This is the all-purpose phrase used to quickly remove one's foot from one's mouth with a minimal amount of embarassment and/or physical damage to one's person.
The phrase intends to imply that a broad generalization does not apply to those who fall into the category while within earshot of the generalization.
For example:
There is a meeting of the International Burly Security Guards Association. Almost all of the 400 people present are burly security guards. There are balloons climbing up the walls, streamers clinging to the ceiling, loud music is travelling through the air, and the well-dressed attendees are all involved in hundreds of separate conversations.
"Personally, I think that burly security guards are pointless waste of space, easily avoidable, and have the mental capacity of a goldfish."
The music abruptly stops with a scratch, and all the attendees focus their eyes on the source of this blasphemy. The person, attempting to backpedal at around 70 miles per hour, manages to sputter "Errr, present company excluded of course!"
The gatherers hold their gaze for a second or so more, then resume their conversations as the music starts back up.
Yeah, I guess you'd need the mental capacity of a goldfish to fall for that one.
SCRATCH!
It don't work twice, folks.