INDIANA

35-1057796  

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

Yes

X

No

Indicate by check mark whether the registrant is an accelerated filer.

Yes

No

X

March 31, 2005 (unaudited) & December 31, 2004

3

Three Months Ended March 31, 2005 & 2004

4

Three Months Ended March 31, 2005 & 2004

5

Notes to Unaudited Condensed Financial Statements

6-7

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL

8-12

CONDITION AND RESULTS OF OPERATIONS

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

12

ITEM 4. CONTROLS AND PROCEDURES

12

PART II: OTHER INFORMATION

13

Signatures

14

MARCH 31

DECEMBER 31

2005

2004

Cash and cash equivalents

$

585,250

$

82,787

Trade receivables

21,858,929

16,720,245

Inventories

37,012,083

34,343,558

Prepaid expenses

934,605

951,192

Deferred tax assets

1,658,000

1,658,000

Total current assets

62,048,867

53,755,782

PROPERTY AND EQUIPMENT, at cost

95,567,774

94,161,533

Less accumulated depreciation

59,335,360

58,518,666

36,232,414

35,642,867

OTHER ASSETS

2,913,649

2,976,026

Total assets

$101,194,930

$

92,374,675

Current maturities of long-term debt

$

3,810,319

$

3,671,430

Short-term borrowings

- -

7,300,000

Accounts payable

12,495,441

11,389,966

Accrued liabilities

2,698,434

2,624,489

Income taxes payable

61,197

- -

Total current liabilities

19,065,391

24,985,885

LONG-TERM DEBT, less current maturities

18,961,111

4,100,000

DEFERRED LIABILITIES

2,549,674

2,548,606

Total liabilities

$

40,576,176

$

31,634,491

Common stock

19,137,471

19,128,021

Retained earnings

41,481,283

41,612,163

Total shareholders' equity

60,618,754

60,740,184

Total liabilities and shareholders' equity

$101,194,930

$ 92,374,675

THREE MONTHS ENDED

MARCH 31

2005

2004

Net Sales

$

79,730,325

$ 65,712,355

Cost of goods sold

70,927,595

58,119,215

Gross profit

8,802,730

7,593,140

Warehouse and delivery expenses

3,540,000

3,160,855

Selling, general, and administrative expenses

5,210,540

5,156,545

Total operating expenses

8,750,540

8,317,400

Operating (income) loss

52,190

(724,260)

Interest expense, net

270,370

137,830

Loss before income taxes (credits)

(218,180)

(862,090)

Federal and state income taxes (credits)

(87,300)

(340,500)

Net loss

$

(130,880)

$

(521,590)

Basic and diluted loss per common share

$

(0.03)

$

(0.11)

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING

4,747,181

4,640,741

THREE MONTHS ENDED

MARCH 31

2005

2004

Net loss

$

(130,880)

$

(521,590)

Depreciation and amortization

1,164,947

1,399,259

(Gain) on sale of fixed assets

(108,656)

(11,375)

Deferred income taxes

- -

(332,566)

Other

76,500

70,500

Decrease (increase) in:

Trade receivables

(5,138,684)

(5,664,780)

Inventories

(2,668,525)

(4,590,978)

Prepaid expenses

16,587

(5,516)

Increase (decrease) in:

Accounts payable and accrued liabilities

1,308,662

7,705,556

Income taxes payable

(68,045)

(12,707)

Net cash (used in) operating activities

(5,548,094)

(1,964,197)

Capital expenditures

(1,761,600)

(4,027,617)

Proceeds from sale of property and equipment

212,570

17,150

Other

(27,020)

(106,102)

Net cash (used in) investing activities

(1,576,050)

(4,116,569)

Borrowings under long term debt

15,000,000

- -

Principal payments on debt

(7,300,000)

- -

Payments on deferred compensation obligations

(75,432)

(58,812)

Proceeds from exercise of common stock options

9,450

401,730

Other

(7,411)

(2,113)

Net cash provided by financing activities

7,626,607

340,805

Increase (decrease) in cash and cash equivalents

502,463

(5,739,961)

Cash and cash equivalents, beginning

82,787

7,077,390

Cash and cash equivalents, ending

$

585,250

$

1,337,429

Interest

$

220,173

$

228,078

Income taxes

17,764

4,773

1.

In the opinion of the Company, the accompanying unaudited condensed financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position as of March 31, 2005, and December 31, 2004, and the results of operations and cash flows for the three months ended March 31, 2005 and 2004.

2.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's December 31, 2004 audited financial statements. The results of operations for the three month periods ended March 31, 2005 and 2004 are not necessarily indicative of the results to be expected for the full year.

3.

The inventories on March 31, 2005 and December 31, 2004 consist of the following classes:

March 31

December 31

2005

2004

Raw materials

$ 22,608,977

$ 20,466,965

Work in process

2,157,219

1,955,284

Finished goods

5,439,651

5,336,306

Total manufactured goods

30,205,847

27,758,555

Distribution products

6,806,236

6,585,003

TOTAL INVENTORIES

$ 37,012,083

$ 34,343,558

4.

The Company accounts for grants of stock options under its stock option plan based on the recognition and measurement principles of APB Opinion No. 25 and related interpretations. The following table illustrates the effect on net income and earnings per share if the Company had applied the fair value recognition provision of FASB Statement No. 123 to stock based employee compensation:

2005

2004

As reported

$ (130,880)

$ (521,590)

all rewards net of related tax effects

(11,632)

(30,035)

Pro forma

$ (142,512)

$ (551,625)

As reported

$

(0.03)

$

(0.11)

Pro forma

(0.03)

(0.12)

5.

Effective January 1, 2004, the Company changed its segment reporting to no longer allocate corporate expense to the individual business units. Accordingly, the segment results have been restated to reflect this change.

6.

The Company has determined that its reportable segments are those that are based on the Company’s method of internal reporting, which segregates its business by product category and production/distribution process. Effective January 1, 2004, in accordance with the Company’s internal reporting, the Company changed its segment reporting from four reportable segments to three. As a result of this change, two of the operations in the wood segment were combined into the Primary Manufactured Products Segment and two of the operations were combined into the Other Component Manufactured Products Segment. The Company’s reportable segments are as follows:

The table below presents unaudited information about the revenue and operating income of those segments:

THREE MONTHS ENDED MARCH 31, 2005

PRIMARY

OTHER

MANUFACTURED

COMPONENT MFG

PRODUCTS

DISTRIBUTION

PRODUCTS

SEGMENT TOTAL

Net outside sales

$ 40,419,694

$ 25,822,717

$ 13,487,914

$ 79,730,325

Intersegment sales

1,388,795

90,133

1,940,897

3,419,825

Total sales

$ 41,808,489

$ 25,912,850

$ 15,428,811

$ 83,150,150 *

Operating income

$ 1,146,206

$

665,173

$

383,673

$

2,195,052

Total assets

$ 45,075,097

$ 13,881,044

$ 12,497,887

$ 71,454,028

THREE MONTHS ENDED MARCH 31, 2004

Net outside sales

$ 35,434,304

$ 20,796,415

$

9,481,636

$ 65,712,355

Intersegment sales

1,771,428

343,915

2,233,894

4,349,237

Total sales

$ 37,205,732

$ 21,140,330

$ 11,715,530

$70,061,592 *

Operating income

$

728,672

$

783,686

$

153,575

$

1,665,933

Total assets

$ 35,724,873

$ 12,423,900

$

7,788,714

$ 55,937,487

2005

2004

Operating income for segments

$ 2,195,052

$ 1,665,933

Corporate incentive agreements

301,110

300,000

Consolidation reclassifications

124,991

8,649

and equipment

108,657

11,375

Corporate expenses

(2,599,472)

(2,748,223)