THE 2005/2006 OUTLOOK FOR THE U.S. MILLWORK INDUSTRY (With Long-Term Forecasts Through 2014)

TABLE OF CONTENTS

SECTION I: OVERVIEW OF THE U.S. MILLWORK INDUSTRY

Analysis:

The Marketplace

New Construction Market

Remodeling/Replacement Market

Competition from Vinyl

Foreign Markets

Industry Consolidation

SECTION II: THE U.S. MARKET FOR MILLWORK

Analysis:

Overview

The Overall Market

Wood Window Units

Wood Window Sash

Wood Window and Door Frames

Wood Doors

Interior and Exterior Wood Doors

Specialty Wood Doors

Wood Moldings

Other Millwork Products

Tables:

U.S. Manufacturers  Sales of Millwork:

Total

Dollar Sales, by Type

Product Mix of Dollar Sales

Growth Comparison for Dollar Sales, by Type

U.S. Manufacturers  Sales of Wood Window Units:

Dollar and Unit Sales and Average Prices

Dollar Sales, by Type

Product Mix of Dollar Sales

Growth Comparison for Dollar Sales, by Type

Unit Sales, by Type

Product Mix of Unit Sales

Growth Comparison for Unit Sales, by Type

Average Prices, by Type

U.S. Manufacturers  Sales of Wood Window Sash:

Total

Dollar Sales, by Type

Product Mix of Dollar Sales

Growth Comparison for Dollar Sales, by Type

U.S. Manufacturers  Sales of Wood Window and Door Frames:

Total

Dollar Sales, by Type

Product Mix of Dollar Sales

Growth Comparison for Dollar Sales, by Type

Product Mix of U.S. Manufacturers  Dollar Sales of Wood Doors

U.S. Manufacturers  Sales of Wood Interior and Exterior Doors:

Total

Dollar Sales, by Type

Product Mix of Dollar Sales

Growth Comparison for Dollar Sales, by Type

U.S. Manufacturers  Sales of Specialty Wood Doors:

Total

Dollar Sales, by Type

Product Mix of Dollar Sales

Growth Comparison for Dollar Sales, by Type

U.S. Manufacturers  Sales of Wood Moldings:

Total

Dollar Sales, by Type

Dollar Sales, by Type and Species

Product Mix of Dollar Sales

Growth Comparison for Dollar Sales, by Type and Species

U.S. Manufacturers  Sales of Other Millwork Products:

Total

Dollar Sales, by Type

Product Mix of Dollar Sales

Growth Comparison for Dollar Sales, by Type

SECTION III: U.S. CONSTRUCTION ACTIVITY AND THE HOUSING MARKET

Analysis:

Overview

The Economy Recovers

New Private Construction

New Private Residential Building Construction

Characteristics of New Housing

Shifting Consumption of Materials in Housing

New Public Construction

Tables:

U.S. Gross Domestic Product

U.S. Gross Private Domestic Investment

U.S. Industrial Production Index

U.S. Disposable Personal Income

U.S. Per Capita Disposable Personal Income

U.S. Personal Consumption Expenditures

U.S. Per Capita Personal Consumption Expenditures

Consumer Confidence Index

Interest Rates Charged by U.S. Banks

Value of New Construction in the U.S.:

Total

By Type

New Private Construction, by Type

New Private Residential Building Construction, by Type

Privately Owned Housing Starts:

By Type

Distribution, by Type

By Region

Average Square Feet of Floor Area in New Privately Owned One-Family Housing, by Region

Privately Owned Housing Units Completed:

By Type

By Region

By Number of Stories

By Number of Bathrooms

By Number of Bedrooms

By Types of Parking Facilities

Principal Type of Exterior Wall Material Used in New Privately Owned

One-Family Housing Units Completed

Lumber Costs in a 2,300-Square-Foot Home

Value of New Private Nonresidential Building Construction, by Type

Value of New Public Construction, by Type

Value of New Public Building Construction, by Type

SECTION IV: REMODELING, REPLACEMENT, AND REPAIR ACTIVITY

Analysis:

Overview

Millwork and the Market for Maintenance and Repair Work

Housing Affordability

Sales of Existing Homes

Tables:

Distribution of Expenditures on Owner-Occupied Properties (Graphs):

Replacement Expenditures

Maintenance and Repair Expenditures

Expenditures on Interior Additions

Expenditures on Interior Alterations

Expenditures on Outside Additions and Alterations

Average Annual Consumer Expenditures on Maintenance and Repair

Services and Commodities:

By Region

By Age

By Occupation

Housing Affordability

First-Time Home Buyer Affordability

Average Sale Prices of Existing Single-Family Homes Sold, by Region

Median Sale Prices of Existing Single-Family Homes Sold, by Region

Existing Home Sales, by Region

Existing Apartment, Condominium, and Co-Op Sales, by Region

U.S. Resident Population Trends and Projections

U.S. Resident Population Trends and Projections, by Age Group

Age Distribution of the U.S. Population

U.S. Population and Household Trends and Projections

U.S. Resident Population Projections, by Region

U.S. Resident Population Projections, by State

Distribution of the U.S. Population, by State

Number of Live Births, by Gender

SECTION V: WHOLESALE AND RETAIL DISTRIBUTION OF MILLWORK

Analysis:

Overview

Wholesalers

Retailers

Home Improvement Centers

Tables:

Sales of U.S. Lumber and Other Construction Material Wholesalers

Number of U.S. Lumber, Plywood, and Millwork Wholesalers

Number of U.S. Lumber, Plywood, and Millwork Wholesalers, by

Employment Size

Financial Profile of Lumber and Millwork Wholesalers:

Total

Sorted by Sales

Sorted by Assets

Sales of U.S. Building Material and Supply Retailers

Number of U.S. Lumber and Other Building Material Retailers

Number of U.S. Lumber and Other Building Material Retailers, by

Employment Size

Financial Profile of Home Centers:

Total

Sorted by Sales

Sorted by Assets

Total Retail Sales of Home Improvement Centers

Ranking of the Top 10 Do-It-Yourself Home Center Chains

Market Share of the Top 25 Hardware, Home Center, and Lumberyard

Chains

Distributor Profiles:

Introduction

84 Lumber Company:

Overview

Retail Operations

Component Plants

News

Outlook

Boise Cascade, LLC:

Overview

Boise Building Solutions

Timber

Outlook

The Home Depot, Inc.:

Overview

Products Sold

Home Depot Stores

EXPO Design Center Stores

Other Stores

Store Modernization

Outlook

Financial Summary and Analysis

Lowe s Companies, Inc.:

Overview

Markets

Distribution

Addressing Women

Outlook

Financial Summary and Analysis

Menard, Inc.

Sears, Roebuck and Co.:

Overview

Retail Operations

The Great Indoors

Outlook

Financial Summary and Analysis

Stock Building Supply:

Overview

Growth Through Acquisition

Distribution

Wolseley plc

SECTION VI: MILLWORK CONSUMPTION

Analysis:

Overview

The Prime Window Market

Fiberglass: A Future Threat?

Tables:

Residential Interior Door Shipments

Storm Door Shipments

Unit Shipments of Prime Windows, by Market Segment

Unit Shipments of Prime Windows, by Market Segment (Graph)

Unit Shipments of Prime Windows, by Type (Graph)

Unit Shipments of Prime Windows for New Construction, by Type

Unit Shipments of Prime Windows for New Construction, by Type (Graph)

Material Shares of Unit Shipments of Prime Windows for New Construction (Graph)

Unit Shipments of Prime Windows for Remodeling and Replacement, by Type

Unit Shipments of Prime Windows for Remodeling and Replacement, by Type (Graph)

Material Shares of Unit Shipments of Prime Windows for Remodeling and Replacement (Graph)

Residential Patio Door Usage

SECTION VII: THE U.S. LUMBER SUPPLY

Analysis:

Overview

Lumber Production Rebounds

Softwood Lumber Production

Hardwood Lumber Production

Trade Issues Affecting Supply

Tables:

U.S. Lumber Production, by Type

U.S. Softwood Lumber Production, by Type

U.S. Eastern Lumber Production, by Species

U.S. Western Lumber Production, by Species

Production, Exports, Imports, and U.S. Apparent Consumption of

Softwood Lumber

U.S. Production and Exports of Softwood Lumber, by Detailed Type

Tables: (cont d.)

Production, Exports, Imports, and U.S. Apparent Consumption of

Hardwood Lumber

U.S. Production and Exports of Hardwood Lumber, by Detailed Type

U.S. Lumber Mill Stocks

SECTION VIII: PRICING IN THE U.S. MILLWORK INDUSTRY

Analysis:

Overview

Lumber Prices

Producer Prices for Wood Window Units

Producer Prices for Wood Doors

Producer Prices for Wood Moldings

Tables:

Producer Price Trends:

General Millwork

Wood Window Units

Wood Window Units, by Type

Wood Sash

Wood Window and Door Frames and Door Frames Shipped in Units

Wood Doors

Wood Doors, by Type

Wood Moldings

Other Millwork

SECTION IX: ADVERTISING TRENDS IN THE U.S. MILLWORK INDUSTRY

Analysis:

Overview

Erratic Nature of Media Spending

Leading Advertisers

Advertising Venues

Tables:

Total Media Expenditures by Window and Door Manufacturers

Top Media Spenders Among Window and Door Manufacturers

Top Advertised Brands of Windows and Doors

Media Expenditures by Window and Door Manufacturers, by Company

and Brand

SECTION X: HOME BUILDER BRAND PREFERENCE/USAGE SURVEYS

Analysis:

Introduction

Wood and Wood-Clad Windows

Skylights and Roof Windows

Interior Passage Doors

Entry Doors

Garage Doors

Patio Doors

Decorative Molding/Trim/Columns

Tables:

Quality Ratings:

Wood and Wood-Clad Windows:

By Census Region

By Average Home Sale Price

By Number of Units Built

Skylights and Roof Windows:

By Census Region

By Average Home Sale Price

By Number of Units Built

Interior Passage Doors:

By Census Region

By Average Home Sale Price

By Number of Units Built

Entry Doors:

By Census Region

By Average Home Sale Price

By Number of Units Built

Garage Doors:

By Census Region

By Average Home Sale Price

By Number of Units Built

Patio Doors:

By Census Region

By Average Home Sale Price

By Number of Units Built

Decorative Molding/Trim/Columns:

By Census Region

By Average Home Sale Price

By Number of Units Built

Brands Used the Most:

Wood and Wood-Clad Windows:

By Census Region

By Average Home Sale Price

By Number of Units Built

Skylights and Roof Windows:

By Census Region

By Average Home Sale Price

By Number of Units Built

Interior Passage Doors:

By Census Region

By Average Home Sale Price

By Number of Units Built

Entry Doors:

By Census Region

By Average Home Sale Price

By Number of Units Built

Garage Doors:

By Census Region

By Average Home Sale Price

By Number of Units Built

Patio Doors:

By Census Region

By Average Home Sale Price

By Number of Units Built

Decorative Molding/Trim/Columns:

By Census Region

By Average Home Sale Price

By Number of Units Built

SECTION XI: FOREIGN TRADE ACTIVITY

Analysis:

Overview

U.S. Balance of Trade

U.S. Apparent Consumption of Millwork

U.S. Exports of Millwork Products

A Slow Boat to China

U.S. Imports of Millwork Products

Tables:

Foreign Exchange Rates

Fixed Euro Conversion Rates

U.S. Apparent Consumption of Millwork

U.S. Balance of Trade for Millwork

U.S. Balance of Trade for Millwork, by Type

U.S. Exports of Millwork (Graph)

Top 20 U.S. Export Destinations for Millwork

Dollar Market Shares of the Top 20 U.S. Export Destinations for Millwork

Leading U.S. Export Destinations for Millwork (Graph)

U.S. Exports of Millwork, by Type

U.S. Exports of Millwork, by Country of Destination:

Coniferous Wood Moldings

Nonconiferous Wood Moldings

Wood Windows, French Windows, and Their Frames

Wood Flush Doors

Wood Doors and Their Frames and Thresholds

Wood Blinds, Shutters, and Screens

U.S. Imports of Millwork (Graph)

Top 20 U.S. Import Sources for Millwork

Dollar Market Shares of the Top 20 U.S. Import Sources for Millwork

Leading U.S. Import Sources for Millwork (Graph)

U.S. Imports of Millwork, by Type

U.S. Imports of Millwork, by Country of Origin:

Coniferous Standard Wood Moldings

Other Coniferous Wood Moldings

Nonconiferous Standard Wood Moldings

Other Nonconiferous Wood Moldings

Pine Standard Wood Moldings

Wood Windows, French Windows, and Their Frames

Wood French Doors

Wood Flush Doors

Other Wood Doors and Their Frames and Thresholds

Wood Blinds, Shutters, Screens, and Shades

Wood Blinds, Shutters, Screens, and Shades, Without Louver Boards or Slats

SECTION XII: STRUCTURE OF THE U.S. MILLWORK INDUSTRY

Analysis:

Overview

Operating Structure

Employment Trends

New Capital Expenditures

Consolidation

Number of Establishments

Explanation of Terms

Tables:

The U.S. Millwork Industry:

Operating Structure

Gross Operating Margin

Value Added by Manufacture

Vertical Integration Index

Employment Structure

Total Labor Costs

Average Hourly Earnings of Production Workers

Cost of Living Index for Production Workers

Labor Productivity

Indexes of Real Labor Productivity

New Capital Expenditures

Plant vs. Equipment Expenditures

Ending Inventories

Capacity Utilization Rates

Number of Establishments

Number of Manufacturing Plants, by State and Employment Size

The Plant Manager s Workbook:

How to Use This Section

Gathering Your Data

Developing Your Ratios

How Does Your Plant Stack Up?

SECTION XIII: CORPORATE ACTIVITY

Introduction

Tables:

Financial Profile of Wood Window and Door Manufacturers:

Total

Sorted by Sales

Sorted by Assets

Financial Profile of Manufacturers of Dimension Lumber or Stock Made

from Purchased Lumber or Cut Stock:

Total

Sorted by Sales

Sorted by Assets

Financial Profile of Other Millwork Manufacturers:

Total

Sorted by Sales

Sorted by Assets

Company Profiles:

Andersen Corporation:

Overview

Products

Distribution

Manufacturing

The Centennial Celebration

Project Odyssey

Causeway Lumber Company

Edward Hines Lumber Co.

Griffon Corporation:

Overview

Garage Doors

Manufacturing

Outlook

Financial Summary and Analysis

Hurd Millwork Company, Inc.:

Overview

Products and Distribution

Manufacturing

Total Window Control

Outlook

JELD-WEN, inc.:

Overview

Products

Success of AuraLast

Kolbe & Kolbe Millwork Co., Inc.:

Overview

Products

Distribution

Manufacturing

Marvin Windows and Doors:

Overview

Windows

Doors

Manufacturing and Distribution

Outlook

Masonite International Corporation:

Overview

Manufacturing and Distribution

Global Expansion

Outlook

Financial Summary and Analysis

Milgard Manufacturing, Inc.:

Overview

Manufacturing and Distribution

WoodClad

Masco Corporation

Pella Corporation:

Overview

Products

Manufacturing

News

Pioneer Millworks

Weather Shield Manufacturing, Inc.:

Overview

Products

Manufacturing

Newest Entry Door Line

Weyerhaeuser Company:

Overview

Wood Products

Manufacturing

News

Outlook

Financial Summary and Analysis

APPENDIX A: GLOSSARY OF SELECTED WINDOW TERMS

APPENDIX B: DIRECTORY OF SELECTED U.S. MANUFACTURERS OF MILLWORK

Introduction

Directory