Sterling Vision, Inc. Reports 1998 Year-End Results

Business Wire, April 16, 1999

EAST MEADOW, N.Y.--(BUSINESS WIRE)--April 16, 1999--

Sterling Vision, Inc. (NASDAQ: ISEE), one of the largest chains of retail optical stores in the United States, today reported that it incurred a net loss, for the year ended December 31, 1998, of approximately $17,777,000, of which approximately $15,600,000 represented charges to earnings (which management believes to be non-recurring in nature) as a result of certain financing obtained by the Company, management's decision to increase certain of its reserves, and the write-down of certain of the Company's assets.

The Company's losses from continuing operations were approximately $2.2 million, a substantial portion of which (approximately $1 million) resulted from the operation of its Insight Laser Centers, which the Company believes will be profitable in 1999 as evidenced by an over 100% increase in the number of procedures performed during the first quarter of 1999.

Such net loss for calendar year 1998 of $17,777,000, or $(1.22) per share, compares to a net loss for 1997 of $14,162,000, or $(1.02) per share, which 1998 results include significant charges to earnings as a result of the Company's re-evaluation of its asset base and reserves, all of which were aimed at strengthening the Company's future operating performance. System wide sales (sales for both Company operated and franchised stores) increased by approximately 2.5%, to $150 million for 1998, as compared to approximately $146 million for 1997.

Dr. Robert Cohen, Chairman of the Board, stated "1997 and 1998 were important transitions years for Sterling Vision, Inc. Our new, aggressive management team has implemented numerous initiatives to better position the Company for future revenue and profit growth. The decision to close certain of the Company's non-profitable stores, coupled with its substantial reduction of administrative overhead and increased focus on managed care programs and marketing (including a new, revolutionary, interactive website), demonstrate Sterling's ability to effectively compete in this highly competitive industry."

All statements contained herein (other than historical facts) are based upon current expectations. These statements are forward looking in nature and involve a number of risks and uncertainties. Actual results may differ materially from the anticipated results or other expectations expressed in the Company's forward looking statements. Generally, the words "anticipate", "believe", "estimate", "expects" and similar expressions as they relate to the Company and/or its management, are intended to identify forward looking statements. -0-

                STERLING VISION, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENT OF OPERATIONS

                               For the Year Ended   For the Year Ended
                                December 31, 1998    December 31, 1997
                               ------------------   ------------------
                           (Dollars in thousands, except number of shares)

Systemwide Sales (unaudited)      $149,947               $146,333
                                  --------               --------

Revenues                          $ 35,127               $ 35,992
                                  --------               --------

Net loss                          $(17,777)              $(14,162)
                                  --------              ---------

Basic and diluted earnings
   per share                      $  (1.22)              $  (1.02)
                                  --------               --------

Weighted shares outstanding         14,627                 13,883

                                  --------               --------

No information is presented for diluted earnings per share, as the effect of the inclusion of convertible securities would be anti-dilutive.