SEAIR YEAR-END RESULTS SHOW INCREASED REVENUE DIVERSIFICATION

/THIS PRESS RELEASE IS NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

EDMONTON, Dec. 29 /CNW/ - Seair Inc. (SDS:TSX Venture Exchange) today released its audited financial statements for the year ending August 31, 2010.

FINANCIAL RESULTS

Revenue for the year ending August 31, 2010 was $3.5 million, or 8% lower than fiscal 2009.  The decline is attributable to low deployment rates for the Company's fleet of portable wastewater treatment plants.  However, the portable wastewater treatment decline was largely offset by the emergence of new commercialized revenue streams in oil sands water treatment and municipal wastewater treatment plants.  Revenue from these new sources was $2.5 million, an increase of 224% over the prior year.

Fiscal 2010 gross profit was $2.3 million (66% of revenue) compared to $1.8 million (49% of revenue) in the year ending August 31, 2009.  This $456 thousand increase in gross profit is due to strong margins on applications unique to Seair, such as flow-through dewatering treatment systems for the oil sands. 

Seair's patented diffusion technology is uniquely able to deliver industrial-scale flow-through treatment capabilities for various oil field waters.  As a result Seair is able to build strong gross margins around the intellectual property underlying the treatment units.  Seair will continue to focus its commercialization efforts on applications where its patented diffusion technology can achieve unique, and therefore high margin, outcomes.

The Wolf Creek wastewater treatment plant is the first Seair-based complete turnkey facility for a residential community.  The plant uses essentially the same technologies and processes as the Company's portable units, although on a much larger scale and with full nutrient removal with all treated water is used for golf course irrigation.  The Wolf Creek plant was completed in summer 2010 with commissioning taking place in August and it is now Seair's reference site in pursuing similar opportunities in other residential communities.  The gross profit percentage on the Wolf Creek sale was impacted by one-time costs associated with bringing this first-of-a-kind project to completion.  These regulatory and engineering costs should not recur to this magnitude on subsequent similar projects.

Total operating expenses decreased by $1.3 million to $3.8 million (25% decrease) from fiscal 2009 to fiscal 2010.  The main items contributing to this decrease were reduced amortization of units for rental or resale, stock-based compensation and salaries and wages.

Amortization of equipment held for rental or resale, or essentially the portable wastewater treatment fleet, was changed from a declining balance basis to a usage basis.  Low fleet deployment rate results in decreased amortization and, therefore, amortization expense decreased by $626 thousand on a year-over-year basis.  Stock-based compensation was nil ($324 thousand in fiscal 2009) as no options vested during the year.

Salaries and benefits decreased by $197 thousand as a result of head count reductions.  Fewer support personnel were required as a result of the low Septic fleet deployment rate and any additional work associated with the growing oil sands and municipal wastewater sectors is being handled by existing Seair staff.

Net loss for the year ending August 31, 2010 was $1.6 million, which is an improvement of $2.9 million over fiscal 2009.

BUSINESS UPDATE

For the past several years the portable wastewater treatment business has generated the vast majority of Seair's revenue and served as a proving ground for the effectiveness and durability of the Company's treatment technologies and systems.  At the same time, research and development work was focussed on applying Seair's diffusion technology to larger and more complex situations where Seair's unique capabilities can position the Company as the only viable solution provider.

In fiscal 2010 the first of these diffusion applications, flow-through treatment of groundwater in mining operations such as the oil sands, was commercialized.  To date, Seair has sold 14 groundwater treatment systems to a major oil sands producer who described their adoption of the Seair solution at the April 2010 CONRAD (Canadian Oil Sands Network for Research and Development) symposium.  During fiscal 2010 Seair began a partnership with North American Energy Partners Inc. on this initiative and other oil sands water treatment applications.  Seair is seeking to advance its accelerated tailing settling solution (using diffused CO2) and tailing pond toxin removal solution to the pilot plant stage, which will further expand Seair's ability in processing oil sands tailings.

Work also continues on commercialization of Seair's diffusion-based systems for treatment/reuse of frac and produced water as well as treatment of brackish and blowback water for SAGD (steam-assisted gravity discharge) oil sands companies.  All of the oil field water treatment projects are ultimately targeted at high volume throughput installations.  The efficiency and comparatively low power consumption of Seair's micro-bubble diffusion system is critical to providing economically viable treatment systems at commercial volumes.

Apart from oil field water treatment, Seair's major new initiative is permanent end-to-end wastewater treatment plants for residential communities not connected to municipal systems.  The first such plant, sold to the Village at Wolf Creek in central Alberta, completed commissioning in August 2010.  These ozone-based plants are unique.  They are small, efficient, odourless and produce effluent that can be tailored for reuse in whatever manner suits the purchaser.  At Wolf Creek, treated residential wastewater will be used to irrigate the 36 hole golf course.  Bringing the Seair permanent plant design from paper to reality took several years, but with the first plant up and running the Company now has a tangible showcase for advantages inherent to the Seair system.  Intensive marketing of Seair plants to residential communities in need of stand-alone wastewater treatment has commenced with the Wolf Creek plant serving as a reference site for engineers, property developers, planners and other stakeholders and influencers.

Western Canadian oil patch activity levels are on the increase and this is expected to spark a rebound in Seair's portable wastewater treatment plant business.  The Company has hired Sonny Vallieres, a Calgary-based sales professional with extensive oil field experience, to lead efforts to improve Seair's fleet deployment.

Seair is no longer engaging Uptick Communications Inc. for investor relations services.  Alternatives are presently under review and, in the meantime, all investor inquiries should go directly to Seair.

About Seair

Seair develops proprietary equipment that diffuses gases into liquids. The introduction of oxygen, ozone or carbon dioxide results in a supersaturated solution, that meets environmental standards and customer needs. Seair's patented technologies can produce extremely small bubbles which are more efficient than other diffusion technologies. Our technologies are used in a variety of applications in the oil and gas industry. We also service customers in such diverse fields as wastewater treatment, pulp and paper, food processing, aquaculture, agriculture/horticulture, sterilization, golf course irrigation and pond treatment and animal enhancement.

Seair is a leading developer of patent-protected diffusion and sterilization technologies, which allow for the efficient diffusion of gases into liquids, thereby facilitating numerous applications in a wide variety of industries, including wastewater treatment, pulp and paper production, food processing, aquaculture, agriculture/horticulture, sterilization, golf course irrigation and pond treatment, animal enhancement and oil and gas.  Seair's primary focus is developing and selling equipment that diffuses gases, such as oxygen, ozone or carbon dioxide, into a liquid, resulting in a supersaturated solution.  The major difference between Seair's and others' diffusion technologies is Seair's ability to achieve extremely small bubble size, which in turn allows for the mass transfer of gas to fluid.  The result is a stable condition, where gases remain in solution for extended periods of time, leading to increased productivity and lower operating costs.  Seair provides diffusion-enhanced portable wastewater treatment plants through its subsidiary, Seair Septic.

Parties interested in obtaining further information or receiving news releases and corporate documents from Seair may email such requests to seair@telus.net or visit the Seair website at www.seair.ca.

This news release contains forward-looking statements relating to the future operations of the Seair Inc. and other statements that are not historical facts.  Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expects" and similar expressions.  Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements.  Such forward-looking statements are subject to important risks, uncertainties and assumptions. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect.  Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Seair Inc.  As a result, we cannot guarantee that any forward-looking statement will materialize and the reader is cautioned not to place undue reliance on any forward-looking information.  Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated.  Forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

The forward-looking statements contained in this news release are made as of the date of this news release, and Seair Inc. does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by Canadian securities law.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Seair Inc.

For further information: For further information:

Harold Kinasewich
Seair Inc.
T: 780 477 7188
F: 780 477 6622
E: seair@telus.net


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