iParty Corp. Reports Third Quarter 2000 Results

New York, New York, UNITED STATES


NEW YORK, Nov. 14, 2000 (PRIMEZONE) --iParty Corp. (AMEX:IPT), owners and operators of iParty.com, a premier destination for party goods and party planning and 33 iParty retail stores, today reported results for its third quarter 2000 and nine months ended September 30, 2000.

For the quarter, iParty Corp. reported consolidated revenues of $3.6 million from the Company's online website, www.iparty.com, and its retail stores, which were acquired during the third quarter 2000, from The Big Party chain of party supply retail stores. Revenues from the online division were $350,000, a 34% sequential increase over the second quarter. The Company reported a consolidated net loss of $3.6 million. Due to the Company's limited operating history, comparable results for the prior year are not meaningful. The weighted average number of common shares outstanding for the quarter were 11,136,107.

Sal Perisano, Chief Executive Officer of iParty Corp., commented, "iParty Corp. is continuing its evolution into a complete multi-channel retail provider. The acquired Big Party stores will be re-branded "iParty" by the end of the year, ultimately enabling iParty to cross promote its various distribution channels under a single brand name. Furthermore, this will allow us to offer additional products and services to our customers, while simultaneously providing iParty with a solid platform for revenue growth."

Commenting on the third quarter and future outlook, Mr. Perisano stated, "We have started to reduce the costs related to running our Internet business and we now plan to consolidate our divisions by relocating our New York office to Boston by year end. This move will allow us to leverage overheads and establish a clearer path-to-profitability. Additionally, we believe that the 33 retail stores will be cash flow positive on an operating basis in 2001 and the consolidated company will be cash flow positive on an operating basis by the fourth quarter 2002."

About iParty Corp.

Headquartered in New York City, iParty.com, owned and operated by iParty Corp. (AMEX:IPT), is a premier multi-channel party supply and party planning company that includes an online destination, offline national catalog and retail stores, that all make throwing a successful event both stress-free and fun. From over 11,000 party supplies and costumes to an online party magazine and party related content, iParty.com offers consumers a sophisticated yet fun and easy-to-use resource with a definitive assortment of products to customize any party, including birthday bashes, Easter get-togethers, graduation parties, summer barbecues, and, of course, Halloween. iParty.com offers reliable, time-tested knowledge of party-perfect trends, superior customer service and distribution to ensure convenient and comprehensive merchandise selections for every occasion. Please visit our site at www.iparty.com.

Certain information included in this news release (as well as information included in oral statements or other written statements made or to be made by iParty.com) contains statements that are forward-looking, such as statements relating to anticipated future revenues of the company and the success of current product offerings. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ materially from those expressed in any forward-looking statements made by or on behalf of iParty Corp.


                              iPARTY CORP.
                 CONSOLIDATED STATEMENTS OF OPERATIONS
                              (Unaudited)

                           For the                  For the 
                     Three months ended        Nine months ended
                        September 30,             September 30,
                      2000         1999         2000         1999
                  -----------  -----------  ------------  -----------

 Revenues         $ 3,648,105  $     4,257  $  4,054,791  $     4,257
                  -----------  -----------  ------------  -----------
 Operating costs:
  Cost of
   products sold   2,685,984        5,107     3,178,704        5,107
  Amortization of
   fulfillment
   partner
   warrant            377,744      379,262     1,133,233      379,262
  Marketing and
   sales            2,160,959      632,442     7,176,081      878,372
  Product and
   technology
   development      1,068,973      399,143     4,510,562      893,466
  General and
   administrative   1,000,144      725,653     2,079,287    1,528,614
  Loss resulting
   from abandonment
   of assets             --         92,924          --        366,212
  Non-cash
   compensation
   expense             88,777      531,900       723,733      761,303
                  -----------  -----------  ------------  -----------
 Operating loss    (3,734,476)  (2,762,174)  (14,746,809)  (4,808,079)
  Interest income     144,039       41,141       644,172       42,688
  Interest Expense    (11,000)    (763,463)      (11,000)  (1,004,452)
                  -----------  -----------  ------------  -----------
 Net loss before
  income taxes     (3,601,437)  (3,484,496)  (14,113,637)  (5,769,843)

  Provision for
   income
   taxes                 --           --          84,784         --
                  -----------  -----------  ------------  -----------
 Net loss         $(3,601,437) $(3,484,496) $(14,198,421) $(5,769,843)
                  ===========  ===========  ============  ===========
 Loss per share:
  Basic and
   diluted        $     (0.53) $     (1.72) $      (1.48) $     (1.93)
                  ===========  ===========  ============  ===========

 Weighted Average
  Shares Outstanding:
   Basic and
    diluted        11,136,107   11,005,691    11,114,326   11,005,691
                  ===========  ===========  ============  ===========

                            iPARTY CORP.
                      CONSOLIDATED BALANCE SHEET
                              (Unaudited)

                                       September 30,   December 31,
                                           2000            1999
                                       ------------    ------------
 ASSETS

 Current assets:
  Cash and cash equivalents            $  7,522,327    $ 18,673,304
  Marketable securities                        --           973,877
  Inventory                               6,315,000            --
  Prepaid expenses and other
   current assets                           587,579         579,133
                                       ------------    ------------
    Total current assets                 14,424,906      20,226,314

 Property and equipment, net              1,091,246         860,457
 Intangible Assets                        4,578,466       6,119,734
 Other assets                               213,961          50,245
                                       ------------    ------------
 Total assets                          $ 20,308,579    $ 27,256,750
                                       ============    ============

 LIABILITIES AND STOCKHOLDERS' EQUITY

 Current liabilities:
  Accounts payable                     $  2,834,185    $  1,749,806
  Accrued expenses                        1,348,247         452,876
                                       ------------    ------------
   Total current liabilities              4,182,432       2,202,682

 Other Liabilities:
  Line of Credit                          1,601,000            --
  Deferred Payables                         453,022            --

 Commitments and contingencies                 --              --
                                       ------------    ------------
 Total Liabilities                        6,236,454       2,202,682
                                       ============    ============
 Stockholders' Equity:
  Preferred stock                             3,672           2,395
  Common stock                               11,137          11,006
  Additional paid in capital             64,080,855      58,616,431
  Accumulated deficit                   (50,023,539)    (33,575,764)
                                       ------------    ------------
   Total stockholders' equity            14,072,125      25,054,068
                                       ------------    ------------
  Total liabilities and
   stockholders' equity                $ 20,308,579    $ 27,256,750
                                       ============    ============


        

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