Attention Business, Technology and Economics Editors and Reporters

Toronto - October 28, 2004 - Ontario-based firms hold 5 of the top 10 spots on Canada's Top 100 Corporate R&D Spenders List 2004 released today by Research Infosource Inc.

#1 - Nortel Networks retains its dominant position with an estimated R&D expenditure of $2.8 billion in fiscal 2003, a decrease of (-20.4%) from fiscal 2002 following an estimated revenue decline of (-17.1%) from $16.6 billion in 2002 to $13.7 billion in 2003. (Nortel figures are not final. The best data available were used for our calculations.)

#3 - Magna International drops from 2nd place despite a 9.7% increase in R&D spending on a 5.6% increase in revenue.

#5 - ATI Technologies moves up from 7th spot with a 14.9% jump in R&D investment and a 21% increase in estimated revenue.

#6 - IBM Canada slips from 5th place to 6th with a modest 2.3% increase in R&D expenditures on no increase in estimated revenue.

#10 - Atomic Energy of Canada climbs from 12th position into 10th even with a slight drop in R&D spending of (-3.8%) on a 15.2% increase in revenue.

Overall, corporate spending on R&D in Canada declined for the second year in a row. In fiscal 2003, Canada's top R&D companies invested nearly $10.6 billion in research and development activities, down (-5.1%) from 2002. This 2-year decline that began in 2002 comes on the heels of 5 straight years (1996-2001) of spending increases. In 2003, 55 firms, over half of the Top 100 companies cut back or held the line on R&D spending. In 2002, only 34 firms reduced their R&D investment.

The 48 companies headquartered in Ontario accounted for $6.4 billion or 61% of the total for fiscal 2003. This represents a decrease of (-8.1%) from fiscal 2002. Québec's 26 companies spent $3.02 billion, representing 29% of total expenditures, an increase of 2.3%. The 16 British Columbia-based firms invested $788.5 million, 7% of the total and a decrease of (-5.6%). The 8 Alberta firms accounted for $282.3 million or 3% of Top 100 spending and posted a decrease of (-5.7%) from 2002.

"Nortel's dominance of the R&D picture is felt in Ontario as well as the rest of Canada," says Ron Freedman, CEO of Research Infosource Inc. "Removing Nortel from the Ontario calculations, 47 companies invested $3.6 billion, 47% of the total, a respectable increase of 4.2%. Looking at the national picture, without Nortel's results, 99 firms invested $7.8 billion for a very modest 1.9% increase."

Ontario companies accounted for 12 of the 21 firms that qualified for Research Infosource's $100 Million Club (companies that spend $100 million or more on R&D): Nortel, Magna, ATI, IBM Canada, Atomic Energy of Canada, Apotex, GlaxoSmithKline, Zarlink Semiconductor, Biovail, CAE, Aventis Pasteur, and Cognos.

The complete Canada's Top 100 Corporate R&D Spenders List 2004 and more regional information is available on the Research Infosource website, www.researchinfosource.com. An in-depth Canada's Top Corporate R&D Spenders Report 2004, based on over 650 companies, is slated for publication in November 2004. Research Infosource Inc., a division of The Impact Group, is Canada's source of R&D intelligence. Drawing from an extensive database, Research Infosource Inc. publishes Canada's Top 100 Corporate R&D Spenders List, Canada's Top 50 Research Universities List, and specialized reports.

Information: Ron Freedman, CEO, Research Infosource Inc. (416) 481-7070 ext. 31
Janet Sandor, Director of Communications (416) 481-7070 ext. 25