Precision Auto Care Announces Third Quarter FY06 Results

LEESBURG, Va., May 11, 2006 -- Precision Auto Care, Inc. (BULLETIN BOARD: PACI) announced its financial results for the third quarter of fiscal year ending June 30, 2006. Revenue was $3.0 million and profit was $110,000, or less than $0.01 per share, compared with a profit of $630,000, or $0.02 per share, on revenue of $2.8 million for the same period in the prior year. Year to date, the revenues are $8.7 million and profit is $594,000, or $.02 per share compared with revenues of $9.3 million and profit of $2.3 million or $.08 per share for the same period in the previous fiscal year.

The Company's President, Robert Falconi, stated, "While I am disappointed that the top line has not increased, I am pleased with PACI's financial performance. Our balance sheet continues to get stronger every quarter. Although the results are not as impressive as the numbers from last year, there are mitigating circumstances. Last year, we did not have to recognize a tax expense as we do in the current year. Last year, the Company was able to recognize $965,000 as a tax benefit due to the release of the valuation allowance through the nine months ended March 31, 2005.

Finally, last year, the company generated $500K by selling the rights to the Seattle market, which was a one-time event. I am confident that the Company will continue to operate profitably and we will continue to look for opportunities to grow."

Lou Brown, Chairman and CEO of PACI, said, "The Board of Directors is pleased with the Company's progress and positive operating results. We are confident that the Company is moving in the right direction."

Precision Auto Care, Inc.'s affiliate, Precision Franchising LLC, is one of the world's leading franchisors of auto care centers, with 412 operating centers as of April 30, 2006. The Company franchises Precision Tune Auto Care centers around the world.

                                           Three Months Ending March 31,

  000s except per share amounts

                                                    2006          2005
  Revenue                                       $  2,963     $   2,767
  Net income                                    $    110     $     630 *
  Diluted income per share                      $   0.00     $    0.02
  Shares outstanding - diluted                    29,585        28,542

  * Includes release of the valuation allowance of $428,000 for the three
    months ending March 31, 2005.

                                            Nine Months Ending March 31,

  000s except per share amounts

                                                     2006         2005
  Revenue                                       $   8,657    $   9,294
  Net income                                    $     594    $   2,286 **
  Diluted income per share                      $    0.02    $    0.08
  Shares outstanding - diluted                     29,722       27,615

  ** Includes release of the valuation allowance of $965,000 for the nine
     months ending March 31, 2005.