Ariely Reports 3Q96 EPS of 8 cents, Commissions and Fees $7.8 Million.

TEL AVIV, Israel--(BUSINESS WIRE)--Nov. 8, 1996--Ariely Advertising Ltd. (NASDAQ: RELEF), a leading full service Israeli advertising agency, today reported third quarter 1996 consolidated commissions and fees of NIS 24.9 million ($7.8 million), a 27 percent decline from commissions and fees of NIS 33.9 million ($10.5 million) in the third quarter of 1995.

Third quarter net income declined from NIS $2.0 million ($615,000) or NIS 0.96 (30 cents) per share in 1995, based on 2,067,000 shares outstanding, to NIS 811,000 ($252,000) or NIS 0.26 (8 cents) per share based on 3,083,000 shares outstanding. Gross profit for the third quarter was down from NIS 5.5 million ($1.7 million) in the 1995 quarter to NIS 4.1 million ($1.3 million) for 3Q96.

Ariely Managing Director Amos Tal-Shir said the results were due to macroeconomic and other factors beyond the control of the Company. "The Israeli economy continues to be sluggish during the third quarter," Mr. Tal-Shir said. "In addition, the current status of the peace process is hampering our expansion in the region. As an indicator of the market situation, we witnessed a substantial decline in media prices during the months of August and September."

Commissions and fees for the first nine months of 1996 were NIS 92.5 million ($28.7 million), a decline of 14 percent from commissions and fees of NIS 108 million ($33.4 million) in the comparable period of 1995.

Nine month net income was NIS 3.7 million ($1.1 million) or NIS 1.17 (36 cents) per share compared with NIS 5.6 million ($1.7 million) or NIS 2.88 (89 cents) per share last year, a decrease of 35 percent. Gross profit for the first nine months of 1996 was NIS 15 million ($4.7 million) against NIS 17 million ($5.3 million) in 1995, a decrease of 12 percent.

Mr. Tal-Shir said the Company's new business development division should help produce more positive results in the fourth quarter and beyond. The department enhances Ariely's ability to expand its client base. Mr. Tal-Shir added, "Already, some of our clients including Nestle and Motorola have increased their business activity in the region and this will have a positive impact on the advertising budgets at the beginning of 1997."

Ariely Advertising Ltd. is a leading full service advertising agency which provides a broad range of advertising services in Israel, including market analysis, the development of marketing strategies and creative concepts, media planning and the placement of advertising in various media, such as television, magazines, newspapers, radio and billboards. -0-

                      Ariely Advertising Ltd.
     Condensed Interim Consolidated Statements of Operations

                         Adjusted New Israeli shekels
                     Nine months ended   Three months ended   Year ended
                          Sept. 30,           Sept. 30,        Dec. 31,
                     1996        1995     1996       1995       1995
                        (unaudited)         (unaudited)       (audited)
                            NIS in thousands except per share data

Advertising commissions
 and fees            92,544     107,673   24,953    33,868     136,412
Gross profit         15,045      17,111    4,153     5,542      23,162
Net income            3,656       5,626      811     1,979       7,535
Net income per share   1.17        2.88     0.26      0.96        3.47
Weighted average
 number of shares
 outstanding      3,119,000  1,955,000  3,083,000  2,067,000  2,192,491

                        Convenience translation into U.S. dollars(a)
                        Nine months ended         Three months ended
                           Sept. 30,                   Sept. 30,
                              1996                       1996
                          (unaudited)                 (unaudited)
                         US$ in thousands, except per share data

Advertising commissions
 and fees                   $28,740                     $7,750
Gross profit                $ 4,672                     $1,290
Net income                  $ 1,135                     $  252
Net income per share        $  0.36                     $ 0.08
Weighted average
 number of shares
 outstanding              3,119,000                  3,083,000

(a) For convenience purposes, certain information contained herein
has been translated into dollars using the representative exchange
rate at Sept. 30, 1996 of NIS 3.22=$1.00.

CONTACT: Amos Tal-Shir & Vered Viduchinsky

Ariely

Tel. [phone]

or

Leslie Creutzfeldt Wolf

The Anne McBride Co.

Tel. [phone]