Planet Zanett CEO Comments On Q1 Financial Results; Company Reaffirms IT Commonwealth Fiscal Year Goals.

Business Editors

NEW YORK--(BUSINESS WIRE)--May 17, 2002

Planet Zanett, Inc. (NASDAQ:ZANE), an information technology (IT) service company, today reported revenues of $1.4 million for the quarter ended March 31st, representing a 304% increase over the fourth quarter of 2001.

Comparably, the Company had no operating revenues during the first quarter of 2001.

Jack M Rapport, Planet Zanett's Chief Financial Officer, explained, "We are pleased with the Q1 operating results of the IT Commonwealth(TM). While the Company recorded a net loss of $745,000 for the quarter, on a pro forma basis, excluding non-cash stock based compensation charges and impairment costs in our technology development segment, our net loss was $35,000, or almost break-even. Furthermore, in April we achieved revenues of $569,000, boding well for the second quarter."

Commenting on the current outlook, David M McCarthy, CEO noted, "Strong performance from Back Bay Technologies, coupled with our accelerated acquisition strategy, gives us confidence that we will meet our run-rate projections of total acquired revenue of $15 million and total acquired EBITDA of $3 million by the end of fiscal year 2002."

ABOUT PLANET ZANETT, INC. (www.planetzanett.com)

Planet Zanett, Inc. is an information technology (IT) services company. We are building an IT Commonwealth(TM) by acquiring profitable, privately-held IT consulting firms that serve Fortune 500 caliber companies and governmental agencies. The Company's business model seeks to preserve the culture, management and business practices that contributed to the historical success of the acquired entities while achieving economies of scale, increasing competitive advantage and maximizing the financial and operating performance of the IT Commonwealth(TM) as a whole.

Our ability to expand existing relationships and compete effectively in winning new business against larger consulting firms is the focus of each member of the IT Commonwealth(TM). More specifically, our business model helps profitable companies not only maintain their historically high level of profitability, but also promotes an environment where this profitability can increase significantly.

The Company provides services that help clients use technology to make core business transactions more efficient, manage knowledge and information, or facilitate enterprise procurement and communications. Its offerings include systems planning and design, business process engineering, applications development, training and systems integration.

Each acquisition candidate under consideration must achieve a minimum of $4-20 million in annualized revenues and $1-4 million in EBITDA. Most importantly, each candidate must possess an excellent management team with unsurpassed ethics, outstanding and motivated employees, and a historically proven track record within their respective markets.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 

This press release contains forward-looking statements within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements relate to, among other things, future events or Planet Zanett, Inc.'s future financial performance. In some cases, you can identify forward-looking statements by terminology including, but not limited to, "may," "will," "could", "should," "expects," "plans," "anticipates" "believes," "estimates," "projects," "predicts," "potential" or "continue" or the negative of such terms or other comparable terminology. These statements include, but are not limited to, statements regarding: the expected benefits of the acquisition such as efficiencies, cost savings, market profile and financial strength, and the competitive ability and position of the combined company. These statements involve, among other things, known and unknown risks, uncertainties and other factors that may affect Planet Zanett, Inc.'s or its industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risk that Planet Zanett, Inc.'s and Back Bay Technologies, Inc.'s businesses will not be coordinated and integrated successfully, and disruptions from the acquisition will make it more difficult to maintain relationships with clients, lenders, employees, suppliers or other constituents. For a discussion of additional factors that could cause Planet Zanett, Inc.'s results to differ materially from those described in the forward-looking statements, please refer to Planet Zanett, Inc.'s filings with the Securities and Exchange Commission, including, but not limited to, the sections titled "Special Note Regarding Forward-Looking Information" and "Management's Discussion and Analysis of Financial Condition and Results of Operations -- Risk Factors" in Planet Zanett, Inc.'s 2001 Annual Report on Form 10-K, Planet Zanett, Inc.'s 2002 Quarterly Report on Form 10-Q and "Special Note Regarding Forward-Looking Statements." These factors may cause Planet Zanett, Inc.'s actual results to differ materially from any forward-looking statement.