12. Segmented, Significant Customer Information and Economic Dependency

9 Months Ended

Sep. 30, 2012

Notes to Financial Statements

Note 12. Segmented, Significant Customer Information and Economic Dependency.

The Company operates in two segments:

(a)   Development and marketing of two lines of energy and water conservation products (as shown under the column heading “EWCP” below), which consists of a (i) liquid swimming pool blanket which saves energy and water by inhibiting evaporation from the pool surface, and (ii) food-safe powdered form of the active ingredient within the liquid blanket and which is designed to be used in still or slow moving drinking water sources.

(b)    Manufacture of biodegradable polymers (“BCPA’s”) used by the petroleum, chemical, utility and mining industries to prevent corrosion and scaling in water piping. This product can also be used in detergents to increase biodegradability and in agriculture to increase crop yields by enhancing fertilizer uptake.

The accounting policies of the segments are the same as those described in Note 2, Significant Accounting Policies.  The Company evaluates performance based on profit or loss from operations before income taxes, not including nonrecurring gains and losses and foreign exchange gains and losses.

The Company’s reportable segments are strategic business units that offer different, but synergistic products and services.  They are managed separately because each business requires different technology and marketing strategies.

Nine months ended September 30, 2012:
	EWCP			BPCA		Total
Revenue	$	616,050		$	11,937,782	$	12,553,832
Interest revenue		750			9		759
Interest expense		45,447			40,190		85,637
Depreciation and amortization		729,708			189,820		919,528
Segment profit (loss)		(2,017,779	)		1,316,358		(701,421	)
Segment assets		5,760,309			2,025,466		7,785,775
Expenditures for segment assets		76,503			16,504		93,007

Nine months ended September  30, 2011:
	EWCP			BPCA		Total
Revenue	$	855,060		$	11,293,677	$	12,148,737
Interest revenue		53			-		53
Interest expense		53,109			15,548		68,657
Depreciation and amortization		32,674			215,402		248,076
Segment profit (loss)		(1,299,359	)		1,739,904		440,545
Segment assets		5,984,588			2,267,888		8,252,476
Expenditures for segment assets		675,313			65,503		740,816

The sales generated in the United States and Canada are as follows:

	Nine Months Ended September 30, 2012		Nine Months Ended September 30, 2011
Canada	$	682,159	$	443,064
United States and abroad		11,871,673		11,705,673
Total	$	12,553,832	$	12,148,737

The Company’s property, equipment, leasehold and patents are located in Canada and the United States as follows:

	September 30, 2012		December 31, 2011
Canada	$	5,760,309	$	6,214,939
United States		2,025,466		2,198,781
Total	$	7,785,775	$	8,413,720

 Three customers accounted for $7,103,617 (57%) of sales made during the nine months ended September 30, 2012 (2011 - $7,105,435 or 59%).