Good day ladies and gentlemen and welcome to the 2008 Drew Industries Incorporated First Quarter Earnings Conference call. (Operator Instructions) I will now turn your call over to Ryan McGrath with Lambert, Edwards & Associates.

Good morning everyone and welcome to Drew Industries 2008 First Quarter Conference Call. I’m Ryan McGrath with Lambert, Edwards & Associates, Drew’s Investor Relations firm and I have with me today members of Drew’s management team including Leigh Abrams, President and CEO and the director of Drew; David Webster, President and CEO of Kinro and Director of Drew; Jason Lippert, President and CEO of Lippert Components and a director of Drew and Fred Zinn, Executive Vice President and CFO of Drew. We want to take a few minutes to discuss our quarterly results; however before we do so is my responsibility to inform you that certain statements made in today’s conference call regarding Drew Industries and its’ operations may be considered forward-looking statements under the Securities Laws. As a result, I must caution that there are a number of factors, many of which are beyond the company’s control, which may cause actual results and events to differ materially than those described in the forward-looking statements. These risk factors that are identified in our press releases and our latest Form 10-K filed with the SEC. With that, I’d like to turn the call over to Leigh Abrams.

Thank you, Ryan. Good morning and welcome to all of you on this call and to all of those listening on the internet. It appears that 2008 is turning out to be a very challenging year for us. The turmoil in the real estate industry and the mortgage markets and the focus on recession, all have severely impacted consumer confidence, which was recently at the lowest level than the last five years. Generally under such conditions, purchases of discretionary big-ticket items such as RV and boats slow down; however, in spite of these conditions, we are pleased with our first quarter results. Although net income is down slightly from last year’s first quarter, we continue to make progress. Our cash position is strong and we recently announced an agreement in principle to acquire Seating Technology, a company in the RV industry with sales of $40 million that has the potential to generate significant growth and synergies when combined with our existing operations. In addition, it will create an entire new product category for Drew. We expect to pay for the acquisition with existing cash. The RV industry spent much of 2007 reducing inventory levels and then late in 2007, just as dealers appeared satisfied with their inventory levels, talk of recession intensified, retail traffic slowed and according dealers were compelled to reduce inventory levels even further. As a result, RV shipments of travel trailer and fifth wheel RVs to dealers, by our customers, were down 8% for the 2008 first quarter, but down more than 14% for the month of March alone. Shipments of motor homes in the quarter were down 25%. RV sales represent about 78% of Drew’s consolidated sales, with more than 90% of such sales being for travel trailers and fifth wheel RVs and just 3% being…

Thank you very much, Leigh, I really do appreciate your confidence and your kind words. As most of you know, Leigh and I have worked together as a team for many years now and I believe that we have the same perspective on Drew’s strengths and how to capitalize on those strengths to grow profitably. Those of you who have me with Leigh and me know that we are both committed to helping Drew continue the kind of outstanding performance our stockholders have come to expect. Further, I am extremely confident that Joe Giordano who will be appointed Drew’s CFO at our board meeting later this month, is fully prepared for his new role. Joe has made my job much, much easier over the past five years that he had been the corporate controller, he has had broad responsibility for financial reporting, monitoring internal controls, and cash management, and he has played a key leadership role in our corporate office. I know he is well versed for the responsibilities of becoming CFO. But for now I still need to fulfill my role as CFO, so I’ll try and add a little color to our first quarter results. The key to our performance this quarter, and to our potential for the balance of the year, is that we’ve prepared for the current economic and industry downturn through cost cutting. Facility consolidations and improved production efficiencies that were accomplished in late 2006 and throughout 2007. Cost reductions to date added $1.4 million to first quarter operating profit and are expected to add more than $4 million to operating profit for the full year. As a result of these efforts, which are continuing, we entered 2008 with an even stronger balance sheet and a more productive workforce, which will allow us to meet…

Thank you, Fred, and again congratulations. I’m more than happy to take questions now. ………..

(Operator Instructions) Your first question comes from Kathryn Thompson of Avondale Partners.

I think it was largely, as we mentioned in prior quarters, due to the drafting of some of the lower margin business. I think we were able to improve some margins on some other products. It was product mix. We have obviously different margins on various different product categories. You put those three together and I think that’s what helped this year, on top of…

Then previously you said it had about a $1 to $2 million impact. Would it be similar in this quarter or would you say it was a bigger impact?

I don’t remember making that estimation. I’m sure you’re right, but I would say in that order, maybe that’s a little high.

Well you know price increases have continued to go up. The biggest price increase is probably coming in April or May, but they’ve been going up all year just about every month and again, I look back to ’04 when price increases doubled and tripled and again, David and Jason were very successful in doing what they had to do. Jason, do you want to add anything to that and I’m going to ask David the same?

No, I think Kathryn said that has been studied since ’04 and it’s just one of those situations where you have to evaluate everything and do what we’ve done: in the past I think we’ve had to do it twice, twice or three times since then and it’s just another one of those times we’ve got to evaluate everything and get back out to the market and educate the customers.

Do you think it’s more difficult this time around than in previous cycles?

Well it’s always difficult to go out to the industry with price increases, but this is nothing new for us. We’ve had price increases for the last 28 years, raw materials is going up. It so happens that we’re in the middle of a campaign trail that really didn’t need to last for two years and I think it’s having a tremendous effect on the economy. But, yes we’ll handle it the same way we’ve always handled it. It’s a tough road out there.

But overall, just from your perspective Leigh, do you see this as incrementally tougher today than it was…

You know it’s always tough. David and Jason both said it’s always tough to put through price increases, particularly in a down economy, but we’re confident that they’ll do what they have to do.

What is the potential, there is Seating Technology’s, and there are other potential targets out there. What is the total potential market for that particular new segment?

Probably $100 million, but Jason do you want to add to that?

What was the question?

What’s the total market for Seating Technology’s? They have $40 million, what do you think the total furniture market is? I said $100 million, I think.

I’d say somewhere in the neighborhood of, if you consider all their different business units, probably $150 somewhere in there at this point.

The problem is you look firstly only at the total of the market where they service right now, but there are other markets that we would like to take them into, so that would expand that base.

Well between motor homes and mattresses and all the other design and decorator work that they do, it’s bigger than just the seating portion of that.

In the past you’d given a total market potential, I was just trying to get a sense of that.

Well again, if we just narrowed it to the total, RV would be one number and if we’re successful, and we don’t know whether we will be or not, in taking it to other markets, it could be much larger.

There is a pretty big potential, you know they are just a retail company right now, they don’t do business in all parts of the country, they’ve got gas in their customer list; so I think there is a lot. However, more important than that, first we have to close the acquisitions, it’s not closed yet and we hope to do that by the end of June.

Any other, just in terms of modeling for it on SG&A, any other items that we should keep in mind that are more recurring, for instance the option expense going forward for the remainder of the year?

Just be aware that we are impacted also by higher fuel costs, so our delivery costs are up a little bit and our utility costs are up a little bit. They’re not huge costs for us, but incrementally they do make an impact.

Your next question comes from John Diffendal of BB&T Capital Markets. John Diffendal - BB&T Capital Markets : Kathryn covered most of it, but going back, you mentioned the bad debt expense. Did you give a number on that relative to, just a few; it may have washed out on mine.

No, I didn’t give a number; it’s just a few hundred thousand dollars. It was very low in the fourth quarter and fairly average this quarter. What happens during they year we estimate bad debt accrual and then in the end of the year you have to true it up. This year it trued up pretty good. John Diffendal - BB&T Capital Markets : But there’s no specific things that have started to merge that are much different than what you had before?

No, of course in economies like this, I’d love to be able to put aside some more allowance for bad debt accounts, but we can’t really do that because we collected so quickly.

By the time the auditor’s sign off, we’ve collected our entire year in balance and so…

There are lots of accounts we’re watching, no different than prior quarters and we’ll keep monitoring them. John Diffendal - BB&T Capital Markets : I was just wondering, you mentioned going back on the Seating Technology acquisition; I guess the biggest positive would be say stretching them into other markets and other customers, but I was wondering if Jason might be able to give us a little bit of color on what they do maybe that’s better than other people or just, I mean in terms of their cost structures, anything like that that’s worth noting about them?

I can comment so much as, to the fact that they’re a lot like us with respect to customer service. These guys take care of their customers from a day-to-day standpoint, long-term standpoint, they’re very responsive, and they’re very creative. I mean, they just do a good overall job with their customers in building relationships and their people are strong and I think that our two companies are very similar from that standpoint. I would like to think that we’ve got, you know we’ve got the strongest team in their marketplace there. With our distribution channels I think we’ve got an awesome opportunity to really realize some synergies and gain even more market share than what they’ve been gaining over the last 12 months themselves. John Diffendal - BB&T Capital Markets : To move outside the regions would it imply that you would have to have factories opened in some of these other areas or can they service most of what they have out of the base that they are in currently?

It’s kind of bulky. A lot of the products are kind of bulky type products that you don’t want to ship long distance, so you kind of have to be in the regions of the manufacturing. We’ve got plenty of capacity in the Northwest and the Southwest to expand their product lines out there, it’s just a matter of timing, doing it at the right time, and approaching the customers, and all that stuff.

Again, I emphasize we still have to close the transaction. John Diffendal - BB&T Capital Markets : I know you’ve all been doing some pre-buying of steel and that most of that’s sort of gone by now. The steel price increases I guess you’re pushing through basically right now and I know you implied that it’s a constant sort of thing, but give us a little more color in terms of, is that process basically done now or is it later this month?

Don’t forget John, the prices have been up mostly during this year, so it’s kind of bleeding into our cost of sales, we’ve got a couple of months lag. I know that Jason and David have been out to some customers already to negotiate price increases, but we have more to go.

Your next question comes from John [Skemper] - Sidoti & Co.. John [Skemper] - Sidoti & Co.: Regarding the 4% increase that you mentioned in the press release, through April, can you talk about how much if any price increases are embedded in that number or was that pretty much just a true number?

It’s a 4% decrease. There is very little in terms of price increases through that period, but you have to remember there was an extra shipping day, an extra business day in the month of April. John [Skemper] - Sidoti & Co.: Obviously that included any acquisition activity that happened last year?

Yes.

It was very small; I think it was $4 million.

But it was $4 million of acquisition increases. John [Skemper] - Sidoti & Co.: Another question about Seating Technologies: I know the deal hasn’t closed yet, but one of the other opportunities here that you guys have talked about is outset of the RV space and manufactured housing and maybe even in the marine boating industry. Can you just maybe give a little bit more granularity on that?

Not really at this point. First we’re going to try to grow the RV segment. First was have to close it, then we have to grow the RV segment, and then we’ll see where to go from there. John [Skemper] - Sidoti & Co.: As far as cost setting goes, I know that you guys have gotten most of that out of the way: how would you clarify or classify what you have going forward that you can take out of the system?

Well just in what’s already been done, this year 2008 we’ll reduce costs by more than $4 million. I know there are additional cuts that have been planned recently, so it should be more than $4 million. We’re late in the ball game. We’re not going to eliminate another 19 facilities. A lot of it just depends on what the industry does too.

Your next question comes from Edward Aaron - RBC Capital Markets.

A few questions for you: first on the whole pricing issue with the whole commodity inflation. Can you just remind us how you’re pricing contracts are structured and if they’re similar or different depending on account in terms of like your ability to just add on surcharges on a monthly or quarterly basis?

We generally don’t have a lot of contracts, and if we do have contracts that cancel going on short-term notice, so we just operate as a partnership, we hope, with our customers.

So kind of a constant negotiation process would you say?

Yes, you know you have to satisfy your customer and the customer has to help us to survive as well, so it’s a real partnership and that’s the way we try to operate.

The April sales number that you mentioned, I know you don’t really talk about monthly sales for every single month, but it looks like maybe there was a little bit of rate of change improvement relative to March. Is that a fair assumption?

Well again, you remember we have an extra day in April, which an extra day can add, could be a couple of percent, so it may have been down 7% or 8% instead of 4%. It’s running about the same as it has been.

Yes, it’s not significantly different.

When you talk about the cost reduction number that kind of formerly and minimum number that you threw out for this year. Just to be clear, that is a combination of the cost that you’ve taken out of the system, plus just the general efficiency gains?

It doesn’t really include the efficiency gains. The efficiency gains do flow with the sales of our business, so this quarter our sales were down and our efficiency’s were down a little bit. The $4 million is just the facility consolidations, the fixed costs of the facility consolidations and the staff reductions.

Two last questions if I could: one on the buy-back, it didn’t look like there was any activity this quarter, is that a matter of price or does it have something to do with the acquisition that you ended up pursuing? Secondly, Fred if just in your new seat as president there if maybe you could talk about any strategic initiatives that you’re going to be working on there?

I’ll answer the first question and let Fred answer the second. The first question, buy-back, we’ve basically been on a blackout almost since the time we’ve announced it. First we were in a year-end blackout for 40 some odd days and then we were in the midst of negotiating Seating Technology, so we’re going to blackout. Just about when we announced Seating Technology we were in the year-end blackout. It’s been almost a non-stop blackout from the beginning of December to through today. As you know, we constantly look at acquisition, so we’re extremely careful, but as soon as there is a real window, where we’re not looking at something, it will be better.

In terms of your second question, I think you if look at our history, we’ve got a pretty good track record. I don’t anticipate that an awful lot will change. I do think that we’ve got a lot of room for growth. You look at our product now, our sales in the RV industry account for about 10% or 11% or there abouts of a typical travel trailer and fifth wheel and I think we can grow that a lot more with acquisitions like Seating Technology’s or others that give us new platforms to grow on. But, I think you’ll see us maintain the winning combination we’ve had in the past.

Your last question comes from Arnie Brief of Goldsmith & Harris Arnie Brief - Goldsmith & Harris: Two questions: one, given the past experience, if you could discuss price points and mortgage activity in the manufactured housing industry. And maybe you could discuss what you would expect, the change in the mortgage provisions from $50,000 to $70,000. What could that mean, assuming it’s passed, what do you think the impact would be on the industry number one. Then number two, in this period where margins are depressed, sales are depressed what have you, are acquisition opportunities becoming more available or has the activity picked up or not?

Well let’s start with the first one. The $50,000 limit basically limited people to single-section homes, or to a very low-end multi, but $70,000 would open up the multi-section market for FHA financing, which could be big number. I’ve heard estimates of 5 to 10,000 additional homes. First we have to pass that law too. It’s been passed by the senate and by the house and it’s been in conference for quite awhile. The president seems to have indicated that he would sign it, but it’s still not out of conference. I think David Webster said it earlier; you’re in an election year. It’s very tough to get any business done in an election year. We’re hoping that this doesn’t just get brought down and it does get passed, but it would be a boost for the industry. Secondarily, the acquisition pipeline, we said right now the retiree, for instance, is not selling his home either because he can’t find a buyer or because maybe he thought he was going to get $300,000 for it last year and now he can only get $250 for it, so he says “I’m certainly not selling it”. I think you also see that in the acquisition market where people say, “well my business was worth $10 million last year” and we say yes and now it’s worth only $6 and he says, “well fine I’m not selling less than $10”. Despite that, the acquisition market is available. There maybe are actually even slightly more companies for sale right now than we’ve seen in the past, but as you know we’re a very tough acquire, very patient, very tough and we wait for our price, so we just have to wait and see what happens. There that reluctance to sell at a lower price.

There are no more questions at this time; I will turn it back over to Leigh Abrams for closing remarks.

I again appreciate everybody listening in and please feel free to contact either Fred or myself. Have a good day.