The board of directors of Leader Environmental Technologies Limited provided an update on the development of the Group's Artificial Intelligence Water Management System ("AIWater"). Since the last business update on 21 April 2023, the Group has successfully secured four projects in Shandong province and Zhejiang province, China which will implement AIWater to manage 500,000 tons/day of municipal and industrial wastewater. The projects were secured via Environment Resource Management Contracts ("ERMCs") for tenures ranging from 6 to 10 years.

Under the terms of ERMCs, the Group will earn a share of the cost savings arising from the implementation of AIWater on the existing wastewater treatment plants ("WWTPs"). These ERMCs provide the Group with long-term recurring incomes with minimal capital investments. Based on past experience of operating AIWater, the Group expects a reduction of electricity consumption by approximately 10%, chemical consumption by approximately 40%, and overall operating cost by approximately 10% to 20%.

This will translate to reduction of carbon emission by approximately 200 tons per ten thousand tons of wastewater treated annually. The Group has developed its patented AIWater by integrating AI technology, technical and operational know-hows, and experiences of operating WWTPs. AIWater has demonstrated cost savings in optimising the operations of the WWTPs to achieve low-carbon and efficient operation while maintaining stability and regulatory compliance.

The Company believes technology is key to the sustainable growth of its business.