Questor Technology Inc.

Questor Technology Inc.

April 29, 2009 09:10 ET

Questor Technology Inc. Announces 2008 Financial Results

CALGARY, ALBERTA--(Marketwire - April 29, 2009) -


Questor Technology Inc. ("Questor" or the "Company") (TSX VENTURE:QST) announced today it's financial and operating results for the year ended December 31, 2008. The Company reported net income of $628,056 ($0.03 per basic share) compared to net income of $1,977,383 ($0.08 per basic share) for the year ended December 31, 2007. The net income variance is primarily attributable to a significant incinerator sales contract completed in the third quarter of 2007, the magnitude of which was not repeated in 2008. The net income variance was partially offset by foreign exchange gains and lower income tax expense in 2008.

"Questor delivered profitable results in 2008 despite the challenging economic environment. While we did not reprise a material sales contract similar to the one with China Petrochemical International Company Ltd. ("SINOPEC") in 2007, our total revenue was significantly higher compared to all other prior years. We have delivered consistent, stable growth over the last eight years," said Audrey Mascarenhas, President and Chief Executive Officer.

"As 2009 unfolds, the Company continues to experience increasing demand for its products and services from both domestic and international clients. At this time, we have more than $30 million of bids outstanding pending completion of the tender process and notification of the clients' purchase decision. While the number of the bids for which Questor will ultimately be successful, their quantum and timing is not reasonably determinable, the opportunity to grow our revenue is clearly present. We have a capable team in place and a strong balance sheet to position the Company to capitalize on these opportunities. Based on the significant increased interest for permanent applications of our technology and the current order backlog of $1.8 million, we are anticipating favourable results for the first and second quarters of 2009."

Ms. Mascarenhas added, "A strategic initiative upon which the Company is actively focused is the development of a process to convert waste gas to heat/power that will help our clients save money, develop sustainable solutions, meet regulations and address public concerns. Overall, the Company's outlook is quite promising as Questor benefits from increasing corporate and government focus on environmental responsibility and sustainable development."

In recognition of Questor's best-in-class technology and the professional expertise of its leadership, Audrey Mascarenhas was recently nominated for consideration by the Society of Petroleum Engineers ("SPE") as a Distinguished Lecturer speaking on environment and sustainability. As SPE is a key resource for technical information in the oil and gas industry, the lecture series offers an opportunity to present to SPE members worldwide.


- Successfully commissioned the well testing incinerators for SINOPEC. This project firmly establishes Questor as an industry leader in the handling of critically sour gas and complex applications for clients who want to adopt best practices in an economic and environmentally responsible manner.

- Completed its first landfill project and continued its collaborative effort with CrystaTech, Inc., to develop a portable, cost effective solution to remove hydrogen sulfide from waste gas streams and convert it to liquid sulphur which would reduce sulphur dioxide emissions. These efforts are consistent with Questor's strategic pursuit of alternate markets for application of its technology.

- Entered into a strategic arrangement with Natco Group Inc. ("Natco") to market and fabricate Questor's products for the United States market. Questor's strategic relationship with Natco is providing a strong base upon which to capitalize on the U.S. market opportunity.

- Established marketing arrangements with Ramsay Machine Works Ltd. and EMCS Industries Ltd., both headquartered in Sidney, British Columbia, for the purpose of targeting industries such as the oil sands, offshore oil and gas platforms, solid waste treatment, waste water treatment and landfills, all of whom would benefit from Questor's technology;

- Executed an agreement with Terra Verde Emissions Credits Inc. to develop the protocol methodology and sale of the greenhouse gas credits/offsets in Alberta generated from the use of Questor's proprietary incinerator technology.

- Built market awareness and influence of Questor's expertise and environmental perspectives relating to air quality by presenting at several conferences worldwide, among them:

-- "Environmental Challenges and Innovations Conference" sponsored by the Texas Association of Environmental Professionals in Houston, Texas, USA in February 2008;

-- The "China National Science and Technology Sulphur Forum" in Dazhou, China in April 2008;

-- The "Canadian Sour Gas Forum" presented by inSIGHT in Calgary, Alberta in December 2008; and

-- "Global Forum on Flaring Reduction and Natural Gas Utilization" organized by the World Bank Group as a leading partner in the Global Gas Flaring Reduction partnership, along with the U.S. Environmental Protection Agency's Natural Gas STAR Program, Methane to Markets Partnership, and the International Association of Oil & Gas Producers in Amsterdam, The Netherlands in December 2008.

- Achieved recognition of Questor's continued growth when selected for the following awards:

-- One of the "2008 TSX Venture 50", a ranking of the top 10 public venture capital companies in each of five major industry sectors - mining, oil and gas, technology and life sciences, diversified industries and clean technology. Questor ranked second in the clean technology category;

-- One of the 2009 Fast Growth 50 chosen by Alberta Venture magazine. Questor ranked third in the top 25 fastest growing companies with revenue under $20 million; and

-- One of three finalists in the New Exporter category of the inaugural Alberta Export Awards held by the Alberta division of Canadian Manufacturers and Exporters.

The Company also announced today, subject to regulatory approval and effective May 1, 2009, the grant of share options to select officers, employees and contractors entitling the purchase of up to 400,000 common shares at $0.25 per share, exercisable for a period of five years and vesting in accordance with the provisions of the Company's share option plan.

Questor's audited financial statements and Management's Discussion and Analysis for the years ended December 31, 2008 and 2007 will be available shortly on the Company's website at and through SEDAR at


Questor is an international environmental oil field service company founded in late 1994 and headquartered in Calgary, Alberta, Canada with a field office located in Grande Prairie, Alberta, Canada. The Company is focused on clean air technologies with activities in Canada, the United States, Europe and Asia. Questor designs and manufactures high efficiency waste gas incinerators for sale or for use on a rental basis and also provides field burner services. The Company's proprietary incinerator technology destroys noxious or toxic hydrocarbon gases which ensures regulatory compliance, environmental protection, public confidence and reduced operating costs for clients. Questor is recognized for its particular expertise in the combustion of sour gas (H2S). While the Company's current client base is primarily in the oil and gas industry, this technology is applicable to other industries such as landfills, water and sewage treatment, tire recycling and agriculture.

Questor trades on the TSX Venture Exchange under the symbol "QST".

Certain information in this news release constitutes forward-looking statements. When used in this news release, the words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "seek", "propose", "estimate", "expect", and similar expressions, as they relate to the Company, are intended to identify forward-looking statements. In particular, this news release contains forward-looking statements with respect to, among other things, business objectives, expected growth, results of operations, performance, business projects and opportunities and financial results. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Such statements reflect the Company's current views with respect to future events based on certain material factors and assumptions and are subject to certain risks and uncertainties, including without limitation, changes in market, competition, governmental or regulatory developments, general economic conditions and other factors set out in the Company's public disclosure documents. Many factors could cause the Company's actual results, performance or achievements to vary from those described in this news release, including without limitation those listed above. These factors should not be construed as exhaustive. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those described in this news release and such forward-looking statements included in, or incorporated by reference in this news release, should not be unduly relied upon. Such statements speak only as of the date of this news release. The Company does not intend, and does not assume any obligation, to update these forward-looking statements. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.



As at December 31 2008 2007

Current assets
Cash and cash equivalents $ 3,259,037 $ 2,753,997
Accounts receivable 1,767,823 1,062,716
Inventory 384,914 526,401
Prepaid expenses and deposits 80,340 98,609
Deferred expenses 29,160 -
5,521,274 4,441,723
Property and equipment 1,176,529 1,299,677
Intangibles 44,680 73,678
Deferred expenses 30,575 -
Future income tax asset - 31,480
$ 6,773,058 $ 5,846,558

Current liabilities
Accounts payable and accrued liabilities $ 667,792 $ 501,314
Short-term debt - 191,186
Current portion of long-term debt 37,498 60,183
Income and other taxes payable 285,795 115,707
Deferred revenue and deposits 146,707 70,129
Future income tax liability 9,281 102,682
1,147,073 1,041,201
Long-term debt 15,232 53,206
Other long-term liabilities 30,575 -
Future income tax liability 26,710 -
1,219,590 1,094,407
Shareholders' equity
Share capital 5,265,736 5,235,677
Contributed surplus 283,552 140,350
Retained earnings (deficit) 4,180 (623,876)
5,553,468 4,752,151
$ 6,773,058 $ 5,846,558


For the years ended December 31 2008 2007

Incinerator sales and services $ 2,583,199 $ 7,568,257
Incinerator rentals and services 954,396 1,158,576
Combustion services 678,660 415,382
4,216,255 9,142,215
Less: Direct costs 2,818,502 4,996,524
1,397,753 4,145,691

Other revenue 254,896 90,062

General and administrative 1,328,469 987,880
Foreign exchange loss (gain) (707,664) 211,709
Depreciation and amortization 40,459 35,839
661,264 1,235,428
Income before interest expense and
income tax expense 991,385 3,000,325
Interest expense
Short-term debt 5,196 19,796
Long-term debt 2,016 2,959
Income before income tax expense 984,173 2,977,570
Income tax expense
Current income tax 391,328 131,502
Future income tax (35,211) 868,685
Net income and comprehensive income 628,056 1,977,383
Deficit, beginning of year (623,876) (2,601,259)
Retained earnings (deficit), end of year $ 4,180 $ (623,876)

Net income per share
Basic $ 0.026 $ 0.083
Diluted $ 0.026 $ 0.079

Weighted average number of
shares outstanding
Basic 23,830,287 23,739,767
Diluted 24,491,573 24,905,399


For the years ended December 31 2008 2007

Operating activities
Net income $ 628,056 $ 1,977,383
Items not involving cash:
Depreciation and amortization 151,120 152,325
Future income taxes (35,211) 868,685
Share-based compensation 152,011 81,291
Gain on disposition of assets (98,269) -
Write-down of inventory 38,912 4,722
836,619 3,084,406
Net change in non-cash working capital (189,054) 24,666
Foreign exchange loss (gain) on cash (317,106) 242,519
330,459 3,351,591

Investing activities
Additions to property and equipment (51,663) (88,857)
Dispositions of property and equipment 139,733 -
88,070 (88,857)

Financing activities
Repayment of short-term debt (191,186) (270,111)
Repayment of long-term debt (60,659) (49,543)
Net proceeds from issuance of common shares 21,250 24,250
(230,595) (295,404)

Effect of exchange rates on cash 317,106 (242,519)

Increase in cash and cash equivalents 505,040 2,724,811
Cash and cash equivalents, beginning of year 2,753,997 29,186
Cash and cash equivalents, end of year $ 3,259,037 $ 2,753,997

Neither 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.

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