Cantronic Reports Results for Q2 Ended July 31, 2011: Revenue Increased 31.5%, Adjusted EBITDA by 52% and Net Income by 405%

Cantronic Systems Inc., ("Cantronic" or the "Company") (TSX VENTURE:CTS)(PINK
SHEETS:CRIXF) today announced its financial results for the second quarter of
fiscal year 2012, ended July 31, 2011. All amounts are reported in Canadian
dollars unless otherwise stated. Selected highlights of the quarter and
subsequent events:


Financial:



--  Revenue of $7.3 million, an increase of 31.5% compared to $5.6 million
    for the corresponding quarter of the previous fiscal year. 
--  Adjusted EBITDA (a non-GAAP term) of $1.15 million, an increase of 52%
    compared to $0.76 million for the corresponding quarter of the previous
    fiscal year. The Company uses adjusted EBITDA (a non-GAAP financial
    measure) internally to make strategic decisions, forecast future results
    and evaluate its performance, defined as net income before interest,
    income taxes, depreciation, amortization, stock based compensation
    expenses, foreign currency loss, and minority interest. 
--  Gross margin of $2.7 million (37% of revenue) compared to $2.3 million
    (41% of revenue) for the corresponding quarter of the previous fiscal
    year. 
--  Net Income (after minority interest) was $741K or $0.008 per basic share
    and $0.007 per diluted share, an increase of 405% compared to $147K or
    $0.003 per basic and diluted share in the corresponding quarter of the
    previous fiscal year.

----------------------------------------------------------------------------
Operating results                                                           
($000's except per share amounts)                                           
                                          Q2 Fiscal 2012      Q2 Fiscal 2011
                                                 Quarter             Quarter
                                          ended July 31,          ended July
                                                    2011            31, 2010
                                                                            
Revenue from continuing operations                 7,294               5,548
Adjusted EBITDA                                    1,153                 760
Net income to shareholders                           741                 147
Net earnings per share, basic                      0.008               0.003
Net earnings per share, diluted                    0.007               0.003
----------------------------------------------------------------------------



Business:



--  On June 14, 2011 it had entered into an arrangement as an Original
    Design Manufacturer ("ODM") with Digital China Holdings Limited of
    Beijing ("Digital China") to design and manufacture a customized version
    of Cantronic's most popular digital IP (Internet Protocol) video camera
    under Digital China's AMPON brand of security products. 
--  On July 18, 2011, Cantronic announced that it was awarded a contract to
    provide video security and protection systems in China's Jiangsu
    province totalling RMB 30 million (approximately Canadian $4.7 million).
    The project begins in September 2011 with duration of one to two years.
    Cantronic will supply and install complete solutions that will integrate
    video surveillance with smart building systems, such as video intercom,
    access control and alarm monitoring. Cantronic will receive 10% of
    payment in advance with milestone payments to be made as the project
    progresses and 90% of payment to be received by the project completion
    date. 
--  In August 2010, Cantronic was awarded a RMB 25 million (approximately
    $3.9 million) contract to act as the primary contractor for a city-wide
    networked video surveillance system under China's Safe City program for
    the city of Haicheng, Liaoning Province. Less than half of the project
    has been completed and the rest of the project is expected to be
    completed within 3 - 6 months. 
--  Subsequent to the quarter end, on September 13, 2011, the Cantronic
    wholly-owned subsidiary,
    Cantronic Security Systems (China) Co., Ltd of Shanghai, China ("CSSC"),
    signed an agreement to sell its 51% interest in Shenzhen Huanghe Digital
    Technology Co. Ltd., of Shenzhen, China ("Yellow River") to an investor
    in China. Under the agreement, CSSC will sell all of the 51% interest it
    holds in Yellow River. Closing of the sale is conditional on completing
    all applicable regulatory procedures in China and Canada and a
    satisfactory valuation report issued by a qualified business valuator or
    appraiser as well as being subject to the usual terms and conditions.
    The transaction is expected to close before the end of October, 2011 for
    cash consideration of approximately RMB 10.71 million or approximately
    $1.65 million.



"Revenue, adjusted EBITDA and net income increased significantly in Q2,
reflecting efforts the company has made in marketing. In the quarter, Cantronic
announced a $4.5 million integration contract for a private video security
system with excellent payment terms and the Company is completing a Safe City
contract announced earlier. The company will continue to seek additional
integration contracts while producing product under OEM and ODM agreements and
selling to our local customers. We also plan to develop distribution of our
high-speed IP dome cameras, IP cameras and software in North America," remarked
James Zahn, President and CEO of Cantronic Systems Inc.


"The planned sale of Yellow River will improve our working capital and makes it
unnecessary for the Company to raise additional equity in the immediate
near-term. We have had several consecutive quarters of profitability and
positive adjusted EBITDA. With positive cash flow from operations and positive
working capital at the end of the second quarter, this will enable us to seek
more integration contracts for networked video surveillance systems, which
generally have higher gross margin than product sales," said Mr. Zahn.


Regulatory Filings

The material will be available through SEDAR at www.sedar.com and on the
Company's website, www.cantronicsecurity.com


About Cantronic Systems Inc.

Cantronic Systems Inc. manufactures, distributes, and provides training and
services in the fields of IP- based networked video security surveillance
technologies, specializing in networked video management software and video
analytics, IP cameras, speed dome cameras, high definition video surveillance
cameras and night vision surveillance systems for demanding security and
surveillance applications.


Cantronic, through its China subsidiaries Cantronic Security Systems (China) Co.
Ltd., Beijing Advanced Videoinfo Technology Co. Ltd. ("AVINFO"), Shenzhen
Huanghe Digital Technology Co. Ltd. ("Yellow River") and Actiontop Electronics
(Shenzhen) Co. Ltd. ("Actiontop") provides high-speed and digital networked
video surveillance solutions to government and corporate customers in China.


Cantronic is a Tier 1 issuer on the TSX-V exchange, trading under the symbol
CTS. For further information about Cantronic and Cantronic China, please visit
our websites at www.cantronicsecurity.com and www.cantronics.com.cn.


Forward-looking statements

This news release contains forward-looking statements, within the meaning of
applicable securities legislation, concerning Cantronic Systems Inc. and the
markets in which it operates. Forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause actual results,
performance and achievements of Cantronic to be materially different from any
future results, performance or achievements expressed or implied by said
forward-looking statements.


Forward-looking statements include, but are not limited to: the completion of
the Proposed Transaction, anticipated share capital following completion of the
Proposed Transaction, expectations, opinions,forecasts, projections and other
similar statements concerning anticipated future events, conditions or results
that are not historical facts. In certain cases, forward-looking statements can
be identified by the use of words such as "plans," "expects" or "does not
expect," "is expected," "budget," "scheduled," "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes", or variations
of such words and phrases or statements that certain actions, events or results
"may", "could", "would", "might" or "will be taken", "occur" or "be achieved."


Readers are cautioned not to place undue reliance on such forward-looking
statements. Forward- looking information is provided as of the date of this news
release, and Cantronic Systems Inc. assumes no obligation to update or revise
them to reflect new events or circumstances, except as may be required under
applicable securities laws.
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