Precision Auto Care Announces FY 04 Year End Results

LEESBURG, Va., Sept. 29 -- Precision Auto Care, Inc. (BULLETIN BOARD: PACI) announced its financial results for the fiscal year ending June 30, 2004. Revenues were $11.8 million and profits were $1.6 million, or $0.07 per share, compared with a profit of $10.9 million, or $0.72 per share, on revenues of $11.9 million for the prior year. For the quarter ending June 30, 2004, the Company earned a profit of $726 thousand, or $0.03 per share on revenues of $3.0 million, compared to a profit of $2.0 million or $0.11 per share on revenues of $3.1 million for the comparable quarter in 2003.

The Company's President, Robert Falconi, stated, "It has been another excellent year for the company. Operating profits were very close to $1 million for the second year in a row and the balance sheet continues to improve each quarter. I have every reason to believe that trend will continue throughout FY05. Equally important, we are currently selling franchise licenses, Area Development rights domestically and Master Franchisee rights internationally. A year ago, we said that we believed Precision had turned the corner. We now have even more data to give us confidence for the future."

Lou Brown, Chairman and CEO of PACI, said, "The Board of Directors is very pleased with the company's operating results. PACI's balance sheet is significantly stronger than it was at the same time a year ago and the company has been showing operating profits for the past seven quarters. We feel the company will be able to grow in the upcoming year and management is determined to make that happen."

Precision Auto Care, Inc.'s affiliate, Precision Franchising LLC, is one of the world's leading franchisors of auto care centers, with 428 operating centers as of September 29, 2004. The Company franchises Precision Tune Auto Care centers around the world.

                                  Three Months Ending June 30

  000s except per share amounts

                                        2004        2003
  Revenue                              $2,961      $3,099
  Net income                           $  726      $2,022*
  Diluted income per share             $ 0.03      $ 0.11
  Shares outstanding - diluted         26,785      17,711

  * Includes gain on debt restructuring of $659,893.

                                   Twelve Months Ending June 30

  000s except per share amounts

                                       2004        2003
  Revenue                            $ 11,774    $ 11,937
  Net income                         $  1,590    $ 10,932**
  Diluted income per share           $   0.07    $   0.72
  Shares outstanding - diluted         22,549      15,188

  ** Includes gain on debt restructuring of $10,405,993.