Halosource : Trading Update

27 December 2017

HaloSource, Inc.

('HaloSource' or the 'Company')

Trading Update

HaloSource, Inc. ('HaloSource' or 'the Company') (HAL.LN, HALO.LN) the clean water technology company, today provides an update on trading ahead of the year ending 31 December 2017.

The Board of HaloSource was notified late on 22 December 2017 that on 21 December 2017, the Chinese government issued a temporary shutdown order to manufacturing facilities in the region of China where our glass pitcher supplier is located for region wide, rather than supplier specific, pollution mitigation reasons. As a result, we have experienced an unexpected delay in receipt of glass pitchers from this supplier which will temporarily prevent the Company from shipping product to one of its customers, JiuBan, prior to 31 December 2017. This will have a material negative impact on our revenues for 2017 and the Company now anticipates that its total sales for the year will be in the range of $2.6 to $3.0 million and net loss for the year will be in the range of $5.0 to $5.5 million. The low end of the revised forecasts reflects an approximate 25% increase in revenues for the full year, a greater than 145% increase in revenues compared to the second half of 2016 and a nearly 50% reduction in the Company's net loss for 2017 compared to 2016.

The Company expects all delayed products to be received from our supplier as soon as possible after the temporary shutdown affecting the region has ended and we expect to ship the delayed pitchers and related cartridges to fulfill orders received from JiuBan, valued at over 5.5 million Chinese yuan (approximately $840,000), early in 2018.

The Company also announces today that it has adjourned its Annual General Meeting from 27 December to 29 December at 9:30 am Pacific standard time to allow more time for votes to be cast and obtain a quorum for the items to be approved at the meeting. Given the expected approval of the Company's fundraising, previously announced on 15 December 2017, at the Annual General Meeting it is now expected that the new common shares of the Company to be issued as part of the fundraising will be admitted to trading on AIM effective at 8.00 a.m. on 3 January 2018.

Market Abuse Regulation

The information communicated in this Announcement is inside information for the purposes of Article 7 of Market Abuse Regulation 596/2014 ('MAR'). For the purposes of MAR and Article 2 of Commission Implementing Regulation (EU) 2016/1055, this announcement is being made on behalf of the Company by Craig Crowell, Chief Financial Officer.

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About HaloSource

HaloSource, Inc. innovates and integrates technologies to deliver clean drinking water solutions to partners with trusted brands around the world. The Company works with scientists and industry experts across the globe in search of new ways to improve drinking water quality and has been awarded more than 30 patents for its ground-breaking chemistries, which provide safe drinking water for more than 10 million consumers globally. The Company's class-leading HaloPure® Drinking Water technology has the highest global certifications, including registration with the US EPA.

Founded in Seattle, Washington, HaloSource has grown to become an influential leader in drinking water purification. HaloSource is headquartered in the US with operations in China and in India. Learn more about the Company's research and development and future cutting edge technologies by visiting www.halosource.com.

The HaloPure® and astrea® brands are registered trademarks of HaloSource, Inc. All other trademarks, brand names or product names belong to their respective holders.

This document contains certain forward-looking statements relating to the Company. The Company considers any statements that are not historical facts as 'forward-looking statements'. They relate to events and trends that are subject to risk and uncertainty that may cause actual results and the financial performance of the Company to differ materially from those contained in any forward-looking statement. These statements are made by management in good faith based on information available to them and such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.