The Dwyer Group, Inc. Reports Third Quarter Results.

WACO, Texas--(BUSINESS WIRE)--Nov. 13, 1998--The Dwyer Group, Inc., (Nasdaq:DWYR) (the "Company") today reported a net loss of $288,000 or four cents per share for the third quarter of 1998, versus a net profit of $252,000 or four cents per share for the third quarter of 1997.

The Company also reported a net loss of $148,000 or two cents per share for the nine months ended September 30, 1998 as compared to a net profit of $493,000 or seven cents per share for the same period last year.

Revenues for the third quarter of 1998 decreased to $3,052,000 from $3,921,000 for the comparable period last year. Revenues decreased slightly to $10,955,000 for the first nine months of 1998 as compared to $10,997,000 for the same period in 1997.

During the third quarter, the Company completed the acquisition of Glass Doctor, a franchisor of glass replacement and repair businesses, serving the automotive, residential and commercial glass markets, currently having 26 U.S. franchisees generating more that $33 million in annual system-wide sales. The Company also recently sold two of its franchising businesses, General Business Services ("GBS") and E.K. Williams & Co. ("EKW"), and recorded a pre-tax gain of $1,446,000 on the sale. The loss of revenues from GBS and EKW, net of the additional revenues from Glass Doctor, along with a decrease in overall franchise sales revenues, are the primary reasons for the decline in the Company's revenues in the third quarter.

Exclusive of the above noted gains, the Company recorded a significant operating loss in the third quarter. The following factors contributed to the loss:

-- The decline in franchise sales revenues.

-- General and administrative expenses which were excessive for the

Company's level of operations.

-- Severance pay and benefits to employees leaving the Company due

to both the sale of GBS and EKW and to a general reduction in the

number of corporate personnel.

-- Start-up expenses related to the acquisition of Glass Doctor.

-- A litigation reserve which was established due to management's

decision to attempt to settle a number of lawsuits to which the

Company is a party.

-- Increased reserves for bad debts based on recent collection

history on franchisee notes.

-- Increased reserves for franchisee notes to unrelated third

parties, payment on which is guaranteed by the Company.

In order to move the Company back to profitability, management has taken the following actions:

-- Realigned the franchise sales department to provide a more

efficient and focused sales process.

-- Revamped the franchise sales system in order to increase the

quantity and quality of new franchisees entering our system.

-- Reduced general and administrative expenses by approximately $1

million on an annual basis, primarily by a reduction in the

number of employees and related expenses. This reduction is over

and above eliminated expenses which were related directly to GBS

and EKW.

Theresa Dwyer, Chairperson of the Board of Directors, said "We believe that the actions taken this year will be of great benefit to all of us as we move forward. The acquisition of Glass Doctor and the sale of GBS and EKW further establishes us as a leading franchisor of 'consumer service' concepts. The improvements in our franchise sales department and selling process are already showing benefits in the fourth quarter. We believe that we have reduced our overhead to a level appropriate for our revenues, while maintaining a staff sufficient to provide a high level of support to our franchisees. While we are disappointed to report losses, we remain optimistic about our future and appreciate the support of our stockholders during this period of readjustment."

The Dwyer Group, Inc., now supports over 900 franchisees in the United States and approximately 250 franchisees in 23 foreign countries operating the following concepts: Mr. Rooter(R), Rainbow International(R), Glass Doctor(R), Mr. Electric(R), Mr. Appliance(R) and Aire Serv(R).

Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ from those projected. Such risks and uncertainties include, but are not limited to, the Company's ability to integrate Glass Doctor's operations effectively into the Company, general business conditions, competition, taxes, inflation and government regulations. -0-

                         The Dwyer Group, Inc.
                Summary Consolidated Operating Results
                              (Unaudited)
               (In Thousands, Except Per Share Amounts)


                               Three Months Ended    Nine Months Ended
                                  September 30,         September 30,
                                  -------------         -------------
                                 1998        1997      1998      1997
                                -----       -----     -----     -----
Royalty Revenues              $ 1,979     $ 2,007   $ 6,271   $ 5,789
Franchise Fees                    418       1,061     1,461     2,470
Other Revenues                    655         853     3,223     2,738
                              -------     -------   -------   --------
Total Revenues                $ 3,052     $ 3,921   $10,955   $10,997
                              -------     -------   -------   --------
                              -------     -------   -------   --------

Operating Income (Loss)      ($ 1,888)      $ 382  $ (1,994)    $ 751
Gain on Sale of Assets          1,446                 1,446
Gain on Sale of Securities         14          --       331        --
                              -------     -------   -------   --------
Income (Loss) Before Taxes     $ (428)      $ 382    $ (217)    $ 751
                              -------     -------   -------   --------
                              -------     -------   -------   --------
Net Income (Loss)              $ (288)      $ 252   $  (148)    $ 493
                              -------     -------   -------   --------
                              -------     -------   -------   --------
Earnings (Loss) Per Share    $   (.04)      $ .04    $ (.02) $    .07
                              -------     -------   -------   --------
                              -------     -------   -------   --------

For more information, contact Tom Buckley, Chief Financial Officer at 800/490-7501. For general information regarding The Dwyer Group or its franchise concepts, visit the Company's website at http://www.dwyergroup.com.