QRS Music Technologies, Inc. Reports Year-end Results; Sales Increased 24%, Net Income Increased 76% and Earnings Per Share Increased 75%

Business Wire, Sept 30, 2004

NAPLES, Fla. -- QRS Music Technologies, Inc. (OTCBB: QRSM) announced today record sales, net income and earnings per share for the year ended June 30, 2004.

Sales for the year-ended June 30, 2004, were $18,512,717 with net income of $1,334,982 (available to common shareholders), or $.14 per share fully diluted. Comparable amounts for the year-ago period ended June 30, 2003, were total sales of $14,934,100 with net income of $757,773 (available to common shareholders), or $.08 per share fully diluted.

Tom Dolan, President and CEO said: "The majority of the sales increase is attributable to the introduction of the Digital Hymnal, an increase in the sales of Pianomation equipped Story & Clark pianos and to an increase in Pianomation hardware sales. The overall growth trend continues as piano dealers are enjoying good sell through on QRS Music products."

Dolan added: "Our R&D development decreased about 20% due to the varying times of products in development. Several products, such as the Psalmist and the Virtuoso Violin moved from development to production and distribution."

The QRS Pianomation(R) system can turn any piano into a reproducing player piano. A hardware and software process can store and transport Musical Instrument Digital Interface ("MIDI") information as an analog signal. This process gives QRS the ability to store, and wirelessly transmit, MIDI performance data in an analog format from a controller (CD, video, cassette, DVD, DAT or Minidisc) to the receiver on the piano. This creates numerous possibilities. For example, most off-the-shelf audio equipment has a left and right channel available for use. State-of-the-art technology permits QRS to store the digital signal in an analog format on the left channel of the software which operates those players. This leaves the right channel available for live prerecorded audio music, even vocal recordings. Pianomation(R) blends them together in perfect harmony and perfect synchronization. The Pianomation(R) MIDI System is the first product of its kind to "marry" analog and digital technology.

QRS Music Technologies, Inc.'s stock is traded Over-The-Counter on the OTCBB: QRSM.

Forward-Looking Statements

Statements made in this news release that relate to future plans, events or performances are forward-looking statements. Any statements containing words, such as, "believes," "should," "anticipates," "plans," or "expects" as well as other statements are forward-looking, and those statements involve risks and uncertainties outside of the control of QRS and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements. Attention is directed to cautionary statements in our filings on Form 10-KSB for the fiscal year ended June 30, 2004 and our other filings with the Securities and Exchange Commission. All those filings are available on the Web site of the Securities and Exchange Commission at www.sec.gov.

QRS Music Technologies
Selected Unaudited Financial Data

                                          For 12 Months  For 12 Months
                                              Ended          Ended
                                            6/30/2004      6/30/2003
                                         -----------------------------

Operating Data:
Sales                                         18,512,717   14,934,100
Cost of sales                                 12,502,577   10,029,514
Gross Profit                                   6,010,140    4,904,586

Selling, general and administrative
 expense                                       3,267,189    3,035,526
Research and development                         337,814      421,397
Income from operations                         2,405,137    1,447,663

Interest Expense                                  22,773       30,508
Income before Taxes                            2,382,364    1,417,155
Provision for Income Taxes                       919,000      531,000
----------------------------------------------------------------------
Less current yr preferred stock dividends
 in arrears                                      128,382      128,382
----------------------------------------------------------------------
Net Earnings (Losses)                          1,334,982      757,773
----------------------------------------------------------------------
Net income per share                                0.14         0.08
----------------------------------------------------------------------

Balance Sheet Data:
Total Assets                                  10,024,955    8,953,365
----------------------------------------------------------------------
Total Liabilities                              1,696,869    1,915,870

----------------------------------------------------------------------