Avcorp Provides Financing Update.

Business Editors

VANCOUVER, British Columbia--(BUSINESS WIRE)--Jan. 31, 2003

Avcorp Industries Inc. (TSX:AVP) announced the company's bank has advised the company that it will not extend credit agreements beyond January 30, 2003 and has demanded payment of the full amount, approximately $12.5 million, by February 11, 2003.

The company continues to pursue alternative financing. The company has received a proposal for a sale-leaseback of its land and buildings although this proposal will not close before the date payment to the bank is due.

The company also announced that on January 24, 2003 Senator Jack Austin resigned from the board of directors. Senator Austin's resignation was unconnected with the bank demanding payment and the board thanks him for his valuable contribution.

Avcorp Industries Inc. is a Canadian aerospace industry manufacturer. The Company is a single-source supplier for engineering design, manufacture and assembly of subassemblies and complex major structures for aircraft manufacturers.

Certain statements in this press release that are not purely historical constitute forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, as amended, including statements regarding the Company's expectations, beliefs, intentions or strategies regarding the future. The information in this press release is based on information available to the Company as of the date hereof and the Company assumes no obligation to update any such forward-looking statements. Forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. Such risks include, among others, general business and economic conditions and competitive actions as well as other risks and uncertainties.

JOHN H. NICHOLSON
President and
Chief Executive Officer