TSX Symbol:  SQP                                               For Immediate Release

Strongco Announces Third Quarter Results

Mississauga, November 7, 2002:  Strongco Inc. released its financial results for the third quarter today.

By completing the sales of its three Supplies divisions during the quarter, Strongco significantly advanced its stated objective of disposing of non-core assets in order to strengthen its balance sheet and increase its focus on its core equipment distribution businesses.  Cash proceeds from these sales approximated $22 million, which was applied primarily to the Company’s funded debt.  The financial position and operating results of the Supplies divisions have been disclosed as discontinued operations in the 2002 and 2001 financial statements.

Strongco’s financial results from continuing operations showed further improvement in the third quarter.  The Company’s net loss from continuing operations was $689,000, or $0.07 per share compared to $1.7 million, or $0.18 per share, during last year’s third quarter.  In spite of weak market conditions across most of Strongco’s territories, revenues increased to $82.9 million from $80.4 million last year.  Furthermore, progress continued to be made in reducing both the Company’s operating costs, which declined to $12.7 million during the quarter from $14.1 million last year, and its interest costs, which fell to $1.8 million from $2.7 million last year.  Reduced operating and interest costs more than compensated for the quarter’s lower gross margins, which continue to be under pressure stemming from industry-wide competitive factors.

For the first three quarters of the year, the loss from continuing operations was $4.3 million ($0.46 per share), approximately half of last year’s loss of $8.5 million ($0.90 per share) for the same period.  Year-to-date revenues have increased to $247.8 million from $236.0 million.  As with the third quarter results, the majority of this increase has been realized in the Eastern Canadian market, primarily in Quebec where activity levels have strengthened this year, and the Western Canadian market as a result of Strongco having the Volvo equipment line for the full year.  Excluding $3.9 million of non-recurring costs incurred last year in relation to the execution of portions of Strongco’s strategic plan, operating costs for the first three quarters of 2002 have declined by $4.1 million to $39.0 million.  Furthermore, the combination of lower average interest rates in 2002 and reductions in the Company’s asset base have resulted a substantial decrease in interest costs, falling to $5.1 million for the first three quarters of this year from $10.1 million for the same period last year.

Strongco generated cash from operations of $2.4 million during the third quarter compared to a usage of $4.9 million in last year’s third quarter.  This cash, plus $0.8 million generated largely through dispositions of rental equipment and other capital assets and $21.2 million from discontinued operations (including approximately $22.0 million from the dispositions of these divisions), was applied primarily to Strongco’s interest-bearing debt.  For the first nine months of the year, the Company’s interest-bearing debt has been reduced by $36.6 million with the application of $9.3 million of cash from operations, $3.7 million net from asset dispositions and $23.6 million from discontinued operations.

Mr. Larry Pirnak, Chairman of Strongco, commented:  “Although ongoing weakness in most of our markets translated into an overall loss for the company during the quarter, we continue to be encouraged by the progress our company is making.  Revenues are up over the same period last year and costs, both operating and interest, are down significantly.  We have been able to improve market shares for our principal product lines over last year, our equipment rental losses have been reduced, and our core equipment distribution operations were profitable for the second consecutive quarter.   While all this has yet to translate into a profit for the company as a whole due to losses in our Engineered Systems and Equipment Rentals businesses, we believe that the trend is clearly in the right direction.”

The Company also noted that discussions pertaining to the previously-announced sale of its Engineered Systems business had been terminated and the transaction would not be proceeding.

Strongco will host a conference call at 3:00 PM on November 7 to further discuss its third quarter and year-to-date results and operations.  Call-in details can be obtained from the Company by phoning 905-565-3875.

Strongco is one of Canada’s largest full-line equipment sales, rental and service companies.  Its shares are listed on the Toronto Stock Exchange and its website can be accessed at www.strongco.com.

For further information, contact:

Randy Henderson
President
905-565-3802

rhenderson@strongco.com