Questor Technology Inc. Announces First Quarter 2013 Financial Results

CALGARY, ALBERTA--(Marketwired - May 30, 2013) -

THIS DOCUMENT IS NOT INTENDED FOR DISSEMINATION OR DISTRIBUTION IN THE UNITED STATES.

Questor Technology Inc. ("Questor" or the "Company") (TSX VENTURE:QST) announced today its financial and operating results for the first quarter of 2013. The Company reported a profit of $417,084 ($0.017per basic share) for the three months ended March 31, 2013 compared to a profit of $487,438 ($0.020 per basic share) for the same three-month period of the prior year.

The decrease in profit was due primarily to lower revenues arising out of differences in the volume and mix of incinerator sales and utilization of the fleet of rental incinerators in each quarter, offset in part by the stronger margins achieved in the current quarter. Net foreign exchange gains recorded in the first quarter of 2013 compared to foreign exchanges losses in the comparative period of 2012, lower research and development expenditures and lower income tax expense also contributed in reducing the impact of the lower revenues on operating results.

FINANCIAL HIGHLIGHTS SUMMARY
(Stated in Canadian dollars except per share amounts)
For the three months ended March 31		2013		2012		Increase (decrease	)
Revenue		1,719,577		2,230,875		(511,298	)
Gross profit(1)		890,441		1,053,700		(163,259	)
EBITDA(1)		656,220		727,329		(71,109	)
Profit and total comprehensive income		417,084		487,438		(70,354	)
Cost of sales as a percent of revenue(1)		48.2	%	52.8	%	(4.6%	)
Cash generated from operations before movements in non-cash working capital(1)		662,405		774,985		(112,580	)
As at		March 31, 2013		December 31, 2012		Increase (decrease	)
Total assets		10,439,573		9,798,449		641,124
Non-current liabilities		280,034		250,065		29,969
Shares outstanding(2)
	Basic	25,007,370		24,869,255		138,115
	Diluted	25,225,542		25,144,794		80,748
Earnings per share - Basic		0.017		0.020		(0.003	)
Earnings per share - Diluted		0.017		0.019		(0.002	)

(1)	Non-IFRS financial measure. Please see discussion in the Non-IFRS Financial Measures section of the Company's Management's Discussion and Analysis for the three months ended March 31, 2013.
(2)	Weighted average.

"Although our revenues are lower this quarter in comparison to the previous year quarter, this is not a reflection of the expected performance for this year. We have confirmed orders for incinerator sales of $4.0 million to date of which only $1.2 million was recognized in first quarter 2013. We have taken significant steps this first quarter of 2013, setting the stage for a very active second quarter and balance of the year," said Audrey Mascarenhas, President and Chief Executive Officer. "We completed the construction of units that we had intended for our rental fleet, but are instead being sold to customers to meet their timing requirements in Q2. We moved forward on several joint venture arrangements for the construction of our units in Europe which will prove to be a strategic location to also serve the Russian and Middle East markets. Questor has appointed a Vice President Business Development which has resulted in a series of productive meetings and discussions with both our US and Canadian clients. We are supporting our clients in their quest for social license to operate with our technology solution addressing community flaring concerns that have attracted significant public attention."

"As the impact of the new emission standards in the United States becomes more well understood, interest in our incineration technology has continued to grow. In addition, regulation in Europe is becoming increasingly focused on emissions and some countries have begun to disallow open flaring, thereby creating opportunities for Questor.

As we move through 2013 we expect to see substantial growth in the sale and rental of our units as the marketplace recognizes the operational, environmental and economic benefits Questor's clean air solutions offer. Our focus will be on increasing our operating capacity to meet this demand." concluded Ms. Mascarenhas.

Shareholders are invited to attend the Company's Annual General Meeting to be held on Tuesday, June 4, 2013 at 3:00 p.m. MDT in Questor's Boardroom at 1121 940 - 6^th Avenue S.W., Calgary, Alberta. In addition to the formal business items, management will be presenting an overview of Questor's results for the financial year ended December 31, 2012 and first quarter ended March 31, 2013 and discussing the Company's strategic initiatives for 2013.

Questor's unaudited condensed financial statements and notes thereto and management's discussion and analysis for the three months ended March 31, 2013 will be available shortly on the Company's website at www.questortech.com and through SEDAR at www.sedar.com.

ABOUT QUESTOR TECHNOLOGY INC.

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. 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 operates 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.

QUESTOR TECHNOLOGY INC.
CONDENSED STATEMENTS OF FINANCIAL POSITION
Stated in Canadian dollars
Unaudited
As at		March 31 2013	December 31 2012
ASSETS
Current assets
	Cash and cash equivalents	$ 4,827,269	$ 4,405,624
	Trade and other receivables	2,318,471	2,304,478
	Inventories	1,136,229	670,959
	Prepaid expenses and deposits	66,212	88,378
	Current tax assets	48,182	25,158
	Total current assets	8,396,363	7,494,597
Non-current assets
	Property and equipment	2,035,192	2,295,529
	Intangible assets	8,018	8,323
	Total non-current assets	2,043,210	2,303,852
Total assets		$ 10,439,573	$ 9,798,449
LIABILITIES AND EQUITY
Current liabilities
	Trade payables, accrued liabilities and provisions	$ 919,535	$ 894,206
	Deferred revenue and deposits	50,905	2,205
	Current tax liabilities	273,153	171,907
	Total current liabilities	1,243,593	1,068,318
Non-current liabilities
	Deferred tax liabilities	104,375	97,319
	Lease inducement	175,659	152,746
	Total non-current liabilities	280,034	250,065
Total liabilities		1,523,627	1,318,383
Capital and reserves
	Issued capital	5,521,001	5,521,001
	Reserves	695,630	676,834
	Retained earnings	2,699,315	2,282,231
	Total equity	8,915,946	8,480,066
Total liabilities and equity		$ 10,439,573	$ 9,798,449
See accompanying notes to the unaudited condensed financial statements.

QUESTOR TECHNOLOGY INC.
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Stated in Canadian dollars except per share data
Unaudited
For the three months ended March 31		2013		2012
Revenue		$ 1,719,577		$ 2,230,875
Cost of sales		(829,136	)	(1,177,175	)
Gross profit		890,441		1,053,700
Administration expenses		(353,550	)	(353,444	)
Net foreign exchange gains (losses)		44,997		(34,413	)
Depreciation of property and equipment		(10,740	)	(10,322	)
Amortization of intangible assets		(305	)	(305	)
Write-off of property and equipment		-		(2,768	)
Other income		4,675		4,705
Profit before tax		575,518		657,153
Income tax expense		(158,434	)	(169,715	)
Profit and total comprehensive income		$ 417,084		$ 487,438
Earnings per share
	Basic	$ 0.017		$ 0.020
	Diluted	$ 0.017		$ 0.019

QUESTOR TECHNOLOGY INC.
CONDENSED STATEMENTS OF CHANGES IN EQUITY
Stated in Canadian dollars
Unaudited
		Issued capital		Reserves		Retained earnings		Total equity
	Balance at January 1, 2013	$ 5,521,001		$ 676,834		$ 2,282,231		$ 8,480,066
	Profit and total comprehensive income	-		-		417,084		417,084
	Recognition of share-based payments	-		18,796		-		18,796
	Issue of ordinary shares under employee share option plan	-		-		-		-
	Balance at March 31, 2013	$ 5,521,001		$ 695,630		$ 2,699,315		$ 8,915,946
	Balance at January 1, 2012	$ 5,458,215		$ 622,226		$ 1,241,875		$ 7,322,316
	Profit and total comprehensive income	-		-		487,438		487,438
	Recognition of share-based payments	-		9,281		-		9,281
	Issue of ordinary shares under employee share option plan	-		-		-		-
	Balance at March 31, 2012	$ 5,458,215		$ 631,507		$ 1,729,313		$ 7,819,035

QUESTOR TECHNOLOGY INC.
CONDENSED STATEMENTS OF CASH FLOWS
Stated in Canadian dollars
Unaudited
For the three months ended March 31			2013		2012
Cash flows from operating activities
	Profit and total comprehensive income		$ 417,084		$ 487,438
	Adjustments for:
		Income tax expense	158,434		169,715
		Write-off of property and equipment	-		2,768
		Depreciation of property and equipment	80,397		69,871
		Amortization of intangible assets	305		305
		Net unrealized foreign exchange (gains) losses	(12,611	)	35,607
		Expense recognized in respect of equity-settled share-based payments	18,796		9,281
			662,405		774,985
	Movements in non-cash working capital		(156,651	)	1,414,553
	Cash generated from operations		505,754		2,189,538
	Income taxes paid		-		(280,061	)
Net cash generated from operating activities			505,754		1,909,477
Cash flows used in investing activities
	Payments for property and equipment		(90,355	)	(152,502	)
Net cash used in investing activities			(90,355	)	(152,502	)
Cash flows from financing activities			-		-
Net increase in cash			415,399		1,756,975
Cash at beginning of the period			4,405,624		2,166,301
Effects of exchange rate changes on the balance of cash held in foreign currencies			6,246		(31,522	)
Cash at end of the period			$ 4,827,269		$ 3,891,754