued to draw on the capabilities of our joint venture company, NTi Technology Pte. Ltd. (“NTi Tech”), to support the production of high-performance membranes. With manufacturing facilities in both Singapore and China, the Group is well positioned to serve a wider customer base. Leveraging on NTi Tech’s technical expertise and advanced technology, we are able to offer customised membrane solutions that cater to municipal and industrial applications alike, while maintaining competitive pricing and quality assurance.
Building on the Group’s strong technical expertise and synergy in both sludge treatment and advanced membrane technologies, we have developed an innovative membrane condenser system which can further enhance the existing CTH platform’s performance. Supported by the Living Lab Grant from National Research Foundation, a demonstration plant will commence operation in 2026. This project enables the Group to demonstrate its membrane technology in a live operational environment, deepen system integration and application capabilities, and enhance the commercial readiness of the membrane division, supporting its longerterm growth prospects.
We are raring to move forward and accelerate business growth. We entered 2025 with the formation of a consortium with Econ Technology Co. Ltd. (“Econ”), a subsidiary of Shandong Hi-Speed Co. Ltd., a state-owned enterprise listed on the Shanghai Stock Exchange. The consortium successfully secured contracts worth RMB143.3 million to provide municipal sludge treatment services in Tongxu and Tangying counties in Henan Province, China. The Group will supply its proprietary CTH technology and energy recovery system, with approximately RMB70 million apportioned to the Group.
With the joint venture company being formally established, this partnership underscores our commitment to an asset-light business model. By contributing our proprietary sludge treatment technology, along with our engineering expertise, the Group can participate in sizeable infrastructure projects without taking on significant debt or capital expenditure. The construction and financing of the treatment facilities will be undertaken by our joint venture partner and consortium members, allowing us to capture value through technology deployment.
In December 2025, the Group entered into a joint investment agreement with Mr Yang Peng (“YP”) to provide Engineering, Procurement and Construction (“EPC”) and Operation and Maintenance (“O&M”) services to treat organic wastes and sludge. Mr YP’s technologies comprise a carbon source production process that converts food waste and sludge into organic carbon sources; a bio-iron flocculant that is a highly efficient and cost-effective solution for wastewater treatment and sludge conditioning; and an integrated vacuum press drying system that operates on electricity, offering lower operating cost and higher energy efficiency. We believe that the integration of our combined technical expertise and complementary resources will enhance our project execution capabilities and unlock new market opportunities. The construction and financing of the treatment facilities will be undertaken by Econ and consortium members while the EPC and O&M services will be provided by the joint venture company
Looking ahead, the Group remains focused on leveraging innovative technologies to support sustainable growth. We will continue to deepen our presence in the environmental solutions sector through the ongoing identification, development and application of advanced technologies aimed at addressing practical environmental challenges across our core business segments.
The Board records with deep sorrow the passing of Dr Lin Yucheng (“Dr Lin”) on 3 January 2026. Dr Lin had previously retired as Executive Chairman and was appointed Emeritus Chairman and Senior Advisor with effect from 1 February 2025. Since 2020, Dr Lin played a pivotal role in reshaping the Group’s strategic direction, transforming it into a technology-driven environmental solutions company with strong capabilities in sludge treatment, membrane manufacturing and AI-enabled water management.
A visionary founder and respected techno-entrepreneur, Dr Lin’s leadership, conviction and commitment to innovation laid the foundation for the Group’s long-term growth. The Board and Management pay tribute to his remarkable legacy and remain resolute in carrying forward his vision of technological excellence and value creation for all stakeholders.
We thank our shareholders, customers, management team and employees for their unwavering support. As we move into 2026, the operating environment is expected to remain volatile, and the Group will continue to monitor developments closely. Our priority is to ensure that the Company remains operationally resilient and appropriately positioned to respond to opportunities as market conditions evolve.
On behalf of the Board, I would like to express my heartfelt appreciation to Independent Non-Executive Director, Dr. Ng Wun Jern. He will retire on 28 April 2026 after serving 2 years with the Company. We would like to express our appreciation for his invaluable contributions and wish him all the best in his future endeavours.
Executive Chairman