CALGARY, ALBERTA--(Marketwire - Aug. 25, 2011) -
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 three and six month periods ended June 30, 2011. The Company's unaudited condensed financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS"), including restatement of prior year results for comparative purposes.
The Company reported a profit of $209,002 ($0.008 per basic share) for the three months ended June 30, 2011 compared to a profit of $171,836 ($0.007 per basic share) for the same three-month period last year. Profit for the six months ended June 30, 2011 was $89,461 ($0.004 per basic share) compared to a profit of $8,388 for the six months ended June 30, 2010.
On a comparative basis, profit improved in each of the three and six month periods ended June 30, 2011 as a result of increased revenues and lower income tax expense, partially offset by higher administration expenses and research and development costs and by foreign exchange losses recorded in the first half of 2011 compared to foreign exchange gains in the same period of 2010. The cost of sales also impacted each of the periods as it was lower in second quarter 2011 but higher on a year-to-date 2011 basis relative to the comparative periods of 2010.
Financial Highlights Summary
(Stated in Canadian dollars except per share amounts)
For the three months For the six months
ended June 30 ended June 30
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Increase Increase
(decr- (decr-
2011 2010 ease) 2011 2010 ease)
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Revenue(1) 1,297,277 1,161,202 136,075 2,197,257 1,650,831 546,426
Gross
profit(2) 238,558 466,171 (227,613) 536,170 616,580 (80,410)
EBITDA(2) 303,411 291,135 12,276 202,935 126,090 76,845
Profit 209,002 171,836 37,166 89,461 8,388 81,073
Cash
provided by
(used in)
operations
before
movements
in working
capital(2) (59,957) 39,848 (99,805) (59,957) 39,848 (99,805)
Total assets 7,620,230 6,729,756 890,474 7,620,230 6,729,756 890,474
Non-current
liabilities 133,060 78,106 54,954 133,060 78,106 54,954
Shares
outstanding
(3)
Basic 24,707,370 24,069,457 637,913 24,707,370 24,038,585 668,785
Diluted 24,844,360 24,606,500 237,860 24,856,292 25,187,525 (331,233)
Earnings per
share -
Basic and
diluted 0.008 0.007 0.001 0.004 0.000 0.004
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(1) Includes net gain 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 the Company's Management's Discussion
and Analysis for the three and six month periods ended June 30,
2011.
(3) Weighted average.
"Revenue increased by 33 percent in the first six months of this year compared to the same period last year," said Audrey Mascarenhas, President and Chief Executive Officer. "Tougher emission regulations, particularly in the United States, coupled with the market's growing understanding of the economic benefits of Questor's clean combustion technology is creating opportunities worldwide for us. We recently deployed rental incinerator units, including the new equipment added to the incinerator rental fleet at the beginning of July, to Europe and the United States to assist customers with the active development of shale gas plays."
"Building on the successful operations of our technology in oil sands applications, our expertise in efficient combustion and our proficiency in H2S destruction, discussions continue with prospective customers for onshore and offshore projects. Questor currently has confirmed incinerator sales orders of $1.5 million, the revenue for which will be recognized when the product is delivered. Based on the current customer-specified schedule, approximately $1.1 million of revenue will be recorded in third quarter 2011 and the balance in fourth quarter 2011," concluded Ms. Mascarenhas.
In relation to the Company's market awareness initiatives, Ms. Mascarenhas will make a presentation on the topic of "Community Engagement" at the 2011 Canadian Society for Unconventional Gas / Society of Petroleum Engineers (CSUG/SPE) Unconventional Resources Conference to be held November 15 - 17, 2011 in Calgary, Alberta, Canada. A copy of this presentation will be made available on the Company's website at that time.
Questor's unaudited condensed financial statements and notes thereto and management's discussion and analysis for the three and six month periods ended June 30, 2011 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, 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.
QUESTOR TECHNOLOGY INC.
CONDENSED STATEMENT OF COMPREHENSIVE INCOME
Stated in Canadian dollars except per share data
(unaudited)
For the three months ended For the six months ended
June 30 June 30
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2011 2010 2011 2010
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Revenue $ 819,481 $ 1,160,570 $ 1,717,357 $ 1,648,687
Cost of sales (580,923) (694,399) (1,181,187) (1,032,107)
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Gross profit 238,558 466,171 536,170 616,580
Administration
expenses (404,849) (314,079) (789,118) (611,403)
Net foreign exchange
gains (losses) (40,745) 98,224 (79,032) 50,929
Research and
development costs (10,729) (3,517) (31,697) (20,215)
Depreciation of
property and
equipment (8,148) (3,400) (11,036) (6,321)
Amortization of
intangible assets (304) (305) (609) (4,315)
Net gain on disposal
of property and
equipment 203,152 - 201,539 -
Finance costs - (504) - (1,008)
Other revenue 274,644 632 278,361 2,144
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Profit before tax 251,579 243,222 104,578 26,391
Income tax expense (42,577) (71,386) (15,117) (18,003)
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Profit and
comprehensive income $ 209,002 $ 171,836 $ 89,461 $ 8,388
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Earnings per share
Basic $ 0.008 $ 0.007 $ 0.004 $ 0.000
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Diluted $ 0.008 $ 0.007 $ 0.004 $ 0.000
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QUESTOR TECHNOLOGY INC.
CONDENSED STATEMENT OF FINANCIAL POSITION
Stated in Canadian dollars
(unaudited)
June 30 December 31
As at 2011 2010
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ASSETS
Current assets
Cash and cash equivalents $ 3,353,671 $ 3,995,669
Trade and other receivables 1,683,356 1,873,636
Current tax assets 140,428 362
Inventories 528,729 313,567
Prepaid expenses and deposits 53,577 107,467
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Total current assets 5,759,761 6,290,701
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Non-current assets
Property and equipment 1,802,499 1,037,565
Intangible assets 10,150 10,759
Deferred tax assets 47,820 49,695
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Total non-current assets 1,860,469 1,098,019
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Total assets $ 7,620,230 $ 7,388,720
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LIABILITIES AND EQUITY
Current liabilities
Trade payables, accrued liabilities
and provisions $ 1,279,620 $ 852,821
Current tax liabilities 11,777 230,746
Deferred revenue and deposits 24,001 146,485
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Total current liabilities 1,315,398 1,230,052
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Non-current liabilities
Deferred tax liabilities 117,382 108,287
Other non-current liabilities 15,678 -
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Total non-current liabilities 133,060 108,287
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Total liabilities 1,448,458 1,338,339
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Capital and reserves
Issued capital 5,404,966 5,404,966
Reserves 625,874 593,944
Retained earnings 140,932 51,471
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Total equity 6,171,772 6,050,381
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Total liabilities and equity $ 7,620,230 $ 7,388,720
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QUESTOR TECHNOLOGY INC.
CONDENSED STATEMENT OF CHANGES IN EQUITY
Stated in Canadian dollars
(unaudited)
Retained
Issued earnings Total
capital Reserves (deficit) equity
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Balance at January 1, 2010 $ 5,265,736 $ 573,349 $ (393,589) $ 5,445,496
Profit - - 8,388 8,388
Recognition of share-based
payments - 54,035 - 54,035
Issue of ordinary shares
under employee share
option plan 34,808 (17,308) - 17,500
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Balance at June 30, 2010 5,300,544 610,076 (385,201) 5,525,419
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Profit - - 436,672 436,672
Recognition of share-based
payments - 35,790 - 35,790
Issue of ordinary shares
under employee share
option plan 104,422 (51,922) - 52,500
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Balance at December 31,
2010 5,404,966 593,944 51,471 6,050,381
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Profit - - 89,461 89,461
Recognition of share-based
payments - 31,930 - 31,930
Issue of ordinary shares
under employee share
option plan - - - -
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Balance at June 30, 2011 $ 5,404,966 $ 625,874 $ 140,932 $ 6,171,772
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QUESTOR TECHNOLOGY INC.
CONDENSED STATEMENT OF CASH FLOWS
Stated in Canadian dollars
(unaudited)
For the six months ended June 30 2011 2010
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Cash flows from operating activities
Profit for the period $ 89,461 $ 8,388
Adjustments for:
Income tax expense recognized in profit 10,970 7,465
Finance costs recognized in profit - 1,008
Net gain on disposal of property and equipment (201,539) -
Depreciation of property and equipment 97,748 94,376
Amortization of intangible assets 609 4,314
Net foreign exchange gain (105,845) (131,681)
Expense recognized in respect of equity-settled
share-based payments 31,930 54,035
Office lease incentive 15,678 -
Write-downs of inventories to net realizable value 1,031 1,943
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(59,957) 39,848
Movements in working capital 176,961 (172,365)
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Cash generated from (used in) operations 117,004 (132,517)
Income taxes paid (215,000) -
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Net cash used in operating activities (97,996) (132,517)
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Cash flows from investing activities
Movements in working capital (615,523) (1,117)
Payments for property and equipment (435,539) (28,360)
Proceeds from disposal of property and equipment 389,918 -
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Net cash used in investing activities (661,144) (29,477)
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Cash flows from financing activities
Repayment of borrowings - (10,155)
Proceeds from issue of ordinary shares under
employee share option plan - 17,500
Interest paid - (1,008)
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Net cash generated from financing activities - 6,337
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Net decrease in cash and cash equivalents (759,140) (155,657)
Cash and cash equivalents at beginning of period 3,995,669 3,080,997
Effects of exchange rate changes on the balance of
cash held in foreign currencies 117,142 131,100
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Cash and cash equivalents at end of period $ 3,353,671 $ 3,056,440
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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.
Contact Information:
Audrey Mascarenhas
President and Chief Executive Officer
(403) 571-1530
(403) 571-1539 (FAX)
amascarenhas@questortech.com