Form
      10-Q


SECURITIES
      AND EXCHANGE COMMISSION


Washington,
      D.C. 20549








[X]
      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)


OF
      THE
      SECURITIES EXCHANGE ACT OF 1934





For
      the
      quarter ended September 30, 2005





OR





[
      ]
      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)


OF
      THE
      SECURITIES EXCHANGE ACT OF 1934





For
      the
      transition period from ______________ to ______________





Commission
      file number 333-102511





BRAND
      INTERMEDIATE HOLDINGS, INC.


(Exact
      name of registrant as specified in its charter)





Delaware
            13-3909682(State
                or other jurisdiction of incorporation or organization)
            (I.R.S.
                employer identification no.)15450
                South Outer 40, #270, Chesterfield, MO
            63017(Address
                of principal executive offices)
            (Zip
                Code)





Registrant’s
      telephone number, including area code: (636) 519-1000








Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the Registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days. Yes: [X] No: [ ]





Indicate
      by check mark whether the registrant is an accelerated filer (as defined in
      Rule
      12b-2 of the Exchange Act). Yes: [ ] No: [X]





Indicate
      the number of shares outstanding of each of the Registrant’s classes of Common
      Stock as of the latest practicable date.





Class
                of Common Stock
            Outstanding
                at November 14, 2005$.01
                Par Value
            1,000
                shares











INDEX





Page





PART
      I -
      FINANCIAL INFORMATION





Item
                1.
            Financial
                StatementsConsolidated
                Statements of Operations for the Three Months and Nine Months Ended
                September 30, 2004 and 2005
            3Consolidated
                Balance Sheets as of December 31, 2004 and September 30,
                2005
            4-5Consolidated
                Statements of Cash Flows for the Nine Months Ended September 30,
                2004 and
                2005
            6-7Notes
                to the Consolidated Financial Statements
            8-25Item
                2.
            Management’s
                Discussion and Analysis of Financial Condition and Results of
                Operations
            25-31Item
                3.
            Quantitative
                and Qualitative Disclosures About Market Risk
            31-32Item
                4.
            Controls
                and Procedures
            32





PART
      II -
      OTHER INFORMATION





Item
                1.
            Legal
                Proceedings
            33Item
                2.
            Changes
                in Securities and Use of Proceeds
            33Item
                3.
            Defaults
                Upon Senior Securities
            33Item
                4.
            Submission
                of Matters to a Vote of Security Holders
            33Item
                5.
            Other
                Information
            33Item
                6.
            Exhibits
            33





SIGNATURES
            
            34EXHIBITS
            
            35-38





-2-


PART
      I.
      FINANCIAL INFORMATION





ITEM
      1.
      FINANCIAL STATEMENTS








BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES


Consolidated
      Statements of Operations


(In
      thousands)


(Unaudited)





For
                the Three Months Ended September 30,
            
            For
                the Nine Months Ended September 30,2004
            
            2005
            
            2004
            
            2005Revenues:Labor
            
            $
            54,587
            
            $
            87,209
            
            $
            193,171
            
            $
            235,879Equipment rental
            
            
            15,148
            
            
            37,097
            
            
            48,674
            
            
            75,192Equipment sales
            
            
            1,695
            
            
            5,227
            
            
            4,709
            
            
            9,808Total
                revenues
            
            
            71,430
            
            
            129,533
            
            
            246,554
            
            
            320,879Operating
                expenses:Labor
            
            
            44,501
            
            
            73,435
            
            
            158,286
            
            
            195,637Equipment rental
            
            
            6,672
            
            
            13,537
            
            
            20,686
            
            
            27,493Equipment sales
            
            
            1,133
            
            
            2,860
            
            
            3,201
            
            
            5,964Divisional operating expenses
            
            
            4,089
            
            
            6,514
            
            
            12,433
            
            
            15,076Total operating expenses
            
            
            56,395
            
            
            96,346
            
            
            194,606
            
            
            244,170Gross profit
            
            
            15,035
            
            
            33,187
            
            
            51,948
            
            
            76,709Selling
                and administrative expenses
            
            
            10,942
            
            
            22,053
            
            
            33,583
            
            
            50,734Non-cash
                compensation
            
            
            56
            
            
            251
            
            
            145
            
            
            938Operating income
            
            
            4,037
            
            
            10,883
            
            
            18,220
            
            
            25,037Interest
                expense
            
            
            8,804
            
            
            11,096
            
            
            25,209
            
            
            28,140Interest
                income
            
            
            (87
            )
            
            (76
            )
            
            (188
            )
            
            (235
            )Preferred
                stock dividend expense
            
            
            -
            
            
            945
            
            
            -
            
            
            945Currency
                gain
            
            
            -
            
            
            (3,053
            )
            
            -
            
            
            (3,053
            )Income (loss) before income taxexpense
                (benefit)
            
            
            (4,680
            )
            
            1,971
            
            
            (6,801
            )
            
            (760
            )Income
                tax expense (benefit)
            
            
            (1,549
            )
            
            1,260
            
            
            (1,711
            )
            
            836Net loss
            
            $
            (3,131
            )
            $
            711
            
            $
            (5,090
            )
            $
            (1,596
            )

















The
      accompanying notes to the consolidated financial statements are an integral
      part
      of the consolidated financial statements.


-3-





BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES


Consolidated
      Balance Sheets


(In
      thousands)





December
                31,
              2004
            
            September
                30, 2005 (unaudited)ASSETSCURRENT
                ASSETS:Cash
                and cash equivalents
            
            $
            14,408
            
            $
            13,824Trade
                accounts receivable, net of allowance for doubtfulaccounts
                of $1,605 in 2004 and $5,140 in 2005
            
            
            56,639
            
            
            96,775Accrued
                revenue
            
            
            2,115
            
            
            13,680Notes
                receivable
            
            
            176
            
            
            1,711Other
                current assets
            
            
            8,847
            
            
            8,882Total
                current assets
            
            
            82,185
            
            
            134,872PROPERTY
                AND EQUIPMENT:Land
            
            
            1,283
            
            
            4,549Buildings
                and leasehold improvements
            
            
            3,518
            
            
            8,802Vehicles
                and other equipment
            
            
            29,090
            
            
            29,850Scaffolding
                equipment
            
            
            195,356
            
            
            334,085Total
                property and equipment, at cost
            
            
            229,247
            
            
            377,286Less-Accumulated
                depreciation and amortization
            
            
            59,554
            
            
            74,208Total
                property and equipment, net
            
            
            169,693
            
            
            303,078GOODWILL
            
            
            247,325
            
            
            276,691CUSTOMER
                RELATIONSHIPS
            
            
            43,794
            
            
            72,569OTHER
                ASSETS AND INTANGIBLES
            
            
            24,578
            
            
            42,011TOTAL
                ASSETS
            
            $
            567,575
            
            $
            829,221











(Continued
      on following page)





-4-




BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES


Consolidated
      Balance Sheets


(In
      thousands except share and per share amounts)








December
                31, 2004
            
            September
                30, 2005 (unaudited)LIABILITIES
                AND STOCKHOLDER’S EQUITYCURRENT
                LIABILITIES:Current
                maturities of long-term debt
            
            $
            1,047
            
            $
            2,906Notes
                payable and capital lease obligations, current portion
            
            
            350
            
            
            188Accounts
                payable and accrued expenses
            
            
            37,264
            
            
            71,269Deferred
                revenue
            
            
            1,514
            
            
            2,565Total
                current liabilities
            
            
            40,175
            
            
            76,928LONG-TERM
                DEBT
            
            
            290,467
            
            
            480,862REDEEMABLE
              PREFERRED STOCK
            
            
            -
            
            
            30,945NOTES
                PAYABLE AND CAPITAL LEASE OBLIGATIONS
            
            
            427
            
            
            275DEFERRED
                INCOME TAXES
            
            
            22,546
            
            
            23,553STOCKHOLDER’S
                EQUITY:Common
                stock, $0.01 par value, 1,000 shares authorized, issued andoutstanding
            
            
            -
            
            
            -Paid-in
                capital
            
            
            224,445
            
            
            225,382Cumulative
                foreign currency translation adjustment
            
            
            4,007
            
            
            7,364Accumulated
                deficit
            
            
            (14,492
            )
            
            (16,088
            )Total
                stockholder’s equity
            
            
            213,960
            
            
            216,658Total
                liabilities and stockholder’s equity
            
            $
            567,575
            
            $
            829,221











The
      accompanying notes to the consolidated financial statements are an integral
      part
      of the consolidated balance sheets.














-5-


BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES


Consolidated
      Statements of Cash Flows


(In
      thousands)


(Unaudited)





For
                the Nine Months Ended September 30,2004
            
            2005CASH
                FLOWS FROM OPERATING ACTIVITIES:Net
                loss
            
            $
            (5,090
            )
            $
            (1,596
            )Adjustments
                to reconcile net loss to net cash flows from
              operating
                activities:Depreciation
                and amortization
            
            
            21,440
            
            
            23,216Deferred
                income taxes
            
            
            (1,734
            )
            
            1,007Non-cash
                interest
            
            
            5,522
            
            
            6,196Non-cash
                preferred stock dividends
            
            
            -
            
            
            945Non-cash
                compensation
            
            
            145
            
            
            938Unrealized
                currency gain
            
            
            -
            
            
            (457
            )Gain
                on sale of scaffolding equipment
            
            
            (831
            )
            
            (2,283
            )Changes
                in operating assets and liabilities:Trade
                accounts receivable, net
            
            
            5,704
            
            
            (7,186
            )Accrued
                revenue
            
            
            (2,505
            )
            
            (8,982
            )Notes
                receivable
            
            
            463
            
            
            (1,535
            )Other
                current assets
            
            
            2,497
            
            
            3,384Accounts
                payable and accrued expenses
            
            
            8,206
            
            
            15,130Deferred
                revenue
            
            
            77
            
            
            (530
            )Other
            
            
            17
            
            
            (141
            )Net
                cash flows from operating activities
            
            
            33,911
            
            
            28,106CASH
                FLOWS FROM INVESTING ACTIVITIES:Purchase
                of property and equipment
            
            
            (9,920
            )
            
            (22,778
            )Proceeds
                from sale of property and equipment
            
            
            1,624
            
            
            3,718Payments
                for acquisitions
            
            
            (951
            )
            
            (217,626
            )Net
                cash flows used in investing activities
            
            
            (9,247
            )
            
            (236,686
            )CASH
                FLOWS FROM FINANCING ACTIVITIES:Repayments
                of long-term debt
            
            
            (20,836
            )
            
            (1,247
            )Proceeds
                from long-term debt
            
            
            -
            
            
            185,153Proceeds
                from redeemable preferred stock
            
            
            -
            
            
            30,000Payments
                of deferred financing fees
            
            
            (927
            )
            
            (5,596
            )Payments
                on capital lease obligations
            
            
            (549
            )
            
            (314
            )Net
                cash flows provided by (used in) financing activities
            
            
            (22,312
            )
            
            207,996NET
                INCREASE (DECREASE) IN CASH AND CASHEQUIVALENTS
            
            
            2,352
            
            
            (584
            )CASH
                AND CASH EQUIVALENTS, beginning of period
            
            
            23,100
            
            
            14,408CASH
                AND CASH EQUIVALENTS, end of period
            
            $
            25,452
            
            $
            13,824





(Continued
      on following page)


-6-


BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES


Consolidated
      Statements of Cash Flows


(In
      thousands)


(Unaudited)





For
                the Nine Months Ended September 30,2004
            
            2005SUPPLEMENTAL
                CASH FLOW DISCLOSURES:Interest
                paid
            
            $
            14,645
            
            $
            18,400Income
                taxes paid
            
            
            1,977
            
            
            1,477NON-CASH
                TRANSACTIONS:Capital
                Lease obligations
            
            
            259
            
            
            128Note
                payable issued for acquisition
            
            
            393
            
            
            335







































































The
      accompanying notes to the consolidated financial statements are an integral
      part
      of the consolidated financial statements.


-7-





BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES





Notes
      to
      the Consolidated Financial Statements


(Unaudited)





The
      financial statements included herein for the periods ended September 30, 2004
      and 2005 have been prepared by the Company without an audit. In the opinion
      of
      management, all adjustments have been made which are of a normal recurring
      nature necessary to present fairly the Company’s financial position as of
      September 30, 2005, and the results of operations and cash flows for the three
      months and nine months ended September 30, 2004 and 2005. Certain information
      and footnote disclosures have been condensed or omitted for these periods.
      The
      results for interim periods are not necessarily indicative of results for the
      entire year. Reference is made to the notes to the consolidated financial
      statements contained in the Company’s Annual Report on Form 10-K for the year
      ended December 31, 2004, filed with the Securities and Exchange
      Commission.





1.
            Organization
                and Business





Brand
      Intermediate Holdings, Inc. and its subsidiaries ("Brand") are 100% owned by
      Brand Holdings LLC (the "LLC"). As of September 30, 2005, the voting equity
      interests of the LLC are owned 73.0% by J.P. Morgan Partners and its affiliates
      ("JPMP") and 27.0% by other equity investors on a fully diluted basis. Brand
      Services, Inc. is a wholly owned subsidiary of Brand Intermediate Holdings,
      Inc.
      All references to "the Company", "we", "us", or "our" mean Brand Intermediate
      Holdings, Inc. and its subsidiaries.





The
      Company operates and provides scaffolding services primarily to refining,
      petrochemical, chemical, utility and pulp and paper industries, and to a lesser
      extent general commercial clients. Scaffolding services are typically provided
      in connection with periodic, routine maintenance of refineries, chemical plants
      and utilities, as well as for new construction and renovation projects. The
      Company provides personnel to erect and dismantle scaffolding structures,
      transport scaffolding to project sites and supervise and manage such activities.
      In addition, the Company rents and occasionally sells scaffolding that is
      classified as property and equipment on the consolidated balance sheets. The
      Company maintains a substantial inventory of scaffolding in the United States
      and Canada.




The Company has recently entered the forming
      and
      shoring business as a result of the Aluma acquisition. The forming and shoring
      business for the three and nine months ended September 30, 2005 were not
      material to our operations.





2.
            Summary
                of Significant Accounting Policies





The
      accompanying financial statements are prepared on a consolidated basis and
      include those assets, liabilities, revenues and expenses directly attributable
      to the operations of the Company. All significant intercompany balances and
      transactions have been eliminated.





The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States requires management to make estimates
      and assumptions that affect the reported amounts of assets and liabilities,
      the
      disclosure of contingent assets and liabilities at the date of the financial
      statements and the reported amounts of revenues and expenses during the
      reporting period. Actual results could differ from those estimates.





3.
            Stock
                Based Employee Compensation





Effective
      January 1, 2004, the Company adopted the fair value recognition provisions
      of
      Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting for
      Stock-Based Compensation". The Company selected the modified prospective
      transition method under the provisions of SFAS No. 148, "Accounting for
      Stock-Based Compensation-Transition and Disclosure," which requires expensing
      options prospectively, beginning in the year of adoption. The Company expensed
      $251 and $56, for the three month periods ended September 30, 2005 and 2004,
      respectively. The Company expensed $938 and $145, for the nine month periods
      ended September 30, 2005 and 2004, respectively, recorded in the caption
      Non-cash compensation.


-8-





4.
            Accrued
                Revenue





Accrued
      revenue represents work performed which either due to billing cycles, contract
      stipulations or lacking contractual documentation requirements, could not be
      billed. Substantially all unbilled amounts are expected to be billed and
      collected within one year.





5.
            Debt
                and Borrowing Arrangements





At
      December 31, 2004 and September 30, 2005, long-term debt consisted of the
      following (in thousands):




December
                31, 2004
            
            September
                30, 2005 (unaudited)Credit
                Facility, due 2009
            
            $
            102,615
            
            $
            -Amended
                Credit Facility, due 2012
            
            
            -
            
            
            289,93412%
                Senior Subordinated Notes, due 2012
            
            
            150,000
            
            
            150,00013%
                Intermediate Subordinated Notes, due 2013
            
            
            46,249
            
            
            50,798298,864
            
            
            490,732LessCurrent
                portion
            
            
            1,047
            
            
            2,906Unamortized
                discount
            
            
            7,350
            
            
            6,964$
            290,467
            
            $
            480,862





On
      July
      29, 2005, the Company amended and restated its existing credit facility with
      Credit Suisse (formerly known as Credit Suisse First Boston, acting through
      its
      Cayman Islands Branch), as administrative agent, and other institutions, to
      provide for supplemental term loans in the aggregate principal amount of $185
      million. As amended and restated, the credit facility consists of $287.0 million
      in aggregate principal amount of term loans, a letter of credit facility of
      $20
      million, a synthetic letter of credit facility of $15 million and a revolving
      credit facility of $50 million. The supplemental term loan included
      $57 million of debt in Canadian dollar equivalents




Indebtedness
      under the credit facility for US dollar loans bears interest at a floating
      rate
      based upon (i) the Base Rate (as defined in the credit agreement) in
      each
      case, plus 2.25%, in the case of revolving loans, 2.75%, in the case of letter
      of credit facility loans, or 2.00%, in the case of synthetic letter of credit
      facility loans and term loans, or, at our option, (ii) the LIBOR Rate (as
      defined in the credit agreement) for one, two, three or six month period, (or
      a
      nine or twelve month period if, at the time of the relevant LIBOR Rate Loan,
      all
      Lenders participation therein agree to make an interest period of such duration
      available) plus 3.50%, in the case of revolving loans, 4.00%, in the case of
      letter of credit facility loans or 3.00%, in the case of synthetic letter of
      credit facility loans and term loans. Indebtedness under the credit facility
      for
      Canadian dollar loans bears interest at (i) in the case of Canadian prime rate
      loans, a floating rate based upon the Canadian Prime Rate (as defined in the
      credit agreement), plus 2.25% or, at our option, (ii) in the case of bankers’
      acceptance loans, Brand will pay a fee at the rate of 3.25% calculated on the
      basis of a year of 365 days on the face amount at maturity (or the principal
      amount in the case of a bankers’ acceptance equivalent loan) of such bankers’
      acceptance for the period from and including the date of acceptance (or advance
      in the case of a bankers’ acceptance equivalent loan) of such bankers’
      acceptance to but excluding the maturity date of such bankers’ acceptance. The
      interest period for bankers’ acceptance loans is a 30, 60, 90 or 180 day period
      (in each case subject to availability). The interest rate for loans under the
      revolving credit facility and the letter of credit facility is subject to
      adjustment on a quarterly basis, based on the ratio of our consolidated debt
      to
      EBITDA (as defined).




-9-


The
      revolving facility will mature in October 2008. The term loan will mature in
      January 2012. The term loan is subject to nominal quarterly amortization
      payments, with the balance payable in equal installments on the maturity date.
      In addition, the credit agreement will provide for mandatory repayments, subject
      to certain exceptions, of the term loan based on certain asset sales, the net
      proceeds of certain debt and equity issuances, excess cash flow and insurance
      proceeds.




The
      amended credit agreement contains financial and operating covenants,
      including among other things, that the Company maintain certain financial
      ratios, and imposes limitations on the Company's ability to make capital
      expenditures to incur indebtedness, and to pay dividends. The Company was in
      compliance with all loan covenants at September 30, 2005.




For
      the
      three and nine months ended September 30, 2004, the weighted-average interest
      rate of loans outstanding under the Credit Facility was 4.8% and 4.6%,
      respectively. For the three and nine months ended September 30, 2005, the
      weighted-average interest rate of loans outstanding under the Credit Facility
      was 6.3% and 6.5%, respectively.





6.
            Deferred
                Revenue





Deferred
      revenue represents amounts collected from customers at a faster rate than work
      was performed on these contracts. Substantially all of the costs related to
      these amounts will be incurred within one year.




-10-





7.
            Commitments
                and Contingencies





In
      the
      ordinary course of conducting its business, the Company becomes involved in
      various pending claims and lawsuits. These primarily relate to employee matters.
      The outcome of these matters is not presently determinable. However, in the
      opinion of management, based on the advice of legal counsel, the resolution
      of
      these matters is not anticipated to have a material adverse effect on the
      financial position or results of operations of the Company.





8.
            Comprehensive
                Income





For
      the
      three months ended September 30, 2004 and 2005, comprehensive income (loss)
      was
      $(2.3) million and $4.4 million, respectively. For the nine months ended
      September 30, 2004 and 2005, comprehensive income (loss) was $(4.7) million
      and
      $1.8 million, respectively. The difference between comprehensive income and
      net
      income is entirely related to foreign currency translation.





9.
            Income
                Taxes





Deferred
      income taxes reflect the tax effects of temporary differences between the
      carrying amounts of assets and liabilities for financial reporting purposes
      and
      the amounts used for income tax purposes. For the nine months ended September
      30, 2004, the effective tax rate benefit of 25% is less than the federal
      statutory rate of 35% primarily due to permanent tax items, the largest of
      which
      is a portion of the interest expense on the 13% Intermediate Subordinated Notes
      which is not deductible for tax purposes. For the nine months ended September
      30, 2005, the effective tax rate provision of 110% is more than
      the
      federal statutory rate of 35% primarily due to the increased pretax income
      of
      the Canadian subsidiaries related to the Aluma acquisition. For the three months
      ended September 30, 2004, the effective tax rate benefit of 33% is less than
      the
      federal statutory rate of 35% primarily due to the permanent tax items mentioned
      above. For the three months ended September 30, 2005, the effective tax rate
      provision of 64% is greater than the federal statutory rate of 35% primarily
      due
      to the increased pretax income of the Canadian subsidiaries related to the
      Aluma
      acquisition, as mentioned above.




10.
      Acquisition





On
      July
      29, 2005, the Company purchased substantially all of the operations and the
      net
      operating assets of Aluma Enterprises, Inc. ("Aluma"), as defined by the
      terms
      of the Asset Purchase Agreement dated May 19, 2005. The purpose of the
      transaction was to expand the Company's market position in Canada
      and obtain entry into the forming and shoring business. The results
      of
      Aluma are included in the Company’s consolidated financial statements from July
      29, 2005 to September 30, 2005.





The
      purchase price paid for this acquisition was as follows:





Cash
                paid
            
            $
            209,482Direct
                acquisition costs
            
            
            5,712$
            215,194Liabilities
                assumed
            
            
            22,888Total
                purchase price
            
            $
            238,082




Included
      in the total purchase price is $3.0 million of severance related costs and
      contingent consideration. The affected employees were notified of their
      termination concurrent with the closing of the transaction and payments for
      the
      severance-related costs were made on the date of the acquisition. The contingent
      consideration relates to change in control payments assumed by the Company
      that
      were earned by former Aluma executives that have accepted executive positions
      with the Company.




The
      acquisition was principally financed through borrowings under the Company’s
      amended and restated secured credit facility (Note 5) and through the issuance
      of the Company’s redeemable preferred stock (Note 11).





The
      Company obtained a preliminary independent third-party valuation of tangible
      and
      identifiable intangible assets, which consists of patents, trademarks and
      customer relationships. The excess of the total purchase price over the fair
      value of the assets acquired, including the value of the identifiable intangible
      assets, has been allocated to goodwill. These fair values are based on
      preliminary information and are subject to change.




-11-




The
      following table presents the estimated fair values of the assets acquired and
      the amount allocated to goodwill:





Current
                assets
            
            
            
            
            $
            38,961Property
                and equipment
            
            
            
            
            
            126,595Identifiable
                intangible assets:Customer
                relationships
            
            $
            30,760Patents
            
            
            344Trademarks
            
            
            12,27343,377Total
                fair value of assets acquired
            
            
            
            
            $
            208,933Goodwill
            
            
            
            
            
            29,149Total
                purchase price
            
            
            
            
            $
            238,082





The
      Company is amortizing customer relationships over twelve years and patents
      over
      the life of the related patent. Trademarks will not be amortized as this
      intangible asset has an indefinite life.





The
      following pro forma information assumes the acquisition occurred as of the
      beginning of each period presented. The pro forma results are not necessarily
      indicative of what actually would have occurred had the acquisition been in
      effect for the periods presented. In addition, they are not intended to be
      a
      projection of future results that may be achieved from the combined
      operations.


For
                  the Three Months Ended September 30,
              
              For
                  the Nine Months Ended September 30,2004
              
              2005
              
              2004
              
              2005Revenues
              
              $
              127,493
              
              $
              150,070
              
              $
              394,647
              
              $
              467,871Operating
                  income
              
              
              6,953
              
              
              6,984
              
              
              25,928
              
              
              29,036Pre-tax
                  income (loss)
              
              
              (2,021
              )
              
              (4,055
              )
              
              (11,992
              )
              
              (8,695
              )Net
                  income (loss)
              
              
              (2,005
              )
              
              (3,224
              )
              
              (10,029
              )
              
              (7,588
              )


On
        June
        1, 2004, the Company purchased the assets of Levitator, Inc., a commercial
        scaffolding company, for an aggregate purchase price of approximately $1.0
        million in cash and a $0.4 million note payable. The price was allocated
        to the
        assets and liabilities assumed, based on relative fair values. In connection
        with the acquisition, the Company recorded goodwill of approximately $0.2
        million. The acquisition was accounted for using the purchase method of
        accounting, and accordingly has been included in the financial statements
        from
        the date of the acquisition.




11.
            Redeemable
                Preferred Stock




On
      July
      29, 2005, the Company issued and sold to J.P. Morgan Partners Global Investors,
      L.P., J.P. Morgan Partners Global Investors (Cayman), L.P., J.P. Morgan Partners
      Global Investors A, L.P., J.P. Morgan Partners Global Investors (Cayman) II,
      L.P., J.P. Morgan Partners (BHCA), L.P. and J.P. Morgan Partners Global
      Investors (Selldown), L.P. $30.0 million aggregate liquidation value of its
      Series A Preferred Capital Stock.





Dividends
      on the preferred stock accrue cumulatively on a daily basis at a rate of 18%
      per
      annum (computed on the basis of a 360-day year of twelve 30-day months) on
      the
      liquidation value of the preferred stock. The dividend rate will increase (a) by
      0.25% each quarter after the occurrence of certain events of default,
      up to
      a maximum rate of 20.0% per annum and (b) to 20% per annum after a default
      in
      any payment due on the preferred stock.





The
      preferred stock is required to be redeemed by Brand Intermediate Holdings,
      Inc.
      on October
      16, 2014 at their
      liquidation value or upon the occurrence of a change of control at 101% of
      their
      liquidation value. Prior
      to
      July 1, 2008, the preferred stock may be redeemed at the option of Brand
      Intermediate Holdings, Inc. at a redemption price equal to the sum of the
      present values of 109% of the aggregate liquidation value of the preferred
      stock
      to and including July 1, 2008, discounted to the date of redemption on a
      quarterly basis (assuming a 360-day year consisting of twelve 30-day months)
      at
      the U.S. Treasury rate plus 50 basis points, together with, in each case,
      accrued and unpaid dividends, if any at redemption date.


-12-





After
      July 1, 2008, the preferred stock may be redeemed at the option of Brand
      Intermediate Holdings, Inc., at the following redemption prices (expressed
      as
      percentages of the liquidation value thereof), plus, in each case, accrued
      and
      unpaid dividends to the date of redemption, if any:





Period
                in which redemption occurs
            
            PercentageJuly
                1, 2008 through (and including) June 30, 2009
            
            109%July
                1, 2009 through (and including) June 30, 2010
            
            104.5%July
                1, 2010 through (and including) June 30, 2011
            
            102.25%Thereafter
            
            100%





Because
      the preferred stock has mandatory redemptions terms, it is accounted for as
      a
      long-term liability and the related accrued dividends are recorded as preferred
      stock dividend expense.





12.
      New
      Accounting Standards




On
      December 16, 2004, the Financial Accounting Standards Board (FASB) issued FASB
      Statement No. 123 (revised 2004), Share-Based Payment, which is a revision
      of
      FASB Statement No. 123, Accounting for Stock-Based Compensation. Statement
      123(R) supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees,
      and amends FASB Statement No. 95, Statement of Cash Flows. Generally, the
      approach in Statement 123(R) is similar to the approach described in Statement
      123.  However, Statement 123(R) requires all share-based payments to
      employees, including grants of employee stock options, to be recognized in
      the
      income statement based on their fair values. Pro forma disclosure is no longer
      an alternative. We expect to adopt Statement 123(R) on January 1, 2006
      using the modified-prospective method.




The
      Company adopted the fair-value-based method of accounting for share-based
      payments effective January 1, 2004 using the "modified prospective method"
      described in FASB Statement No. 148, Accounting for Stock-Based
      Compensation-Transition and Disclosure.  Currently, the Company uses
      the
      minimal value method of the Black-Scholes formula to estimate the value of
      stock
      options granted to employees. The minimal value method is not allowable under
      Statement 123(R), and the Company is currently researching other acceptable
      methods. The Company does not anticipate that adoption of Statement 123(R)
      will
      have a material impact on its results of operations or its financial
      position.




13.
            Supplemental
                Consolidating Information




The
      12%
      Senior Notes, which are an obligation of Brand Services, Inc. are fully and
      unconditionally guaranteed on a senior subordinated, joint, and several basis
      by
      the other domestic subsidiaries of Brand Intermediate Holdings (which are all
      100% owned by Brand Intermediate Holdings) and by Brand Intermediate Holdings,
      Inc. Supplemental consolidating information of Brand Intermediate Holdings,
      Inc., Brand Services, Inc., the guarantor subsidiaries, and its foreign
      non-guarantor subsidiaries is presented below. Investments in subsidiaries
      are
      presented on the equity method of accounting. Separate financial statements
      are
      not provided because management has concluded that the summarized financial
      information below provides sufficient information to allow investors to
      separately determine the nature of the assets held by and the operations of
      the
      guarantor and non-guarantor subsidiaries.




-13-




**BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





Brand
                Intermediate Holdings, Inc.Condensed
                Consolidating Balance SheetDecember
                31, 2004**Assets**
            
            **Brand**
              **Services,
                Inc.**
            
            **Guarantor
                Subsidiaries**
            
            **Non-Guarantor
                Subsidiary**
            
            **Brand
                Intermediate Holdings, Inc.**
            
            **Adjustments
                and Eliminations**
            
            **Brand
                Intermediate Holdings, Inc. Consolidated**Current
                Assets:Cash
                and cash equivalents
            
            $
            13,336
            
            $
            —
            
            $
            1,525
            
            $
            —
            
            $
            (453
            )
            $
            14,408Trade
                accounts receivable
            
            
            —
            
            
            52,626
            
            
            4,013
            
            
            —
            
            
            —
            
            
            56,639Accrued
                revenue
            
            
            —
            
            
            1,967
            
            
            148
            
            
            —
            
            
            —
            
            
            2,115Notes
                receivable, current portion
            
            
            15
            
            
            161
            
            
            —
            
            
            —
            
            
            —
            
            
            176Other
                current assets
            
            
            2,865
            
            
            5,614
            
            
            368
            
            
            —
            
            
            —
            
            
            8,847Due
                from affiliates
            
            
            31,648
            
            
            1,649
            
            
            -
            
            
            —
            
            
            (33,297
            )
            
            —Total
                current assets
            
            
            47,864
            
            
            62,017
            
            
            6,054
            
            
            —
            
            
            (33,750
            )
            
            82,185Property
                and Equipment:Land
            
            
            —
            
            
            866
            
            
            417
            
            
            —
            
            
            —
            
            
            1,283Buildings
                and leasehold improvements
            
            
            13
            
            
            3,080
            
            
            425
            
            
            —
            
            
            —
            
            
            3,518Vehicles
                and other equipment
            
            
            6,726
            
            
            17,866
            
            
            4,498
            
            
            —
            
            
            —
            
            
            29,090Scaffolding
                equipment
            
            
            179,859
            
            
            —
            
            
            15,497
            
            
            —
            
            
            —
            
            
            195,356Total
                property and equipment, at cost
            
            
            186,598
            
            
            21,812
            
            
            20,837
            
            
            —
            
            
            —
            
            
            229,247Less
                accumulated depreciation and amortization
            
            
            41,650
            
            
            11,292
            
            
            6,612
            
            
            —
            
            
            —
            
            
            59,554Total
                property and equipment, net
            
            
            144,948
            
            
            10,520
            
            
            14,225
            
            
            —
            
            
            —
            
            
            169,693Due
                from affiliates
            
            
            9,750
            
            
            —
            
            
            —
            
            
            46,752
            
            
            (56,502
            )
            
            —Deferred
                tax asset
            
            
            —
            
            
            —
            
            
            —
            
            
            2,375
            
            
            (2,375
            )
            
            —Investment
                in subsidiaries
            
            
            —
            
            
            —
            
            
            —
            
            
            206,481
            
            
            (206,481
            )
            
            —Goodwill
            
            
            247,325
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            247,325Customer
                Relationships
            
            
            43,794
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            43,794Intangibles
                and other assets
            
            
            23,671
            
            
            —
            
            
            —
            
            
            907
            
            
            —
            
            
            24,578Total
                assets
            
            $
            517,352
            
            $
            72,537
            
            $
            20,279
            
            $
            256,515
            
            $
            (299,108
            )
            $
            567,575





-14-





**BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**





Brand
                Intermediate Holdings, Inc.Condensed
                Consolidating Balance SheetDecember
                31, 2004 (continued)**Liabilities
                and Stockholder’s Equity (Deficit)**
            **Brand**
              **Services,
                Inc.**
            
            **Guarantor
                Subsidiaries**
            
            **Non-Guarantor
                Subsidiary**
            
            **Brand
                Intermediate Holdings, Inc.**
            
            **Adjustments**
              **and
                Eliminations**
            
            **Brand
                Intermediate Holdings, Inc. Consolidated**Current
                Liabilities:Revolving
                loan
            
            $
            —
            
            $
            —
            
            $
            —
            
            $
            —
            
            $
            —
            
            $
            —Current
                maturities of long-term debt
            
            
            1,047
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            1,047Notes
                payable and capital lease obligations, current portion
            
            
            265
            
            
            85
            
            
            —
            
            
            —
            
            
            —
            
            
            350Accounts
                payable and accrued expenses
            
            
            27,532
            
            
            6,397
            
            
            3,788
            
            
            —
            
            
            (453
            )
            
            37,264Deferred
                revenue
            
            
            —
            
            
            1,514
            
            
            —
            
            
            —
            
            
            —
            
            
            1,514Due
                to affiliates
            
            
            1,649
            
            
            25,109
            
            
            6,539
            
            
            —
            
            
            (33,297
            )
            
            —Total
                current liabilities
            
            
            30,493
            
            
            33,105
            
            
            10,327
            
            
            —
            
            
            (33,750
            )
            
            40,175Long-term
                debt
            
            
            247,912
            
            
            —
            
            
            —
            
            
            42,555
            
            
            —
            
            
            290,467Notes
                payable and capital lease obligations
            
            
            336
            
            
            91
            
            
            —
            
            
            —
            
            
            —
            
            
            427Deferred
                income taxes
            
            
            21,882
            
            
            4
            
            
            3,035
            
            
            —
            
            
            (2,375
            )
            
            22,546Due
                to affiliates
            
            
            46,752
            
            
            —
            
            
            9,750
            
            
            —
            
            
            (56,502
            )
            
            —Total
                stockholder’s equity (deficit)
            
            
            169,977
            
            
            39,337
            
            
            (2,833
            )
            
            213,960
            
            
            (206,481
            )
            
            213,960Total
                liabilities and stockholder’s equity (deficit)
            
            $
            517,352
            
            $
            72,537
            
            $
            20,279
            
            $
            256,515
            
            $
            (299,108
            )
            $
            567,575








-15-


**BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**




Brand
                  Intermediate Holdings, Inc.Condensed
                  Consolidating Balance SheetSeptember
                  30, 2005**Assets**
              
              **Brand**
                **Services,
                  Inc.**
              
              **Guarantor
                  Subsidiaries**
              
              **Non-Guarantor
                  Subsidiary**
              
              **Brand
                  Intermediate Holdings, Inc.**
              
              **Adjustments**
                **and**
                **Eliminations**
              
              **Brand
                  Intermediate Holdings, Inc. Consolidated**Current
                  Assets:Cash
                  and cash equivalents
              
              $
              3,254
              
              $
              -
              
              $
              11,362
              
              $
              -
              
              $
              (792
              )
              $13,824Trade
                  accounts receivable
              
              
              -
              
              
              68,490
              
              
              28,285
              
              
              -
              
              
              -
              
              96,775Accrued
                  revenue
              
              
              -
              
              
              11,292
              
              
              2,388
              
              
              -
              
              
              -
              
              13,680Notes
                  receivable, current portion
              
              
              15
              
              
              -
              
              
              1,696
              
              
              -
              
              
              -
              
              1,711Other
                  current assets
              
              
              2,078
              
              
              3,770
              
              
              3,034
              
              
              -
              
              
              -
              
              8,882Due
                  from affiliates
              
              
              27,684
              
              
              3,684
              
              
              -
              
              
              -
              
              
              (31,368
              )
              -Total
                  current assets
              
              
              33,031
              
              
              87,236
              
              
              46,765
              
              
              -
              
              
              (32,160
              )
              134,872Property
                  and Equipment:Land
              
              
              -
              
              
              1,587
              
              
              2,962
              
              
              -
              
              
              -
              
              4,549Buildings
                  and leasehold improvements
              
              
              13
              
              
              4,986
              
              
              3,803
              
              
              -
              
              
              -
              
              8,802Vehicles
                  and other equipment
              
              
              7,513
              
              
              19,309
              
              
              3,028
              
              
              -
              
              
              -
              
              29,850Scaffolding
                  equipment
              
              
              193,301
              
              
              54,162
              
              
              86,622
              
              
              -
              
              
              -
              
              334,085Total
                  property and equipment, at cost
              
              
              200,827
              
              
              80,044
              
              
              96,415
              
              
              -
              
              
              -
              
              377,286Less
                  accumulated depreciation and amortization
              
              
              54,107
              
              
              14,289
              
              
              5,812
              
              
              -
              
              
              -
              
              74,208Total
                  property and equipment, net
              
              
              146,720
              
              
              65,755
              
              
              90,603
              
              
              -
              
              
              -
              
              303,078Due
                  from affiliates
              
              
              113,688
              
              
              -
              
              
              -
              
              
              51,506
              
              
              (165,194
              )
              -Deferred
                  tax asset
              
              
              -
              
              
              -
              
              
              -
              
              
              2,375
              
              
              (2,375
              )
              -Investment
                  in subsidiaries
              
              
              110,350
              
              
              -
              
              
              -
              
              
              239,534
              
              
              (349,884
              )
              -Goodwill
              
              
              247,325
              
              
              824
              
              
              28,542
              
              
              -
              
              
              -
              
              276,691Customer
                  relationships
              
              
              40,425
              
              
              37
              
              
              32,107
              
              
              -
              
              
              -
              
              72,569Other
                  assets and intangibles
              
              
              27,396
              
              
              3,641
              
              
              9,518
              
              
              1,456
              
              
              -
              
              42,011Total
                  assets
              
              $
              718,935
              
              $
              157,493
              
              $
              207,535
              
              $
              294,871
              
              $
              (549,613
              )
              $829,221


-16-


**BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**





Brand
                Intermediate Holdings, Inc.Condensed
                Consolidating Balance SheetSeptember
                30, 2005 (Continued)**Liabilities
                and Stockholder’s Equity**
            
            **Brand
                Services, Inc.**
            
            **Guarantor
                Subsidiaries**
            
            **Non-Guarantor
                Subsidiary**
            
            **Brand
                Intermediate Holdings, Inc.**
            
            **Adjustments
                and Eliminations**
            
            **Brand
                Intermediate Holdings, Inc. Consolidated**Current
                Liabilities:Current
                maturities of long-term debt
            
            $
            2,906
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            2,906Notes
                payable and capital lease obligations, current portion
            
            
            100
            
            
            88
            
            
            -
            
            
            -
            
            
            -
            
            
            188Accounts
                payable and accrued expenses
            
            
            36,350
            
            
            18,954
            
            
            16,757
            
            
            -
            
            
            (792
            )
            
            71,269Deferred
                revenue
            
            
            -
            
            
            1,440
            
            
            1,125
            
            
            -
            
            
            -
            
            
            2,565Due
                to affiliates
            
            
            3,684
            
            
            17,444
            
            
            10,240
            
            
            -
            
            
            (31,368
            )
            
            -Total
                current liabilities
            
            
            43,040
            
            
            37,926
            
            
            28,122
            
            
            -
            
            
            (32,160
            )
            
            76,928Long-term
                debt
            
            
            433,594
            
            
            -
            
            
            -
            
            
            47,268
            
            
            
            
            
            480,862Redeemable
              Preferred stock
            
            
            -
            
            
            -
            
            
            -
            
            
            30,945
            
            
            -
            
            
            30,945Notes
                payable and capital lease obligations
            
            
            253
            
            
            22
            
            
            
            
            
            -
            
            
            
            
            
            275Deferred
                income taxes
            
            
            20,542
            
            
            -
            
            
            5,386
            
            
            -
            
            
            (2,375
            )
            
            23,553Due
                to affiliates
            
            
            51,506
            
            
            -
            
            
            113,688
            
            
            -
            
            
            (165,194
            )
            
            -Total
                stockholder’s equity (deficit)
            
            
            170,000
            
            
            119,545
            
            
            60,339
            
            
            216,658
            
            
            (349,884
            )
            
            216,658Total
                liabilities and stockholder’s equity (deficit)
            
            $
            718,935
            
            $
            157,493
            
            $
            207,535
            
            $
            294,871
            
            $
            (549,613
            )
            $
            829,221













-17-


**BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**





Brand
                Intermediate Holdings, Inc.Condensed
                Consolidating Statement of OperationsFor
                the Three Months Ended September 30, 2004**Brand**
              **Services,
                Inc.**
            
            **Guarantor
                Subsidiaries**
            
            **Non-Guarantor
                Subsidiary**
            
            **Brand
                Intermediate Holdings, Inc.**
            
            **Adjustments**
              **and**
              **Eliminations**
            
            **Brand
                Intermediate Holdings, Inc. Consolidated**Revenue:Labor
            
            $
            -
            
            $
            50,763
            
            $
            3,824
            
            $
            -
            
            $
            -
            
            $
            54,587Equipment
                rental
            
            
            -
            
            
            14,402
            
            
            746
            
            
            -
            
            
            -
            
            
            15,148Equipment
                sales
            
            
            -
            
            
            1,550
            
            
            361
            
            
            -
            
            
            (216
            )
            
            1,695Intercompany
                revenue
            
            
            4,721
            
            
            32
            
            
            -
            
            
            -
            
            
            (4,753
            )
            
            -Total
                revenues
            
            
            4,721
            
            
            66,747
            
            
            4,931
            
            
            -
            
            
            (4,969
            )
            
            71,430Operating
                expenses:Labor
            
            
            -
            
            
            42,441
            
            
            3,420
            
            
            -
            
            
            (1,360
            )
            
            44,501Equipment
                rental
            
            
            5,252
            
            
            1,052
            
            
            368
            
            
            -
            
            
            -
            
            
            6,672Equipment
                sales
            
            
            -
            
            
            1,207
            
            
            376
            
            
            -
            
            
            (450
            )
            
            1,133Divisional
                operating expenses
            
            
            59
            
            
            3,892
            
            
            138
            
            
            -
            
            
            -
            
            
            4,089Intercompany
                operating expenses
            
            
            -
            
            
            4,721
            
            
            32
            
            
            -
            
            
            (4,753
            )
            
            -Total
                operating expenses
            
            
            5,311
            
            
            53,313
            
            
            4,334
            
            
            -
            
            
            (6,563
            )
            
            56,395Gross
                profit (loss)
            
            
            (590
            )
            
            13,434
            
            
            597
            
            
            -
            
            
            1,594
            
            
            15,035Selling
                and administrative expenses
            
            
            3,358
            
            
            7,256
            
            
            328
            
            
            -
            
            
            -
            
            
            10,942Non-cash
                compensation
            
            
            56
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            56Operating
                income (loss)
            
            
            (4,004
            )
            
            6,178
            
            
            269
            
            
            -
            
            
            1,594
            
            
            4,037Interest
                expense
            
            
            7,387
            
            
            (24
            )
            
            -
            
            
            1,441
            
            
            -
            
            
            8,804Interest
                income
            
            
            (84
            )
            
            -
            
            
            (3
            )
            
            -
            
            
            -
            
            
            (87
            )Intercompany
                interest
            
            
            1,441
            
            
            -
            
            
            -
            
            
            (1,441
            )
            
            -
            
            
            -Equity
                in loss (income) of subsidiaries
            
            
            -
            
            
            -
            
            
            -
            
            
            3,131
            
            
            (3,131
            )
            
            -Income
                (loss) before income tax expense (benefit)
            
            
            (12,748
            )
            
            6,202
            
            
            272
            
            
            (3,131
            )
            
            4,725
            
            
            (4,680
            )Income
                tax expense (benefit)
            
            
            (4,151
            )
            
            2,481
            
            
            121
            
            
            -
            
            
            -
            
            
            (1,549
            )Net
                income (loss)
            
            $
            (8,597
            )
            $
            3,721
            
            $
            151
            
            $
            (3,131
            )
            $
            4,725
            
            $
            (3,131
            )





-18-


**BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**





Brand
                Intermediate Holdings, Inc.Condensed
                Consolidating Statement of OperationsFor
                the Three Months Ended September 30, 2005**Brand**
              **Services,
                Inc.**
            
            **Guarantor
                Subsidiaries**
            
            **Non-Guarantor
                Subsidiary**
            
            **Brand
                Intermediate Holdings, Inc.**
            
            **Adjustments**
              **and**
              **Eliminations**
            
            **Brand
                Intermediate Holdings, Inc. Consolidated**Revenue:Labor
            
            $
            -
            
            $
            64,206
            
            $
            23,003
            
            $
            -
            
            $
            -
            
            $
            87,209Equipment
                rental
            
            
            -
            
            
            24,232
            
            
            12,865
            
            
            -
            
            
            -
            
            
            37,097Equipment
                sales
            
            
            -
            
            
            2,708
            
            
            3,083
            
            
            -
            
            
            (564
            )
            
            5,227Intercompany
                revenue
            
            
            6,307
            
            
            53
            
            
            -
            
            
            -
            
            
            (6,360
            )
            
            -Total
                revenues
            
            
            6,307
            
            
            91,199
            
            
            38,951
            
            
            -
            
            
            6,924
            
            
            129,533Operating
                expenses:Labor
            
            
            -
            
            
            53,971
            
            
            20,127
            
            
            -
            
            
            (663
            )
            
            73,435Equipment
                rental
            
            
            4,727
            
            
            4,018
            
            
            4,792
            
            
            -
            
            
            -
            
            
            13,537Equipment
                sales
            
            
            -
            
            
            1,924
            
            
            1,664
            
            
            -
            
            
            (728
            )
            
            2,860Divisional
                operating expenses
            
            
            11
            
            
            5,820
            
            
            683
            
            
            -
            
            
            -
            
            
            6,514Intercompany
                operating expenses
            
            
            -
            
            
            6,307
            
            
            53
            
            
            -
            
            
            (6,360
            )
            
            -Total
                operating expenses
            
            
            4,738
            
            
            72,040
            
            
            27,319
            
            
            -
            
            
            (7,751
            )
            
            96,346Gross
                profit
            
            
            1,569
            
            
            19,159
            
            
            11,632
            
            
            -
            
            
            (827
            )
            
            33,187Selling
                and administrative expenses
            
            
            6,489
            
            
            9,927
            
            
            5,637
            
            
            -
            
            
            -
            
            
            22,053Non-cash
                compensation
            
            
            251
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            251Operating
                income (loss)
            
            
            (5,171
            )
            
            9,232
            
            
            5,995
            
            
            -
            
            
            (827
            )
            
            10,883Interest
                expense
            
            
            9,447
            
            
            2
            
            
            -
            
            
            1,647
            
            
            -
            
            
            11,096Interest
                income
            
            
            (71
            )
            
            -
            
            
            (5
            )
            
            -
            
            
            -
            
            
            (76
            )Preferred
                stock dividend expense
            
            
            -
            
            
            -
            
            
            -
            
            
            945
            
            
            -
            
            
            945Intercompany
                interest
            
            
            (115
            )
            
            -
            
            
            1,751
            
            
            (1,636
            )
            
            -
            
            
            -Currency
                (gain) loss
            
            
            (3,057
            )
            
            106
            
            
            (102
            )
            
            -
            
            
            -
            
            
            (3,053
            )Equity
                in loss (income) of subsidiaries
            
            
            -
            
            
            -
            
            
            -
            
            
            (1,667
            )
            
            1,667
            
            
            -Income
                (loss) before income tax
            
            
            (11,375
            )
            
            9,124
            
            
            4,351
            
            
            711
            
            
            (840
            )
            
            1,971expense
                (benefit)Income
                tax expense (benefit)
            
            
            8,133
            
            
            (8,572
            )
            
            1,699
            
            
            -
            
            
            -
            
            
            1,260Net
                income (loss)
            
            $
            (19,508
            )
            $
            17,696
            
            $
            2,652
            
            $
            711
            
            $
            (840
            )
            $
            711


-19-


**BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**





Brand
                Intermediate Holdings, Inc.Condensed
                Consolidating Statement of OperationsFor
                the Nine Months Ended September 30, 2004**Brand**
              **Services,
                Inc.**
            
            **Guarantor
                Subsidiaries**
            
            **Non-Guarantor
                Subsidiary**
            
            **Brand
                Intermediate Holdings, Inc.**
            
            **Adjustments**
              **and**
              **Eliminations**
            
            **Brand
                Intermediate Holdings, Inc. Consolidated**Revenue:Labor
            
            $
            -
            
            $
            181,692
            
            $
            11,479
            
            $
            -
            
            $
            -
            
            $
            193,171Equipment
                rental
            
            
            -
            
            
            46,561
            
            
            2,113
            
            
            -
            
            
            -
            
            
            48,674Equipment
                sales
            
            
            -
            
            
            4,794
            
            
            702
            
            
            -
            
            
            (787
            )
            
            4,709Intercompany
                revenue
            
            
            14,801
            
            
            71
            
            
            -
            
            
            -
            
            
            (14,872
            )
            
            -Total
                revenues
            
            
            14,801
            
            
            233,118
            
            
            14,294
            
            
            -
            
            
            (15,659
            )
            
            246,554Operating
                expenses:Labor
            
            
            -
            
            
            152,006
            
            
            10,345
            
            
            -
            
            
            (4,065
            )
            
            158,286Equipment
                rental
            
            
            16,485
            
            
            3,148
            
            
            1,053
            
            
            -
            
            
            -
            
            
            20,686Equipment
                sales
            
            
            -
            
            
            3,887
            
            
            562
            
            
            -
            
            
            (1,248
            )
            
            3,201Divisional
                operating expenses
            
            
            115
            
            
            11,907
            
            
            411
            
            
            -
            
            
            -
            
            
            12,433Intercompany
                operating expenses
            
            
            -
            
            
            14,801
            
            
            71
            
            
            -
            
            
            (14,872
            )
            
            -Total
                operating expenses
            
            
            16,600
            
            
            185,749
            
            
            12,442
            
            
            -
            
            
            (20,185
            )
            
            194,606Gross
                profit (loss)
            
            
            (1,799
            )
            
            47,369
            
            
            1,852
            
            
            -
            
            
            4,526
            
            
            51,948Selling
                and administrative expenses
            
            
            11,612
            
            
            20,933
            
            
            1,038
            
            
            -
            
            
            -
            
            
            33,583Non-cash
                compensation
            
            
            145
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            145Operating
                income (loss)
            
            
            (13,556
            )
            
            26,436
            
            
            814
            
            
            -
            
            
            4,526
            
            
            18,220Interest
                expense
            
            
            20,849
            
            
            33
            
            
            -
            
            
            4,327
            
            
            -
            
            
            25,209Interest
                income
            
            
            (172
            )
            
            -
            
            
            (16
            )
            
            -
            
            
            -
            
            
            (188
            )Intercompany
                interest
            
            
            4,327
            
            
            -
            
            
            -
            
            
            (4,327
            )
            
            -
            
            
            -Equity
                in loss (income) of subsidiaries
            
            
            -
            
            
            -
            
            
            -
            
            
            5,090
            
            
            (5,090
            )
            
            -Income
                (loss) before income taxexpense
                (benefit)
            
            
            (38,560
            )
            
            26,403
            
            
            830
            
            
            (5,090
            )
            
            9,616
            
            
            (6,801
            )Income
                tax expense (benefit)
            
            
            (12,638
            )
            
            10,562
            
            
            365
            
            
            -
            
            
            
            
            
            (1,711
            )Net
                income (loss)
            
            $
            (25,922
            )
            $
            15,841
            
            $
            465
            
            $
            (5,090
            )
            $
            9,616
            
            $
            (5,090
            )


-20-


**BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**





Brand
                Intermediate Holdings, Inc.Condensed
                Consolidating Statement of OperationsFor
                the Nine Months Ended September 30, 2005**Brand**
              **Services,
                Inc.**
            
            **Guarantor
                Subsidiaries**
            
            **Non-Guarantor
                Subsidiary**
            
            **Brand
                Intermediate Holdings, Inc.**
            
            **Adjustments**
              **and**
              **Eliminations**
            
            **Brand
                Intermediate Holdings, Inc. Consolidated**Revenue:Labor
            
            $
            -
            
            $
            201,911
            
            $
            33,968
            
            $
            -
            
            $
            -
            
            $
            235,879Equipment
                rental
            
            
            -
            
            
            60,313
            
            
            14,879
            
            
            -
            
            
            -
            
            
            75,192Equipment
                sales
            
            
            -
            
            
            7,899
            
            
            3,379
            
            
            -
            
            
            (1,470
            )
            
            9,808Intercompany
                revenue
            
            
            18,270
            
            
            131
            
            
            -
            
            
            -
            
            
            (18,401
            )
            
            -Total
                revenues
            
            
            18,270
            
            
            270,254
            
            
            52,226
            
            
            -
            
            
            (19,871
            )
            
            320,879Operating
                expenses:Labor
            
            
            -
            
            
            168,292
            
            
            29,989
            
            
            -
            
            
            (2,644
            )
            
            195,637Equipment
                rental
            
            
            14,689
            
            
            7,169
            
            
            5,635
            
            
            -
            
            
            -
            
            
            27,493Equipment
                sales
            
            
            -
            
            
            5,993
            
            
            1,742
            
            
            -
            
            
            (1,771
            )
            
            5,964Divisional
                operating expenses
            
            
            17
            
            
            14,054
            
            
            1,005
            
            
            -
            
            
            -
            
            
            15,076Intercompany
                operating expenses
            
            
            -
            
            
            18,270
            
            
            131
            
            
            -
            
            
            (18,401
            )
            
            -Total
                operating expenses
            
            
            14,706
            
            
            213,778
            
            
            38,502
            
            
            -
            
            
            (22,816
            )
            
            244,170Gross
                profit
            
            
            3,564
            
            
            56,476
            
            
            13,724
            
            
            -
            
            
            2,945
            
            
            76,709Selling
                and administrative expenses
            
            
            20,186
            
            
            24,195
            
            
            6,353
            
            
            -
            
            
            -
            
            
            50,734Non-cash
                compensation
            
            
            938
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            938Operating
                income (loss)
            
            
            (17,560
            )
            
            32,281
            
            
            7,371
            
            
            -
            
            
            2,945
            
            
            25,037Interest
                expense
            
            
            23,329
            
            
            41
            
            
            5
            
            
            4,765
            
            
            -
            
            
            28,140Interest
                income
            
            
            (219
            )
            
            (1
            )
            
            (15
            )
            
            -
            
            
            -
            
            
            (235
            )Preferred
                stock dividend expense
            
            
            -
            
            
            -
            
            
            -
            
            
            945
            
            
            -
            
            
            945Intercompany
                interest
            
            
            3,003
            
            
            -
            
            
            1,751
            
            
            (4,754
            )
            
            -
            
            
            -Currency
                (gain) loss
            
            
            (3,057
            )
            
            106
            
            
            (102
            )
            
            -
            
            
            -
            
            
            (3,053
            )Equity
                in loss (income) of subsidiaries
            
            
            -
            
            
            -
            
            
            -
            
            
            640
            
            
            (640
            )
            
            -Income
                (loss) before income tax expense (benefit)
            
            
            (40,616
            )
            
            32,135
            
            
            5,732
            
            
            (1,596
            )
            
            3,585
            
            
            (760
            )Provision
                (benefit) for income tax
            
            
            (1,345
            )
            
            -
            
            
            2,181
            
            
            -
            
            
            -
            
            
            836Net
                income (loss)
            
            $
            (39,271
            )
            $
            32,135
            
            $
            3,551
            
            $
            (1,596
            )
            $
            3,585
            
            $
            (1,596
            )


-21-


**BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**





Brand
                Intermediate Holdings, Inc.Condensed
                Consolidating Statement of Cash FlowsFor
                the Nine Months Ended September 30, 2004**Brand
                Services, Inc.**
            
            **Guarantor
                Subsidiaries**
            
            **Non-Guarantor
                Subsidiary**
            
            **Brand
                Intermediate Holdings, Inc.**
            
            **Adjustments
                and Eliminations**
            
            **Brand
                Intermediate Holdings, Inc. Consolidated**CASH
                FLOWS FROM OPERATING ACTIVITIES:Net
                cash provided by (used for) operating activities
            
            $
            32,637
            
            $
            1,724
            
            $
            (642
            )
            
            -
            
            $
            192
            
            $
            33,911CASH
                FLOWS FROM INVESTING ACTIVITIES:Purchases
                of property and equipment
            
            
            (7,749
            )
            
            (1,670
            )
            
            (501
            )
            
            -
            
            
            -
            
            
            (9,920
            )Proceeds
                from sales of property and equipment
            
            
            1,624
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            1,624Payments
                for acquisitions
            
            
            (951
            )
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (951
            )Net
                cash used for investing activities
            
            
            (7,076
            )
            
            (1,670
            )
            
            (501
            )
            
            -
            
            
            -
            
            
            (9,247
            )CASH
                FLOWS FROM FINANCING ACTIVITIES:Repayments
                of long-term debt
            
            
            (20,836
            )
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (20,836
            )Payments
                of deferred financing fees
            
            
            (927
            )
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (927
            )Payments
                on capital lease obligations
            
            
            (495
            )
            
            (54
            )
            
            -
            
            
            -
            
            
            -
            
            
            (549
            )Net
                cash used for financing activities
            
            
            (22,258
            )
            
            (54
            )
            
            -
            
            
            -
            
            
            -
            
            
            (22,312
            )INCREASE
                (DECREASE) IN CASH AND CASH
              EQUIVALENTS
            
            
            3,303
            
            
            -
            
            
            (1,143
            )
            
            -
            
            
            192
            
            
            2,352CASH
                AND CASH EQUIVALENTS, beginning of period
            
            
            21,154
            
            
            -
            
            
            2,236
            
            
            -
            
            
            (290
            )
            
            23,100CASH
                AND CASH EQUIVALENTS, end of period
            
            $
            24,457
            
            $
            -
            
            $
            1,093
            
            
            -
            
            $
            (98
            )
            $
            25,452


-22-





**BRAND
      INTERMEDIATE HOLDINGS, INC. AND SUBSIDIARIES**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**





Brand
                Intermediate Holdings, Inc.Condensed
                Consolidating Statement of Cash FlowsFor
                the Nine Months Ended September 30, 2005**Brand
                Services, Inc.**
            
            **Guarantor
                Subsidiaries**
            
            **Non-Guarantor
                Subsidiary**
            
            **Brand
                Intermediate Holdings, Inc.**
            
            **Adjustments
                and Eliminations**
            
            **Brand
                Intermediate Holdings, Inc. Consolidated**CASH
                FLOWS FROM OPERATING ACTIVITIES:Net
                cash provided by (used for) operating activities
            
            $
            11,439
            
            $
            5,228
            
            $
            11,778
            
            $
            -
            
            $
            (339
            )
            $
            28,106CASH
                FLOWS FROM INVESTING ACTIVITIES:Purchases
                of property and equipment
            
            
            (13,728
            )
            
            (6,048
            )
            
            (3,002
            )
            
            -
            
            
            -
            
            
            (22,778
            )Proceeds
                from sales of property and equipment
            
            
            1,771
            
            
            886
            
            
            1,061
            
            
            -
            
            
            -
            
            
            3,718Payments
                for acquisitions
            
            
            (217,626
            )
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (217,626
            )Net
                cash used for investing activities
            
            
            (229,583
            )
            
            (5,162
            )
            
            (1,941
            )
            
            -
            
            
            -
            
            
            (236,686
            )CASH
                FLOWS FROM FINANCING ACTIVITIES:Repayments
                of long-term debt
            
            
            (1,247
            )
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (1,247
            )Proceeds
                from long-term debt
            
            
            185,153
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            185,153Payments
                of deferred financing fees
            
            
            (4,996
            )
            
            -
            
            
            -
            
            
            (600
            )
            
            -
            
            
            (5,596
            )Proceeds
                from redeemable preferred stock
            
            
            -
            
            
            -
            
            
            -
            
            
            30,000
            
            
            -
            
            
            30,000Capital
                Investment
            
            
            29,400
            
            
            -
            
            
            -
            
            
            (29,400
            )
            
            -
            
            
            -Payments
                on capital lease obligations
            
            
            (248
            )
            
            (66
            )
            
            -
            
            
            -
            
            
            -
            
            
            (314
            )Net
                cash provided by (used in) financing activities
            
            
            208,062
            
            
            (66
            )
            
            -
            
            
            -
            
            
            -
            
            
            207,996INCREASE
                (DECREASE) IN CASH AND CASH
              EQUIVALENTS
            
            
            (10,082
            )
            
            -
            
            
            9,837
            
            
            -
            
            
            (339
            )
            
            (584
            )CASH
                AND CASH EQUIVALENTS, beginning of period
            
            
            13,336
            
            
            -
            
            
            1,525
            
            
            -
            
            
            (453
            )
            
            14,408CASH
                AND CASH EQUIVALENTS, end of period
            
            $
            3,254
            
            $
            -
            
            $
            11,362
            
            $
            -
            
            $
            (792
            )
            $
            13,824







-23-




14.
              Subsequent
                  Event
 
 The
        Company has entered into two interest rate swap agreements with terms commencing
        December 31, 2005. Under these agreements, the Company will pay fixed interest
        rates for three years and will receive floating interest rate payments based
        on
        the U.S. 90 day LIBOR and 90 day Canadian bankers acceptances. During years
        one
        and two the notional amounts of the U.S. Dollar swap is $50 million and reduces
        to $25 million in the final year of the agreement, while the notional amount
        of
        the Canadian dollar swap is $35 million in years one and two, reducing to
        $17.5
        million in the final year of the agreement.
  The
        Company has also entered into an $80 million U.S. dollar / Canadian dollar
        currency swap for a period of three years commencing December 31, 2005. The
        notional amount of the swap is $80 million during years one and two and reduces
        to $40 million during the final year of the agreement. The swap was executed
        on
        a floating rate basis whereby the Company will pay floating payments based
        on
        the 90 day Canadian bankers acceptances and will receive floating payments
        based
        on the U.S. 90 day LIBOR.




ITEM
      2.  MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
      AND RESULTS OF OPERATIONS





The
      matters discussed in this Form 10-Q of Brand Intermediate Holdings, Inc. and
      subsidiaries (the "Company") contain forward looking statements that involve
      a
      number of risks and uncertainties. A number of factors could cause actual
      results, performance, achievements of the Company, or industry results, to
      be
      materially different from any future results, performance or achievements
      expressed or implied by such forward-looking statements. These factors include,
      but are not limited to, the competitive environment in the industrial and
      commercial scaffolding industry in general and in the Company’s specific market
      areas; changes in prevailing interest rates and the availability of and terms
      of
      financing to fund the anticipated growth of the Company’s business; the effects
      of changes in currency exchange rates; inflation; changes in costs of goods
      and
      services; economic conditions in general and in the Company’s specific market
      areas; demographic changes; changes in or failure to comply with federal, state
      and/or local government regulations; liability and other claims asserted against
      the Company; changes in operating strategy or development plans; the ability
      to
      attract and retain qualified personnel; the significant indebtedness of the
      Company; labor disturbances; weather; changes in the Company’s acquisition and
      capital expenditure plans; and other factors referenced herein. The forward
      looking statements contained herein reflect the Company’s current beliefs and
      specific assumptions with respect to future business decisions and are based
      on
      information currently available. Accordingly, the statements are subject to
      significant risks, uncertainties and contingencies, which could cause the
      Company’s actual operating results, performance or business prospects to differ
      from those expressed in, or implied by, these statements.





The
      following discussion and analysis should be read in conjunction with the
      attached condensed consolidated financial statements and notes thereto.





Overview




The
      Company is one of the largest North American providers of industrial scaffolding
      services which facilitate access to tall structures for maintenance, turnarounds
      and capital projects, principally in the refining, petrochemical, chemical,
      utility and pulp and paper industries. The Company provides turnkey services,
      which include equipment rental, labor for the erection and dismantlement of
      the
      scaffolding and scaffolding design services. The Company also provides
      scaffolding services to the commercial market (primarily nonresidential
      construction and renovation) and sells a small amount of scaffolding.





On
      July
      29, 2005, the Company purchased the operating assets of Aluma Enterprises,
      Inc.
      ("Aluma"), a Canadian scaffolding and concrete construction company. Aluma
      had
      revenues and pretax income of approximately $211.4 million and $4.6 million
      for
      the year ended December 31, 2004, as prepared in conformity with accounting
      principles generally accepted in the United States. The cash
      purchase
      price was Canadian $255.0 million (approximately US $208 million), subject
      to
      post-closing adjustments in addition to the purchase of two properties of US
      $1.4 million. The Company funded the acquisition and related fees and expenses
      with $190.0 million of additional borrowings under the Credit Facility
      (including $5.0 million of borrowings under the revolving portion),
      as
      amended, and the issuance of $30.0 million of preferred stock to affiliates
      of
      JPMP.





The
      Company typically provides on-going maintenance services under long-term
      contracts; the duration of these contracts is usually one to five years.
      Turnarounds occur every one to four years depending on the industry and the
      type
      of turnaround being performed. Although some turnarounds may be postponed for
      a
      period of time, they are a necessary component of maintaining industrial
      facilities and are required to ensure the safe and efficient operation of such
      facilities. While the postponement of scheduled turnarounds causes fluctuations
      in the Company’s quarterly and annual results, the Company believes the
      necessity for on-going maintenance and turnarounds provides a stable, recurring
      revenue base.





The
      Company’s business is seasonal. End-use industries such as the refining and
      utility industries experience increased demand for their products during the
      summer months. Consequently, turnarounds are generally scheduled during the
      first and fourth quarters of the year.


-24-





The
      Company has in the past completed strategic acquisitions and intends to continue
      to pursue complementary acquisitions where significant consolidation savings
      and
      economies of scale can be achieved. The scaffolding industry is characterized
      by
      single-office or regional companies, many of which are undercapitalized and
      have
      limited scaffolding inventories. The Company intends to focus its acquisition
      strategy on companies that have an expertise in a certain industry or
      scaffolding applications.





Brand
      Intermediate Holdings, Inc. and its subsidiaries ("Brand") are 100% owned by
      Brand Holdings, LLC (the "LLC"). As of September 30, 2005, the voting equity
      interests of the LLC are owned 73.0% by J.P. Morgan Partners and its affiliates
      ("JPMP") and 27.0% by other equity investors on a fully diluted basis. Brand
      Services, Inc. is a wholly owned subsidiary of Brand Intermediate Holdings,
      Inc.
      and its subsidiaries.








Results
      of Operations





Revenue
      -
      Total revenue for the three months ended September 30, 2005 increased by $58.1
      million or 81.3% as compared to the similar prior year period. Revenue related
      to the Aluma acquisition was $44.1 million. In addition, revenue in the refinery
      and chemical sector increased $9.7 million over last year’s lower than normal
      levels. In third quarter 2004 several refineries delayed scheduled maintenance
      work to take advantage of high gasoline prices in the marketplace. Revenues
      also
      increased $3.3 million in the commercial sector primarily due to continued
      economic recovery in the Southeast. Total revenue for the nine months ended
      September 30, 2005 increased by $74.3 million or 30.1% compared to the nine
      months ended September 30, 2004. The biggest factors in the increase were the
      $44.1 million related to the Aluma acquisition, a $9.0 million increase in
      the
      other industrial sector due to offshore related work in south Texas, a $10.1
      million increase in the refinery and chemical sector, and a $9.2 million
      increase in commercial revenues primarily due to continued economic recovery
      in
      the Southeast.





Gross
      profit - Gross profit increased by $18.2 million, or 120.7% in the three months
      ended September 30, 2005 as compared to the three months ended September 30,
      2004. Gross profit increased $14.0 million related to the Aluma acquisition.
      Labor gross profit increased $3.7 million including $2.4 million related to
      the
      Aluma acquisition. The remaining $1.3 million increase is primarily due to
      a
      $11.1 million increase in labor revenues excluding revenue associated with
      the
      Aluma acquisitions partially offset by a lower percentage of labor gross profit
      to labor revenues. Equipment rental gross profit increased $12.7 million of
      which $9.9 million related to the Aluma acquisition. Equipment sales gross
      profit increased $1.8 million principally due to the Aluma acquisition. For
      the
      nine months ended September 30, 2005, gross profit increased $24.8 million
      or
      47.7% as compared to the nine months ended September 30, 2004. Labor gross
      profit increased $5.4 million with $2.4 million due to the Aluma acquisition
      and
      the remaining $3.0 million primarily due to a $18.2 million increase in labor
      revenues excluding revenue associated with the Aluma acquisition. The percentage
      of labor gross profit to labor revenues decreased from 18.1% compared to 17.1%
      with 0.6% of the decrease as a result of the Aluma acquisition. Equipment rental
      gross profit increased $17.1 million of which $9.9 million related to the Aluma
      acquisition and the remaining $7.2 million due to the increase in rental
      revenue. An increase in equipment sales gross profit of $2.3 million was
      primarily due to the Aluma acquisition.





Selling
      and administrative expenses - Selling and administrative expenses increased
      by
      $11.1 million and $17.2 million, respectively, in the three and nine-month
      periods ended September 30, 2005 as compared to the similar prior year periods.
      The Aluma acquisition accounted for $8.0 million of the increase for both the
      three and nine-month periods. For the three-month period approximately $0.5
      million of non-recurring charges contributed to the increase which include
      approximately $0.2 million of duplicate salaries for the CEO position, and
      $0.2
      million of integration and relocation costs.  Also contributing
      were
      increases in bonus expense of $1.9 million and smaller increases/decreases
      in
      various miscellaneous accounts. For the nine-month period, the Aluma acquisition
      accounted for $8.0 million of the increase and non-recurring charges accounted
      for $3.5 million of the increase. These include approximately $1.9 million
      in
      severance charges related to the CEO and other executive positions, $0.5 million
      of duplicate salaries for the CEO position, $0.3 million of professional fees
      related to tax restructuring and $0.5 million in relocation and recruiting
      costs
      for new executives. Also contributing were increases in bonus expense of $3.1
      million, professional fees of $0.6 million, salaries and benefits of $0.6
      million, travel expenses of $0.5 million and bad debt expense of $0.2
      million.





-25-


Non-cash
      compensation - Non-cash compensation increased by $0.2 million and $0.8 million,
      respectively, in the three- and nine- month periods ended September 30, 2005
      as
      compared to the similar prior year periods. The primary reason for the increase
      for the three-month period is due to class B units sold and class C-1 units
      granted to new executives. The primary reason for the increase for the
      nine-month period is due to Class A and B unit awards granted to the Company’s
      new CEO, who was hired effective January 1, 2005, as part of his employment
      agreement and class B and class C-1 units sold or granted to new
      executives.





Operating
      income - As a result of the above events, operating income increased by $6.8
      million, or 169.6%, when comparing the three- month period ended September
      30,
      2005 with the similar prior year period. The Aluma acquisition accounted for
      $6.1 million of the increase. Operating income for the nine- month period ended
      September 30 increased by $6.8 million, or 37.4% compared with the similar
      prior
      year period. The Aluma acquisition accounted for $6.1 million of the
      increase.




Interest
      expense - Interest expense increased by $2.3 million in the three months ended
      September 30, 2005 as compared to the three months ended September 30, 2004.
      This was primarily due to the impact of higher interest rates on the senior
      debt, the additional senior debt related to the amended credit agreement used
      to
      finance the acquisition and to the compounding effect of interest on the 13%
      pay-in-kind notes. Interest expense increased by $2.9 million in the nine months
      ended September 30, 2005 as compared to the nine months ended September 30,
      2004. This was primarily due to higher interest rates on the senior debt, the
      additional senior debt related to the amended credit agreement used to finance
      the acquisition and the compounding effect of interest on the pay-in-kind notes,
      partially offset by the lower senior debt level in the first quarter of 2005
      due
      to a $20 million prepayment made in March of 2004.





Preferred
      Stock dividend expense - Dividends on the redeemable preferred stock
      were
      $0.9 million for the three and nine-month period ended September 30, 2005
      related to the Preferred Stock issued July 29, 2005.




Currency
        gain - For the three and nine month periods ended September 30, 2005 the
        currency gain was $3.1 million. This was due to the weakening of the United
        States dollar on the net receivable from the new inter-company receivable
        between Brand Services, Inc. and the Canadian subsidiaries partially offset
        by
        the new Canada dollar term debt.




Income
      Tax  Expense - For the nine months ended September 30, 2004, the effective
      tax rate benefit of 25% is less than the federal statutory rate of 35% primarily
      due to permanent tax items, the largest of which is a portion of the interest
      expense on the 13% Intermediate Subordinated Notes which is not deductible
      for
      tax purposes. For the nine months ended September 30, 2005, the effective tax
      rate expense of 110% is more than the federal statutory rate
      of 35%
      primarily due to the increased pretax income of the Canadian subsidiaries
      related to the Aluma acquisition. For the three months ended September 30,
      2004,
      the effective tax rate benefit of 33% is less than the federal statutory rate
      of
      35% primarily due to the permanent tax items mentioned above. For the three
      months ended September 30, 2005, the effective tax rate expense of 64%
      is
      greater than the federal statutory rate of 35% primarily due to the increased
      pretax income of the Canadian subsidiaries related to the Aluma acquisition,
      as
      mentioned above.





Liquidity
      and Capital Resources





The
      Company has historically utilized internal cash flow from operations and
      borrowings under its Credit Facility to fund its operations, capital
      expenditures and working capital requirements. As of December 31, 2004 and
      September 30, 2005, the Company had working capital of $42.0 million and $57.9
      million and cash of $14.4 million and $13.8 million, respectively.






-26-


The
      Company believes that its existing working capital, borrowings available under
      its Credit Facility and internal cash flow from operations should provide
      sufficient resources to support current business activities. To the extent
      the
      Company accelerates its growth plans, consummates acquisitions or has lower
      than
      anticipated sales or increases in expenses, it may also need to raise additional
      capital. In particular, increased working capital needs occur whenever the
      Company consummates acquisitions or experiences strong incremental
      demand.





One
      of
      the Company’s major uses of cash is capital expenditures. The Company’s capital
      expenditure requirements are comprised of maintenance and expansion
      expenditures. The Company’s maintenance capital expenditure requirements are
      generally for scaffolding planks and other items used in the business, such
      as
      trucks and equipment. Expansion capital expenditures are for new scaffolding
      and
      vehicles, are discretionary and vary annually based on the Company’s level of
      scaffolding rental activity and management’s growth expectations. During the
      Nine Months ended September 30, 2004 and 2005, capital expenditures were $9.9
      million and $21.5 million, respectively.





Our
      Credit Facility (the "Credit Facility"), as amended in connection with the
      Aluma
      acquisition provides for $287.0 million of term loans, a $50.0 million revolving
      loan facility, a $20.0 million letter of credit facility and a synthetic letter
      of credit facility of $15.0 million. As of September 30, 2005, the Company
      had
      no borrowings outstanding under the revolving credit facility and had total
      outstanding letters of credit of $36.6 million. The revolving loan facility
      will
      mature in October 2008. The term loans will mature in January 2012.





The
      interest rate on the term loans outstanding under the Credit Facility is
      variable. For the three months and nine months ended September 30, 2005, the
      weighted average interest rate on the term loans was 6.0% and 6.3%,
      respectively.





We
      are
      required to make semi-annual interest payments on our 12%, $150.0 million Senior
      Subordinated Notes in the amount of $9.0 million in April and October of every
      year until the Senior Notes mature in October 2012. We are also required to
      make
      quarterly interest payments on loans under our Credit Facility, which bears
      interest at a floating rate based upon the base rate (as defined in our credit
      agreement, for base rate loans), or the LIBOR rate (for LIBOR loans) or the
      Canadian Prime Rate (for Canadian dollar loans) plus a spread of 2.0% to 4.0%,
      depending on the ratio of our consolidated debt to EBITDA (as defined). As
      of
      September 30, 2005, the interest rate on our term loans was 6.5%. We are not
      required to make interest payments on our 13%, $35.0 million Intermediate Notes
      until 2008, as these notes are pay-in-kind notes. Dividends on the redeemable
      preferred stock issued to affiliates of JPMP accrue at a rate of 18% per annum,
      but are not required to be paid in cash until they are redeemed.





The
      Credit Facility requires financial and operating covenants, including among
      other things, that the Company maintain certain financial ratios, and imposes
      limitations on the Company’s ability to make capital expenditures, to incur
      indebtedness, and to pay dividends. The Company was in compliance with all
      loan
      covenants at September 30, 2005.





-27-


A
      summary
      of the sources and uses of cash for the nine months ended September 30, 2004
      and
      2005, follows:





Nine
                Months Ended
              September
                30,2004
            
            2005Net
                cash provided by (used for):Operating
                activities
            
            $
            33,911
            
            $
            28,106Investing
                activities
            
            
            (9,247
            )
            
            (236,686
            )Financing
                activities
            
            
            (22,312
            )
            
            207,996





Contractual
      Obligations





The
      following is a summary of contractual cash obligations as of September 30,
      2005
      (dollars in thousands):


Payments
      due in:


Total
            
            2005
            
            2006
            
            2007
            
            2008
            
            2009
            
            After
                2009US
                Dollar Term Loan
            
            $
            229,517
            
            $
            575
            
            $
            2,300
            
            $
            2,300
            
            $
            2,300
            
            $
            2,300
            
            $
            219,742Expected
                Interest Payments on Term Loan (1)
            
            
            98,946
            
            
            4,029
            
            
            16,014
            
            
            15,852
            
            
            15,690
            
            
            15,529
            
            
            31,832Canadian
                Dollar Term Loan
            
            
            60,417
            
            
            152
            
            
            606
            
            
            606
            
            
            607
            
            
            606
            
            
            57,840Expected
                Interest Paymentson
                Term Loan (2)
            
            
            23,007
            
            
            937
            
            
            3,724
            
            
            3,686
            
            
            3,648
            
            
            3,611
            
            
            7,401Senior
                Notes
            
            
            150,000
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            150,000Expected
                Interest Payments on Senior Notes
            
            
            126,000
            
            
            -
            
            
            18,000
            
            
            18,000
            
            
            18,000
            
            
            18,000
            
            
            54,000Intermediate
                Notes
            
            
            50,798
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            50,798Expected
                Interest Payments onIntermediate
                Notes
            
            
            66,108
            
            
            -
            
            
            -
            
            
            -
            
            
            8,538
            
            
            8,538
            
            
            49,032Preferred
                Stock
            
            
            30,945
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            30,945Expected
                Dividend PaymentsOn
                Preferred Stock
            
            
            123,381
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            123,381Capital
                Leases
            
            
            128
            
            
            31
            
            
            92
            
            
            5
            
            
            -
            
            
            -
            
            
            -Operating
                Leases
            
            
            18,472
            
            
            2,102
            
            
            5,761
            
            
            4,081
            
            
            2,499
            
            
            1,642
            
            
            2,387Notes
                Payable
            
            
            335
            
            
            -
            
            
            84
            
            
            84
            
            
            84
            
            
            83
            
            
            -Total
                Contractual Cash Obligations
            
            $
            978,054
            
            $
            7,826
            
            $
            46,581
            
            $
            44,614
            
            $
            51,366
            
            $
            50,309
            
            $
            777,358





(1)
            The
                interest rate on the Term Loan is floating. For purposes of this
                schedule
                we are using the September 30, 2005 interest rate of 7.0% for all
                periods.
                Also, we have the option to make voluntary prepayments on the Term
                Loan
                and are required by the credit agreement to make prepayments equal
                to 50%
                of the free cash flow generated in each year as defined in the Credit
                Agreement. For purposes of this schedule we have not attempted to
                estimate
                what, if any, prepayments might be made throughout the life of the
                agreement.


(2)
              The
                  interest rate on the Term Loan is floating. For purposes of this
                  schedule
                  we are using the September 30, 2005 interest rate of 6.2% for all
                  periods.
                  Also, we have the option to make voluntary prepayments on the Term
                  Loan
                  and are required by the credit agreement to make prepayments equal
                  to 50%
                  of the free cash flow generated in each year as defined in the
                  Credit
                  Agreement. For purposes of this schedule we have not attempted
                  to estimate
                  what, if any, prepayments might be made throughout the life of
                  the
                  agreement.


-28-


Critical
      Accounting Policies





Certain
      of our accounting policies as discussed below require the application of
      significant judgement by management in selecting the appropriate assumptions
      for
      calculating amounts to record in our financial statements. By their nature,
      these judgements are subject to an inherent degree of uncertainty.





Labor
      revenues are recognized when the services are performed. Equipment rental
      revenue is recognized based on the number of days the equipment is rented
      beginning with the first day the equipment is under rental. The Company
      periodically sells new scaffolding directly to third parties. The Company
      recognizes revenue upon shipment and records as operating expense, the average
      cost of the scaffolding sold. The Company periodically sells scaffolding to
      third parties, primarily to its rental customers. The Company recognizes revenue
      for the proceeds of such sales and records as operating expense, the net book
      value of the scaffolding. Net book value is determined assuming the oldest
      scaffolding is sold first, as the Company maintains inventory records on a
      group
      basis.





As
      part
      of our ongoing business, we make payments for workers’ compensation and health
      benefit claims. We have purchased insurance coverage for large claims. Our
      workers’ compensation and health benefit liabilities are developed using
      actuarial methods based upon historical data for payment patterns, cost trends,
      utilization of healthcare services and other relevant factors. These estimates
      take into account incurred but not reported (IBNR) claims. While we believe
      our
      liabilities for workers’ compensation, general liability, automobile, and health
      benefit claims of $15.6 million as of September 30, 2005, are adequate and
      that
      the judgement applied is appropriate, such estimated liabilities could differ
      materially from what will actually transpire in the future.





The
      Company accounts for its long-lived assets excluding goodwill and tradenames,
      in
      accordance with Statement of Financial Accounting Standards (SFAS) No. 144,
      which requires the Company to assess the recoverability of these assets when
      events or changes in circumstances indicate that the carrying amount of the
      long-lived asset (group) might not be recoverable. If impairment indicators
      exist, the Company determines whether the projected undiscounted cash flows
      will
      be sufficient to cover the carrying value of such assets. This requires the
      Company to make significant judgements about the expected future cash flows
      of
      the asset group. The future cash flows are dependent on general and economic
      conditions and are subject to change.





The
      Company accounts for its goodwill and tradenames in accordance with SFAS No.
      142, which requires the Company to test goodwill and tradenames for impairment
      annually and whenever events occur or circumstances change that would more
      likely than not reduce the fair value of the reporting unit below its carrying
      value. For purposes of applying the provisions, the Company has determined
      that
      it will perform its impairment analysis on a consolidated enterprise level.
      Because quoted market prices do not exist for the Company, management uses
      the
      present value of expected future cash flows to estimate fair value. Management
      must make significant judgements and estimates about future conditions to
      estimate future cash flows. Unforeseen events and changes in circumstances
      and
      market conditions including general economic and competitive conditions, could
      result in significant changes in those estimates and material charges to
      income.





Change
      in
      Accounting Principle





Effective
      January 1, 2004, the Company adopted the fair value recognition provisions
      of
      Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting for
      Stock-Based Compensation". The Company selected the modified prospective
      transition method under the provisions of SFAS No. 148, "Accounting for
      Stock-Based Compensation-Transition and Disclosure," which requires expensing
      options prospectively, beginning in the year of adoption. The Company expensed
      $251 thousand and $56 thousand, for the three month periods ended September
      30,
      2005 and 2004, respectively. The Company expensed $938 thousand and $145
      thousand, for the nine month periods ended September 30, 2005 and 2004,
      respectively, recorded in the caption Non-cash compensation.





-29-




Acquisitions




On
      July
      29, 2005, the Company purchased the operating assets of Aluma, a Canadian
      scaffolding and concrete construction company.




New
      Accounting Standards




On
      December 16, 2004, the Financial Accounting Standards Board (FASB) issued FASB
      Statement No. 123 (revised 2004), Share-Based Payment, which is a revision
      of
      FASB Statement No. 123, Accounting for Stock-Based Compensation. Statement
      123(R) supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees,
      and amends FASB Statement No. 95, Statement of Cash Flows. Generally, the
      approach in Statement 123(R) is similar to the approach described in Statement
      123.  However, Statement 123(R) requires all share-based payments to
      employees, including grants of employee stock options, to be recognized in
      the
      income statement based on their fair values. Pro forma disclosure is no longer
      an alternative. We expect to adopt Statement 123(R) on January 1, 2006 using
      the
      modified-prospective method.




The
      Company adopted the fair-value-based method of accounting for share-based
      payments effective January 1, 2004 using the "modified prospective method"
      described in FASB Statement No. 148, Accounting for Stock-Based
      Compensation-Transition and Disclosure.  Currently, the Company uses
      the
      minimal value method of the Black-Scholes formula to estimate the value of
      stock
      options granted to employees. The minimal value method is not allowable under
      Statement 123(R), and the Company is currently researching other acceptable
      methods. The Company does not anticipate that adoption of Statement 123(R)
      will
      have a material impact on its results of operations or its financial position.




ITEM
      3.
      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK




Interest
      Rate Risk




The
      Company is exposed to interest rate risk related to changes in interest rates
      on
      its variable rate debt. At September 30, 2005, the Company held approximately
      $490.7 million of long-term debt, with approximately $289.9 million subject
      to
      variable interest rates based upon LIBOR plus an applicable margin. If interest
      rates increased by 100 basis points, annualized cash interest expense would
      increase by approximately $2.9 million. This analysis does not reflect the
      effect that interest rates would have on other items, such as new borrowings
      nor
      the favorable impact declining rates would have on cash interest expense. The
      Company did not have any derivative financial instruments in place at September
      30, 2005.




In
      order
      to mitigate the interest rate risk related to changes on its variable rate
      debt,
      the Company has subsequently entered into two interest rate swap agreements
      with
      terms commencing December 31, 2005. Under these agreements, the Company will
      pay
      fixed interest rates for three years and will receive floating interest rate
      payments based on the U.S. 90 day LIBOR and 90 day Canadian bankers acceptances.
      During years one and two the notional amounts of the U.S. Dollar swap is $50
      million and reduces to $25 million in the final year of the agreement, while
      the
      notional amount of the Canadian dollar swap is $35 million in years one and
      two,
      reducing to $17.5 million in the final year of the agreement. Based upon current
      variable debt outstanding if interest rates increased by 100 basis points,
      annualized cash interest expense would increase approximately $2.1 million
      after
      taking into consideration the effect of these interest rate swaps.




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Foreign
      Currency Risk




Foreign
      currency exposures arise from transactions denominated in a currency other
      than
      the functional currency and from foreign denominated revenue and profit
      translated into U.S. dollars. As a result of the Company’s purchase of
      substantially all of the operations and the net operating assets of Aluma
      effective July 29, 2005, the Company is subject to foreign currency risk
      associated with its Canadian investment. In order to mitigate the Company’s
      exposure to changes in the value of the Canadian dollar due to its investment
      in
      Aluma, the Company has subsequently entered into an $80 million U.S. dollar
      /
      Canadian dollar currency swap for a period of three years commencing December
      31, 2005. The notional amount of the swap is $80 million during years one and
      two and reduces to $40 million during the final year of the agreement. A change
      in the Canadian dollar / U.S. dollar exchange rate of U.S. 10% could have an
      annual impact upon earnings of approximately $1.3 million, excluding
      the
      impact of foreign currency hedges.




ITEM
        4.
        CONTROLS AND PROCEDURES





An
      evaluation was carried out under the supervision and with the participation
      of
      our management, including our Chief Executive Officer and Chief Financial
      Officer, of the effectiveness of our disclosure controls and procedures (as
      defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange
      Act
      of 1934) as of the end of the quarter covered by this report. Based on their
      evaluation, our Chief Executive Officer and Chief Financial Officer have
      concluded that the Company's disclosure controls and procedures are effective
      to
      ensure that information required to be disclosed by our Company in reports
      that
      it files or submits under the Exchange Act is recorded, processed, summarized
      and reported within the time periods specified in Securities and Exchange
      Commission rules and forms. There were no changes in the internal control over
      financial reporting that occurred during the third quarter of 2005 that have
      materially affected, or are likely to materially affect, our internal control
      over financial reporting.





PART
      II -
      OTHER INFORMATION





ITEM
      1.
      LEGAL PROCEEDINGS





From
      time
      to time, the Company is subject to legal proceedings and other claims arising
      in
      the ordinary course of its business. There are no material pending legal
      proceedings, other than routine litigation incidental to the business, to which
      the Company is a party or of which any of the Company’s property is the
      subject.





ITEM
      2.
      CHANGES IN SECURITIES AND USE OF PROCEEDS





None.





ITEM
      3.
      DEFAULTS UPON SENIOR SECURITIES





None.





ITEM
      4.
      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS





None.





ITEM
      5.
      OTHER INFORMATION





None.





ITEM
      6.
      EXHIBITS





31.1
            Certification
                of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 2002





31.2
            Certification of Chief Financial Officer pursuant to Section 302
                of the
                Sarbanes-Oxley Act of 2002





32.1
            Certification
                of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley
                Act of 2002





32.2
            Certification
                of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley
                Act of 2002








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SIGNATURES





Pursuant
      to the requirement of the Securities Exchange Act of 1934, the registrant has
      duly caused this report to be signed on its behalf by the undersigned thereunto
      duly authorized.





**BRAND
              INTERMEDIATE HOLDINGS, INC.**Date: 
              November 14, 2005
            By:
            /s/ Paul
              T. WoodPaul
              T. WoodChief
              Executive Officer and President




Date:  
              November 14, 2005
            By:
            /s/ Anthony
              A. RabbAnthony
              A. RabbChief
              Financial Officer and Vice President,
              Finance






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