American Building Control Chief Executive Officer J. Collier Sparks Releases Third Quarter 2004 State of the Company Address.

SAN ANTONIO, Texas -- American Building Control, Inc. (Nasdaq:ABCX):

--Recent Milestones Include Centralization of Operations, Significant Cost Reductions, Sale of Ancillary Businesses and Re-organization of Sales Efforts Towards Government, Enterprise and Commercial Markets

J. Collier Sparks, CEO of American Building Control, Inc. (Nasdaq:ABCX) and President of MDI Security Systems, announced today that he would release a state of the company address focused on reporting the company's current corporate position, major objectives achieved and future direction. The address reads as follows:

I would like to take this opportunity to express my deepest appreciation to those people who have been continuously providing their support and trust towards the American Building Control family of companies. I recognize that our dealers, customers and stakeholders across the globe share many unanswered questions about the current state of affairs at our company and I would like to take this opportunity to provide some clarity.

2004 has been one of the most demanding and challenging years that the company has faced. Many changes were made in a very short period of time that immediately affected the future of our company. These changes have included implementing painful, but necessary, decisions that we believe will transition the company into the market leader that it was as little as five years ago. Going forward, we will protect our cash by closely adhering to cost control, investment and acquisition standards that are designed to help us meet our growth and profitability goals. We will re-double our efforts to develop a trusted relationship with our dealers who will be one of the keys to our growth. That means we will only deliver to our dealers and end users new product releases that have been thoroughly tested and are ready for market.

I am pleased to say that after a difficult and painful year of restructuring, refocusing and renewal, a leaner and more dynamic company has emerged. The strength and value of our products, coupled with our new team's expertise and passion for supporting the customer, will enable us to continue operations during the remainder of this critical transition phase with minimal disruptions. We have expanded and strengthened our sales organization the results of which has already resulted in our securing several new enterprise customers that required a proven and time-tested security solution, such as ours.

Today's management understands the problems that plagued us in the past and we have addressed these problems. At the same time, we continue to develop and market the right products, retain the right people and implement the right processes to assure a profitable future for our company. The result is that your company is in a very strong position to grow, prosper and regain its market leadership as the best systems company in the business.

This is also the year that we proudly celebrate the 25th anniversary of MDI Security Systems. As many new access control and security vendors have entered our market in an attempt to capitalize on the increasing homeland security budgets, our company remains at the forefront by continuing to deliver on our promises and customer commitments, just as we have done over the past quarter century. During the past 25 years, almost every Federal government organization has had an MDI system within its infrastructure at one point or another. Many of the world's largest government contractors continue to support thousands of MDI systems that are still in place after decades of reliable service. We will continue to capitalize on this tremendous installed-base and we will follow through with our planned customer migration and modernization strategies. At the same time, we will also engage in new business partnerships to broaden our product and customer base.

To do this, we will focus on four key areas of business development:

--Build and support our certified MDI dealer base;

--Increase the number of MDI channel partners and integrator relationships;

--Grow our government, enterprise and large commercial customer base; and

--Migrate our legacy customers to new MDI security technology.

The long-term rewards that we expect from this dedicated focus was the basis of our centralized re-organization strategy and was what fueled our decision to position MDI as the cornerstone of American Building Control. This strategy includes focusing on the development and delivery of high-value enterprise security management solutions that can be integrated into any organization's security infrastructure while maintaining the lowest cost of ownership and highest return on security investment in the industry.

However, before we were able to properly position ourselves for the future, we had to clear a major hurdle by finalizing the sale of our non-core Diversified Security Group (DSG) units. Since the sale of Industrial Vision Source and SecurityandMore in July, many "fireside chats" have taken place about the reasons why the company decided to part with these two solid businesses, which together accounted for $20 million in annual revenue.

Our motivation behind selling the DSG units was clear from the start: these businesses did not fit into our long-term plans. These were relatively low margin, retail businesses that required a great deal of management attention which we felt could be better focused on the fulfillment of our new mission: fulfilling the security needs of government, enterprise and large commercial clients.

The DSG sale allowed us to focus on what we do best. It also provided us the working capital and additional resources we needed to strengthen and expedite the implementation of the four key business development areas within our Professional Security Group (MDI Security Systems and ABM Data Systems).

Many of you have taken the time to read the 10-Q quarterly report issued by the company last week. As we move forward with our strategy, we know that the financial results we report in these periodic reports will play a huge role in the decisions made by our stakeholders. I feel that we have already made great improvements in the financial stability of the company in just a few short months. Please keep in mind that this was accomplished during a year of massive corporate transition involving large severance payments and lease settlements. Now that we are positioned to execute on the sales, product enhancement and business development phase of our strategy during 2005, these reports should begin to show a positive trend. As you review this document, please take the time to focus on a few key highlights:

--We are debt free;

--Our restructuring and consolidation efforts have had an immediate impact on further reducing losses;

--"Smart-sizing" and the reduction of non-critical staff as a result of our corporate consolidation will continue to have an impact on further reducing losses;

--Sale of the DSG units has increased our cash reserves;

--Gross profit margins increased notably as a result of the sale of the DSG units; and

--We are dedicated to our high-margin enterprise focus and mission.

We appreciate that investors will have continued doubts about the future of American Building Control, and we can assure those investors that we know full well that only concrete achievements will alleviate those doubts. I assure you, that for the remainder of 2004 and FY 2005, our emphasis will remain squarely on development, execution and achievement of growth and profit goals.

There has also been a great deal of speculation about the reason for our corporate re-location, particularly the complete move of our corporate headquarters to San Antonio, Texas. Our new San Antonio office will be occupied by our executive team, operations, sales, marketing, engineering, technical support, product assembly, integration and sustaining research and development activities. The address is 9725 Data Point Drive, San Antonio, TX 78229 -- Telephone [phone].

We did not move our Product Development group from California to San Antonio (including product management and quality assurance functions). These functions are located in Ontario, Calif.

Under the direction of Conrad Hartwig, Senior Vice President of Sales, we have established six sales regions located across the nation which include Regional Sales Engineers (to support customers, dealers and integrators before and after a sale) and Regional Sales Managers (working new business opportunities). As a result of Conrad's initiatives, the company has doubled its dealer base and channel partners. The result will be increased sales and additional market penetration.

The benefits of our re-organization and consolidation will soon be evident. As a direct result of our downsizing, which actually started in December 2002 with the sale of our CCTV business to Honeywell International, we have been paying substantial rent on facilities we no longer had a need for. With our concentration on the MDI Security Systems business, we no longer had a need for a de-centralized corporate infrastructure. Therefore, we took the necessary measures to reduce our non-critical staff while being mindful to retain our core product development staff who possess the company's security domain knowledgebase. Our team is now focused on business execution and bottom line results.

San Antonio was selected as our corporate headquarters because it combines easy access to some of the top information security minds in the world (ready security clearances and military background) with a low cost of living. The city boasts a dynamic social environment and sunny weather that makes it attractive to all. As we continue to invest in our future, we firmly believe that our relocation to San Antonio will prove to be even more beneficial in attracting and keeping the best quality talent. This top-notch talent will play a key role in our ability to develop additional revenue streams around our products through dedicated maintenance agreements, comprehensive training packages and best-in-class customer support.

Our latest release of the patent pending MDI Security Suite(TM), known as SAFEnet(R) 6.2.1, is the best product of its kind that I have ever seen. SAFEnet 6.2.1 is clearly the best integrated security offering on the market today. As we announced last week, Jim St. Pierre has re-joined the company. In past years he was instrumental in the success of MDI and we are confident that with the help of Jim St. Pierre our SAFEnet product will become the new standard in the security space in a short period of time. Mr. St. Pierre's deep knowledge of the industry coupled with his ability to drive the development of cutting edge products will enable our team to regain its leadership position in the security industry.

Quality assurance and product testing are a critical part of MDI's focus. Rest assured that under my direction we never will release sub-standard or un-tested products. We will strive to always maintain the highest quality control and assurance standards required of a company securing the nations most classified operations.

In June of this year, MDI formally announced its product migration program, offering seamless and affordable modernization upgrades for customers with legacy MDI systems. We want our existing customers to receive the full benefit of the new and enhanced MDI security solution. For this to become a reality, our legacy customers must make the effort to migrate and modernize their systems. Some of our clients have had the same MDI systems in their organization for over 15 years. Some of our original installations, implemented over two decades ago, are still operating today. Although this longevity is a testimony to the tremendous value that our products bring to the market, much of the hardware and software in these legacy systems is obsolete, as is O/S2, which IBM no longer supports. Because the MDI PPU and RTU processor units will no longer be available after the end of Q3, we have developed a cost-effective PB2000 as a direct replacement for the legacy hardware and we now offer SAFEnet 6.2 as a replacement for the O/S2 software. The benefit to our existing customers will be that even the largest migrations will be just a minor task for us to handle, thus accomplishing a full data conversion to new MDI systems. Jim St. Pierre and his team's primary focus will be on supporting MDI's long-standing client base during this migration and modernization effort. Their efforts will be devoted to the delivery of innovative system migration solutions that enhance the security investment that MDI customers made in our products over the past two decades.

I would like to conclude this address by announcing the most recent business win for MDI Security Systems and communicating some important upcoming events for the MDI team. First, we have delivered an $800,000 order for our DMS (Digital Media Services) integrated video offering to a well-known government institution. This product provides video streaming and data storage for 300 cameras at 30 frames per second (live video) through our newly developed video codec and our SAFEnet Security Suite of software. During the final four months of 2004 and on into FY 2005, I am committed to keeping you informed of all significant sales and product development efforts as soon as they may be disclosed.

At the ASIS International 2004 50th Annual Seminar and Exhibits in Dallas (Sept. 27-30), MDI will be showcasing and demonstrating its leading security technologies for the 17,000 security industry professionals that will be in attendance. ASIS is the largest security conference in the world and I would like to take this opportunity to invite everyone to visit our MDI Security Suite demonstration area.

At this conference, I will be presenting a live audio webcast. Since our re-organization, one of my objectives is to communicate openly, honestly and frequently to our employees, dealers, partners, customers and investors. I will release more information on this conference and the corresponding webcast in the weeks to come.

As we continue this challenging journey, we want you to be assured that our focus will continue to be the development and delivery of high-value enterprise security management solutions that can be integrated into any organization's security infrastructure. Our goal will be to provide the lowest cost of ownership and highest return in the industry on your security investment.

Again, thank you for your continued support and trust in American Building Control and MDI Security Systems.

About American Building Control, Inc.

American Building Control (Nasdaq:ABCX) is an established global leader in providing centralized, integrated security management solutions to corporate, government and institutional enterprises. For more information on American Building Control, Inc., please visit our website at www.americanbuildingcontrol.com.

About MDI Security Systems

For 25 years, MDI Security Systems has been securing clients across the globe by delivering the most dependable access control and integrated security management solutions available. As a security industry pioneer and technical thought leader, MDI continues to deliver value to its shareholders through the development of market-driven, technically superior security systems that can be managed from a centralized point of control. By combining a quarter century of expertise with thousands of worldwide users from a variety of industries including financial, transportation, manufacturing, education, government, defense and homeland security, MDI is able to maintain the highest return on investment in the industry for its client base. More information on MDI Security Systems and its solutions can be found at www.mdisecure.com.

Forward-Looking and Cautionary Statements

Except for historical information and discussions contained herein, certain statements included in this press release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include a number of risks, uncertainties and other factors that could cause actual results to differ materially, as discussed in the Company's filings with the Securities and Exchange Commission.