AQM ANNOUNCES 42 PERCENT INCREASE IN SALES AND 17 PERCENT INCREASE IN NET INCOME.

WOODBRIDGE, Ont.--(BUSINESS WIRE)--July 13, 1995-- AQM Automotive Corporation (the "Corporation") today announced its combined financial and operating results for the second fiscal quarter (March 1, 1995 - May 31, 1995) and for the six months ended May 31, 1995.

For the six months ended May 31, 1995, sales volume rose 42 percent to $5,051,015 compared with $3,554,145 for the same period last year. Net income during this period, increased by 17 percent to $127,992 ($0.01 per share) compared with $109,847 ($0.01 per share) a year earlier. For the quarter ended May 31, 1995, sales volume rose 27 percent to $2,776,590 compared with $2,188,887 for the same period in 1994. Net income for the three months ended May 31, 1995 was $49,441 compared with $107,923 for the same period last year. While gross margins remained virtually the same at 32 percent, the cost of carrying larger inventories added $77,000 to interest charges, while amortization of goodwill and deferred charges added a further $49,000 to expenses during the second quarter of 1995. -0-

         Second         Second          Six          Six
         Quarter        Quarter       Months to    Months to
       May 31, 1995  May 31, 1994  May 31, 1995 May 31, 1994

Sales   $2,776,590    $2,188,887    $5,051,015   $3,554,145

Operating
Expenses   865,586       495,566     1,509,896      915,553

Net
Income      49,441       107,923       127,992      109,847

Sales for the month of May, 1995 exceeded $1 million for the first time in the Corporation's history, despite delays in shipments to the Mexican market, following the recent difficulties with the Peso and a slow down in orders from some existing US customers. However, the corporation has made significant inroads in attracting a number of new US-based customers and consequently sales volume for the remainder of 1995 is expected to remain on target.

Gross margins should remain constant at 32 percent of sales, but net income is expected to be lower than originally forecast. This is due mainly to the higher cost of maintaining increased inventory levels in response to the changing mix of clients which the corporation recently brought on board: including several larger volume accounts that require "just in time" deliveries. Management also made the conscious decision, during this period, to invest heavily in the vertical integration of the corporation's manufacturing arm and other improvements to its infrastructure, in order to position the corporation for significant growth in 1996 and beyond. The increased amortization and administrative costs, associated with these investments, will therefore impact on net income in 1995.

AQM is pleased to announce the appointment of Mr. James Shekarchi as Vice President, Corporate Development and Strategic Planning as well as to the Board of Directors of the corporation. Mr. Shekarchi brings with him an extensive background in the automotive filter industry. He will pay an important role in the future growth and development of the corporation.

AQM is also pleased to announce that it has renewed its Investor Relations contract with Surefund Capital Corporation. Mr. Gary Perkins, a Director of AQM, is also the President of Surefund Capital Corporation.

The Alberta Stock Exchange has neither approved nor disapproved of the information contained herein.

CONTACT: Gary Perkins, Director

Tel: [phone]

Toll Free: 1-800-293-5519

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