1TSX-V: TMG | Corporate Presentation | November 2017

Profitable energy

efficiency & emission

reduction solutions

2

This presentation includes “forward-looking information”. For example, statementsabout the opportunities for repeat business, additional orders, entry into new marketsand growth of recurring revenue streams; order backlog; introduction of new productsand services and growth opportunities and strategies are all forward lookinginformation. Such forward looking information reflects Thermal Energy International’s(“TEI”) current expectations with respect to future events and are based oninformation currently available to management. Forward-looking information involvessignificant known and unknown risks, uncertainties and assumptions. Should one ormore of these risks or uncertainties materialize, or should assumptions underlying theforward-looking information prove incorrect, actual results, performance orachievements could vary materially from those expressed or implied by the forward-looking information contained in this presentation.

Readers should not place undue reliance on forward-looking information. Theforward-looking information is made as of the date of this presentation and TEI doesnot assume any obligation to update or revise it to reflect new events orcircumstances, except as required by law.

Forward-looking statements

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Global provider of energy efficiency solutions

We save our customers money & improve their bottom lines by…

Reducing their fuel use and cutting emissions

4

Highlights

1

2

3

Enormous, fast-growing global market

with strong fundamentals

Proprietary products sold to leading

companies in many sectors

Poised to continue strong track record

of growth

5

Governments and industries

around the world taking

unprecedented action on

climate change

Increasing energy efficiency is the

fastest, cheapest & easiest way to

reduce GHG emissions

Market fundamentals stronger than ever!

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6

To meet Paris Agreement 2˚C goal

0

0.5

1

1.5

2

2013 For 2 degreetarget

Source: IEA 2014 & 2016 World Energy Outlook reports

Trill

ion

do

llars

(2

01

3)

Average annual low-carbon investment, 2013 – 2040

Energy efficiencyOther

Renewables

9X growth needed in annual investment in energy efficiency

49% of carbon emission reductions will come from energy efficiency

7

Enormous opportunity

1 P&S Market Research Report on Global Waste Heat Recovery Market

20%-50% Amount of industrial energy consumption lost as waste heat1

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Proprietary, proven solutions

FLU-ACE®

Direct contact condensing heat recovery

GEM™Steam traps

~80%We can recover of energy lost in typical boiler plant and steam system operations

High ROI with short, compelling payback

20 year track record

8

99

FLU-ACE® Heat Recovery

Recovers waste heat from process exhaust

Returns hot water for use in production or heating

Sells for $100k to millions each

90% 10-30% 2-5YRSRecovery

RateReduction in Energy Costs

Payback Period

1010

GEM™ Condensate Return System

More efficient than traditional mechanical traps

No moving parts –never needs replacing

100’s to 1,000’s of traps per location; sells for $500 to $2,000 per trap

10-30% 1-2YRS

Reduction in Energy Costs

Payback Period

10

GEM steam trap

Mechanical trap

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Customers include F500 &

other leading companies

across many sectors

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Annual revenue

($ millions)

0

2

4

6

8

10

12

14

FY 15 FY 16 FY 17

$13.2

FY 2017 highlights:

Record revenue

Up 6.4% over FY 2016

GEM revenue up 28.6% over FY 2016

Heat recovery revenue down 9.4% versus FY 2016

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Annual gross profit

($ millions)

0

1

2

3

4

5

6

7

8

FY 15 FY 16 FY 17

$7.4

FY 2017 highlights:

Record gross profit

Up 9.5% over FY 2016

Gross margin of 56.4% versus 54.8% in FY 2016

Higher proportion of GEM revenue

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Annual EBITDAS and net income

($ thousands)

-2400

-2000

-1600

-1200

-800

-400

0

400

800 $750

-2400

-2000

-1600

-1200

-800

-400

0

400

800

$393

FY 15 FY 16 FY 17 FY 15 FY 16 FY 17

EBITDAS Net income

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Q1 revenue

($ millions)

0

0.5

1

1.5

2

2.5

3

3.5

Q1 16 Q1 17 Q1 18

$3.1

Q1 2018 highlights:

Record Q1 revenue

Up 45.1% over Q1 2017

Heat recovery revenue up 168.6%

Second strongest Q1 GEM revenue on record

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Q1 gross profit

($ millions)

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

Q1 16 Q1 17 Q1 18

$1.5

Q1 2018 highlights:

Up 4.3% over Q1 2017

Gross margin of 49.0% versus 68.2% in Q1 2017

Much higher proportion of heat recovery revenue

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-500

-400

-300

-200

-100

0

100

EBITDAS Net loss

Q1 EBITDAS and net income

($ thousands)

Q1 16 Q1 17 Q1 18

Operating expenses for the quarter were $1.7M versus $1.5M in Q1 2017:

More than half of the increase relates to:

• New sales staff

• New technical staff

• Other strategic growth initiatives

Operating expenses as a percentage of revenue fell to 56% in Q1 2018 vs. 70% in Q1 2017

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Order backlog remains strong

Order backlog: The value of projects in respect of which purchase orders have been received but have not yet been reflected as revenue in the Company’s published quarterly financial statements.

At the time of reporting year end in October of each year

($ millions)

0

1

2

3

4

5

6

7

8

9

Q1 16 Q1 17 Q1 18

$7.8

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Recent & planned growth initiatives

Increase penetration in key markets

FY2017: Three new sales people/territories (Ontario, Latin America, Germany)

FY2018 and Beyond: Alberta, Texas, Germany, France, Eastern Europe

Introduce new products

FY2017: Super-Efficient Cogeneration™

FY2018 and Beyond: Dry-Rex low-temp.

biomass drying Indirect heat recovery Direct fired water

heater

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Support agents/distributors in secondary markets

Increase penetration in key strategic markets

Corporate / Sales Office Agent / Distributor

Growing global presence

* Company has engineering offices in Ottawa and Bristol (U.K.)

Strategic growth in key markets (NA and EU)

Opportunistic growth in secondary markets

Corporate accounts

Strategically targeted sectors

Alternate distribution channels

New products and services

Grow organically

and/or through

accretive

acquisitions

Growth strategy

Strong market fundamentals, enormous growth potential

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Summary

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Enormous, fast-growing market with strong fundamentals

Proprietary products sold to leading companies in many sectors

Poised to continue strong track record of growth

1

2

3

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