CALGARY, ALBERTA--(Marketwire - Nov. 29, 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 nine month periods ended September 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 $304,596 ($0.012 per basic share) for the three months ended September 30, 2011 compared to a profit of $66,015 ($0.003 per basic share) for the same three-month period last year. Profit for the nine months ended September 30, 2011 was $394,057 ($0.016 per basic share) compared to a profit of $74,403 for the nine months ended September 30, 2010.
On a comparative basis, profit improved in each of the three and nine month periods ended September 30, 2011 due to higher margins resulting from the sales and services mix achieved, partially offset by higher income tax expense and administration expenses. Profit for the three months ended September 30, 2011 further benefited from the net foreign exchange gains recorded compared to the net foreign exchange losses in the same period of 2010. Other non-recurring revenue arising in second quarter 2011 further contributed to the positive profit variance for the nine months ended September 30, 2011.
| Financial Highlights Summary |
| (Stated in Canadian dollars except per share amounts) |
| For the three months ended September 30 | For the nine months ended September 30 | |||||||||||||
| 2011 | 2010 | Increase (decrease |
) | 2011 | 2010 | Increase (decrease) |
||||||||
| Revenue(1) | 1,583,571 | 1,987,106 | (403,535 | ) | 3,780,828 | 3,637,937 | 142,891 | |||||||
| Gross profit(2) | 802,243 | 422,512 | 379,731 | 1,338,413 | 1,039,092 | 299,321 | ||||||||
| EBITDA(2) | 605,795 | 162,209 | 443,586 | 808,730 | 288,299 | 520,431 | ||||||||
| Profit | 304,596 | 66,015 | 238,581 | 394,057 | 74,403 | 319,654 | ||||||||
| Cash generated from operations before movements in working capital(2) | 412,240 | 198,143 | 214,097 | 352,283 | 237,991 | 114,292 | ||||||||
| Total assets | 7,818,476 | 7,388,720 | 429,756 | 7,818,476 | 7,388,720 | 429,756 | ||||||||
| Non-current liabilities | 226,539 | 108,287 | 118,252 | 226,539 | 108,287 | 118,252 | ||||||||
| Shares outstanding(3) | ||||||||||||||
| Basic | 24,712,261 | 24,331,283 | 380,978 | 24,709,018 | 24,137,223 | 571,795 | ||||||||
| Diluted | 24,812,335 | 24,461,645 | 350,690 | 24,753,921 | 24,359,365 | 394,556 | ||||||||
| Earnings per share - Basic and diluted | 0.012 | 0.003 | 0.009 | 0.016 | 0.003 | 0.013 | ||||||||
- Includes net gain (loss) on disposal of property and equipment and other revenue.
- 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 September 30, 2011.
- Weighted average.
"Profit increased by $319,654, or over 400 percent, in the first nine months of 2011 compared to the same period last year," said Audrey Mascarenhas, President and Chief Executive Officer. "A key contributor to these favourable results is the marked increase in rental incinerator revenue and related services due to higher utilization of the existing fleet and deployment of $431,297 of new equipment added to the fleet in the second and third quarters of 2011. Approximately 80 percent of Questor's rental incinerator fleet is committed under term contracts to the end of the year and, of that, approximately 40 percent of our fleet is operating in the United States primarily to assist with well testing in shale plays."
"Questor currently has confirmed incinerator sales orders of $1.9 million for which the revenue will be recognized when the product is delivered. Based on the current customer-specified schedule, approximately $1.6 million of this revenue will be recorded in fourth quarter 2011 and the balance in the first quarter 2012. The majority of these sales orders are destined for the United States where the oil and gas industry is preparing for compliance with new air emissions regulation effective 2012. Questor's clean combustion technology is recognized as a cost effective solution to meet the new regulations. To enhance our ability to capture these opportunities, we are currently evaluating an increased presence in the United States and the viability of fabrication closer to these markets," concluded Ms. Mascarenhas.
In relation to the Company's market awareness and brand recognition initiatives, Ms. Mascarenhas presented at the following events in recent weeks:
- Global Methane Initiative All-Partnership Meeting in Krakow, Poland on October 13, 2011 on the topic of "Heat to Power";
- Global Clean Energy Congress in Calgary, Alberta, Canada on November 2, 2011 on the topic of "Solutions Powered by Clean Combustion";
- Canadian Launch Pad in Denver, Colorado, USA on November 7, 2011 on the topic of "Clearing the Air! Safely, Economically and Efficiently"; and
- Canadian Unconventional Resources Conference in Calgary, Alberta, Canada on November 15, 2011 on the topic of "Community Engagement" in relation to its importance to the success of unconventional reserves development.
Copies of these presentations are available on the Company's website.
The Company is pleased to announce that Ms. Mascarenhas was the recipient of the Ernst & Young Entrepreneur Of The Year 2011 Prairies Award for the Cleantech and Environmental Services category. She was also selected by the national judging panel to receive a special citation in honour of Values-Based Innovation. Entrepreneur Of The Year recognizes the spirit and contribution of entrepreneurs here and around the world. The Canadian program is in its 18th year of honouring the country's most impressive entrepreneurs from all areas of business who drive growth, build communities and transform industries.
Questor's unaudited condensed financial statements and notes thereto and management's discussion and analysis for the three and nine month periods ended September 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 September 30 |
For the nine months ended September 30 |
||||||||||||
| 2011 | 2010 | 2011 | 2010 | ||||||||||
| Revenue | $ 1,580,395 | $ 1,955,081 | $ 3,297,752 | $ 3,603,768 | |||||||||
| Cost of sales | (778,152 | ) | (1,532,569 | ) | (1,959,339 | ) | (2,564,676 | ) | |||||
| Gross profit | 802,243 | 422,512 | 1,338,413 | 1,039,092 | |||||||||
| Administration expenses | (354,330 | ) | (280,670 | ) | (1,143,448 | ) | (892,074 | ) | |||||
| Net foreign exchange gains (losses) | 102,755 | (38,434 | ) | 23,723 | 12,495 | ||||||||
| Research and development costs | 2,887 | (17,392 | ) | (28,810 | ) | (37,607 | ) | ||||||
| Depreciation of property and equipment | (10,922 | ) | (3,359 | ) | (21,958 | ) | (9,680 | ) | |||||
| Amortization of intangible assets | (305 | ) | (305 | ) | (914 | ) | (4,619 | ) | |||||
| Net gain (loss) on disposal of property and equipment | (13,340 | ) | - | 188,199 | - | ||||||||
| Finance costs | - | (4 | ) | - | (1,012 | ) | |||||||
| Other revenue | 16,516 | 32,025 | 294,877 | 34,169 | |||||||||
| Profit before tax | 545,504 | 114,373 | 650,082 | 140,764 | |||||||||
| Income tax expense | (240,908 | ) | (48,358 | ) | (256,025 | ) | (66,361 | ) | |||||
| Profit and comprehensive income | $ 304,596 | $ 66,015 | $ 394,057 | $ 74,403 | |||||||||
| Earnings per share | |||||||||||||
| Basic and diluted | $ 0.012 | $ 0.003 | $ 0.016 | $ 0.003 | |||||||||
| QUESTOR TECHNOLOGY INC. |
| CONDENSED STATEMENT OF FINANCIAL POSITION |
| Stated in Canadian dollars |
| (unaudited) |
| As at | September 30 2011 |
December 31 2010 |
|
| ASSETS | |||
| Current assets | |||
| Cash and cash equivalents | $ 3,156,806 | $ 3,995,669 | |
| Trade and other receivables | 1,947,954 | 1,873,636 | |
| Current tax assets | 10,178 | 362 | |
| Inventories | 539,239 | 313,567 | |
| Prepaid expenses and deposits | 116,485 | 107,467 | |
| Total current assets | 5,770,662 | 6,290,701 | |
| Non-current assets | |||
| Property and equipment | 1,990,986 | 1,037,565 | |
| Intangible assets | 9,845 | 10,759 | |
| Deferred tax assets | 46,983 | 49,695 | |
| Total non-current assets | 2,047,814 | 1,098,019 | |
| Total assets | $ 7,818,476 | $ 7,388,720 | |
| LIABILITIES AND EQUITY | |||
| Current liabilities | |||
| Trade payables, accrued liabilities and provisions | $ 774,138 | $ 852,821 | |
| Current tax liabilities | 79,898 | 230,746 | |
| Deferred revenue and deposits | 221,361 | 146,485 | |
| Total current liabilities | 1,075,397 | 1,230,052 | |
| Non-current liabilities | |||
| Deferred tax liabilities | 188,352 | 108,287 | |
| Other non-current liabilities | 38,187 | - | |
| Total non-current liabilities | 226,539 | 108,287 | |
| Total liabilities | 1,301,936 | 1,338,339 | |
| Capital and reserves | |||
| Issued capital | 5,458,215 | 5,404,966 | |
| Reserves | 612,797 | 593,944 | |
| Retained earnings | 445,528 | 51,471 | |
| Total equity | 6,516,540 | 6,050,381 | |
| Total liabilities and equity | $ 7,818,476 | $ 7,388,720 | |
| QUESTOR TECHNOLOGY INC. |
| CONDENSED STATEMENT OF CHANGES IN EQUITY |
| Stated in Canadian dollars |
| (unaudited) |
| Issued capital | Reserves | Retained earnings (deficit | ) | Total equity | ||||||
| Balance at January 1, 2010 | $ 5,265,736 | $ 573,349 | $ (393,589 | ) | $ 5,445,496 | |||||
| Profit | - | - | 74,403 | 74,403 | ||||||
| Recognition of share-based payments | - | 73,860 | - | 73,860 | ||||||
| Issue of ordinary shares under employee share option plan | 124,312 | (61,813 | ) | - | 62,499 | |||||
| Balance at September 30, 2010 | 5,390,048 | 585,396 | (319,186 | ) | 5,656,258 | |||||
| Profit | - | - | 370,657 | 370,657 | ||||||
| Recognition of share-based payments | - | 15,965 | - | 15,965 | ||||||
| Issue of ordinary shares under employee share option plan | 14,918 | (7,417 | ) | - | 7,501 | |||||
| Balance at December 31, 2010 | 5,404,966 | 593,944 | 51,471 | 6,050,381 | ||||||
| Profit | - | - | 394,057 | 394,057 | ||||||
| Recognition of share-based payments | - | 45,102 | - | 45,102 | ||||||
| Issue of ordinary shares under employee share option plan | 53,249 | (26,249 | ) | - | 27,000 | |||||
| Balance at September 30, 2011 | $ 5,458,215 | $ 612,797 | $ 445,528 | $ 6,516,540 |
| QUESTOR TECHNOLOGY INC. |
| CONDENSED STATEMENT OF CASH FLOWS |
| Stated in Canadian dollars |
| (unaudited) |
| For the nine months ended September 30 | 2011 | 2010 | ||||||
| Cash flows from operating activities | ||||||||
| Profit for the period | $ 394,057 | $ 74,403 | ||||||
| Adjustments for: | ||||||||
| Income tax expense recognized in profit | 82,777 | 64,391 | ||||||
| Finance costs recognized in profit | - | 1,012 | ||||||
| Net gain on disposal of property and equipment | (188,199 | ) | - | |||||
| Depreciation of property and equipment | 157,734 | 141,904 | ||||||
| Amortization of intangible assets | 914 | 4,619 | ||||||
| Net foreign exchange gain | (181,119 | ) | (124,203 | ) | ||||
| Expense recognized in respect of equity-settled share-based payments | 45,102 | 73,859 | ||||||
| Office lease incentive | 38,187 | - | ||||||
| Write-downs of inventories to net realizable value | 2,830 | 2,006 | ||||||
| 352,283 | 237,991 | |||||||
| Movements in working capital | (182,015 | ) | 266,050 | |||||
| Cash generated from operations | 170,268 | 504,041 | ||||||
| Income taxes refunded (paid) | (242,523 | ) | 37,453 | |||||
| Net cash generated from (used in) operating activities | (72,255 | ) | 541,494 | |||||
| Cash flows from investing activities | ||||||||
| Movements in working capital | (33,420 | ) | (1,972 | ) | ||||
| Payments for property and equipment | (1,279,454 | ) | (41,802 | ) | ||||
| Proceeds from disposal of property and equipment | 389,918 | - | ||||||
| Interest paid | - | (1,012 | ) | |||||
| Net cash used in investing activities | (922,956 | ) | (44,786 | ) | ||||
| Cash flows from financing activities | ||||||||
| Repayment of borrowings | - | (15,232 | ) | |||||
| Proceeds from issue of ordinary shares under employee share option plan | 27,000 | 62,500 | ||||||
| Net cash provided by financing activities | 27,000 | 47,268 | ||||||
| Net increase (decrease) in cash and cash equivalents | (968,211 | ) | 543,976 | |||||
| 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 | 129,348 | 125,731 | ||||||
| Cash and cash equivalents at end of period | $ 3,156,806 | $ 3,750,704 | ||||||
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