Questor Technology Inc.

Questor Technology Inc.

June 28, 2011 06:00 ET

Questor Technology Inc. Announces First Quarter 2011 Financial Results

CALGARY, ALBERTA--(Marketwire - June 28, 2011) -


Questor Technology Inc. ("Questor" or the "Company") (TSX VENTURE:QST) announced today its financial and operating results for the three months ended March 31, 2011. The Company's unaudited condensed financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS"), including restatement of its prior year results for comparative purposes.

The Company reported a loss of $119,541 ($0.005 per basic share) for the three months ended March 31, 2011 compared to a loss of $163,448 ($0.007 per basic share) for the three months ended March 31, 2010. On a comparative basis, the profit increase of $43,907 is primarily attributable to higher incinerator sales and services revenues and lower net foreign exchange losses. Partially offsetting these impacts is reduced incinerator rental revenue and combustion services activity, a smaller income tax recovery and higher administration expenses.

Financial Highlights Summary
(Stated in Canadian dollars except per share amounts)
For the three months ended March 3120112010Increase
Gross profit(2)297,612150,409147,203
Loss per share – Basic and diluted$0.005$0.007$(0.002)
Cash used in operations before movements in working capital(2)44,56591,479(46,914)
Total assets6,718,5026,073,528644,974
Non-current liabilities100,65555,07245,583
(1) Includes loss on disposal of property and equipment and other revenue.
(2) Non-IFRS financial measure. Please see discussion in the Non-IFRS Financial Measures section of this MD&A.

"Revenue increased by nearly 84 percent in first quarter 2011 compared to the same period last year. The economic and environmental value created by Questor's clean air technologies is evident in the successful start-up of a large incinerator at a heavy oil in situ combustion development in Saskatchewan and the upcoming commissioning of our incineration and waste heat water vaporization equipment for a carbon emissions reduction and energy efficiency demonstration project in Colorado. Both of these projects have led to additional opportunities for Questor and discussions are underway with prospective customers for both onshore and offshore applications in the Middle East, Mexico, China, Russia and Europe. In recent weeks, we have deployed rental incinerator units to the United States and European markets to provide a solution which addresses community concerns associated with shale gas well testing activities," said Audrey Mascarenhas, President and Chief Executive Officer. "Finally, in collaboration with a major Canadian university and a leading Organic Rankine Cycle generator manufacturer, we are advancing the development of our waste heat to power technology and hope to have a demonstration site operational by the end of the year."

"We are focused on the profitability and long-term growth of the Company. The market's understanding of the economic benefits of clean combustion is evolving and the awareness of Questor's incineration products and technologies is building. We continue to position our core products and to develop new air quality solutions to capitalize on the emerging market opportunities," concluded Ms. Mascarenhas.

As previously announced, the Company was selected for Alberta Venture's 2011 Fast Growth 50 list, an annual ranking honoring fifty of the fastest growing companies in Alberta. This is the third year in succession that Questor has been selected. The May 2011 edition of Alberta Venture magazine featured the Company and Audrey Mascarenhas in an article written by Steve Macleod entitled "Growing Concern: Questor Technology Realized that Removing Waste Gas Doesn't Have to be a Waste of Money".

On June 9, 2011, Ms. Mascarenhas presented at a paper entitled "Emission Reduction: Effective, Efficient, Safe and Sustainable" at the 2011 North America Gas and Oil Expo and Conference held in Calgary, Alberta, Canada. Ms. Mascarenhas also spoke at the Regional Forum on Flaring Reduction and Gas Utilization held June 17, 2011 in Baku, Azerbaijan, an event organized by the World Bank led Global Gas Flaring Reduction (GGFR) partnership and SOCAR, Azerbaijan's national oil company. Copies of these presentations are available on the Company's website.

Questor's unaudited condensed financial statements and notes thereto and management's discussion and analysis for the three months ended March 31, 2011 will be available shortly on the Company's website at and through SEDAR at


Questor is an international environmental oilfield 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 combustion-related oilfield 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 customers. Questor is recognized for its particular expertise in the combustion of sour gas (H2S). While the Company's current customer 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.

Stated in Canadian dollars
For the three months ended March 3120112010
Cost of sales(600,264)(337,708)
Gross profit297,612150,409
Administration expenses(384,269)(297,324)
Net foreign exchange losses(38,287)(47,295)
Research and development costs(20,968)(16,698)
Depreciation of property and equipment(2,888)(2,921)
Amortization of intangible assets(305)(4,010)
Loss on disposal of property and equipment(1,613)-
Finance costs-(504)
Other revenue3,7171,512
Loss before tax(147,001)(216,831)
Income tax income27,46053,383
Loss and comprehensive loss$(119,541)$(163,448)
Loss per share – Basic and diluted$(0.005)$(0.007)
Stated in Canadian dollars
As atMarch 31
December 31
Current assets
Trade and other receivables1,020,3521,873,636
Current tax assets110,444362
Prepaid expenses and deposits60,861107,467
Total current assets5,540,4916,290,701
Non-current assets
Property and equipment1,098,0341,037,565
Intangible assets10,45410,759
Deferred tax assets69,52349,695
Total non-current assets1,178,0111,098,019
Total assets$6,718,502$7,388,720
Current liabilities
Trade payables, accrued liabilities and provisions$625,381$852,821
Current tax liabilities13,408230,746
Deferred revenue and deposits31,944146,485
Total current liabilities670,7331,230,052
Non-current liabilities
Deferred tax liabilities100,655108,287
Total liabilities771,3881,338,339
Capital and reserves
Issued capital5,404,9665,404,966
(Deficit) retained earnings(68,070)51,471
Total equity5,947,1146,050,381
Total liabilities and equity$6,718,502$7,388,720
Stated in Canadian dollars
retained earnings
Balance at January 1, 2010$5,265,736$573,349$(393,589)$5,445,496
Recognition of share-based payments-26,308-26,308
Issue of ordinary shares under employee share option plan----
Balance at March 31, 20105,265,736599,657(557,037)5,308,356
Recognition of share-based payments-63,517-63,517
Issue of ordinary shares under employee share option plan139,230(69,230)-70,000
Balance at December 31, 20105,404,966593,94451,4716,050,381
Recognition of share-based payments-16,274-16,274
Issue of ordinary shares under employee share option plan----
Balance at March 31, 2011$5,404,966$610,218$(68,070)$5,947,114
Stated in Canadian dollars
For the three months ended March 3120112010
Cash flows from operating activities
Adjustments for:
Income tax income recognized in loss(27,460)(53,383)
Finance costs recognized in loss-504
Loss on disposal of property and equipment1,613-
Depreciation of property and equipment46,22047,272
Amortization of intangible assets3054,010
Net foreign exchange loss38,02447,258
Expense recognized in respect of equity-settled share-based payments16,27426,308
Movements in working capital350,983293,135
Cash generated from operations306,418201,656
Income taxes paid(215,000)-
Net cash generated by operating activities91,418201,656
Cash flows from investing activities
Movements in working capital(28,984)(275)
Payments for property and equipment(82,518)(3,439)
Proceeds from disposal of property and equipment3,200-
Net cash used in investing activities(108,302)(3,714)
Cash flows from financing activities
Repayment of borrowings-(5,077)
Interest paid-(504)
Net cash used in financing activities-(5,581)
Net increase (decrease) in cash(16,884)192,361
Cash at beginning of period3,995,6693,080,997
Effects of exchange rate changes on the balance of cash held in foreign currencies(28,649)(44,935)
Cash at end of period$3,950,136$3,228,423

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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