Consolidated gross profit for the third quarter of 2004 was $5,989,000, an increase of $1,012,000 or 20.3% from the third quarter of last year. Gross profit in the transportation segment increased $922,000 or 35.0% achieved by the increased revenue and a steady level of fixed costs.  Gross profit in the real estate segment increased $90,000 or 3.8% from the third quarter of 2003 primarily due to the gross profit derived from the additional leased space.

Selling, general and administrative expense increased $258,000 or 12.8% for the third quarter of 2004 compared to the same period last year. The increase is primarily due to the accrual of management incentive compensation, which is based on the Company achieving certain profitability targets. Selling, general and administrative expense as a percent of consolidated revenues was 7.7% in the third quarter of 2004 as compared to 7.5% the same quarter last year.

Income from continuing operations was $1,913,000 or $.64 per diluted share for the third quarter of Fiscal 2004, an increase of $653,000 from the same quarter last year.

Income from discontinued operations of $9,041,000 net of income taxes was recorded during the quarter, primarily as a result of the net gain on sale of properties to a related party for $16,628,000.

Net income was $10,954,000 or $3.68 per diluted share for the third quarter of Fiscal 2004 compared to $1,346,000 or $.44 per diluted share for the same quarter last year.

Nine Month’s Operating Results. For the first nine months of Fiscal 2004, consolidated revenues were $85,740,000, an increase of $10,253,000 or 13.6% over the same period last year.

The transportation segment’s revenues for the first nine months of Fiscal 2004 were $73,637,000, an increase of $8,580,000 or 13.2% over the same period last year. The revenue increase is primarily due to a 5.6% increase in miles hauled in the tankline division and a 21.6% increase in miles for the flatbed division. These increases reflect higher customer demand over the same period last year. Revenue per mile, net of fuel surcharges, increased 2.5%, reflecting moderate price increases, particularly in the flatbed division. Fuel surcharges accounted for $761,000 or 8.9% of the increased revenue.

Real estate revenues were $12,103,000 for the first nine months of 2004, an increase of $1,673,000 or 16.0% from the first nine months of 2003. Royalties from mining contracts increased $393,000 or 9.9% primarily resulting from an increase in mined materials sold. Revenues from flex office-warehouse properties increased $1,349,000 or 21.1%, primarily due to a 20.2% increase in average leased square feet. The increase in leased square feet is attributable to the completion of a 200,200 square foot build-to-suit flex office/warehouse in August 2003 and the April 2004 purchase of two existing commercial warehouse/distribution buildings, comprising 303,000 square feet. Of this new space, 251,000 average square feet were leased during the nine months ended June 30, 2004.

Consolidated gross profit increased $3,327,000 or 25.8% for the first nine months as compared to the same period last year. Gross profit in the transportation segment increased $2,710,000 or 39.3% as a result of the increased revenue and steady level of fixed costs.

Gross profit in the real estate segment increased $617,000 or 10.3% from the first nine months of 2004 due to increased royalties from mining operations, as well as gross profits from the additional leased space.

Selling, general and administrative expense increased $644,000 or 10.7% for the first nine months of 2004 compared to the same period last year. The increase is primarily due to the accrual of management incentive compensation, which is based on the Company achieving certain profitability targets.  Selling, general and administrative expense as a percent of consolidated revenues was 7.8% compared to 8.0% last year.

The Company recorded an income tax provision of $2,690,000 in the first nine months of 2004 compared to $1,674,000 in the same period last year. The effective tax rate decreased to 38% in 2004 from 39% in 2003.

Income from continuing operations was $4,390,000 or $1.47 per diluted share for the first nine months of Fiscal 2004 compared to $2,620,000 or $.85 per diluted share for the first nine months of last year.

Income from discontinued operations for the nine months ended June 30, 2004 was $14,855,000 net of income taxes, primarily as a result of the net gain from sale of two rental properties and a mining property to a related party for $26,628,000.

Net income was $19,245,000 or $6.46 per diluted share for the first nine months of Fiscal 2004 compared to $2,906,000 or $.94 per diluted share for the same period last year.

Summary and Outlook.  The Company’s real estate and transportation businesses are both experiencing an improved economic climate as the result of a strengthening regional and national economy.  While low interest rates continue to enhance overall business conditions, the Company’s real estate development operations are encountering stronger levels of inquiry from prospective tenants for the Company’s flexible office/warehouse product.

Demand for hauling services has also strengthened for the Company’s transportation business.  Improved demand and pricing is especially occurring for the Company’s flatbed trucking operations which haul primarily construction materials. Operating pressures from volatile diesel fuel costs, tight driver availability, and burdensome health and liability insurance costs will continue to challenge the trucking industry. Such expense pressure in the face of improving freight demand should lead to continued price increases for hauling services.

PATRIOT TRANSPORTATION HOLDING, INC.

                                                 Summary of Consolidated Revenues and Earnings         

(In thousands except per share amounts)

	Three Months			Nine Months
	Ended			Ended
	June 30			June 30
	2004	2003		2004	2003
Revenues	$29,670	26,827		$85,740	75,487
Gross profit	$  5,989	4,977		$16,221	12,894
Income before income taxes	$  3,082	2,065		$  7,080	4,294
Income from continuing operations	$  1,913	1,260		$  4,390	2,620
Income from discontinued operations	$  9,041	86		$14,855	286
Net income	$10,954	1,346		$19,245	2,906
Earnings per common share:
Income from continuing operations
Basic	$.65	.42		$1.50	.85
Diluted	$.64	.41		$1.47	.85
Gain from discontinued operations
Basic	$3.09	.03		$5.07	.10
Diluted	$3.04	.03		$4.99	.09
Net income
Basic	$3.74	.45		$6.57	.95
Diluted	$3.68	.44		$6.46	.94
Weighted average common shares outstanding:
Basic	2,929	3,015		2,931	3,067
Diluted	2,979	3,054		2,977	3,098

PATRIOT TRANSPORTATION HOLDING, INC. Condensed Balance Sheets (Unaudited) (Amounts in thousands)
			June 30		September 30
			2004			2003
Cash and cash equivalents			$       7,820			$       757
Cash held in escrow (a)			10,259			1,795
Accounts receivable, net			8,089			7,332
Other current assets			3,359			4,081
Property, plant and equipment, net			146,922			139,379
Other non-current assets			6,386			11,872
Total Assets			$182,835			$165,216
Current liabilities			$  19,265			$  11,220
Long-term debt (excluding current maturities)			44,461			57,816
Deferred income taxes			15,234			10,760
Other non-current liabilities			7,328			7,391
Shareholders’ equity			96,547			78,029
Total Liabilities and Shareholders’ Equity			$182,835			$165,216

(a)    Cash held in escrow consists of proceeds from sales of real estate being held in escrow in anticipation of qualified real estate purchases in accordance with Section 1031 of the Internal Revenue Code.

                                                                                  Business Segments

(Amounts in thousands)

(Unaudited)

The Company has identified two business segments, Transportation and Real Estate.  All of the Company’s operations are located in the Southeastern and Mid-Atlantic states and each is managed separately along product lines.  Operating results for the Company’s business segments are as follows:

	Three Months Ended				Nine Months Ended
	June 30				June 30
	2004		2003		2004		2003
Transportation Revenues	$25,585	23,079		$73,637		65,057
Real Estate Revenues	$  4,085	3,748		$12,103		10,430