American Residential Services reports first quarter results at or above expectations.

HOUSTON--(BUSINESS WIRE)--May 8, 1997--American Residential Services, Inc. (NYSE:ARS), a leading provider of residential heating, air conditioning, plumbing, electrical and appliance services, today reported results for the quarter ended March 31, 1997.

Revenues for the quarter were $55.4 million compared to pro forma revenues of $33.2 million for the first quarter of 1996. Net income from continuing operations for the quarter was $0.6 million, or 5 cents per share, as expected, compared to pro forma net income from continuing operations of $0.5 million, or 5 cents per share for the same period last year and compared with quarter expectations of between 2 cents and 5 cents per share.

In further news, the Company announced that it is on schedule with its new financial reporting and operating systems implementation programs. "One of the goals we established after our initial public offering in September of 1996 was to have all companies acquired in 1996 on the same accounting/reporting system by the time of this announcement," commented Hank Nicodemus, Chief Financial Officer. "This goal has been accomplished and we now have the reporting template in place to analyze and consolidate financial reporting for our existing operations and to add new acquisitions in a consistent fashion on an ongoing basis. We are also working diligently toward our second major systems initiative of implementing new operating systems software at each of our regional data centers which will be used by each of our local operations within a region. This initiative is expected to be substantially complete by the end of this year. Having both systems in place will enhance our reporting and service capabilities, which we consider crucial to the success of our consolidation strategy."

American Residential Services is the largest publicly held company in the United States engaged principally in providing comprehensive maintenance, repair, replacement and new equipment installation services for heating, air conditioning, plumbing, electrical, indoor air quality systems and major home appliances, primarily in homes, including homes under construction, and small commercial buildings. -0-

        AMERICAN RESIDENTIAL SERVICES, INC. AND SUBSIDIARIES
                   Combined Results of Operations
               (in thousands, except per share amounts)

                                         Three Months Ended
                                              March 31,
                                          1997        1996(1)
Revenues                                $55,446     $33,151
Gross profit                             16,491       9,244
Operating income                          1,919       1,177
Pro forma combined net income
 from continuing operations                 559         517
Pro forma combined earnings per
 share from continuing operations       $  0.05     $  0.05
Average shares outstanding               12,157      10,362

    (1) Results of operations for the three months ended
March 31, 1996 reflected in the table above are pro forma combined
results and do not reflect actual results for this period, as the
Company completed its acquisitions of its initial group of operating
companies (the "Founding Companies") on September 27, 1996, the date
of the closing of the Company's initial public offering.  Pro forma
combined results above include the results of the Founding Companies
and the eight companies acquired in the first quarter of 1997 and
accounted for as pooling-of-interests transactions, combined as of
January 1, 1996 and adjusted for compensation, rent and
non-recurring charges for distributions.  The pro forma results for
the three months ended March 31, 1996 exclude the pro forma effect
of the fifteen acquisitions completed in the fourth quarter of 1996
and the first quarter of 1997 which were accounted for as purchase
transactions.  Actual results of the Company (without giving effect
to any of the purchase acquisitions) for the three months ended
March 31, 1996 reflect revenues of $13.6 million, net income from
continuing operations of $0.4 million and earnings per share from
continuing operations of $0.19.

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This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current plans and expectations of ARS and involve risks and uncertainties that could cause actual future activities and results of operations to be materially different from those set forth in the forward-looking statements. Important factors that could cause actual results to differ include, among others, risks associated with acquisitions, fluctuations in operating results because of acquisitions and variations in stock prices, competition, and risks of operations and integration of the newly acquired businesses.

CONTACT: American Residential Services, Inc., Houston

Jennifer L. Tweeton, 713/599-9015