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QUESTECH REPORTS 1993 THIRD QUARTER RESULTS

 FALLS CHURCH, Va., Nov. 23 /PRNewswire/ -- QuesTech, Inc., (NASDAQ: QTEC) posted revenue increases of 5 percent for the quarter and 7 percent for the nine-month period ended Sept. 30, 1993, compared to the same periods last year. Income from continuing operations remained favorable and improved 4 percent during the quarter. In addition, interest cost savings due to reduced line of credit usage boosted pre- tax income and the resultant net earnings, which were up 7 percent for the quarter and 12 percent for the nine-month period. Earnings per share rose to 8 cents for the quarter and 19 cents for the nine-month period compared to 7 cents and 17 cents for the same periods last year.
 Vincent L. Salvatori, chairman of the board and chief executive officer, stated: "Despite the general slowdown in the defense contracting environment, the company continues to receive increased tasking from its customers, thereby sustaining the growth momentum demonstrated over the last four years. Although funding is always held hostage by congressional continuing resolution and political processes, we believe that the funding for intelligence work and research and development (which are the core of our business) will remain stable in the long run and will provide a possibility for a steady revenue stream, thereby paving the way for continued growth."
 QuesTech, Inc., and Subsidiaries
 CONDENSED CONSOLIDATED BALANCE SHEETS
 ASSETS
 Sept. 30, Dec. 31,
 1993 1992
 (Unaudited) (Note)
 CURRENT ASSETS
 Cash and cash equivalents $ 339,600 $ 100,200
 Accounts receivable 9,241,700 10,078,900
 Inventories 61,000 57,600
 Prepaid expenses and other 250,100 167,400
 Deferred income taxes 506,000 506,000
 Total current assets $10,398,400 $10,910,100
 EQUIPMENT AND LEASEHOLD IMPROVEMENTS
 -- at cost less accumulated
 depreciation and amortization of
 $8,599,900 and $9,486,600,
 respectively 1,042,100 1,052,200
 GOODWILL, less accumulated amortization
 of $1,069,200 and $953,300,
 respectively 1,867,400 1,983,300
 DEFERRED INCOME TAXES, net of
 valuation allowance of $148,000 506,200 379,300
 OTHER ASSETS 531,000 571,500
 TOTAL ASSETS $14,345,100 $14,896,400
 The accompanying notes are an integral part of these statements.
 NOTE: The balance sheet at Dec. 31, 1992, has been derived from the audited financial statements at that date.
 QuesTech, Inc., and Subsidiaries
 CONDENSED CONSOLIDATED BALANCE SHEETS
 LIABILITIES AND STOCKHOLDERS' EQUITY
 Sept. 30, Dec. 31,
 1993 1992
 (Unaudited) (Note)
 CURRENT LIABILITIES
 Line of Credit $ -- $ 746,900
 Current maturities of long-term
 obligations payable 88,200 197,400
 Accounts payable 2,117,500 1,550,300
 Accrued liabilities 4,609,100 4,932,900
 Income taxes
 Currently payable 312,100 260,100
 Deferred -- --
 Total current liabilities $ 7,126,900 $ 7,687,600
 LONG-TERM OBLIGATIONS 21,100 78,100
 INDEBTEDNESS TO RELATED PARTIES 1,030,300 1,111,400
 DEFERRED CREDITS 801,400 954,400
 Total Liabilities $ 8,979,700 $ 9,831,500
 STOCKHOLDERS' EQUITY
 Common stock -- authorized 3 million
 shares of 5 cents par value, issued
 1,578,000 shares, outstanding
 1,568,000 shares at Sept. 30, 1993,
 and Dec. 31, 1992 78,900 78,900
 Additional paid in capital 2,722,700 2,722,700
 Retained earnings 2,581,100 2,281,400
 Less Treasury Stock at cost (30,000) (30,000)
 Cumulative translation adjustment 12,700 11,900
 Total Stockholders' Equity $ 5,365,400 $ 5,064,900
 TOTAL LIABILITIES AND
 STOCKHOLDERS' EQUITY $14,345,100 $14,896,400
 The accompanying notes are an integral part of these statements.
 NOTE: The balance sheet at Dec. 31, 1992, has been derived from the audited financial statements at that date.
 QuesTech, Inc., and Subsidiaries
 CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
 Three Months Ended Sept. 30,
 1993 1992
 Revenues $13,901,600 $13,288,900
 Operating expenses
 Salaries, wages and employee
 benefits 6,574,500 5,834,000
 Other operating expenses 7,077,000 7,213,500
 Total operating expenses $13,651,500 $13,047,500
 Income from continuing
 operations 250,100 241,400
 Interest expense 24,300 29,700
 Earnings before income taxes $225,800 $211,700
 Provision for income taxes 106,100 99,600
 Net earnings $119,700 $112,100
 Earnings per share $0.08 $0.07
 Weighted average number of
 common shares outstanding 1,568,000 1,568,000
 Consolidated Statements of Earnings (Unaudited)
 (Continued)
 Nine Months Ended Sept. 30,
 1993 1992
 Revenues $37,397,500 $34,883,400
 Operating expenses
 Salaries, wages and employee
 benefits 19,863,000 18,055,100
 Other operating expenses 16,868,200 16,130,500
 Total operating expenses $36,731,200 $34,185,600
 Income from continuing
 operations 666,300 697,800
 Interest expense 100,900 193,800
 Earnings before income taxes $565,400 $504,000
 Provision for income taxes 265,700 236,900
 Net earnings $299,700 $267,100
 Earnings per share $0.19 $0.17
 Weighted average number of
 common shares outstanding 1,568,000 1,568,000
 The accompanying notes are an integral part of these statements.
 -0- 11/23/93
 /CONTACT: Vincent L. Salvatori, chairman and CEO, 703-760-1005, or Joseph P. O'Connell Jr., vice president & CFO, 703-760-1010, both of QuesTech/
 (QTEC)


CO: QuesTech, Inc. ST: Virginia IN: CPR SU: ERN

KD-DC -- DC028 -- 7386 11/23/93 15:58 EST
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Date:Nov 23, 1993
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