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Bestar: Back to Profitability in 2005.

LAC-MEGANTIC, Quebec -- Bestar Inc. (TSX:BES) - Gross revenue for year ended Decembre 31, 2005 totalled C$38,672,000, a decrease of 11.6% compared to the C$43,728,000 of year 2004. "Delayed introduction of our new products, growing Asian competition and an average exchange rate of C$0.08 higher than in 2004 explain this decrease." comments Mr. Jacques Hetu, Chief Executive Officer of Bestar.

Earnings before other items and income taxes reach C$37,000 for 2005, compared with a loss before other items and income taxes of C$2,254,000 for 2004. "Excluding C$1,386,000 in restructuring costs, 2005 shows an improvement of C$905,000 in operating results despite a decrease in sales of C$5 millions." highlights Mr Hetu. "We also have increased our cash position by C$2,995,000 at C$4,758,000 on December 31, 2005. This represents a little more than C$0.36 per outstanding common share, or 40% more than the market value per share on February 20, 2006" continues Bestar's CEO.

Net earnings for 2005 fiscal year totalled C$174,000 or C$0.01 per share compared with a net loss of C$442,000 or C$(0.04) for 2004. "Investment income of C$260,000 in 2005 and of C$1,275,000 in 2004 improved the results of these two fiscal years." explains Mr. Hetu.

Fourth quarter results

Gross revenue for thefourth quarter of 2005 totalled C$9,392,000 compared with C$9,670,000 for the same quarter in 2004.

Earnings before other items and income taxes stand at C$509,000 for the quarter ended December 31, 2005, compared with a loss before other items and income taxes of C$1,204,000 for the same period in 2004. Net earnings for the last three months of 2005 totalled C$319,000 or C$0.02 per share where the last quarter of 2004 showed a net loss of 894,000$ or C$(0.07). Adjustments to our Commission de la Sante et de la Securite du Travail (CSST) allowance, and the reversal of volume rebate allowances due to lower sales from some customers impacted 2005 fourth quarter results by approximately C$400,000. On the other hand, 2004 fourth quarter results where impacted by restructuring costs in the amount of C$944,000." comments Mr. Hetu.

"2005 results clearly demonstrate the effectiveness of the actions put forward in the restructuring plan as well as the soundness of the decisions that were made while reviewing our cost structure. In the future, this, systematic process of continuing improvement will allow the company to constantly adapt to the reality of the market through the efforts of the entire staff.

2006 will remain a challenging year, as pressures from emerging countries and the srenght of the Canadian dollar will continue. As a direct result of these challenges, we will start the first quarter of 2006 with a significant decrease in sales with a key customer, as Asian products will temporarily take the floor spaces we traditionally occupy. We anticipate to regain this space at the end of the second quarter, with products currently under development.

Meanwhile, at the end of 2005, the Board of Directors created a Business Development Committee. Their mandate is to study all opportunities of merger, acquisition, strategic partnership and/or subcontracting, related to the diversification of our product line and the development of new market segments" concludes Bestar's CEO, Mr Jacques Hetu.

Results Summary
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(Results in thousands of dollars, except earnings per share)


 Q1 Q2 Q3 Q4 Total

Revenue(i) 2003 12,211 10,285 11,274 10,512 44,282
 2004 11,403 9,895 12,760 9,670 43,728
 2005 9,948 9,055 10,277 9,392 38,672

Net earnings 2003 1,095 (443) (388) (10) 254
(loss) 2004 (246) (652) 1,350 (894) (442)
 2005 (107) 180 (218) 319 174

Earnings (loss)
 per common share 2003 0.10 (0.04) (0.03) (0.01) 0.02
 2004 (0.02) (0.06) 0.10 (0.07) (0.04)
 2005 (0.01) 0.01 (0.02) 0.02 0.01

Fully diluted
 earnings (loss)
 per common share 2003 0.10 (0.04) (0.03) (0.01) 0.02
 2004 (0.02) (0.06) 0.10 (0.07) (0.04)
 2005 (0.01) 0.01 (0.02) 0.02 0.01

Total Assets 2003 34,814 33,084 31,034 30,722 30,722
 2004 30,507 29,987 29,515 28,228 28,228
 2005 28,215 28,335 28,502 27,578 27,578

Total Liabilities 2003 20,726 19,438 17,777 17,475 17,475
 2004 17,506 16,479 14,774 14,256 14,256
 2005 14,281 14,153 14,470 13,160 13,160

Weighted average
 of outstanding
 shares (in
 thousands) 2003 11,088 11,088 11,088 11,088 11,088
 2004 11,088 11,738 13,038 13,038 12,231
 2005 13,038 13,038 13,038 13,038 13,038
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(i) In conformity with new accounting standards, transportation
 earnings are hereafter presented in the Revenue item. Comparative
 figures have been reclassified to reflect the consequences of
 this modification.



Company Profile

Established in 1948, Bestar Inc. is involved in the design, manufacturing and distribution of a wide range of models of ready-to-assemble furniture and furnishings that meet consumer needs in terms of quality, design and functional requirements.

The Company which has been public since 1986, carries out its operations frommanufacturing facilities located in Lac-Megantic.

Disclosure

This press release may contain prospective information and declarations on the future performance of the Company. These declarations are based on suppositions and uncertainties and the best possible evaluation of future events by management and are subject to certain risk factors such as fluctuating exchange rates, increasing Asian competition and increases in costs of raw materials and transportation.

Information for Shareholders

Shareholders can obtain information regarding this press release by accessing the CDN news file at www.cdn-news-com or on SEDAR at www.sedar.com. The Management report and completed Financial Statements for the 2005 fiscal year, as well as all other regulatory documents, will be submitted, at the latest, March 31, 2006, through the SEDAR database at www.sedar.com.

Meeting of Shareholders

The Annual Meeting of Shareholders of Bestar Inc will be held on Wednesday, May 10, 2005 at 1:30 p.m., at the Motel Le Quiet, 3284 Laval Street in Lac-Megantic.

Bestar Inc. (TSX:BES)
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Geographic Code:1CANA
Date:Feb 21, 2006
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