...our results for the full fiscal year will be in line with our guidance, however we expect revenue and operating income will be slightly below guidance for the fourth quarter
William McDonnell, Rent-Way's Vice President and CFO

Rent-Way Inc. (RWY) today reported reported revenues from the Company's core rental business (which excludes the Company's dPi Teleconnect unit) for the three months ended June 30, 2005 were $124.2 million versus $118.5 million in the same quarter last year, an increase of 4.8%. Same store rental business revenues increased 2.6% versus last year's quarter.

As a result of the increase in the Company's stock price in the quarter, the Company recorded a $5.0 million FAS 133 charge related to the conversion feature of the Company's preferred stock versus income of $0.2 million in the same quarter last year. Giving effect to this charge results in the Company incurring a net loss of $1.2 million in the quarter, compared to net income of $4.9 million in the third quarter last year.

"The fundamentals of our business are sound and our plan to invest in growing the Rent-Way brand by 40 - 50 stores per year for the next several years is working," stated Bill Short, Rent-Way's President. "We opened 9 new stores in the quarter and we expect to open 10 more by the end of September, which would mean 42 new stores opened in fiscal 2005. We're pleased with the top line revenue performance of these new stores. Our cash flow is strong, our team is solid and I remain very optimistic about 2006 and beyond," concluded Mr. Short.

William McDonnell, Rent-Way's Vice President and CFO, stated, "For the quarter, our core stores revenue and operating income, were $121.4 million and $13.2 million, respectively, and our core stores with new stores revenue and operating income, were $124.2 million and $10.6 million, respectively. Higher payoffs and a slight fall off in deliveries during the quarter reduced our agreements on rent more than we had anticipated. Nonetheless, we met our guidance for core store revenue and operating income. Looking forward, our results for the full fiscal year will be in line with our guidance, however we expect revenue and operating income will be slightly below guidance for the fourth quarter," concluded Mr. McDonnell.

Rent-Way operates 786 stores in 34 states.