Corporate Strategy

ZhongDe’s strategic target is to strengthen our position in the Chinese energy-from-waste industry and to return to strong and profitable business growth in order to create superior shareholder value. Because of the change in the market environment of China, the Company quickly adjusted its business strategy so that it was able to largely offset the decline in sales of small and medium-sized incinerators with the revenues from large energy-from-waste projects. The focus of ZhongDe’s business strategy was shifted from small and medium-sized incinerators to large-scale energy-from-waste projects.

 

The World Economic Forum recommends energy-from-waste as one of the ten large-scale technologies to reduce greenhouse gas emissions. As one of seven strategic new industry programs during the 12th Five-Year Plan period, the energy-from-waste industry gains strong support from the government and will have promising growth opportunities.

 

We plan to expand our market position and technological expertise. ZhongDe Waste Technology AG has taken a new step forward in terms of expanding its business and promoting its influence in the industry, with the securing of considerable projects. With BOT projects, we will generate recurring revenues. The BOT business delivers a sustainable earnings stream from waste disposal fee, and electricity sales, interest income and from other by-products. With the cooperation of external service providers, ZhongDe designs and installs equipments for the treatment of municipal solid waste and then operates these energy-from-waste plants for a contracted period of time in accordance with its concession agreements. At the end of 2010, the construction of Feicheng project had been completed and had entered into its trial operation period. Besides two additional EPC projects, three additional BOT projects will be finished in 2011 and 2012, which will contribute to ZhongDe’s Group revenues.

 

We plan to increase our activities and geographical coverage within China. ZhongDe Waste Technology AG successfully relocated its headquarters to Beijing, laying a solid foundation for the promotion of its industrial competitiveness and rapid development. When it is finished, the ZhongDe Environmental Technology Park in Beijing will be responsible for researching environmental technologies, project development and for manufacturing valuable parts of energy-from-waste equipments. The Company takes full advantage of the talent pool and leading-edge technology found in the capital city of Beijing to develop its core competitiveness.