Interstate National Dealer Services Announces Q2 Fiscal 2001 Results

    MITCHEL FIELD, N.Y.--June 12, 2001--Interstate National Dealer Services, Inc. today announced its second quarter results for the period ended April 30, 2001.
    Revenues for the three months ended April 30, 2001 were $14,739,473, compared to $15,347,002 for the same period a year earlier. Net income for the three months ended April 30, 2001 was $870,359, or $0.20 per share on 4,317,446 diluted weighted average shares outstanding, compared to net income of $479,623, or $0.10 per share on 4,897,372 diluted weighted average shares outstanding for the comparable period a year earlier.
    Revenues for the six months ended April 30, 2001 were $27,617,611 compared to $28,579,788 for the six months ended April 30, 2000. Net income for the six months ended April 30, 2001 was $1,189,874, or $0.27 per share on 4,362,631 diluted weighted average shares outstanding, compared to net income of $896,286, or $0.18 per share on 4,873,366 diluted weighted average shares outstanding for the six months ended April 30, 2000.
    In discussing recent results, Mr. Chester J. Luby, Chairman and CEO of Interstate noted, "We are pleased that the actions that we have implemented have had the desired effect of improving our performance from the comparative quarter. While our operating income is still not at levels that we are satisfied with, the trend is encouraging and we intend to continue to closely monitor our expense levels as we grow revenues."
    Mr. Luby concluded, "Our cash and investments have continued to grow and now total nearly $67 million, or $16.13 per share; we have no debt. Book value stands at $5.19 per share. We continue to repurchase shares in the open market and expended $645,000 since the beginning of our fiscal year for such purchases. We will continue to do so as price and market conditions dictate. We view this action as one that benefits all shareholders and an excellent use of our cash resources. Over the years, Interstate has established itself as a leader in the extended service contract and warranty business and we remain confident of our long term prospects."

      INTERSTATE NATIONAL DEALER SERVICES, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF OPERATIONS
                               UNAUDITED

                    For the Three Months      For the Six Months
                       Ended April 30,          Ended April 30,
                      2001          2000       2001          2000


REVENUES       $ 14,739,473 $ 15,347,002  $ 27,617,611 $ 28,579,788

Net income         $870,359     $479,623(a) $1,189,874     $896,286(a)

NET INCOME 
 PER SHARE:

Basic                 $0.21        $0.10(b)      $0.28        $0.19(b)

Weighted 
 average 
 shares 
 outstanding      4,171,283    4,683,601     4,183,503    4,677,805

Diluted               $0.20        $0.10(b)      $0.27        $0.18(b)

Weighted 
 average 
 shares 
 outstanding      4,317,446    4,897,372     4,362,631    4,873,366

(a) Net income excluding discontinued operations of uautobid.com
would be approximately $741,000 and $1,394,000 for the first quarter
and six months, respectively.

(b) Net income per share excluding uautobid.com expenses would be
$0.16 basic, $0.15 diluted and $0.30 basic, $0.28 diluted for the
first quarter and six months, respectively.

                      CONSOLIDATED BALANCE SHEETS

                           April 30,                     October 31,
                             2001                           2000
                             ----                           ----
                           Unaudited

Cash and investments      $ 66,813,546                  $ 62,825,533
Total assets                83,882,672                    79,784,928
Total stockholders' equity  21,495,976                    20,800,567