Questor Technology Inc. Releases Third Quarter 2007 Financial and Operating Results



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

    Announces Record Quarterly Net Income of $1.9 Million

    CALGARY, November 29 /CNW/ - Questor Technology Inc. ("Questor" or
the "Company") (TSX-V: QST) is pleased to release its financial and operating
results for third quarter 2007. The Company today announced a net income of
$1,883,793 ($0.08 per share) for the third quarter of 2007 and a net income of
$1,870,992 ($0.08 per share) for the nine months ended September 30, 2007
compared to net income of $106,879 ($0.005 per share) for the third quarter of
2006 and net income of $495,414 ($0.02 per share) for the nine months ended
September 30, 2006. The net income was primarily attributable to the
successful delivery of well testing incinerators to China Petrochemical
International Company Ltd. ("SINOPEC") in July 2007 pursuant to the previously
announced US$6.6 million contract.
    "The third quarter results have positioned the Company for significant
growth, affording us the flexibility to build our team and infrastructure,
expand the rental fleet and pursue larger international opportunities. It also
provides us with the opportunity to further develop our technology to recover
the waste heat generated by the incinerators and convert it into power. Our
strategy for growth is well underway," said Audrey Mascarenhas, President and
Chief Executive Officer. "The heightened environmental focus on global warming
and climate change and the health concerns arising from the impacts of poor
air quality has created a significant and growing market opportunity for
Questor both domestically and internationally."

    
    PERFORMANCE HIGHLIGHTS(1)

    -   Total revenue for this quarter was $6,925,555 compared to $824,531 in
        the same quarter in 2006. Total revenue for the first nine months of
        2007 was $8,211,967 up from $2,559,561 in the first nine months of
        2006. The record revenue results for this quarter are principally the
        reflection of the SINOPEC sales contract.

    -   Gross margin for the third quarter and first nine months of 2007 were
        $3,325,802 and $3,766,089, respectively. Gross margin was higher than
        third quarter 2006 by $3,140,342 and by $2,772,919 compared to the
        first nine months of 2006 for much the same reason described in the
        revenue discussion above.

    -   Earnings before interest, taxes, depreciation and amortization were
        $2,880,572 this quarter compared to $150,250 in the same quarter in
        2006. Earnings before interest, taxes, depreciation and amortization
        for the first nine months of 2007 were $2,959,186, up from $632,803
        in the same period of 2006.

    -   Operating income in the first nine months was $2,851,892. After
        interest expense of $19,674 and current and future income tax expense
        of $961,226, the net income for the first nine months of the year was
        $1,870,992.

    -   Cash provided by operating activities was $3,012,649 for third
        quarter 2007 compared to cash used in operating activities of
        $335,368 for the same period in 2006. Cash provided by operating
        activities for the first nine months of 2007 was $3,585,621, up from
        $105,351 in the first nine months of 2006.

    -   Funds generated from operations were $2,748,736 for third quarter
        2007 compared to $52,172 for the same period in 2006. Funds generated
        from operations for the first nine months of 2007 were $2,834,704, up
        from $529,199 in the first nine months of 2006.

    -   Total debt was $134,229 at September 30, 2007 compared to $567,090 at
        December 31, 2006. The Company's debt-to-total capitalization ratio
        was 2.8 percent, versus 17.5 percent at the end of 2006.

    (1) Includes non-GAAP financial measures. Please see discussion in the
        Non-GAAP Financial Measures section of the Company's third quarter
        Management's Discussion and Analysis.
    

    Questor's unaudited interim financial statements and notes thereto and
Management's Discussion and Analysis for the three and nine months ended
September 30, 2007 and 2006 is available at 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
focused on clean air technologies with operations 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 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 (H(2)S). While the Company's current client base is
primarily in the oil and gas industry, this technology is applicable to other
industries such as water and sewage treatment, landfills, 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.

    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.


    
                           QUESTOR TECHNOLOGY INC.
                               BALANCE SHEETS
                                 (unaudited)

                                                  September 30   December 31
                                                          2007          2006
    -------------------------------------------------------------------------

    ASSETS
    Current assets
      Cash and cash equivalents                    $ 3,014,907   $    29,186
      Accounts receivable                              524,184       947,993
      Inventory                                        360,802       263,015
      Prepaid expenses and deposits                    114,406        90,074
      Income and other taxes receivable                 81,007             -
      Future income tax asset                                -       583,506
    -------------------------------------------------------------------------
                                                     4,095,306     1,913,774
    Property and equipment                           1,368,694     1,266,758
    Intangibles                                         80,010       101,700
    Future income tax asset                             50,443       232,977
    -------------------------------------------------------------------------
                                                   $ 5,594,453   $ 3,515,209
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current liabilities
      Accounts payable and accrued liabilities     $   666,476   $   271,881
      Short-term debt                                        -       461,297
      Current portion of long-term debt                 64,925        48,674
      Income and other taxes payable                   182,772         7,011
    -------------------------------------------------------------------------
                                                       914,175       788,863
    Long-term debt                                      69,304        57,119
    -------------------------------------------------------------------------
                                                       983,477       845,982
    -------------------------------------------------------------------------
    Shareholders' equity
      Share capital                                  5,210,274     5,188,774
      Contributed surplus                              130,969        81,712
      Retained earnings (deficit)                     (730,267)   (2,601,259)
    -------------------------------------------------------------------------
                                                     4,610,976     2,669,227
    -------------------------------------------------------------------------
                                                   $ 5,594,453   $ 3,515,209
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                           QUESTOR TECHNOLOGY INC.
           STATEMENTS OF INCOME, COMPREHENSIVE INCOME AND DEFICIT
                                 (unaudited)

                              Three months ended           Nine months ended
                                    September 30                September 30
                              2007          2006          2007          2006
    -------------------------------------------------------------------------

    Revenue            $ 6,897,295   $   725,025   $ 8,163,398   $ 2,459,257
    Less: Direct costs   3,571,493       539,565     4,397,309     1,466,097
    -------------------------------------------------------------------------
    Gross margin         3,325,802       185,460     3,766,089       993,170
    -------------------------------------------------------------------------

    Other revenue           28,260        99,506        48,569       100,304

    Expenses
      General and
       administrative      291,958       162,282       754,925       546,581
      Foreign exchange
       loss (gain)         208,704        (2,187)      180,534        (8,438)
      Depreciation and
       amortization          9,078        10,028        27,307        29,764
    -------------------------------------------------------------------------
                           509,740       170,123       962,766       567,907
    -------------------------------------------------------------------------

    Operating income     2,844,322       114,843     2,851,892       525,567
    Interest expense
      Short-term debt        4,703         7,964        19,674        17,769
      Long-term debt             -             -             -        12,384
    -------------------------------------------------------------------------
    Income before income
     taxes               2,839,619       106,879     2,832,218       495,414
    Income tax expense
      Current income
       tax                 155,065             -       155,065             -
      Future income tax    800,761             -       806,161             -
    -------------------------------------------------------------------------
    Net income and
     comprehensive
     income              1,883,793       106,879     1,870,992       495,414
    Deficit, beginning
     of period          (2,614,060)   (3,408,338)   (2,601,259)   (3,796,873)
    -------------------------------------------------------------------------
    Deficit, end of
     period            $  (730,267)  $(3,301,459)  $  (730,267)  $(3,301,459)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net income per
     share
      Basic            $     0.079   $     0.005   $     0.079   $     0.021
      Diluted          $     0.076   $     0.004   $     0.075   $     0.021

    Weighted average
     number of shares
     outstanding
      Basic             23,757,370    23,542,370    23,724,678    23,542,370
      Diluted           24,892,051    24,373,322    25,066,020    24,045,393



                           QUESTOR TECHNOLOGY INC.
                           STATEMENTS OF CASH FLOWS
                                 (unaudited)

                              Three months ended           Nine months ended
                                    September 30                September 30
                              2007          2006          2007          2006
    -------------------------------------------------------------------------
    Operating activities
      Net income       $ 1,883,793   $   106,879   $ 1,870,992   $   495,414
      Items not
       involving cash:
        Depreciation and
         amortization       36,250        35,407       107,294       107,236
        Future income
         taxes             800,761             -       806,161             -
        Share-based
         compensation       27,932         9,288        50,257        25,951
        Gain on sale of
         rental
         incinerator             -       (99,402)            -       (99,402)
    -------------------------------------------------------------------------
        Funds generated
         from
         operations      2,748,736        52,172     2,834,704       529,199
        Net change in
         non-cash working
         capital           263,913       387,540       750,917      (423,848)
    -------------------------------------------------------------------------
    Net cash provided
     by/(used in)
     operating
     activities          3,012,649      (335,368)    3,585,621       105,351
    -------------------------------------------------------------------------

    Investing activities
      Additions to
       property and
       equipment          (183,908)       (3,999)     (188,955)       (6,539)
      Disposition of
       property and
       equipment                 -       124,956         1,415       124,956
    -------------------------------------------------------------------------
    Net cash used in
     investing
     activities           (183,908)      120,957      (187,540)      118,417
    -------------------------------------------------------------------------

    Financing activities
      Decrease in notes
       payable                   -             -             -      (300,000)
      Decrease in short-
       term debt          (687,266)     (139,170)     (461,297)      (68,829)
      Increase/(decrease)
       in long-term debt    54,809        (7,484)       28,437       (22,445)
      Net proceeds from
       issuance of common
       shares                    -             -        20,500             -
    -------------------------------------------------------------------------
    Net cash used in
     financing
     activities           (632,457)     (146,654)     (412,360)     (391,274)
    -------------------------------------------------------------------------
    Change in cash and
     cash equivalents    2,196,284      (361,065)    2,985,721      (167,506)
    Change in cash and
     cash equivalents,
     beginning of period   818,623       370,786        29,186       177,227
    -------------------------------------------------------------------------
    Cash and cash
     equivalents,
     end of period     $ 3,014,907   $     9,721   $ 3,014,907   $     9,721
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    





For further information:

For further information: Audrey Mascarenhas, President and Chief
Executive Officer, Phone: (403) 571-1530, Facsimile: (403) 571-1539, Email:
amascarenhas@questortech.com

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QUESTOR TECHNOLOGY INC.

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