12. SEGMENTED, SIGNIFICANT CUSTOMER INFORMATION AND ECONOMIC DEPENDENCY

3 Months Ended

Mar. 31, 2014

Notes to Financial Statements

Note 12. SEGMENTED, SIGNIFICANT CUSTOMER INFORMATION AND ECONOMIC DEPENDENCY

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 and chemical additives used within the petroleum, chemical, utility and mining industries to prevent corrosion and scaling in water piping (as shown under the column heading “BPCA” below).  These chemical additives are also manufactured for use in laundry and dish detergents, as well as in products to reduce levels of insecticides, herbicides and fungicides.

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.

Three months ended March 31, 2014:

	EWCP			BPCA		Total
Revenue	$	205,597		$	3,607,384	$	3,812,981
Interest revenue		-			-		-
Interest expense		11,081			15,651		26,832
Depreciation and     amortization		153,445			47,154		200,599
Segment profit (loss)		(579,191	)		423,613		(155,578	)
Segment assets		3,949,829			1,694,762		5,644,591
Expenditures for     segment assets		(6,161	)		-		(6,161	)

Three months ended March 31, 2013:

	EWCP			BPCA		Total
Revenue	$	288,939		$	4,215,597	$	4,504,536
Interest revenue		-			-		-
Interest expense		(4,599	)		13,995		9,396
Depreciation and     amortization		274,359			54,840		329,199
Segment profit (loss)		(705,198	)		770,359		65,161
Segment assets		5,045,160			1,906,436		6,951,596
Expenditures for     segment assets		(4,741	)		-		(4,741	)

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

	Three months ended March 31, 2014		Three months ended March 31, 2013
Canada	$	64,493	$	207,680
United States and abroad		3,748,488		4,296,856
Total	$	3,812,981	$	4,504,536

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

	March 31, 2014		December 31, 2013
Canada	$	3,949,829	$	4,258,075
United States		1,694,762		1,741,916
Total	$	5,644,591	$	5,999,991

 Three customers accounted for $2,134,689 (56%) of sales made in the period (2013 - $2,694,248 or 60%).