Business Resource Group Announces Third Quarter Results.

SAN JOSE, Calif.--(BUSINESS WIRE)--Aug. 29, 1996--Business Resource Group announced today net revenues of $21.3 million for the third quarter ended July 31, 1996, an increase of 75% when compared to the third quarter of 1995.

Net revenues for the nine month period ended July 31, 1996 were $56.5 million, an increase of 73% over the prior year period.

Net income for the third quarter of fiscal 1996 was $419,000, a decrease of 18% over the pro forma net income in the third quarter of 1995. Net income of $1.4 million for the nine months ended July 31, 1996 increased 11% over pro forma net income in the comparable period of 1995.

Earnings per share for the third quarter of 1996 was $.09 per share, on 4.9 million weighted average shares outstanding, vs. $.13 per share on 4.0 million weighted average shares outstanding, for the third quarter of 1995. Earnings per share for the nine month period ended July 31, 1996, was $.28 per share, on 4.9 million weighted average shares outstanding, vs. $.34 per share, on 3.6 million weighted average shares outstanding, for the comparable nine month period of 1995. The increase in weighted average shares outstanding was primarily due to the company's initial public offering of its common stock in June 1995.

Bookings for the third quarter totalled $19.6 million and backlog at the end of the quarter totalled $13.5 million.

"We are pleased with the record revenue achieved in our third quarter and, when compared to our second quarter, the improvement in gross profit margins and service revenues as a percentage of total revenue," said Jett Winter, President and CEO. "While we are disappointed that the increasing cost associated with building infrastructure to support our revenue growth has outpaced our increases in gross margin dollars, we feel we are positioned to grow our business substantially over the longer term without the need to significantly increase operating expenses," added Winter. "The company remains committed to continued gross margin improvement while focusing more effort on expense containment through both budgetary and process controls."

Business Resource Group provides comprehensive workspace solutions specializing in the cost-effective management of change in business facilities. Headquartered in San Jose, Calif., BRG has additional offices located in Austin, Dallas, Denver, Las Vegas, Phoenix, San Antonio, San Francisco and Tucson. BRG's common stock is traded on the NASDAQ National Market under the symbol BRGP.

Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that are subject to certain risks and uncertainties that could cause the actual results to differ materially from those projected. Such risks and uncertainties are outlined and included from time to time in the company's other SEC Reports on Form 10-Q and 10-K and are available from the company upon request. -0-

                       BUSINESS RESOURCE GROUP
                   CONDENSED STATEMENTS OF INCOME
              (In thousands, except per share amounts)
                             (unaudited)

                          Three Months Ended     Nine Months Ended
                               July 31,                July 31,
                           1996       1995        1996        1995

Net revenues:
  Workspace products    $18,495    $10,350       $49,623     $27,335
  Workspace services      2,766      1,732         6,580       4,824
  Vendor commission          79        113           280         452
    Total net revenues   21,340     12,195        56,483      32,611

Cost of net revenues:
  Workspace products     15,039      8,192        40,504      21,485
  Workspace services      2,002      1,022         4,760       3,091
    Total cost of net
     revenues            17,041      9,214        45,264      24,576

Gross profit              4,299      2,981        11,219       8,035

 Selling, general and
  administrative expenses 3,597      2,067         9,006       5,896
 Income from operations     702        914         2,213       2,139
 Interest income
  (expense) - net            13        (37)           94         (63)

Income before income taxes  715        877         2,307       2,076
Provision for income taxes  296        253           955         274
Net income               $  419     $  624        $1,352     $ 1,802

  Net income per common
   and common
   equivalent share      $  .09                   $  .28

Shares used in
 computation              4,914                    4,864

Pro forma:
   Historical income
   before income taxes              $  877                   $ 2,076

   Pro forma income taxes              364                       861

   Pro forma net income             $  513                   $ 1,215

Pro forma net income per common
   and common equivalent share      $  .13                   $   .34

Pro forma shares used in
  computation                        3,950                     3,559

                        BUSINESS RESOURCE GROUP
                       CONDENSED BALANCE SHEETS
                           (in thousands)

                                         July 31,       Oct. 31,
                                          1996            1995
                                       (unaudited)
ASSETS

Current assets:
Cash and equivalents                 $       668    $     5,326
Accounts receivable, net                  13,559          7,168
Inventory                                  1,021            929
Prepaids and other current assets          1,446            941
  Total current assets                    16,694         14,364

Property and equipment, net                1,734            733
Other assets, net                          1,015            956
                                     -----------    -----------
                                     $    19,443    $    16,053

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
Bank overdraft                       $       662    $      651
Accounts payable                           2,849         2,096
Accrued liabilities                        3,042         1,905
Income taxes payable                         244            --
Current portion of notes payable and
 capital lease obligations                    79           242
Total current liabilities                  6,876         4,894

Notes payable and capital lease obligations   48           120
Deferred income tax liability                 19            19

Shareholders' equity:
Preferred stock                               --            --
Common stock                                  49            48
Additional paid-in capital                10,685        10,558
Retained earnings                          1,766           414
Total shareholders' equity                12,500        11,020
                                     -----------    ----------
                                     $    19,443    $   16,053

CONTACT: Business Resource Group

Tim Gish, 408/441-3700