----

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

**              **

**              For the quarterly period ended March 31, 2007    **

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

**              **

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

**Commission        File Number 000-05391**

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| **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)              |

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| 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 March 31, 2007 |   |   |   |   | 3-4 |
|                                               |   |   |   |   |   |   |   |   |   |
|                                               | Consolidated                    Statements of Income for the Three and Nine Months |   |   |   | 5 |
|                                               | Ended                    March 31, 2007 and 2006 |   |   |   |   |   |   |
|                                               |   |   |   |   |   |   |   |   |   |
|                                               | Consolidated                    Statements of Cash Flows for the Nine Months |   |   |   |   | 6 |
|                                               | Ended                    March 31, 2007 and 2006 |   |   |   |   |   |   |
|                                               |   |   |   |   |   |   |   |   |   |
|                                               | 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 |   |   |   |   |   | 16 |
|                                               |   |   |   |   |   |   |   |   |   |
| Signatures                                         |   |   |   |   |   |   |   |   | 17 |
|                                               |   |   |   |   |   |   |   |   |   |
| Index                    to Exhibits               |   |   |   |   |   |   |   |   | 18 |

----

*Table              of Contents*

| METWOOD,                INC. AND SUBSIDIARY                                                |
|--------------------------------------------------------------------------------------------|
| CONSOLIDATED                BALANCE SHEET                                                  |
| AS                OF MARCH 31, 2007                                                        |
| (UNAUDITED)                                                                                |
|                                                                                       |   |   |   |
| ASSETS                                                                                     |   |   |   |
|                                                                                       |   |   |   |
| Current                Assets                                                              |   |   |   |
| Cash                and cash equivalents                                                   |   | $ | 223,287 |   |
| Accounts                receivable                                                         |   |   | 452,757 |   |
| Deposits                                                                                   |   |   | 8,950 |   |
| Inventory                                                                                  |   |   | 1,207,908 |   |
| Prepaid                expenses                                                            |   |   | 63,518 |   |
|                                                                                       |   |   |   |   |
| Total                current assets                                                        |   |   | 1,956,420 |   |
|                                                                                       |   |   |   |   |
| Property                and Equipment                                                      |   |   |   |   |
| Leasehold                improvements                                                      |   |   | 137,190 |   |
| Furniture,                fixtures and equipment                                           |   |   | 75,850 |   |
| Computer                hardware, software and peripherals                                 |   |   | 178,390 |   |
| Machinery                and shop equipment                                                |   |   | 302,519 |   |
| Vehicles                                                                                   |   |   | 365,501 |   |
|                                                                                       |   |   | 1,059,450 |   |
| Less                accumulated depreciation                                               |   |   | (544,433 | ) |
|                                                                                       |   |   |   |   |
| Net                property and equipment                                                  |   |   | 515,017 |   |
|                                                                                       |   |   |   |   |
| Goodwill                                                                                   |   |   | 253,088 |   |
|                                                                                       |   |   |   |   |
| TOTAL                ASSETS                                                                |   | $ | 2,724,525 |   |
|                                                                                       |   |   |   |   |
|                                                                                       |   |   |   |   |
| See                accompanying notes to consolidated financial                statements. |

----

*Table          of Contents*

| METWOOD,                  INC. AND SUBSIDIARY                                                  |
|------------------------------------------------------------------------------------------------|
| CONSOLIDATED                  BALANCE SHEET                                                    |
| AS                  OF MARCH 31, 2007                                                          |
| (UNAUDITED)                                                                                    |
|                                                                                           |   |   |   |
| LIABILITIES                  AND STOCKHOLDERS' EQUITY                                          |   |   |   |
|                                                                                           |   |   |   |
| Current                  Liabilities                                                           |   |   |   |
| Accounts                  payable and accrued expenses                                         |   | $ | 375,426 |   |
| Income                  taxes                                                                  |   |   | 35,054 |   |
|                                                                                           |   |   |   |   |
| Total                  current liabilities                                                     |   |   | 410,480 |   |
|                                                                                           |   |   |   |   |
| Long-term                  Liabilities                                                         |   |   |   |   |
| Deferred                  income taxes, net                                                    |   |   | 122,770 |   |
|                                                                                           |   |   |   |   |
| Total                  liabilities                                                             |   |   | 533,250 |   |
|                                                                                           |   |   |   |   |
| Stockholders'                  Equity                                                          |   |   |   |   |
| Common                  stock, $.001 par, 100,000,000 shares authorized;                       |   |   |   |   |
| 11,923,999                  shares issued and outstanding                                      |   |   | 11,924 |   |
| Common                  stock not yet issued ($.001 par, 2,150 shares)                         |   |   | 2 |   |
| Additional                  paid-in capital                                                    |   |   | 1,319,317 |   |
| Retained                  earnings                                                             |   |   | 860,032 |   |
|                                                                                           |   |   |   |   |
| Total                  stockholders' equity                                                    |   |   | 2,191,275 |   |
|                                                                                           |   |   |   |   |
| TOTAL                  LIABILITIES                                                             |   |   |   |   |
| AND                  STOCKHOLDERS' EQUITY                                                      |   | $ | 2,724,525 |   |
|                                                                                           |   |   |   |   |
|                                                                                           |   |   |   |   |
| See                  accompanying notes to consolidated financial                  statements. |

----

*Table          of Contents*

| METWOOD,                  INC. AND SUBSIDIARY                                                  |
|------------------------------------------------------------------------------------------------|
| CONSOLIDATED                  STATEMENTS OF INCOME                                             |
| FOR                  THE THREE AND NINE MONTHS ENDED MARCH 31, 2007 AND 2006                   |
| (UNAUDITED)                                                                                    |
|                                                                                           |   |   |   |   |   |   |   |   |   |
|                                                                                           |   | Three                  Months Ended |   | Nine                  Months Ended |   |
|                                                                                           |   | March                  31, |   | March                  31, |   |
|                                                                                           |   | 2007 |   | 2006 |   | 2007 |   | 2006 |   |
| REVENUES                                                                                       |   |   |   |   |   |   |   |   |   |
| Construction                  sales                                                            |   | $ | 1,021,163 |   | $ | 880,085 |   | $ | 3,220,196 |   | $ | 2,906,438 |   |
| Engineering                  sales                                                             |   |   | 35,691 |   |   | 53,277 |   |   | 123,149 |   |   | 186,319 |   |
| Gross                  sales                                                                   |   |   | 1,056,854 |   |   | 933,362 |   |   | 3,343,345 |   |   | 3,092,757 |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cost                  of construction sales                                                    |   |   | 578,106 |   |   | 523,106 |   |   | 1,661,459 |   |   | 1,721,908 |   |
| Cost                  of engineering sales                                                     |   |   | 61,061 |   |   | 45,241 |   |   | 159,423 |   |   | 120,190 |   |
| Gross                  cost of sales                                                           |   |   | 639,167 |   |   | 568,347 |   |   | 1,820,882 |   |   | 1,842,098 |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross                  profit                                                                  |   |   | 417,687 |   |   | 365,015 |   |   | 1,522,463 |   |   | 1,250,659 |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| ADMINISTRATIVE                  EXPENSES                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Advertising                                                                                    |   |   | 40,004 |   |   | 64,811 |   |   | 101,550 |   |   | 188,252 |   |
| Depreciation                                                                                   |   |   | 14,212 |   |   | 15,081 |   |   | 40,569 |   |   | 40,910 |   |
| Insurance                                                                                      |   |   | 23,771 |   |   | 13,247 |   |   | 67,563 |   |   | 46,200 |   |
| Payroll                  expenses                                                              |   |   | 165,283 |   |   | 182,984 |   |   | 579,267 |   |   | 519,772 |   |
| Rent                                                                                           |   |   | 19,650 |   |   | 18,600 |   |   | 58,950 |   |   | 55,800 |   |
| Travel                                                                                         |   |   | 13,576 |   |   | 12,609 |   |   | 33,409 |   |   | 30,636 |   |
| Vehicle                                                                                        |   |   | 11,124 |   |   | 11,798 |   |   | 31,344 |   |   | 26,220 |   |
| Other                                                                                          |   |   | 64,636 |   |   | 60,243 |   |   | 238,466 |   |   | 205,839 |   |
| Total                  administrative expenses                                                 |   |   | 352,256 |   |   | 379,373 |   |   | 1,151,118 |   |   | 1,113,629 |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating                  income (loss)                                                       |   |   | 65,431 |   |   | (14,358 | ) |   | 371,345 |   |   | 137,030 |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other                  income                                                                  |   |   | 7,461 |   |   | 1,916 |   |   | 13,386 |   |   | 11,344 |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income                  (loss) before income taxes                                             |   |   | 72,892 |   |   | (12,442 | ) |   | 384,731 |   |   | 148,374 |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income                  taxes                                                                  |   |   | (25,663 | ) |   | 10,193 |   |   | (144,670 | ) |   | (47,262 | ) |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  income (loss)                                                             |   | $ | 47,229 |   | $ | (2,249 | ) | $ | 240,061 |   | $ | 101,112 |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                  and diluted earnings per share                                          |   |   | ** |   |   | ** |   | $ | 0.02 |   | $ | 0.01 |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted                  average number of shares                                             |   |   | 11,923,999 |   |   | 11,905,299 |   |   | 11,918,949 |   |   | 11,891,054 |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Less                  than $.01                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| See                  accompanying notes to consolidated financial                  statements. |

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*Table          of Contents*

| METWOOD,                  INC. AND SUBSIDIARY                                                  |
|------------------------------------------------------------------------------------------------|
| CONSOLIDATED                  STATEMENTS OF CASH FLOWS                                         |
| FOR                  THE NINE MONTHS ENDED MARCH 31, 2007 AND 2006                             |
| (UNAUDITED)                                                                                    |
|                                                                                           |   |   |   |   |   |
|                                                                                           |   | 2007 |   | 2006 |   |
| CASH                  FLOWS FROM OPERATING ACTIVITIES                                          |   |   |   |   |   |
| Net                  income                                                                    |   | $ | 240,061 |   | $ | 101,112 |   |
| Adjustments                  to reconcile net income to net cash from operating                |   |   |   |   |   |   |   |
| activities:                                                                                    |   |   |   |   |   |   |   |
| Depreciation                                                                                   |   |   | 89,998 |   |   | 80,375 |   |
| Common                  stock issued for services rendered                                     |   |   | - |   |   | 3,135 |   |
| Provision                  for deferred income taxes                                           |   |   | 15,616 |   |   | 14,998 |   |
| (Increase)                  decrease in operating assets:                                      |   |   |   |   |   |   |   |
| Accounts                  receivable                                                           |   |   | 54,068 |   |   | 94,242 |   |
| Inventory                                                                                      |   |   | (224,937 | ) |   | (62,776 | ) |
| Recoverable                  income taxes                                                      |   |   | - |   |   | 25,539 |   |
| Other                  operating assets                                                        |   |   | (1,593 | ) |   | (22,776 | ) |
| Increase                  (decrease) in operating liabilities:                                 |   |   |   |   |   |   |   |
| Accounts                  payable and accrued expenses                                         |   |   | 119,451 |   |   | (70,096 | ) |
| Current                  income taxes payable                                                  |   |   | (26,534 | ) |   | (3,543 | ) |
| Net                  cash from operating activities                                       |   |   | 266,130 |   |   | 160,210 |   |
|                                                                                           |   |   |   |   |   |   |   |
| CASH                  FLOWS USED FOR INVESTING ACTIVITIES                                      |   |   |   |   |   |   |   |
| Expenditures                  for fixed assets                                                 |   |   | (142,723 | ) |   | (213,000 | ) |
| Net                  cash used for investing activities                                   |   |   | (142,723 | ) |   | (213,000 | ) |
|                                                                                           |   |   |   |   |   |   |   |
| Net                  increase (decrease) in cash                                               |   |   | 123,407 |   |   | (52,790 | ) |
|                                                                                           |   |   |   |   |   |   |   |
| Cash,                  beginning of the year                                                   |   |   | 99,880 |   |   | 234,607 |   |
|                                                                                           |   |   |   |   |   |   |   |
| Cash,                  end of the period                                                       |   | $ | 223,287 |   | $ | 181,817 |   |
|                                                                                           |   |   |   |   |   |   |   |
|                                                                                           |   |   |   |   |   |   |   |
| See                  accompanying notes to consolidated financial                  statements. |

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*Table          of Contents*

| METWOOD,                  INC. AND SUBSIDIARY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| NOTES                  TO CONSOLIDATED FINANCIAL STATEMENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| MARCH                  31, 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |

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*Table          of Contents*

| METWOOD,                INC. AND SUBSIDIARY               |
|-----------------------------------------------------------|
| NOTES                TO CONSOLIDATED FINANCIAL STATEMENTS |
| MARCH                31, 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                  March 31, 2007 are not necessarily indicative of the results to                  be                  expected for the entire fiscal year ending June 30,                  2007.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 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                  March 31, 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 or directly to                  bad debt                  expense if there is no remaining allowance. For the three months                  ended                  March 31, 2007 and 2006, the amount of bad debts charged off was                  $7,416                  and $350, respectively. For the nine months ended March 31, 2007                  and 2006,                  the amount of bad debts charged off was $30,887 and $436,                  resp |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 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, 2006 using discounted cash flow estimates and found that                  there                  was no impairment of goodwill.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |

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*Table          of Contents*

| METWOOD,                INC. AND SUBSIDIARY               |
|-----------------------------------------------------------|
| NOTES                TO CONSOLIDATED FINANCIAL STATEMENTS |
| MARCH                31, 2007                             |
| (UNAUDITED)                                               |

| 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |
| 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. There were no research and development costs for                  the three                  months ended March 31, 2007 or 2006. For the nine months ended                  March 31,                  2007 and 2006, the expenses relating to research and development                  were                  $8,000 and $-0-, 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 periods 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                  will become effective for fiscal years beginning after December                  15, 2006.                  Management continues to evaluate the effect that adoption of FIN                  48 will                  have on the Company's consolidated results of operations and financial                  position. |

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*Table          of Contents*

| METWOOD,                INC. AND SUBSIDIARY               |
|-----------------------------------------------------------|
| NOTES                TO CONSOLIDATED FINANCIAL STATEMENTS |
| MARCH                31, 2007                             |
| (UNAUDITED)                                               |

| In                  September 2006, the FASB issued Statement No. 157, "Fair Value                  Measurements." 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                  does                  not expect adoption of FASB No. 157 to have a material effect on                  its                  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, with                  early                  application for the first interim period ending after November                  15, 2006.                  The Company does not believe that the application of SAB 108 will                  have a                  material effect on its consolidated results of operations or financial                  position. |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |
| NOTE                  2 - EARNINGS PER SHARE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   |   |   |   |   |   |

| Net                  income (loss) and earnings per share for the three and nine months                  ending                  March 31, 2007 and 2006 are as follows: |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                     |   |
|                                                                                                                                                                     |   | For                  the Three Months Ended |   | For                  the Nine Months Ended |   |
|                                                                                                                                                                     |   | March                  31, |   | March                  31, |   |
|                                                                                                                                                                     |   | 2007 |   | 2006 |   | 2007 |   | 2006 |   |
| Net                  income (loss)                                                                                                                                       |   | $ | 47,229 |   | $ | (2,249 | ) | $ | 240,061 |   | $ | 101,112 |   |
| Income                  per share - basic and fully diluted                                                                                                              |   |   | ** |   |   | ** |   | $ | 0.02 |   | $ | 0.01 |   |
| Weighted                  average number of shares                                                                                                                       |   |   | 11,923,999 |   |   | 11,905,299 |   |   | 11,918,949 |   |   | 11,891,054 |   |

| NOTE                  3 - SUPPLEMENTAL CASH FLOW INFORMATION                                                                                                                                |   |   |   |                                        |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|---------------------------------------------|--------|
|                                                                                                                                                                                        |   |   |   |                                        |   |   |   |   |   |   |   |
| Supplemental                  disclosures of cash flow information for the three and nine months                  ended                  March 31, 2007 and 2006 are summarized as follows: |   |   |   |
|                                                                                                                                                                                        |   |   |   |
|                                                                                                                                                                                        |   |   |   | For                  the Three Months Ended |   | For                  the Nine Months Ended |   |
|                                                                                                                                                                                        |   |   |   | March                  31,                  |   | March                  31, |   |
|                                                                                                                                                                                        |   |   |   | 2007                                        |   | 2006 |   | 2007 |   | 2006 |   |
|  Cash                paid for:                                                                                                                                                         |   |   |   |                                        |   |   |   |   |   |
| Income                  taxes                                                                                                                                                               |   |   |   |                                        | $      | - |   | $ | - |   | $ | 155,588 |   | $ | - |   |
| Interest                                                                                                                                                                                    |   |   |   |                                        | $      | - |   | $ | - |   | $ | - |   | $ | - |   |
|                                                                                                                                                                                        |   |   |   |                                        |   |   |   |   |   |   |   |   |   |   |   |   |

| 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 and nine                  months                  ended March 31, 2007 and 2006. For the three months ended March                  31, 2007                  and 2006, the Company had sales of $22,023 and $-0-, respectively,                  to the                  company referred to above. For the nine months ended March 31,                  2007 and                  2006, sales were $54,154 and $-0-, respectively. As of March 31,                  2007, the                  related-party receivable was $-0-. See also Note                  7. |

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*Table          of Contents*

| METWOOD,                INC. AND SUBSIDIARY               |
|-----------------------------------------------------------|
| NOTES                TO CONSOLIDATED FINANCIAL STATEMENTS |
| MARCH                31, 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 March 31, 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 and nine months ended March                  31, 2007                  and 2006, as excerpted from internal management reports, is as                  follows: |

|                                          |   | For                  the Three Months Ended |      |   |   | For                  the Nine Months Ended |   |
|-----------------------------------------------|--------|---------------------------------------------|-----------|--------|--------|--------------------------------------------|--------|
|                                          |   | March                  31,                  |      |   |   | March                  31,                 |   |
| Construction:                                 |   | 2007                                        |      | 2006   |   |                                       |   | 2007 |   | 2006 |   |
| Sales                                         |   | $                                           | 1,021,163 |   | $      | 880,085                                    |   |   |   |   | $ | 3,220,196 |   | $ | 2,906,438 |   |
| Intersegment                  expenses        |   |                                        | (27,167   | )      |   | -                                          |   |   |   |   |   | (59,334 | ) |   | - |   |
| Cost                  of sales                |   |                                        | (578,106  | )      |   | (523,106                                   | )      |   |   |   |   | (1,661,459 | ) |   | (1,721,908 | ) |
| Corporate                  and other expenses |   |                                        | (364,505  | )      |   | (362,725                                   | )      |   |   |   |   | (1,261,193 | ) |   | (1,095,457 | ) |
| Segment                  income               |   | $                                           | 51,385    |   | $      | (5,746                                     | )      |   | # |   | $ | 238,210 |   | $ | 89,073 |   |
|                                          |   |                                        |      |   |   |                                       |   |   |   |   |   |   |   |   |   |   |
| Engineering:                                  |   |                                        |      |   |   |                                       |   |   |   |   |   |   |   |   |   |   |
| Sales                                         |   | $                                           | 35,691    |   | $      | 53,277                                     |   |   |   |   | $ | 123,149 |   | $ | 186,319 |   |
| Intersegment                  revenues        |   |                                        | 27,167    |   |   | -                                          |   |   |   |   |   | 59,334 |   |   | - |   |
| Cost                  of sales                |   |                                        | (61,061   | )      |   | (45,241                                    | )      |   |   |   |   | (159,423 | ) |   | (120,190 | ) |
| Corporate                  and other expenses |   |                                        | (5,953    | )      |   | (4,539                                     | )      |   |   |   |   | (21,209 | ) |   | (54,090 | ) |
| Segment                  income (loss)        |   | $                                           | (4,156    | )      | $      | 3,497                                      |   |   | # |   | $ | 1,851 |   | $ | 12,039 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| 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 monthly rental of                  $6,200                  through October 2006 and increasing to $6,550 thereafter. The lease                  expires on December 31, 2014. For the three and nine months ended                  March                  31, 2007 and 2006, the Company recognized rental expense for these                  spaces                  of $19,650, $57,550, $18,600 and $55,800, respectively. The Company                  has                  also entered into a month-to-month lease effective July 2006 with                  the                  related-party company for a trailer located on the Company premises                  with a                  monthly rent of $350. For the three and nine months ended March                  31, 2007,                  rental expense for this property was                  $1,400. |

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*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 |   |   |   |   |   |

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*Table          of Contents*

| *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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |   |
| 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                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |   |
| 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, Home Depot and 84 Lumber. The                Company's relationships with these dealers has strengthened both                sales                volume and collectibility. Additionally, the Company sells directly                to                contractors and do-it-yourself homeowners in Virginia and North Carolina.                Metwood relies primarily on its own sales force to generate sales;                however, the Company has distributors in Virginia, New York, Oklahoma,                Arizona, Colorado, Washington 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. |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |   |
| 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.                                                                                                                                                                                                                                                                                                                                                                                                                                        |

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*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. and four Canadian 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |

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*Table          of Contents*

| Canadian                Patent Nos. 101892, 101893, 101894, and 101895 for the Company's                joist                reinforcing bracket designs.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 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 has 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-three employees at March 31, 2007, all of whom                were                full time.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| **Results                of Operations**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| Net                Income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| The                Company had net income of $47,229 for the three months ended March                31,                2007, versus a net loss of $2,249 for the three months ended March                31,                2006, an increase of $49,478. The increase in net income was attributable                both to a 13% growth in Company sales as well as holding the line                on                administrative costs comparing 2007 with 2006, enjoying a 7% decrease                in                those costs for the three months ended March 31, 2007 over 2006 and                only a                3% increase for the nine-month period ended March 31, 2007 compared                to                2006.                                                                                                         |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| Revenues                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| Revenues                were $1,056,854 for the three months ended March 31, 2007 compared                to                $933,362 for the same period in 2006, an increase of $123,492, or                13%. For                the nine-month periods ended March 31, 2007 and 2006, sales were                $3,343,345 and $3,092,757, respectively, an increase of 8%. The quarterly                increase in 2007 sales over 2006 resulted from both an increase in                volume                and in selling prices comparing the two periods. Gross margins increased                slightly, from 39% to 40% for the three months ended March 31, 2007                compared to 2006 and 40% to 46% for the nine months ended March 31,                2007                compared to the same period in                2006. |

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*Table          of Contents*

| The                  Company's significant growth in sales in its most recent quarter                  resulted                  from several factors, including increased engineering fees and                  completion                  of several large projects. Additionally, the Company experienced                  record                  sales in March, in part due to the unseasonably mild                  weather.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| Total                  administrative expenses were $352,256 and $379,373 for the three                  months                  ended March 31, 2007 and 2006, respectively, a decrease of $27,117,                  or 7%.                  For the nine-month periods ended March 31, 2007 and 2006, administrative                  expenses were $1,151,118 versus $1,113,629, an increase of $37,489,                  or 3%.                  Advertising costs were significantly reduced in 2007 compared to                  2006 for                  both the quarter (38% reduction) and nine-month periods (46% reduction).                  Payroll expenses decreased 10% for the three-month period in 2007                  over                  2006, but increased 11% for the nine months ended March 31, 2007                  compared                  to the same period in 2006. Payroll increases for the nine months                  included                  bonuses paid to sales staff reflecting the previously noted increase                  in                  sales volume for those periods. Insurance costs increased significantly                  for both the three months ended March 31, 2007 compared to 2006                  ($10,524,                  or 79%) and the nine-month periods ended March 31, 2007 compared                  to 2006                  ($21,363, or 46%). These increases were due both to rising |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| Liquidity                  and Capital Reserves                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| On                  March 31, 2007, the Company had cash of $223,287 and working capital                  of                  $1,545,940. Net cash provided by operating activities was $266,130                  for the                  nine months ended March 31, 2007 compared to $160,210 for the nine                  months                  ended March 31, 2006. The increased provision of cash in the current                  year                  resulted primarily from the collection of accounts receivable for                  the                  period and an increase in net income as well as a decrease in the                  payment                  of accounts payable and accrued expenses comparing 2007 to                  2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| Cash                  used in investing activities was $142,723 for the nine months ended                  March                  31, 2007 compared to cash used of $213,000 during the same period                  in the                  prior year. Cash flows used in investing activities for both periods                  were                  for the purchase of fixed assets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

| **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. |

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*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:                    April 30,                    2007                                                /s/ *Robert                    M. Callahan*                                                                                                                    |
|                                                                              Robert M. Callahan                         |
|                                                                              Chief Executive Officer                    |
|                                                                                                                                                                                                                                                                                                                                                                                                                 |
|                                                                              /s/ *Shawn                    A. Callahan* |
|                                                                              Shawn A. Callahan                          |
|                                                                              Chief Financial Officer                    |

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*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 |   |   |   |

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