Electronic Retailing Systems International, Inc. Reports Third Quarter Results.

Business Editors

NORWALK, Conn.--(BUSINESS WIRE)--Nov. 19, 2001

Electronic Retailing Systems International, Inc. ("ERS") (OTC BB:ERSI) today reported financial results for the quarter ended September 30, 2001. Revenues for the third quarter of 2001 were $1,034,000 compared to $979,000 for the same period last year.

The net loss was $370,000 or $0.02 per share, as compared to a net gain of $41,447,000 or $1.95 per share for the same period in 2000.

Revenues for the first nine months of 2001 were $4,141,000, compared to $3,566,000 for the first nine months of the prior year. The net loss was $7,047,000 or $0.33 per share, for the first nine months of 2001 compared to a net gain of $49,139,000 or $2.31 per share in the first nine months of 2000. Net income for the three- and nine-month periods in 2000 reflects an extraordinary gain of $45,870,000 or $2.15 per share and $64,828,000, or $3.05 per share, respectively from the retirement of debt.

Third quarter 2001 results reflect the winding down of ERS' electronic shelf label ("ESL") operations, as a consequence of which ERS recorded $258,000 in product sales for the quarter (approximately $2,901,000 for the nine months ended September 30, 2001), compared to $866,000 in product sales for the three months ended September 30, 2000 ($2,895,000 for the nine months ended on such date). As a result of such circumstances, including an increase in customer calls in connection with the winding down of ESL operations, ERS recorded approximately $776,000 in maintenance revenues for the three months ended September 30, 2001 (approximately $1,240,000 for the nine months ended on such date), compared to $113,000 for the three months ended September 30, 2000 ($671,000 for the nine months ended on such date).

This press release contains forward-looking statements that involve risks and uncertainties. Actual events may vary materially from those anticipated due to a number of factors, including ERS' arrangements with holders of its debt obligations, the prospects of NewCheck Corporation, in which ERS holds an interest, and other risks and uncertainties set forth in reports and other documents filed by ERS with the Securities and Exchange Commission from time to time.

           Electronic Retailing Systems International, Inc.
            Condensed Consolidated Statement of Operations
               (in thousands, except per share amounts)

                        Three Months Ended         Nine Months Ended
                           September 30,              September 30,
                            (unaudited)               (unaudited)
                         2001         2000        2001          2000

Revenues
  Product sales       $   258       $   866     $ 2,901       $ 2,895
  Maintenance             776           113       1,240           671
    Total revenues      1,034           979       4,141         3,566

Cost of goods sold        944         1,142       3,059         3,471

  Gross profit (loss)      90          (163)      1,082            95

Operating expenses
  Selling, general
   and administrative     289         1,633       3,160         5,154
  Research and
   development             91           887       1,996         3,098
  Provision for ESL
   Shutdown                 -             -       1,289             -
  Depreciation and
   amortization             -           660         607           826
    Total operating
     expense              380         3,180       7,052         9,078

  Loss from
   operations            (290)       (3,343)     (5,970)       (8,983)

Other income (expenses)
  Interest income           -           121          22         1,045
  Interest expense        (91)         (148)        (91)       (5,629)
  Loss on investment
   and other assets       (27)       (1,053)     (1,072)       (2,120)
  Gain (loss) on
   disposals               38             -          64            (2)
    Total other expenses  (80)       (1,080)     (1,077)       (6,706)

  Loss before
   extraordinary gain on
   extinguishment of
   debt                  (370)       (4,423)     (7,047)      (15,689)

Extraordinary item
  Gain on extinguishment
   of debt                  -        45,870           -        64,828

  Net gain (loss)     $  (370)      $41,447     $(7,047)      $49,139

Earnings per common
 share
  Weighted average
   common shares
   outstanding         21,345        21,292      21,342        21,290

  Basic gain (loss)
   per common share   $ (0.02)      $  1.95     $ (0.33)      $  2.31


           Electronic Retailing Systems International, Inc.
                 Condensed Consolidated Balance Sheet
                            (in thousands)

                                      September          December
                                         30,                31,
                                        2001               2000
Assets

Current assets
  Cash and cash equivalents          $    112          $  2,887
  Other current assets                    837             3,176
    Total current assets                  949             6,063

Equipment, net                              -             1,361
Other non-current assets                    -                 6

Total assets                         $    949          $  7,430


Liabilities and Stockholders'
 Deficit

Current liabilities                  $  7,660          $  7,092
Long-term debt                          6,882             6,882

Common stock purchase warrants          5,100             5,100
Preferred stock                         3,999             3,999

Stockholders' deficit                 (22,692)          (15,643)

Total liabilities and stockholders'
 deficit                             $    949          $  7,430