Hydro International plc : - Trading Update

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15 January 2013

Hydro International plc

("Hydro" or the "Group")

Trading Update

Hydro International (AIM: HYD), a leading provider of environmentally sustainable and innovative products for the control and treatment of water, today announces the following update on trading.

Although economic conditions remain difficult, particularly in the general construction sector in the UK, the Group has secured the order intake required to achieve revenue and profit objectives for the 2012 financial year. The Group is therefore pleased to confirm that the financial results for the 12 months to 31 December 2012 will be in-line with market expectations.

However, due to the approaching conclusion in 2013 and early 2014 of three major long-term contracts with Thames Water secured by the UK Wastewater business in 2010 and 2011, we anticipate that 2013 revenues and adjusted profit before tax will be materially below 2012 levels. The majority of these three projects, with a total order value of £23m have been delivered over the period from 2010 to 2012, and there are no new projects of such size in the current pipeline.

Other new order input in the UK Wastewater business during 2012 was significantly higher than in the previous year, as the AMP 5 programme got underway; these orders will continue to ship during 2013.  Hydro also achieved a number of significant project wins during 2012 including the previously announced CDN$4m contract at Bonnybrook WWTP, Calgary, Canada. We are also seeing steady progress from our growth initiatives within the individual business units. In particular, we are achieving encouraging growth in the US Stormwater business as a result of our developing relationship with the new distribution partner, and are building on our success in the US Wastewater business with new product introductions, including the GritCup and SpiraSnail. UK Stormwater has updated its core product range through the launch of the Hydro-Brake Optimum, but poor demand from the construction sector means that business remains flat within this business unit.

The growth anticipated across the Group will not, however, make up for the successful conclusion of the Thames Water projects, giving rise to our view that revenue and profitability in 2013 will be materially lower than 2012 levels. In addition a number of orders received in the second half of 2012 are scheduled to be delivered in the second half of 2013, so that the year will again be significantly second half weighted.

Hydro will be announcing Final Results for the year ended 31 December 2012 on Tuesday 19 March 2013 and has today issued an announcement on forthcoming management changes.

For further information please contact:

Hydro International	Arden Partners plc	Newgate Threadneedle
Tel.[phone]	Tel. [phone]	Tel. [phone]
Steve Hides, CEO	Richard Day	John Coles
Tony Hollox, CFO	Steve Douglas	Fiona Conroy

About Hydro International

Hydro International plc (AIM:HYD) (Hydro) is a global supplier of environmentally sustainable products and innovative solutions for the control and treatment of stormwater, wastewater and combined sewer overflows. Hydro's products use a range of advanced technologies including award-winning advanced vortex technology. Headquartered in Clevedon, North Somerset, Hydro also operates in the UK from offices in Ely, Cambridgeshire as well as across the US from bases in Portland, Maine and Hillsboro, Oregon. The Group has a growing presence outside of its core US and UK markets in Ireland, Egypt, Middle East, Mexico, European Union, Malaysia, Singapore, Japan, Korea, Australia and New Zealand.

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