INCON Announces Improved Profitability for the Second Half of 2000; Power Instrument Sales Increase 47 Percent; Fuel Management System Results Stronger in the Second Half.

Business/Technology Editors

SACO, Maine--(BUSINESS WIRE)--Feb. 15, 2001

Intelligent Controls, Inc. (INCON) - (AMEX symbol: ITC.EC), a manufacturer of software and electronic measurement systems for the petroleum and utility industries, announced today that year 2000 annual sales declined 23 percent to $9,941,378 compared to $12,904,697 a year ago. Net income declined 45 percent to $435,271 or $.09 basic and diluted earnings per share, compared to $798,078 or $.16 basic and diluted earnings per share in 1999.

Fourth quarter sales were $2,614,117, nearly equal to sales of $2,679,308 in the fourth quarter of 1999. However, the Company reported net income rose to $181,157 for the quarter, a significant improvement from the loss of $4,803 in the last quarter of 1999. Basic and fully diluted earnings for the fourth quarter were $.04 per share compared to a loss of ($.001) per share in the fourth quarter of 1999.

Roger E. Brooks, President & CEO, said; "During the fourth quarter, and the second half of 2000, our business increased overall. The general demand for fuel management systems improved compared to the depressed levels of the prior twelve months. We also were successful in winning several long-term orders and we began these shipments late in 2000. This, along with very strong demand for our power utility instruments, enabled INCON, despite relatively weak sales volume, to return to profitability."

Mr. Brooks added; "Despite a soft market for petroleum equipment in 2000, we continued to invest heavily for our future and solidified our technological leadership, particularly in fuel management software. System Sentinel AnyWare, an Internet-based version of our popular System Sentinel 2.0 software, was debuted at the National Association of Convenience Stores exhibition in October. This innovative package enables a geographically diverse and mobile organization to stay connected, for fuel and compliance management purposes, via pagers, laptop PCs and personal digital assistants (PDAs). We also introduced a CCSM, control circuit status monitor, for the electric utility sub-station market. This intelligent electronic device allows a utility operation to continuously monitor the status and condition of critical circuit breakers over their supervisory control and data acquisition network, thus achieving real time status information on the reliability of their system."

Mr. Brooks continued; "Our power utility instrument business was a bright spot in the year 2000 with sales increasing by 47 percent. Sales were $2,500,048 compared to $1,700,629 in 1999. This improved upon the strong 27 percent sales growth achieved in 1999 versus 1998. Our load tap position monitors sold briskly as power companies continued to spend actively on transmission infrastructure and programs to increase reliability. This bodes well for the future in this business area and we have engineering efforts underway to insure that our devices communicate within the overall integrated substation system and throughout the utility grid."

Mr. Brooks also stated; "INCON is strong financially with approximately $5.2 million in cash at year end, and no debt. During 2000 we also made progress on a number of important fronts;

--We further reduced warranty expenses contributing approximately $250,000 to profits. The company's world-class ISO 9001 quality system and zero-defect program drove the favorable results.

--We improved gross margins from 49 percent during the first half of the year to 54 percent for the second half. Product mix changes and manufacturing cost restructuring were the key factors responsible for this improvement.

--We secured a key program approval for our fuel management software/systems from a major oil company with significant retail gasoline operations. This is the first commitment of this type for the Company and testifies to the technical/software leadership that we have achieved."

Mr. Brooks concluded; "We are optimistic about our overall business as we look at the year 2001. This past year demonstrates that we can operate profitably, even with weak overall demand in our principal market. With regard to the longer term, we continue to look to expand our business through internal growth, acquisitions, alliances, and joint ventures."

Intelligent Controls, Inc. is a leading supplier of automatic tank gauging systems and line leak detection equipment for the petroleum industry as well as general predictive maintenance instrumentation for the power utility market and other industrial applications.

Additional information about INCON may be found on its website at www.intelcon.com.

Safe harbor statement under Private Securities Litigation Reform Act of 1995: This news release contains forward-looking statements. See the Company's latest Form 10-QSB and Form 10-K reports for discussion of certain risk factors that may affect the Company's future business. This news release is based upon information available to the Company management as of the date hereof, and the Company assumes no obligation to provide updated information about the subject matter of this release.

                    INCON REPORTS OPERATING RESULTS

                      Twelve Months Ended          Quarters Ended
                     12/31/00     12/31/99      12/31/00     12/31/99

Net Sales         $ 9,941,378  $12,904,697   $ 2,614,117  $ 2,679,308
Gross Margins       5,150,798    6,756,607     1,428,853    1,318,497
Gross Margin %             52%          52%           55%          49%
Net income        $   435,271  $   798,078   $   181,157  $    (4,803)

Basic earnings
 per share        $      0.09  $      0.16   $      0.04  $      0.00
Dilluted earnings
 per share        $      0.09  $      0.16   $      0.04  $      0.00

Weighted average
 common shares      4,739,399    4,860,065     4,739,399    4,782,440
Weighted average
 common shares
 and common
 equivalent shares  4,744,735    4,898,014     4,740,890    4,807,431

Balance Sheet Data

Total Assets      $ 8,947,391  $ 8,718,548

Long-term debt    $      --    $    12,535

Stockholders'
 equity           $ 7,883,721  $ 7,448,448