----

----

----

----

----

**[X]         QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT        OF        1934    **

**              **

**              For the quarterly period ended September 30, 2007    **

**[         ]  TRANSITION REPORT UNDER SECTION 12 OR 15(d) OF THE EXCHANGE        ACT    **

**              **

**              For the transition period from ________ to ________    **

**Commission        File Number 000-05391**

----

----

| **NEVADA**                                      | **83-0210365**                         |
|-------------------------------------------------|----------------------------------------|
| (State                    or other jurisdiction | (IRS                    Employer       |
| of                    incorporation)            | Identification                    No.) |

| **819                    Naff Road, Boones Mill, VA 24065** |
|-------------------------------------------------------------|
| (Address                    of principal executive offices) |
|                                                        |
| **(540)                    334-4294**                       |
| (Issuer's                    telephone number)              |

----

----

----

----

|    METWOOD,                  INC. AND SUBSIDIARY      |
|-----------------------------------------------------------------------------------------------|
|  TABLE                  OF CONTENTS - FORM 10-QSB               |
|                                                                                          |   |   |   |   |   |   |   |   |   |
|                                                                                          |   |   |   |   |   |   |   |   |   |
|                                                                                          |   |   |   |   |   |   |   |   |   |
| PART                  I - FINANCIAL INFORMATION                                               |   |   |   |   | *Page(s)* |
|                                                                                          |   |   |   |   |   |   |   |   |   |
|     Item                  1                                               |   Financial                  Statements |   |   |   |   |   |   |
|                                                                                          |   |   |   |   |   |   |   |   |   |
|                                                                                          |       Consolidated                  Balance Sheet As of September 30, 2007 |   |   | 3 |
|                                                                                          |   |   |   |   |   |   |   |   |   |
|                                                                                          |       Consolidated                  Statements of Income for the Three Months Ended September 30, 2007                  and                  2006 |   |   | 4 |
|                                                                                          |   |   |   |   |   |   |   |   |   |
|                                                                                          |       Consolidated                  Statements of Cash Flows for the Three Months Ended September 30,                  2007 and                  2006 |   | 5 |
|                                                                                          |   |   |   |   |   |   |   |   |   |
|                                                                                          |       Notes                  to Consolidated Financial Statements |   |   |   | 7-11 |
|                                                                                          |   |   |   |   |   |   |   |   |   |
| Item                  2                                                                       |   Management's                  Discussion and Analysis |   |   |   |   | 12-16 |
|                                                                                          |   |   |   |   |   |   |   |   |   |
| Item                  3                                                                       |   Controls                  and Procedures |   |   |   |   |   | 16 |
|                                                                                          |   |   |   |   |   |   |   |   |   |
| PART                  II - OTHER INFORMATION                                                  |   |   |   |   |   |   |
|                                                                                          |   |   |   |   |   |   |   |   |   |
| Item                  6                                                                       |   Exhibits                  and Reports on Form 8-K |   |   |   |   | 17 |
|                                                                                          |   |   |   |   |   |   |   |   |   |
| Signatures                                                                                    |   |   |   |   |   |   |   |   | 18 |
|                                                                                          |   |   |   |   |   |   |   |   |   |
| Index                  to Exhibits                                                            |   |   |   |   |   |   |   | 19 |

----

*Table          of Contents*

| METWOOD,                  INC. AND SUBSIDIARY                                                  |
|------------------------------------------------------------------------------------------------|
| CONSOLIDATED                  BALANCE SHEET                                                    |
| AS                  OF SEPTEMBER 30, 2007                                                      |
| (UNAUDITED)                                                                                    |
|                                                                                           |   |   |   |
| ASSETS                                                                                         |   |   |   |
|                                                                                           |   |   |   |
| Current                  Assets                                                                |   |   |   |
| Cash                  and cash equivalents                                                     |   | $ | 42,440 |   |
| Accounts                  receivable                                                           |   |   | 556,527 |   |
| Deposits                                                                                       |   |   | 15,091 |   |
| Inventory                                                                                      |   |   | 1,159,749 |   |
| Prepaid                  expenses                                                              |   |   | 62,825 |   |
| Recoverable                  income taxes                                                      |   |   | 54,583 |   |
|                                                                                           |   |   |   |   |
| Total                  current assets                                                          |   |   | 1,891,215 |   |
|                                                                                           |   |   |   |   |
| Property                  and Equipment                                                        |   |   |   |   |
| Leasehold                  and land improvements                                               |   |   | 163,701 |   |
| Furniture,                  fixtures and equipment                                             |   |   | 81,351 |   |
| Computer                  hardware, software and peripherals                                   |   |   | 187,049 |   |
| Machinery                  and shop equipment                                                  |   |   | 380,110 |   |
| Vehicles                                                                                       |   |   | 371,501 |   |
|                                                                                           |   |   | 1,183,712 |   |
| Less                  accumulated depreciation                                                 |   |   | (612,969 | ) |
|                                                                                           |   |   |   |   |
| Net                  property and equipment                                                    |   |   | 570,743 |   |
|                                                                                           |   |   |   |   |
| Goodwill                                                                                       |   |   | 253,088 |   |
|                                                                                           |   |   |   |   |
| TOTAL                  ASSETS                                                                  |   | $ | 2,715,046 |   |
|                                                                                           |   |   |   |   |
|                                                                                           |   |   |   |   |
| See                  accompanying notes to consolidated financial                  statements. |

----

*Table          of Contents*

| METWOOD,                  INC. AND SUBSIDIARY                                   |
|------------------------------------------------------------------------------------------------|
| CONSOLIDATED                  BALANCE SHEET                                     |
| AS                  OF SEPTEMBER 30, 2007                                       |
| (UNAUDITED)                                                                     |
|                                                                                           |   |   |   |
| LIABILITIES                  AND STOCKHOLDERS' EQUITY                                          |   |   |   |
|                                                                                           |   |   |   |
| Current                  Liabilities                                                           |   |   |   |
| Accounts                  payable and accrued expenses                                         |   | $ | 302,388 |   |
|                                                                                           |   |   |   |   |
| Total                  current liabilities                                                     |   |   | 302,388 |   |
|                                                                                           |   |   |   |   |
| Long-term                  Liabilities                                                         |   |   |   |   |
| Amounts                  owed to related-party company                                         |   |   | 35,522 |   |
| Deferred                  income taxes, net                                                    |   |   | 134,467 |   |
|                                                                                           |   |   |   |   |
| Total                  long-term liabilities                                                   |   |   | 169,989 |   |
|                                                                                           |   |   |   |   |
| Total                  liabilities                                                             |   |   | 472,377 |   |
|                                                                                           |   |   |   |   |
| Stockholders'                  Equity                                                          |   |   |   |   |
| Common                  stock, $.001 par, 100,000,000 shares authorized;                       |   |   |   |   |
|    12,121,249                  shares issued; 12,116,399 outstanding            |   |   | 12,121 |   |
| Common                  stock not yet issued ($.001 par, 2,150 shares)                         |   |   | 2 |   |
| Additional                  paid-in capital                                                    |   |   | 1,345,734 |   |
| Retained                  earnings                                                             |   |   | 886,612 |   |
|                                                                                           |   |   | 2,244,469 |   |
| Treasury                  stock, at cost                                                       |   |   | (1,800 | ) |
|                                                                                           |   |   |   |   |
| Total                  stockholders' equity                                                    |   |   | 2,242,669 |   |
|                                                                                           |   |   |   |   |
| TOTAL                  LIABILITIES                                                             |   |   |   |   |
|   AND                  STOCKHOLDERS' EQUITY                                          |   | $ | 2,715,046 |   |
|                                                                                           |   |   |   |   |
|                                                                                           |   |   |   |   |
| See                  accompanying notes to consolidated financial                  statements. |

----

*Table          of Contents*

| METWOOD,                  INC. AND SUBSIDIARY                                                                                 |
|-------------------------------------------------------------------------------------------------------------------------------|
| CONSOLIDATED                  STATEMENTS OF INCOME                                                                            |
| FOR                  THE THREE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006                                                       |
| (UNAUDITED)                                                                                                                   |
|                                                                                                                          |   |   |   |   |   |   |
|                                                                                                                          |   | 2007 |   |   | 2006 |   |
| REVENUES                                                                                                                      |   |   |   |   |   |   |
|                                                                                                                          |   |   |   |   |   |   |
| Construction                  sales                                                                                           |   | $ | 1,141,513 |   |   | $ | 1,105,956 |   |
| Engineering                  sales                                                                                            |   |   | 68,655 |   |   |   | 44,568 |   |
| Gross                  sales                                                                                                  |   |   | 1,210,168 |   |   |   | 1,150,524 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Cost                  of construction sales                                                                                   |   |   | 722,397 |   |   |   | 570,608 |   |
| Cost                  of engineering sales                                                                                    |   |   | 63,348 |   |   |   | 45,919 |   |
| Gross                  cost of sales                                                                                          |   |   | 785,745 |   |   |   | 616,527 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Gross                  profit                                                                                                 |   |   | 424,423 |   |   |   | 533,997 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| ADMINISTRATIVE                  EXPENSES                                                                                      |   |   |   |   |   |   |   |   |
| Advertising                                                                                                                   |   |   | 20,831 |   |   |   | 30,514 |   |
| Bad                  debts                                                                                                    |   |   | - |   |   |   | 23,061 |   |
| Depreciation                                                                                                                  |   |   | 15,984 |   |   |   | 13,031 |   |
| Insurance                                                                                                                     |   |   | 21,334 |   |   |   | 19,354 |   |
| Payroll                  expenses                                                                                             |   |   | 165,594 |   |   |   | 189,557 |   |
| Professional                  fees                                                                                            |   |   | 27,608 |   |   |   | 22,300 |   |
| Rent                                                                                                                          |   |   | 19,650 |   |   |   | 18,600 |   |
| Research                  and development                                                                                     |   |   | 7,576 |   |   |   | 8,000 |   |
| Telephone                                                                                                                     |   |   | 8,035 |   |   |   | 9,071 |   |
| Travel                                                                                                                        |   |   | 13,794 |   |   |   | 9,809 |   |
| Vehicle                                                                                                                       |   |   | 13,472 |   |   |   | 9,073 |   |
| Other                                                                                                                         |   |   | 36,738 |   |   |   | 34,681 |   |
| Total                  administrative expenses                                                                                |   |   | 350,616 |   |   |   | 387,051 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Operating                  income                                                                                             |   |   | 73,807 |   |   |   | 146,946 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Other                  income (expense)                                                                                       |   |   | 704 |   |   |   | 3,077 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Income                  before income taxes                                                                                   |   |   | 74,511 |   |   |   | 150,023 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Income                  taxes                                                                                                 |   |   | 19,952 |   |   |   | 56,349 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Net                  income                                                                                                   |   | $ | 54,559 |   |   | $ | 93,674 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Basic                  and diluted earnings per share                                                                         |   | $ | - |   |   | $ | 0.01 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Weighted                  average number of shares                                                                            |   |   | 11,989,761 |   |   |   | 11,908,958 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| See                  accompanying notes to consolidated financial statements.         |

----

*Table          of Contents*

| METWOOD,                  INC. AND SUBSIDIARY                     |
|-------------------------------------------------------------------------------------------------|
| CONSOLIDATED                  STATEMENTS OF CASH FLOWS            |
| FOR                  THE THREE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006     |
| (UNAUDITED)                                                       |
|                                                                                            |   |   |   |   |   |   |
|                                                                                            |   | 2007 |   |   | 2006 |   |
| CASH                  FLOWS FROM OPERATING ACTIVITIES                                           |   |   |   |   |   |   |
| Net                  income                                                                     |   | $ | 54,559 |   |   | $ | 93,674 |   |
| Adjustments                  to reconcile net income to net cash from operating                 |   |   |   |   |   |   |   |   |
| activities                                                                                      |   |   |   |   |   |   |   |   |
| Depreciation                                                                                    |   |   | 33,611 |   |   |   | 29,086 |   |
| Provision                  for deferred income taxes                                            |   |   | 17,458 |   |   |   | 4,778 |   |
| (Increase)                  decrease in operating assets:                                       |   |   |   |   |   |   |   |   |
| Accounts                  receivable                                                            |   |   | (156,369 | ) |   |   | 11,861 |   |
| Inventory                                                                                       |   |   | 50,689 |   |   |   | (81,450 | ) |
| Recoverable                  income taxes                                                       |   |   | 2,494 |   |   |   | - |   |
| Other                  operating assets                                                         |   |   | 39,382 |   |   |   | (2,639 | ) |
| Increase                  (decrease) in operating liabilities:                                  |   |   |   |   |   |   |   |   |
| Accounts                  payable and accrued expenses                                          |   |   | 41,539 |   |   |   | (16,520 | ) |
| Current                  income taxes payable                                                   |   |   | - |   |   |   | (7,429 | ) |
| Net                  cash from operating activities                                             |   |   | 83,363 |   |   |   | 31,361 |   |
|                                                                                            |   |   |   |   |   |   |   |   |
| CASH                  FLOWS USED FOR INVESTING ACTIVITIES                                       |   |   |   |   |   |   |   |   |
| Expenditures                  for fixed assets                                                  |   |   | (104,024 | ) |   |   | (33,715 | ) |
| Net                  cash used for investing activities                                         |   |   | (104,024 | ) |   |   | (33,715 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |
| CASH                  FLOWS FROM FINANCING ACTIVITIES                                           |   |   |   |   |   |   |   |   |
| Proceeds                  from issuance of common stock                                         |   |   | 26,614 |   |   |   | - |   |
| Purchase                  of treasury stock                                                     |   |   | (1,800 | ) |   |   | - |   |
| Net                  cash from financing activities                                             |   |   | 24,814 |   |   |   | - |   |
|                                                                                            |   |   |   |   |   |   |   |   |
| Net                  increase (decrease) in cash                                                |   |   | 4,153 |   |   |   | (2,354 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |
| Cash,                  beginning of the year                                                    |   |   | 38,287 |   |   |   | 99,880 |   |
|                                                                                            |   |   |   |   |   |   |   |   |
| Cash,                  end of the period                                                        |   | $ | 42,440 |   |   | $ | 97,526 |   |
|                                                                                            |   |   |   |   |   |   |   |   |
|                                                                                            |   |   |   |   |   |   |   |   |
| See                  accompanying notes to consolidated financial                  statements.  |

----

*Table          of Contents*

| METWOOD,                  INC. AND SUBSIDIARY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| NOTES                  TO CONSOLIDATED FINANCIAL STATEMENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| SEPTEMBER                  30, 2007                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| (UNAUDITED)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |
| NOTE                  1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |
| Business                  Activity - Metwood, Inc. ("Metwood") was organized under the laws                  of the                  Commonwealth of Virginia on April 7, 1993.  On June 30, 2000,                  Metwood entered into an Agreement and Plan of Reorganization in                  which the                  majority of its outstanding common stock was acquired by a publicly                  held                  Nevada shell corporation.  The acquisition was a tax-free                  exchange for federal and state income tax purposes and was accounted                  for                  as a reverse merger in accordance with Accounting Principles Board                  ("APB")                  Opinion No. 16.  Upon acquisition, the name of the shell                  corporation was changed to Metwood, Inc., and Metwood, Inc., the                  Virginia                  corporation, became a wholly owned subsidiary of Metwood, Inc.,                  the Nevada                  corporation.  The publicly traded shell corporation had not had                  a material operating history for several years prior to the                  merger.                                                                                                                                                                                                                                    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |
| Effective                  January 1, 2002, Metwood acquired certain assets of Providence                  Engineering, PC ("Providence"), a professional engineering firm                  with                  customers in the same proximity as Metwood.  The total purchase                  price of $350,000 was paid with $60,000 in cash and with 290,000                  shares of                  the Company's common stock to the two Providence                  shareholders.  These shares were valued at the closing active                  quoted market price of the stock at the effective date of the purchase,                  which was $1.00 per share.  One of the shareholders of                  Providence was also an officer and existing shareholder of Metwood                  prior                  to the acquisition.  In 2002 Metwood purchased from that                  shareholder and retired 15,000 of the originally issued 290,000                  shares for                  $15,000 and in 2004 purchased from that shareholder and retired                  the                  remaining 275,000 of the originally issued 290,000 shares for $50,000.                  The                  initial purchase transaction was accounted for under the purchase                  method                  of accounting.  The purchase price was allocated as                  follows: |

|   Accounts                receivable   |   | $      | 75,000  |   |
|-------------------------------------------------------|--------|--------|---------|--------|
|   Fixed                assets     |   |   | 45,000  |   |
|   Goodwill                   |   |   | 230,000 |   |
|      Total    |   | $      | 350,000 |   |

| During                  the year ended June 30, 2003, liabilities assumed at the date of                  acquisition were identified and paid.  The amount of the                  liabilities paid was $23,088, and this amount was added to                  goodwill.                                                                                                                                                                                                                                                                                                                                              |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| The                  consolidated company ("the Company") provides construction-related                  products and engineering services to residential customers and                  contractors, commercial contractors, developers and retail enterprises,                  primarily in southwestern Virginia.                                                                                                                                                                                                                                                                                                            |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| Basis                  of Presentation - The financial statements include the accounts                  of                  Metwood, Inc. and its wholly owned subsidiary, Providence Engineering,                  PC,                  prepared in accordance with accounting principles generally accepted                  in                  the United States of America and pursuant to the rules and regulations                  of                  the Securities and Exchange Commission.  All significant                  intercompany balances and transactions have been                  eliminated. |

----

*Table          of Contents*

| METWOOD,                INC. AND SUBSIDIARY        |
|-----------------------------------------------------------------------------|
| NOTES                TO CONSOLIDATED FINANCIAL STATEMENTS    |
| SEPTEMBER                30, 2007        |
| (UNAUDITED)                                             |

| In                  the opinion of management, the unaudited condensed consolidated                  financial                  statements contain all the adjustments necessary in order to make                  the                  financial statements not misleading.  The results for the period                  ended September 30, 2007 are not necessarily indicative of the                  results to                  be expected for the entire fiscal year ending June 30,                  2008.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Fair                  Value of Financial Instruments - For certain of the Company's                  financial instruments, none of which are held for trading, including                  cash,                  accounts receivable, accounts payable and accrued expenses, the                  carrying                  amounts approximate fair value due to their short                  maturities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Management's                  Use of Estimates - The preparation of consolidated financial                  statements in conformity with accounting principles generally accepted                  in                  the United States of America requires management to make estimates                  and                  assumptions that affect the reported amounts of assets and liabilities,                  disclosures of contingent assets and liabilities at the date of                  consolidated financial statements, and the reported amounts of                  revenues                  and expenses during the reporting period.  Actual results could                  differ from those estimates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Accounts                  Receivable  - The Company grants credit in the form of                  unsecured accounts receivable to its customers based on an evaluation                  of                  their financial condition.  The Company performs ongoing credit                  evaluations of its customers.  The estimate of the allowance for                  doubtful accounts, which is charged off to bad debt expense, is                  based on                  management’s assessment of current economic conditions and historical                  collection experience with each customer.  At September 30,                  2007, the allowance for doubtful accounts was $-0-.  Specific                  customer receivables are considered past due when they are outstanding                  beyond their contractual terms and are charged off to the allowance                  for                  doubtful accounts when determined uncollectible.  For the three                  months ended September 30, 2007 and 2006, the amount of bad debts                  charged                  off was $-0- and $23,061 respectively, including chargeoffs for                  the three                  months ended September 30, 2006 relating to receivables which have                  been                  awarded to the Company as a result of lawsuits whose                  collectibilit |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Inventory                  - Inventory, consisting of metal and wood raw materials, is located                  on the                  Company's premises and is stated at the lower of cost or market                  using the                  first-in, first-out method.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Property                  and Equipment - Property and equipment are recorded at cost and                  include expenditures for improvements when they substantially increase                  the                  productive lives of existing assets.  Maintenance and repair                  costs are expensed to operations as incurred.  Depreciation is                  computed using the straight-line method over the assets' estimated                  useful                  lives, which range from three to forty years.  When a fixed                  asset is disposed of, its cost and related accumulated depreciation                  are                  removed from the accounts.  The difference between undepreciated                  cost and the proceeds is recorded as a gain or loss.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Goodwill                  - The Company accounts for goodwill and intangibles under SFAS                  No. 142,                  “Goodwill and Other Intangible Assets.” As such, goodwill is not                  amortized, but is subject to annual impairment reviews, or more                  frequent                  reviews if events or circumstances indicate there may be an impairment.                  The Company performed its required annual goodwill impairment test                  as of                  June 30, 2007 using discounted cash flow estimates and found that                  there                  was no impairment of goodwill.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Patents                  - The Company has been assigned several key product patents developed                  by                  certain Company officers.  No value has been recorded in the                  Company's financial statements because the fair value of the patents                  was                  not determinable within reasonable limits at the date of                  assignment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |

----

*Table          of Contents*

| METWOOD,                INC. AND SUBSIDIARY        |
|-----------------------------------------------------------------------------|
| NOTES                TO CONSOLIDATED FINANCIAL STATEMENTS    |
| SEPTEMBER                30, 2007        |
| (UNAUDITED)                                             |

| Revenue                  Recognition - Revenue is recognized when goods are shipped and earned                  or when services are performed, provided collection of the resulting                  receivable is probable.  If any material contingencies are                  present, revenue recognition is delayed until all material contingencies                  are eliminated.  Further, no revenue is recognized unless                  collection of the applicable consideration is probable.                                                                                                                                                                                                                                                                                                                                 |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |
| Income                  Taxes - Income taxes are accounted for in accordance with SFAS No.                  109, "Accounting for Income Taxes."  A deferred tax asset or                  liability is recorded for all temporary differences between financial                  and                  tax reporting and for net operating loss carryforwards, where                  applicable.  Deferred tax assets are reduced by a valuation                  allowance when, in the opinion of management, it is more likely                  than not                  that some portion or the entire deferred tax asset will not be                  realized.  Deferred tax assets and liabilities are adjusted for                  the effect of changes in tax laws and rates on the date of                  enactment. |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |
| Research                  and Development - The Company performs research and development on its                  metal/wood products, new product lines, and new patents.  Costs,                  if any, are expensed as they are incurred.  For the three months                  ended September 30, 2007 and 2006, the expenses relating to research                  and                  development were $7,576 and $8,000, respectively.                                                                                                                                                                                                                                                                                                                                                                                             |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |
| Earnings                  Per Common Share - Basic earnings per share amounts are based on the                  weighted average shares of common stock outstanding.  If                  applicable, diluted earnings per share would assume the conversion,                  exercise or issuance of all potential common stock instruments such as                  options, warrants and convertible securities, unless the effect                  is to                  reduce a loss or increase earnings per share. This presentation                  has been                  adopted for the quarters presented.  There were no adjustments                  required to net income for the years presented in the computation                  of                  diluted earnings per share.                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |
| Recent Accounting Pronouncements                  - In July 2006, the Financial Accounting Standards Board ("FASB")                  issued                  Interpretation ("FIN") No. 48, "Uncertainty in Income                  Taxes."  FIN 48 applies to all tax positions within the scope of                  Statement 109 and clarifies when and how to recognize tax benefits                  in the                  financial statements with a two-step approach to recognition and                  measurement.  FIN 48 became effective for fiscal years beginning                  after December 15, 2006.  The Company does not believe that the                  application of FIN 48 will have a material effect on our consolidated                  results of operations or financial position. |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |
| In                  September 2006, the SEC released Staff Accounting Bulletin ("SAB")                  No.                  108, "Considering the Effects of Prior Year Misstatements when                  Quantifying                  Misstatements in Current Year Financial Statements." SAB 108 provides                  interpretive guidance on the SEC's views regarding the process                  of                  quantifying materiality of financial statement misstatements. SAB                  108 is                  effective for fiscal years ending after November 15, 2006. The                  Company                  does not believe that the application of SAB 108 will have a material                  effect on our consolidated results of operations or financial                  position.                           |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |
| In                  September 2006, the FASB issued Statement No. 157, "Fair Value                  Measurements" ("SFAS 157").  SFAS 157 defines fair value,                  establishes a framework and gives guidance regarding the methods                  used for                  measuring fair value, and expands disclosures about fair value                  measurements. SFAS 157 is effective for financial statements issued                  for                  fiscal years beginning after November 15, 2007, and interim periods                  within                  those fiscal years. The Company is currently assessing the impact                  that                  SFAS 157 will have on our consolidated results of operations or                  financial                  position.                         |

----

*Table          of Contents*

| METWOOD,                INC. AND SUBSIDIARY        |
|-----------------------------------------------------------------------------|
| NOTES                TO CONSOLIDATED FINANCIAL STATEMENTS    |
| SEPTEMBER                30, 2007        |
| (UNAUDITED)                                             |

| In                  February 2007, the FASB issued SFAS No. 159, "The Fair Value Option                  for                  Financial Assets and Financial Liabilities ("SFAS 159").  SFAS                  159 permits entities to choose to measure many financial instruments                  and                  certain other items at fair value.  The objective of SFAS 159 is                  to improve financial reporting by providing entities with the opportunity                  to mitigate volatility in reported earnings caused by measuring                  related                  assets and liabilities differently without having to apply complex                  hedge                  accounting provisions.  SFAS 159 is effective for fiscal years                  beginning after November 15, 2007.  We have not completed our                  evaluation of SFAS 159, but we do not currently believe that it                  will have                  a material impact on our results of operations or financial                  position.                                                                                                                              |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |
| In                  February 2007, the EITF issued EITF 07-03, "Accounting for Nonrefundable                  Advance Payments for Goods or Services to Be Used in Future Research                  and                  Development Activities" ("EITF 07-03").  In EITF 07-3, the task                  force reached a consensus that nonrefundable advance payments for                  goods or                  services to be received in the future for use in research and development                  activities should be deferred and capitalized.  The capitalized                  amounts should be expensed as the related goods are delivered or                  the                  services are performed.  EITF 07-03 is effective for new                  contracts entered into during fiscal years beginning after December                  15,                  2007, including interim periods within those fiscal years.  We                  have not completed our evaluation of EITF 07-03, but we do not                  currently                  believe that it will have a material impact on our results of operation                  or                  financial position. |

| NOTE                  2 - EARNINGS PER SHARE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |       |   |   |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |       |   |   |   |
| Net                  income and earnings per share for the three months ending September                  30,                  2007 and 2006 are as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |       |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   | 2007   |       |   | 2006   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |       |   |   |   |
| Net                  income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $      | 54,559     |   |   | $      | 93,674 |   |
| Income                  per share - basic and fully diluted                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $      | --         |   |   | $      | 0.01 |   |
| Weighted                  average number of shares                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | 11,989,761 |   |   |   | 11,908,958 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |       |   |   |   |   |   |
| NOTE                  3 - SUPPLEMENTAL CASH FLOW INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |       |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |       |   |   |   |   |   |
| Supplemental                  disclosures of cash flow information for the three months ended                  September                  30, 2007 and 2006 are summarized as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |       |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   | 2007   |       |   | 2006   |   |
| Cash                  paid for:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |       |   |   |   |   |   |
| Income                  taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | $      | --         |   |   | $      | 59,000 |   |
| Interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | $      | 356        |   |   | $      | -- |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |       |   |   |   |   |   |
| NOTE                  4 - RELATED-PARTY TRANSACTIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |       |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |       |   |   |   |   |   |
| From                  time to time, the Company contracts with a company related through                  common                  ownership for building and grounds-related maintenance                  services. There were no fees paid to the related company for the                  three months ended September 30, 2007 and 2006. For the three months                  ended September 30, 2007 and 2006, the Company had sales of $31,037                  and                  $25,248, respectively, to the company referred to above. As of                  September 30, 2007, the related receivables outstanding were                  $54,352. See also Note                  7. |

----

*Table          of Contents*

| METWOOD,                INC. AND SUBSIDIARY        |
|-----------------------------------------------------------------------------|
| NOTES                TO CONSOLIDATED FINANCIAL STATEMENTS    |
| SEPTEMBER                30, 2007        |
| (UNAUDITED)                                             |

| NOTE                  5 - BANK CREDIT LINE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |   |   |   |   |
| The                  Company has available a $600,000 revolving line of credit with                  a local                  bank.  The balance outstanding at September 30, 2007 was                  $-0-.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |   |   |   |   |
| NOTE                  6 - SEGMENT INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |   |   |   |   |
| The                  Company operates in two principal business segments: (1)                  construction-related products and (2) engineering                  services.  Performance of each segment is evaluated based on                  profit or loss from operations before income taxes.  These                  reportable segments are strategic business units that offer different                  products and services.  Summarized revenue and expense                  information by segment for the three months ended September 30,                  2007 and                  2006, as excerpted from internal management reports, is as                  follows: |

| Construction:                                                        |   | 2007   |      |   | 2006   |   |
|----------------------------------------------------------------------|--------|--------|-----------|--------|--------|--------|
|                                                                 |   |   |      |   |   |   |
| Sales                                                                |   | $      | 1,141,513 |   |   | $      | 1,105,956 |   |
| Intersegment                  expenses                               |   |   | (14,512   | )      |   |   | (4,837 | ) |
| Cost                  of sales                                       |   |   | (722,397  | )      |   |   | (570,608 | ) |
| Corporate                  and other expenses                        |   |   | (353,865  | )      |   |   | (436,151 | ) |
|      Segment                  income        |   | $      | 50,739    |   |   | $      | 94,360 |   |
|                                                                 |   |   |      |   |   |   |   |   |
| Engineering:                                                         |   |   |      |   |   |   |   |   |
| Sales                                                                |   | $      | 68,655    |   |   | $      | 44,568 |   |
| Intersegment                  revenues                               |   |   | 14,512    |   |   |   | 4,837 |   |
| Cost                  of sales                                       |   |   | (63,348   | )      |   |   | (45,919 | ) |
| Corporate                  and other expenses                        |   |   | (15,999   | )      |   |   | (4,172 | ) |
|      Segment                  income (loss) |   | $      | 3,820     |   |   | $      | (686 | ) |

| NOTE                  7 - OPERATING LEASE COMMITMENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |
| On                  January 3, 2005, the Company entered into a ten-year commercial                  operating                  lease with a company related through common ownership.  The                  lease covers various buildings and property which house our manufacturing                  plant, executive offices and other buildings with a current monthly                  rental                  of $6,550.  The lease expires on December 31, 2014. For the                  three months ended September 30, 2007 and 2006, we recognized rental                  expense for these spaces of $19,650 and $18,600,                  respectively. |

----

*Table            of Contents*

| ITEM                  2 - MANAGEMENT'S DISCUSSION AND ANALYSIS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |
| *With                  the exception of historical facts stated herein, the matters discussed                  in                  this report are "forward-looking" statements that involve risks                  and                  uncertainties that could cause actual results to differ materially                  from                  projected results.  Such "forward-looking" statements include,                  but are not necessarily limited to, statements regarding anticipated                  levels of future revenues and earnings from operations of the                  Company.  Readers of this report are cautioned not to put undue                  reliance on "forward-looking" statements, which are by their nature,                  uncertain as reliable indicators of future                  performance.* |

| **Description                  of Business**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------|--------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |   |   |
| Background                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |   |   |
| As                  discussed in detail in Note 1, the Company was incorporated under                  the laws                  of the Commonwealth of Virginia on April 7, 1993 and, on June 30,                  2000,                  entered into a reverse merger in which it became the wholly owned                  subsidiary of a public Nevada shell corporation, renamed Metwood,                  Inc.  Effective January 1, 2002, Metwood acquired certain assets                  of Providence Engineering, PC in a transaction accounted for under                  the                  purchase method of accounting.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |   |   |
| Principal                  Products/Services and Markets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                               |                                                                                                                                             |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |   |   |
| *Metwood*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |   |
| Residential                  builders are aware of the superiority of steel framing vs. wood                  framing,                  insofar as steel framing is lighter; stronger; termite, pest, rot                  and fire                  resistant; and dimensionally more stable in withstanding induced                  loads.  Although use of steel framing in residential                  construction has generally increased each year since 1980, many                  residential builders have been hesitant to utilize steel due to                  the need                  to retrain framers and subcontractors who are accustomed to a                  "stick-built" construction method where components are laid out                  and                  assembled with nails and screws.  The Company's founders, Robert                  ("Mike") Callahan and Ronald Shiflett, saw the need to combine                  the                  strength and durability of steel with the convenience and familiarity                  of                  wood and wood fasteners. |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |   |   |
| Metwood                  manufactures light-gage steel construction materials, usually combined                  with wood or wood fasteners, for use in residential and commercial                  applications in place of more conventional wood products, which                  are                  inferior in terms of strength and durability.  The steel and                  steel/wood products allow structures to be built with increased                  load                  strength and structural integrity and fewer support beams or support                  configurations, thereby allowing for structural designs that are                  not                  possible with wood-only products.                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |   |   |
| Metwood's                  primary products and services are:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                               |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | **    ·**  Girders                  and headers |           ·  Garage,                  deck and porch concrete pour-over systems |                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |     ·  Floor                  joists            |                                                                                                                                             |           ·  Garage                  and post-and-beam buildings |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |     ·  Floor                  joist reinforcers |           ·  Engineering,                  design and custom building services  |                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |     ·  Roof                  and floor trusses  |                                                                                                                                             |                                                                                                                              |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |   |   |
| *Providence*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                               |                                                                                                                                             |                                                                                                                              |   |   |   |   |
| Providence                  is extensively involved in ongoing product research and development                  for                  Metwood.  Additionally, Providence offers its customers civil                  engineering capabilities which include rezoning and special use                  submissions; erosion and sediment control and storm-water management                  design; residential, commercial, and religious facility site development                  design; and utility design, including water, sewer and onsite treatment                  systems.  Providence's staff is familiar with construction                  practices and has been actively involved in construction administration                  and inspection on multiple                  projects.                                                                                                                                                                                                                                                                                                                |

----

*Table          of Contents*

| Providence                  also performs a variety of structural design and analysis work,                  successfully providing solutions for many projects, including retaining                  walls, residential framing, commercial building framing, light-gage                  steel                  fabrication drawings, metal building retrofits and additions, mezzanines,                  and seismic anchors and restraints.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| Providence                  has designed numerous foundations for a variety of                  structures.  Its foundation design expertise includes metal                  building foundations, traditional building construction foundations,                  atypical foundations for residential structures, tower foundations,                  and                  sign foundations for a variety of uses and                  applications.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| Providence                  has also designed and drafted full building plans for several                  applications.  When subcontracting with local professional                  firms, Providence has the ability to provide basic architectural,                  mechanical, electrical, and detailed civil and structural design                  services                  for these facilities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| Providence                  has reviewed designs by manufacturers for a variety of structures                  and                  structural components, including retaining walls, radio towers,                  tower                  foundations, sign foundations, timber trusses, light-gage steel                  trusses,                  and light-gage steel beams.  This service enables clients to                  take generic designs and have them certified and approved for construction                  in the desired locality.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| Distribution                  Methods of Products and Services                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| The                  Company's sales are primarily retail, directly to contractors and                  do-it-yourself homeowners in Virginia and North                  Carolina.  Approximately 90% of the Company's sales are                  wholesale to lumberyards, home improvement stores, hardware stores,                  and                  plumbing and electrical suppliers in Virginia and North Carolina,                  including Lowe's and 84 Lumber.  Metwood relies primarily on its                  own sales force to generate sales; additionally, however, the Company                  has                  distributors in Virginia, New York, Oklahoma, Arizona, Colorado                  and                  Pennsylvania and also utilizes the salespeople of wholesale yards                  stocking                  the Company's products as an additional sales force.  Metwood                  intends to continue expanding the wholesale marketing of its unique                  products to retailers and to license the Company's technology and                  products                  to increase its distribution outside of Virginia, North Carolina                  and the                  South. |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| Status                  of Publicly Announced New Products or Services                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| The                  Company has acquired four new patents through assignment from Robert                  M.                  Callahan and Ronald B. Shiflett, the patent holders.  All four                  patents reflect various modifications to the Company's Joist Reinforcing                  Bracket which will make it even easier for tradesmen to insert                  utility                  conduits through wood joists.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| Seasonality                  of Market                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |
| The                  Company's sales can be subject to seasonal impacts, as its products                  are                  used in residential and commercial construction projects which                  tend to be                  at peak levels in Virginia and North Carolina between the months                  of March                  and October.  Accordingly, the Company's sales tend to be                  greater in its fourth and first fiscal quarters.  However, the                  Company is expanding into less weather-sensitive markets, such                  as Florida,                  Georgia, Arizona, South Carolina and Alabama in order to ameliorate                  seasonality factors.  The Company builds an inventory of its                  products throughout the winter and spring to support its sales                  season.                                                                                                                                                                                                                                                                                                                                                                          |

----

*Table          of Contents*

| Competition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Nationally,                  there are over one hundred manufacturers of the types of products                  produced                  by the Company.  However, the majority of these manufacturers                  are using wood-only products or products without metal                  reinforcement.  Metwood has identified only one other                  manufacturer in the United States that manufactures a wood-metal                  floor                  truss similar to that of the Company.  However, Metwood has                  often found that its products are the only ones that will work                  within many                  customers' design specs.                                                                                                                                                                                                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Sources                  and Availability of Raw Materials and the Names of Principal                  Suppliers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| All                  of the raw materials used by the Company are readily available                  on the                  market from numerous suppliers.  The light-gage metal used by                  the Company is supplied primarily by Marino-Ware, Telling Industries                  and                  Wheeling Corrugating Company.  The Company's main sources of                  lumber are BlueLinx and The Contractor Yard.  Gerdau Amersteel,                  Descosteel and Adelphia Metals provide the majority of the Company's                  rebar.  Because of the number of suppliers available to the                  Company, its decisions in purchasing materials are dictated primarily                  by                  price and secondarily by availability.  The Company does not                  anticipate a lack of supply to affect its production; however,                  a shortage                  might cause the Company to pass on higher materials prices to its                  buyers. |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Dependence                  on One or a Few Major Customers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Presently                  the Company does not have any one customer whose loss would have                  a                  substantial impact on the Company's operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Patents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| The                  Company has eight U.S. Patents:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|      U.S.                  Patent No. 5,519,977, "Joist Reinforcing Bracket," a bracket that                  reinforces wooden joists with a hole for the passage of a utility                  conduit.  The Company refers to this as its floor joist patch                  kit.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|      U.S.                  Patent No. 5,625,997, "Composite Beam," a composite beam that includes                  an                  elongated metal shell and a pierceable insert for receiving nails,                  screws                  or other penetrating fasteners.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|      U.S.                  Patent No. 5,832,691, "Composite Beam," a composite beam that includes                  an                  elongated metal shell and a pierceable insert for receiving nails,                  screws                  or other penetrating fasteners.  This is a continuation-in-part                  of U.S. Patent No. 5,625,997.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|      U.S.                  Patent No. 5,921,053, "Internally Reinforced Girder with Pierceable                  Nonmetal Components," a girder that includes a pair of c-shaped                  members                  secured together so as to form a hollow box, which permits the                  girder to                  be secured within a building structure with conventional fasteners                  such as                  nails, screws and staples.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|      U.S.                  Patent Nos. D472,791S, D472,792S, D472,793S, and D477,210S, all                  modifications of Metwood's Reinforcing Bracket, which will be used                  for                  repairs of wood I-joists.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

----

*Table          of Contents*

| Each                  of these patents was originally issued to the inventors and Company                  founders, Robert Callahan and Ronald B. Shiflett, who licensed                  these                  patents to the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Need                  for Government Approval of Principal Products                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| The                  Company's products must either be sold with an engineer's seal                  or                  applicable building code approval.  Once that approval is                  obtained, the products can be used in all fifty states.  The                  Company's Floor Joist Reinforcer received Bureau Officials Code                  Association ("BOCA") approval in April 2001.  Currently, the                  Company's chief engineer has obtained professional licensure in                  several                  states which permit products not building code approved to be sold                  and                  used with his seal.   The Company expects his licensure in                  a growing number of states to greatly assist in the uniform acceptability                  of its products as it expands to new markets. |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Time                  Spent During the Last Two Fiscal Years on Research and Development                  Activities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Approximately                  fifteen percent of the Company's time and resources have been spent                  during                  the last two fiscal years researching and developing its metal/wood                  products, new product lines, and new patents.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Costs                  and Effects of Compliance with Environmental Laws                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| The                  Company does not incur any costs to comply with environmental                  laws.  It is an environmentally friendly business in that its                  products are fabricated from recycled steel.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Number                  of Total Employees and Number of Full-Time Employees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| The                  Company had thirty-six employees at September 30, 2007, thirty-four                  of                  whom were full time.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| **Results                  of Operations**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Net                  Income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| The                  Company had net income of $54,559 for the three months ended September                  30,                  2007, versus $93,674 for the three months ended September 30, 2006,                  a                  decrease of $39,115.  The decrease in net income was                  attributable primarily to higher materials costs, since gross sales                  comparing 2007 to 2006 increased slightly and administrative expenses                  were                  lower.                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Sales                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Revenues                  were $1,210,168 for the three months ended September 30, 2007 compared                  to                  $1,150,524 for the same period in 2006, an increase of $59,644,                  or                  5%.  The increase in sales resulted primarily from a slight                  increase in volume comparing the two                  periods.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |

----

*Table          of Contents*

| Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| Total                  administrative expenses were $350,616 for the three months ended                  September                  30, 2007, versus $387,051 for the three months ended September                  30, 2006, a                  decrease of $36,435 (9%).  A decrease of approximately $10,000                  in advertising and $24,000 in payroll expenses in 2007 over 2006                  were the                  largest contributors to the overall decrease.                                                                                                                                                                         |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| Liquidity                  and Capital Reserves                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| On                  September 30, 2007, the Company had cash of $42,440 and working                  capital of                  $1,588,827.  Net cash provided by operating activities was                  $83,363 for the three months ended September 30, 2007 compared                  to $31,361                  for the three months ended September 30, 2006.  The higher                  provision of cash in the current year resulted primarily from the                  use of                  inventory on hand, an increase in payables, and expenses of a non-cash                  nature (depreciation and deferred income taxes). |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| Cash                  used in investing activities was $104,024 for the three months                  ended                  September 30, 2007 compared to cash used of $33,715 during the                  same period                  in the prior year.  Cash flows used in investing activities for                  the current period were for vehicles ($6,000); shop equipment $64,791);                  computers and peripherals and furniture and fixtures ($9,117);                  and                  leasehold and land improvements ($24,116).                                                                                                |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| Cash                  provided by financing activities was $24,814 for the three months                  ended                  September 30, 2007 compared to $-0- for the period ended September                  30,                  2006.  Proceeds from the issuance of common stock of $26,614 was                  offset by the cost ($1,800) of treasury stock.                                                                                                                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| ITEM                  3 - CONTROLS AND PROCEDURES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| The                  management of Metwood, Inc. has reviewed the systems of internal                  controls                  and disclosures within the specified time frame of ninety                  days.  Management believes that the systems in place allow for                  proper controls and disclosures of financial reporting                  information.  There have been no changes in these controls since                  our last evaluation date.                                                                                                                                                                          |

----

*Table          of Contents*

| **PART                  II - OTHER INFORMATION**                                                                                                                                                                      |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                  |
| ITEM                  6 - EXHIBITS AND REPORTS ON FORM 8-K                                                                                                                                                            |
|                                                                                                                                                                                                                  |
|       (a)  Exhibits                                                                                                                                                           |
|                                                                                                                                                                                                                  |
|              See                  index to exhibits.                                                                                                 |
|                                                                                                                                                                                                                  |
|       (b)  Reports                  on Form 8-K                                                                                                                               |
|                                                                                                                                                                                                                  |
|              There                  were no reports on Form 8-K filed during the quarter ended September                  30,                  2006. |

----

*Table            of Contents*

| SIGNATURES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| In                  accordance with the requirements 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.                                                                                                                                                                                                                     |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Date:  November                  14,                  2007                                                   /s/  *Robert M.                  Callahan*                                                                                                                                                          |
|                                                                          Robert                  M. Callahan                 |
|                                                                          Chief                  Executive Officer            |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                                                          /s/  *Shawn                  A. Callahan* |
|                                                                          Shawn                  A. Callahan                  |
|                                                                          Chief                  Financial Officer            |

----

*Table          of Contents*

| **INDEX                  TO EXHIBITS**                                            |
|-----------------------------------------------------------------------------------|
|                                                                              |   |   |   |   |   |   |   |   |   |
| **NUMBER**                                                                        |   | **DESCRIPTION                  OF EXHIBIT** |   |   |   |   |
|                                                                              |   |   |   |   |   |   |   |   |   |
| 3(i)*                                                                             |   | Articles                  of Incorporation |   |   |   |   |   |
|                                                                              |   |   |   |   |   |   |   |   |   |
|    3(ii)**                                                         |   | By-Laws |   |   |   |   |   |   |   |
|                                                                              |   |   |   |   |   |   |   |   |   |
| 31.1                                                                              |   | Certification                  of Chief Executive Officer Pursuant                  to  Securities Exchange Act Rules 13a-14 and 15d-14 as Adopted                  Pursuant to Section 302 of the Sarbanes-Oxley Act of                  2002 |
|                                                                              |   |   |   |   |   |   |   |   |   |
| 31.2                                                                              |   | Certification                  of Chief Financial Officer Pursuant                  to  Securities Exchange Act Rules 13a-14 and 15d-14 as Adopted                  Pursuant to Section 302 of the Sarbanes-Oxley Act of                  2002 |
|                                                                              |   |   |   |   |   |   |   |   |   |
| 32                                                                                |   | Certifications                  Pursuant to Section 906 of the                  Sarbanes-Oxley Act of 2002 (18U.S.C. 1350) |
|                                                                              |   |   |   |   |   |   |   |   |   |
| *Incorporated                  by reference on Form 8-K, filed February 16, 2000  |   |   |   |
|                                                                              |   |   |   |   |   |   |   |   |   |
| **Incorporated                  by reference on Form 8-K, filed February 16, 2000 |   |   |   |

----