Carmanah Announces Second Quarter Profitability and Record Revenue

Vancouver, BC, Canada - (October 21, 2004) - Carmanah Technologies Corporation (TSX VE: CMH; Berlin and Frankfurt Stock Exchanges: QCX), is pleased to announce its second quarter results for the three months ended June 30, 2002. Highlights for the quarter are as follows:

  • Revenue up 86% over Q2 2001 to $1,513,733
  • Profit of $31,140
  • Revenue growth (86%) outpaced expenditures (44%)
  • Unit sales were up 72% to 10,783 for the first half of 2002
  • Gross profit reaches a record 58% as direct sales increase
  • Investments into developing new markets continues

SUMMARY OF RESULTS FOR 2002

3 Months Ended June 30

Carmanah recorded a record $1,513,733 in revenues. This was an 86% increase of $701,587 over the same period in 2001.

Direct cost of goods totaled $649,836, as compared to $349,949 for the three months ended June 30, 2001. Total operational expenses were $878,155, a 44% increase over the $611,267 in the same period in 2001.

Gross profit as a percentage of sales reached a record 58%. Net income was $31,140 as compared to a net loss of $213,759 for the same period in 2001.

6 Months Ended June 30

Carmanah recorded a record $2,894,777 in revenues. This was an increase of 78% over the same period in 2001. Revenue growth was achieved through (i) the continued growth of marine sales in existing product lines; (ii) expansion into the railway and mining markets with existing products; and (iii) expansion into the transportation and transit markets with entirely new products. Unit sales increased from 6,818 units sold and delivered for the first half of 2001 to 10,783 for the first half of 2002.

Direct cost of goods totaled $1,248,166 as compared to $739,853 for the six months ended June 30, 2001. Gross profit as a percentage of sales was 57% as compared to 55% during the same period in 2001. This increase is a result of the Company's movement towards more direct selling through dedicated sales staff and an aggressive e-commerce program.

Total operational expenses were $1,685,710 as compared to $1,059,422 for the same period in 2001. As a percentage of sales, the operating expenses are down to 59%, as compared to 65% for the same period in 2001. This increase is attributed to the increased staff and administrative expenses necessary to support the Company's expansion into new products and new markets. Increasing investment is being made into markets that will be primary sources of revenues in the months and years to come.

Net income was $6,560 as compared to a net loss of $215,762 for the same period in 2001. The overall increase is a result of an increase in sales.

Cash balance as at June 30, 2002 was $820,084, as compared to $1,060,817 as at December 31, 2001. The decrease was primarily attributable to an increase in inventory levels and a decrease in current liabilities.

About Carmanah Technologies Inc.

Carmanah designs, manufactures and supplies patented, proprietary solar-powered LED lighting solutions to the marine, transit, roadway and railway markets. The company has distributors in over 80 countries and now has more than 45,000 units installed worldwide. The shares of Carmanah Technologies Corporation (parent company) are publicly traded on the TSX Venture Exchange under the symbol "CMH" and on the Berlin and Frankfurt Stock Exchanges under the symbol "QCX". For further information, please visit www.carmanah.com.

On Behalf of the Board of Directors

Carmanah Technologies Corporation

Praveen Varshney, Director

For further information, please contact:

Corporate Contacts:

Mr. Praveen Varshney, Director

Tel: (604)629-0264

Toll-Free: 1-866-629-0264

Media Contact:Mr. David Davies

Harbourwerks Communications

Tel: (250)382-4332

ddavies@harbourwerks.com

Investor Relations Contact:

Vanguard Shareholder Solutions

Tel: (604) 608-0824

Toll-Free: 1-800-567-6223

ir@vanguardsolutions.ca

CARMANAH TECHNOLOGIES CORPORATION

Consolidated Balance Sheets

June 30, 2002 and December 31, 2001

(Unaudited - Prepared by Management)

    June 30, December 31,
2002 2001
(unaudited) (audited)
Assets
Current assets:
Cash and cash equivalents $ 820,084 $ 1,060,817
Accounts receivable 643,531 358,958
Taxes recoverable 9,926 23,888
Prepaid expenses and deposits 35,609 26,777
Inventories 833,308 587,439
Current portion of
  advances receivable
36,639 49,472
2,379,097 2,107,351
Advances receivable 111,500 111,500
Capital assets 304,334 279,873
Deferred development costs 105,645 216,895
Patents and other intangibles 35,582 29,487
$ 2,936,158 $2,745,106
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and
  accrued liabilities
333,027 340,876
Bank loan 30,000 30,000
Current portion of
  long-term debt
6,146 27,790
Current portion of obligations under capital lease 12,855 25,800
Current portion of future
  income taxes
18,000 18,000
400,028 442,466
Long-term debt 6,473 17,143
Obligations under capital lease 30,304 30,304
Shareholders' equity:
Share capital 3,267,346 3,029,746
Contributed surplus 26,188 26,188
Deficit (794,181) (800,741)
2,499,353 2,255,193
$ 2,936,158 $ 2,745,106

CARMANAH TECHNOLOGIES CORPORATION

Consolidated Statements of Operations and Deficit

For the six months ended June 30, 2002 and 2001

(Unaudited - Prepared by Management)

    2002 2001
Revenues $ 2,894,777 $ 1,628,983
Cost of goods sold 1,248,166 739,853
Gross Margin 1,646,611 889,130
Operating expenses:
Amortization of:
   Capital assets 48,714 41,507
   Deferred development costs 111,249 70,119
   Patents and other
     intangible assets
4,155 3,700
Bank charges and interest 21,060 15,583
Office and administration 262,185 180,924
Research and development 319,693 125,287
Sales and marketing 262,682 112,486
Wages and benefits 655,972 509,816
1,685,710 1,059,422
Operating loss for the period (39,099) (170,292)
Other income:
Interest and other income 45,659 43,015
Reverse takeover costs -- (88,485)
45,659 (45,470)
Income (loss) for the period 6,560 (215,762)
Deficit, beginning of period (800,741) (124,242)
Deficit, end of period $ (794,181) $ (340,005)
Earnings (loss) per share $ 0.0003 $ (0.0343)
Weighted average number of shares outstanding 20,480,113 6,285,479

CARMANAH TECHNOLOGIES CORPORATION

Consolidated Interim Statements of Cash Flows

For the six months ended June 30, 2002 and 2001

(Unaudited - Prepared by Management)

    2002 2001
Cash provided by (used in):
Operations:
Income (loss) for the period $ 6,560 $ (215,763)
Amortization, an item not
  involving cash
164,118 115,326
Changes in non-cash operating
     working capital:
   Accounts receivable (284,573) (141,344)
   Taxes recoverable 13,962 (89,909)
   Inventories (245,869) (154,168)
   Prepaid expenses and
     deposits
(8,832) (1,782)
   Advances receivable 12,833 -
   Accounts payable and
     accrued liabilities
(7,848) 114,665
(349,649) (372,975)
Investing:
Cash received on the reverse takeover of
Carmanah Technologies Inc.
-- 1,768,014
Capital asset additions (83,423) (94,197)
Patents and other intangibles -- (10,032)
(83,423) 1,663,785
Financing:
Shares issued by way of
  private placement
237,600 -
Bank loan -- (30,000)
Repayment of long term debt (32,316) (27,431)
Obligations under
  capital leases
(12,945) 69,212
192,339 11,781
Increase (decrease) in cash and cash equivalents (240,733) 1,302,591
Cash and cash equivalents, beginning of period 1,060,817 185,634
Cash and cash equivalents, end of period $ 820,084 $ 1,488,225