QCC Technologies Inc.

Release Date: November 27, 2002
QCC Releases Third Quarter Results
21:31 EST Wednesday, November 27, 2002

CALGARY ALBERTA–Sid Dutchak, President and Chief Executive Officer of QCC Technologies Inc. (“QCC” or “the Company”), is pleased to report QCC’s third quarter 2002 financial and operating results.

For the three months ended September 30, 2002, consolidated gross revenues amounted to $2,641,925 compared to $2,248,770 for the quarter ended September 30, 2001. This represents a 17% increase over the same quarter in 2001 which is due in part to the improvement of revenue within QCC Communications Corporation and revenue growth within the QCC Technology subsidiary Graycon Group Inc. Revenues for the nine months ended September 30, 2002 were $7,389,761 compared to $6,674,608 for the corresponding period last year. This represents an 11% improvement over the first nine months of 2001.

The Corporation recorded gross margin of $479,354 for the quarter ended September 30, 2002 as compared to $495,113 for the comparative period in 2001. This represents a decrease of 3%. The profit margin percentage was 18% for 2002 versus 22% in 2001. This decrease in margin percentage is due to higher than normal margins received for projects billed in the third quarter of 2001. Gross margin for the nine months ended September 30, 2002 was $1,434,457 as compared to $1,407,378 for the same period last year. This is an increase of 2% from the prior period.

General and administrative expenses increased by $45,282 from $367,620 for the quarter ended September 30, 2001 to $412,902 for the same period in 2002. This represents an increase of 12% over 2001 overhead costs. The increases in expenses are due primarily to increasing management levels within the Company to support the increased growth seen for the organization. Expenses for the nine month period ended September 30, 2002 were $1,272,012 an increase of $297,772 from the prior period. Also during 2002 the Corporation incurred costs of $58,742 in relation to reorganization costs and severance packages. During the period ended March 31, 2002, the Company recorded a one time expenses recovery of $77,684 for the forgiveness of the additional rent payable within QCC Communications.

The Corporation generated earnings of $51,695, for the quarter ended September 30, 2002 compared to 40,257 for the comparative period in 2001. This is an increase in net income of 28%. This can be attributed to the previously noted improvement in QCC Communication’s results along with the continued performance of the other subsidiaries. For the nine months ended September 30, 2002 earnings were $123,252 versus $150,539 for the same period. This is a decrease of 18%. This can be attributed to the slow down at one of QCC Communication’s major clients during the second quarter of 2001, which impacted the Corporation during the first quarter of 2002. An increased level of general and administrative expenses further contributed to the aforementioned decrease.

The Corporation’s consolidated cash position at June 30, 2002 was $(29,557) compared to consolidated cash of $54,204 at December 31, 2001 a decrease of $83,761. The Corporation’s consolidated long-term debt excluding current portion at September 30, 2002 was $778,159 a reduction of $101,341 from the year end. The consolidated working capital for the Corporation at September 30, 2002 was $233,209 as compared to $436,290 at December 31, 2001 a decrease of $308,739. Current assets increased by $657,076, due to an increase in accounts receivable and other assets of $740,837 offset by a decrease in cash of $83,761. Current liabilities increased by $860,157 as increases in accounts payable, bank indebtedness and royalty payable of $976,352 were offset by a decrease in income taxes payable of $116,195.

Financing activities for the first six months of 2002 were limited to the previously disclosed transaction of March 8, 2002 when the Corporation agreed to re-purchase all Series 3 Preferred shares then outstanding in exchange for 2,500,000 common shares plus $300,000 cash, to be paid in one payment of $37,500 on March 8, 2002 and monthly instalments of $12,500 thereafter.

For the nine months ended September 30, 2002, shareholders’ equity increased to $4,399,928 from $4,313,877 at December 31, 2001. This reflects the equity financing activities conducted during the year related to the Jaratech acquisition as well as the earnings for the nine months ended September 30, 2002 less dividends.

The Corporation will continue to aggressively pursue growth opportunities as today’s businesses continue to demand quality services based upon the newest technological advancements which have become powerful, reliable but more complex. QCC possesses the knowledge of, and insight into those continually evolving technologies.

The Corporation has developed a solid foundation for growth in 2002 and Management continues to utilize that foundation to expand business. Sid Dutchak says that QCC has continued to maintain profitability and financial health while investing in growth. “QCC is developing a reputation for excellence and we are excited about our future growth.”.

QCC Technologies Inc. through its operating subsidiaries in Calgary, Saskatoon, Red Deer, and Vancouver, provides Applied Advanced Information and Networking Technology Services in the forms of technology management; systems and software engineering; technology development; consulting; systems integration; technical support; and, automated network-based services.

3 months to Sep. 30 Year Ago

Revenue 2,641,925 2,248,770
Net Profit 51,695 40,257
Net Profit/Share 0.00 0.00

9 months to Sep. 30 Year Ago

Revenue 7,389,761 6,674,608
Net Profit 123,252 150,539
Net Profit/Share 0.01 0.01

FOR FURTHER INFORMATION PLEASE CONTACT: QCC Technologies Inc., D. Perrins, CFO, (403)777-1721 ext. 23, or, QCC Technologies Inc., Investor Relations, 1-800-694-9909, Email: info@qcctech.com, Website: www.qcctech.com, The TSX Venture Exchange has not reviewed, and does not, accept responsibility for the adequacy or accuracy of this, release.