Precision Auto Care Announces Third Quarter FY 05 Results

LEESBURG, Va., May 16, 2005 -- Precision Auto Care, Inc. (BULLETIN BOARD: PACI) announced its financial results for the third quarter of fiscal year ending March 31, 2005. Revenues were $2.8 million and profits were $630,000, or $0.02 per share, compared with a profit of $307,000 or $0.01 per share, on revenues of the same amount for the quarterly period in the prior year. Of the $630,000 in profit, $202,000 could be attributed to operating income and the balance was due to a $428,000 adjustment in deferred taxes.

The Company's President, Robert Falconi, stated, "We continue to be pleased with PACI's operating results even though the operating results for this quarter were not quite as strong as those from a year ago. Our year-to- date revenues are ahead of last year's pace as is profit. Our international revenues are growing and we are beginning to sell licenses in markets where we have not had a presence in some time such as Connecticut. It is an exciting time for the Company."

Lou Brown, Chairman and CEO of PACI, said, "The Company's finances grow stronger every quarter and that is reflected in our balance sheet. I am very pleased with the progress we are making in both our domestic and international development."

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 November 10, 2004. The Company franchises Precision Tune Auto Care centers around the world.

                                        Three Months Ending March 31

  000s except per share amounts
                                              2005        2004
  Revenue                                   $  2,767    $  2,841
  Net income                                $    630    $    307
  Diluted income per share                  $   0.02    $   0.01
  Shares outstanding - diluted                28,542      23,352

                                        Nine Months Ending March 31

  000s except per share amounts
                                              2005        2004
  Revenue                                   $  9,266    $  8,813
  Net income                                $  2,286    $    864
  Diluted income per share                  $   0.08    $   0.04
  Shares outstanding - diluted                27,615      21,125