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Aaron Rents, Inc. Reports Record Results For Third Quarter and First Nine Months

10/25/2000

ATLANTA, Oct. 25 /PRNewswire/ -- Aaron Rents, Inc. (NYSE: RNT), the nation's leader in the rental, rental purchase and specialty retailing of residential and office furniture, consumer electronics and home appliances, today announced record revenues and earnings for the third quarter and the first nine months of its fiscal year. The third quarter was the 35th consecutive quarter of record revenues and earnings for the Company.

For the three months ended September 30, revenues increased to $124.9 million compared to $109.4 million for the third quarter of 1999, up 14%. Net earnings for the third quarter this year advanced to $6.7 million versus $6.1 million for the third quarter last year. Earnings per share for the third quarter of 2000 rose to $.34 compared to $.30 for the third quarter of 1999, an increase of 13%.

For the nine months, revenues advanced 16% to $372.1 million compared to $321.0 million for the corresponding period last year. Net earnings this year advanced to $20.9 million compared to $19.4 million with earnings per share increasing to $1.05 compared to $.96 per share ($1.05 versus $.94 per share assuming dilution) for the first nine months of 1999, a 12% increase in diluted earnings per share.

Aaron's Rental Purchase division increased its revenues 22% to a record $79.8 million for the third quarter this year compared to $65.4 million last year. Systemwide revenues, which includes revenues of franchised stores, gained 19% to $163.7 million for the quarter compared to $137.0 million last year. For the first nine months, rental purchase revenues grew 25% to $236.7 million compared to $188.8 million for the period last year, while systemwide revenues increased 21% to $484.3 million versus $400.4 million last year.

Revenues from Company-operated rental purchase stores open in comparable quarters grew 10.3% during the third quarter compared to the same period a year ago. In addition, revenues from the Company's rent-to-rent stores open in comparable quarters grew 9.1% during the quarter compared to the same quarter last year.

During the first nine months of this year, the Company has added 66 rental purchase stores, including 10 stores acquired in Puerto Rico in September, and plans to have an over 20% increase in rental purchase stores open by the end of 2000 compared to the previous year. At September 30 the Company had 99 rent-to-rent stores, 248 Company-operated rental purchase stores, and 186 franchised stores open, for a total of 533 stores in 39 states and Puerto Rico.

"This strong performance reflects the continuing success of the Aaron's concept throughout America and the outstanding service provided by our people," said R. Charles Loudermilk, Sr., Chairman and Chief Executive Officer of Aaron Rents. "We look forward to another record year."

Aaron Rents, Inc., based in Atlanta, currently has more than 535 Company- operated and franchised stores in 39 states and Puerto Rico for the rental and sale of residential and office furniture, accessories, consumer electronics and household appliances. The Company manufactures furniture, bedding and accessories at 10 facilities in four states.

Note: Forward-looking statements in this news release are based on current
expectations and are subject to risks and uncertainties, and actual results
may vary materially from the expectations due to such factors as changes in
general economic conditions, competition, pricing, customer demand and other
issues.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1993: Statements in this news release regarding Aaron Rents, Inc.'s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties which could cause actual results to differ from those contained in the forward-looking statements. For a discussion of such risks and uncertainties, see "Risk Factors" in the Company's Annual Report on Form 10-K for fiscal 1999, which discussion is incorporated herein by this reference.

                        Aaron Rents, Inc. and Subsidiaries
                       Consolidated Statements of Earnings
                     (In thousands except per share amounts)

                            Three Months Ended          Nine Months Ended
                               September 30,              September 30,
                            2000          1999          2000          1999
                                (unaudited)                (unaudited)
    Revenues:
     Rentals and Fees      $89,460       $79,963     $266,231      $237,204
     Retail Sales           16,466        16,160       48,301        47,240
     Non-Retail Sales       15,237        10,334       46,459        28,639
     Other                   3,687         2,922       11,141         7,963
       Total               124,850       109,379      372,132       321,046

    Costs and Expenses:
     Retail Cost of Sales   11,516        11,675       33,940        33,893
     Non-Retail Cost of
      Sales                 14,219         9,886       43,124        26,865
     Operating Expenses     56,293        51,349      168,302       150,272
     Depreciation of Rental
      Merchandise           30,610        25,556       89,092        76,033
     Interest                1,413         1,053        3,957         2,729
      Total                114,051        99,519      338,415       289,792

    Earnings Before Taxes   10,799         9,860       33,717        31,254

    Income Taxes             4,093         3,752       12,804        11,892

    Net Earnings            $6,706        $6,108      $20,913       $19,362

    Earnings Per Share        $.34          $.30        $1.05          $.96

    Earnings Per Share
     Assuming Dilution        $.34          $.30        $1.05          $.94

    Weighted Average
     Shares Outstanding     19,834        20,078       19,841        20,111

    Weighted Average
     Shares Outstanding
      Assuming Dilution     19,938        20,393       19,980        20,495

SOURCE Aaron Rents, Inc.

CONTACT: Gilbert L. Danielson, Executive Vice President and Chief Financial Officer of Aaron Rents, Inc., 404-231-001/

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