U.S. Securities and Exchange Commission
                             Washington, D.C. 20549

                                   FORM 10-KSB



[X]     ANNUAL  REPORT  UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
        OF  1934  for  the  period  ended  June  30,  2002

[ ]     TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
        ACT  OF  1934  for  the  transition  period  from  _______  to  _______

COMMISSION FILE NUMBER: 000-05391

                                  METWOOD, INC.
                                  -------------
        (Exact name of small business issuer as specified in its charter)


          Nevada                              83-0210365
     -----------                              ----------
(State or other jurisdiction of      (IRS Employer identification
incorporation or organization)                    No.)


                      819 Naff Road, Boones Mill, VA 24065
                      ------------------------------------
                    (Address of principal executive offices)

                                 (540) 334-4294
                                 --------------
                           (Issuer's telephone number)

      Securities registered pursuant to Section 12(b) of the Exchange Act:

                                      None

      Securities registered pursuant to Section 12(g) of the Exchange Act:

                      $0.001 Par Value Common Voting Stock
                                (Title of Class)


Check whether the issuer (1) filed all reports required to be filed by Section13
or  15(d)  of  the  Exchange  Act during the past 12 months (or for such shorter
period  that the registrant was required to file such reports), and (2) has been
subject  to  such  filing  requirements  for  the  past  90  days.
Yes  [X]  No[  ]

Check  if there is no disclosure of delinquent filers in response to Item 405 of
Regulation  S-B  contained in this form, and no disclosure will be contained, to
the  best  of  registrant's  knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in  Part  III of this Form 10-KSB or an
amendment  to  this  Form  10-KSB.  [x]

State issuer's net revenues for its most recent fiscal year: $1,844,354

As  of  October 11, 2002 there were 12,053,549 common shares outstanding and the
aggregate  market  value of the common shares (based upon the average of the bid
price  ($.65)  reported  by  brokers),  held by non-affiliates was approximately
$7,834,807.  Transitional Small Business Disclosure Format (check one): Yes [  ]
No[X]

Number of shares of common stock outstanding as of October 11, 2002: 12,053,549

Number of shares of preferred stock outstanding as of October 11, 2002: N/A












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                -------------------------------------------------

















                                     PART I
                                     ------

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
-------------------------------------------------

This  periodic  report  contains  certain  forward-looking statements within the
meaning  of the Private Securities Litigation Reform Act of 1995 with respect to
the  financial  condition, results of operations, business strategies, operating
efficiencies  or  synergies,  competitive  positions,  growth  opportunities for
existing  products,  and  plans and objectives of management. Statements in this
periodic  report  that  are  not  historical  facts  are  hereby  identified  as
"forward-looking  statements"  for  the  purpose  of the safe harbor provided by
Section  21E  of  the  Exchange  Act  and  Section  27A  of  the Securities Act.

Item 1. Business

Business Development
--------------------

The  Company was incorporated under the laws of the State of Wyoming on June 19,
1969. Following an involuntary dissolution for failure to file an annual report,
the  Company  was  reinstated  as  a  Wyoming  Corporation  on October 14, 1999.
Thereafter,  on  January  28,  2000, the Company, through a majority shareholder
vote, changed its domicile to Nevada through a merger with EMC Energies, Inc., a
Nevada corporation.  The Plan of Merger provided for the dissenting shareholders
to be paid the amount, if any, to which they would be entitled under the Wyoming
Corporation  Statutes with respect to the rights of dissenting shareholders. The
Company  also changed its par value to $.001 and the amount of authorized common
stock  to  100,000,000.

Prior  to  1990,  the  Company  was engaged in the business of exploring for and
producing  oil  and  gas  in  the  Rocky Mountain and Mid-Continent areas of the
United  States.  The Company liquidated substantially all of its assets in 1990,
and  was  dormant  until  June 30, 2000, when it acquired, in a stock-for-stock,
tax-free  exchange,  all  of  the  outstanding  common stock of a privately held
Virginia  corporation,  Metwood,  Inc., which was incorporated in 1993. See Form
8-K and attached exhibits, filed August 11, 2000.  Metwood has been in the metal
and  metal/wood  construction  materials  manufacturing  business  since  1992.
Following the acquisition, the Company approved a name change from EMC Energies,
Inc.  to  Metwood,  Inc.

Principal Products or Services and Markets
------------------------------------------

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  to  withstand 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.

The  Company  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.

Its primary products and services are:

     Girders and headers
     Floor joists
     Floor joist patch kits
     Roof and floor trusses
     Garage, deck and porch kits
     Concrete/pour over systems
     Garage and post and beam buildings
     Engineering, design and custom building services

 Distribution methods of the products or services
-------------------------------------------------

The  Company's sales are primarily wholesale and retail, directly to contractors
and  do-it-yourself homeowners in Virginia and North Carolina. Approximately 60%
of  the  Company's  sales are wholesale to lumberyards, home improvement stores,
hardware  stores,  and  plumbing  and electrical suppliers in Virginia and North
Carolina.  The  Company relies on its own sales force for all outside sales. The
Company  is  in  negotiations with several distributors that will distribute the
products  nationwide.

Seasonality of market
---------------------

The Company's sales are subject to seasonal impacts, as its products are used in
residential  and  commercial construction projects, which tend to be at a higher
building  rate  in  Virginia  and North Carolina between the months of March and
October.  Accordingly,  the  Company's sales are greater in its first and fourth
quarters.  The Company builds an inventory of its products throughout the winter
and  spring  to  support  this  sales  season.

Competition
-----------

Nationally,  there  are  over one hundred manufacturers of the types of products
produced  by  the  Company.  Approximately  10%  of  these manufacturers capture
approximately  80%  of the market for these products. In addition, most of these
manufacturers  are better financed than the Company, and therefore better poised
for  market  retention  and  expansion.  The  majority  of  these manufacturers,
however,  are using wood-only products, or products without metal reinforcement.
The  Company has identified only one other manufacturer in the western U.S. that
manufacturers  a  wood-metal  floor  truss  similar  to that of the Company. The
Company holds four separate patents on its products (see Patents section, below)
that  are  unique  to the Company. The Company intends to continue to expand its
wholesale  marketing of its unique products to companies such as Lowe's and Home
Depot  and  to  license  the  Company's  technology and products to increase its
distribution  outside  of  Virginia,  North  Carolina  and  the  South.

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.  Primarily Unimast, Inc supplies the light-gage metal
used  by  the  Company.  The Company's main sources of lumber are Smith Mountain
Building Supply, Lowe's and 84 Lumber Company. Co-Steel supplies the majority of
the  Company's rebar supply. Because of the number of suppliers available to the
Company,  its  decision  in purchasing materials is dictated primarily by price,
and  secondarily  by  availability.  The  Company  does not anticipate a lack of
supply  to  ever  affect  its  production,  but  rather a shortage may 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 a customer, the loss of which would have a
substantial  impact  on  the  Company's  operations. As the Company continues to
expand  its  wholesale  sales  to  purchasers  such  as Lowe's and Home Depot, a
substantial  impact  would  be  more  likely  should  such  a  customer be lost.

Patents, trademarks, licenses, franchises, concessions, royalty agreements or
-----------------------------------------------------------------------------
labor contracts, including duration
-----------------------------------

     The Company owns/licenses four U.S. patents:

     U.S.  Patent  No.  5,519,977,  Joist  Reinforcing  Bracket,  a bracket that
reinforces  wooden  joists  provided  with  a  hole for the passage of a utility
conduit.  The  Company  refers to this as its floor joist patch kit. The Company
recently  had an independent appraisal done on the patent that valued it at $7.4
million.

     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.  The  Company  recently  had  an independent appraisal done on the
patent  that  valued  it  at  $13.8  million.

The  Company also has a patent pending on a modification of it floor joist patch
kit.  The  Company expects that this patent will be granted from the U.S. Patent
Office  within  the  next  twelve  months.

Each  of  these  patents  was  originally  issued  to  the inventors and Company
founders,  Robert  (Mike)  Callahan  and  Ronald B. Shiflett, who assigned these
patents  to  the  Company.

Need for any government approval of principal products or services
------------------------------------------------------------------

The  Company's  products  must  either  be  sold  with their engineer's seal, or
Building Officials Code Association (BOCA) must approve them. Once BOCA approval
is  obtained,  the  products  can  be used in all 50 states. The Company's floor
joist  patch  kit  received BOCA approval during April 2001. The Company expects
this to greatly assist in the uniform acceptability of the Company's products as
it  expands  to  new  markets.
Providence  Engineering
-----------------------
The  civil  engineering  capabilities of Providence 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.  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.
Providence  has  successfully  provided  design  and analysis 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 foundation, traditional
building  construction  foundations,  atypical  foundations  for  residential
structures,  tower  foundations,  and sign foundations for a variety of uses and
applications.
Providence  has  designed  and  drafted  full  building  plans  for  several
applications.  The  in-house  staff  provides  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.
Time spent during the last two fiscal years on research and development
-----------------------------------------------------------------------
activities
----------

Approximately fifteen percent of the Company's time and resources have been
spent during the last two fiscal years researching and developing metal/wood
products.

Costs and effects of compliance with environmental laws
-------------------------------------------------------

None; not applicable.

Number of total employees and number of full time employees
-----------------------------------------------------------

The Company has approximately twenty-three employees, all of whom are full-time.

Item  2.  Properties

During the year ended June 30, 2002, the Company purchased five acres of land in
Boones  Mill,  Virginia  adjacent  to  its corporate offices and warehouses. The
purchase  price  of  $89,000  was  paid to an entity controlled by the Company's
officer  and  shareholder.  The  purchase  price  of  $89,000  was paid in cash.

Item  3.  Legal  Proceedings

The  Company  is  not  a party to any legal proceedings, nor, to the best of its
knowledge,  are  any  such  proceedings  threatened  or  contemplated.

Furthermore, to the knowledge of management, no director or executive officer is
a party to any action adverse to the Company or has a material interest adverse
to the Company.

Item  4.  Submission  of  Matters  to  a  Vote  of  Security  Holders

No  matter  was  submitted  to  a  vote  during  the  year.












                                     PART II
                                     -------

Item  5.  Market  for  the Registrant's Common Stock and Related Security Holder
Matters

(a) Market Information
----------------------

     For  five  years  prior to September 2000, there was no "public market" for
shares  of  common  stock of the Company. As a result of the acquisition between
EMC  Energies, Inc. and Metwood, Inc., a trading market has developed, but it is
not an active trading market. It was therefore difficult to determine the market
value  of  the  stock.  Based  on the average bid price for the Company's common
stock at October 11, 2002, of $.65 per share, the market value of shares held by
non-affiliates  would  be  $7,834,807. There are no preferred shares authorized.

The  Company  is listed on the OTC Bulletin Board of the National Association of
Securities  Dealers  ("NASD")  under  the  symbol  "MTWD."

Set forth below is the high and low bid prices for the Company's common stock
for the last two years.

Quarter Ended                     High Bid     Low Bid
-------------                     --------     -------

September 2000 (thru 9/22/00)*     $5.00       $4.50
December 2000                      $4.75       $2.80
March 2001                         $3.25       $1.75
June 2001                          $2.50       $1.75
September 2001                     $2.00       $1.75
December 2001                      $2.00       $1.01
March 2002                         $1.90       $1.01
June 2002                          $1.75       $0.65

* There was no active market for five years before this date.

Holders
-------

The  number of holders of record of the Company's common stock as of October 11,
2002,  was  1,099.  This  number  does  not  include  an indeterminate number of
stockholders  whose  shares  are  held  by brokers in street name. The number of
stockholders  has  been  substantially  the  same  during  the  past  ten years.

Dividends
---------

There are no present material restrictions that limit the ability of the Company
to  pay dividends on common stock or that are likely to do so in the future. The
Company has not paid any dividends with respect to its common stock and does not
intend  to  pay  dividends  in  the  foreseeable  future.
Recent Sales of Unregistered Securities
---------------------------------------

None.

Item  6.  Management's  Discussion  and  Analysis

Selected Financial Data
-----------------------

For  the  years  ended  June  30,  2002  and  2001.

                                         2002          2001
                                         ----          ----

     Revenues                         $1,844,354     $1,558,807

     Net  income                         122,557         22,413
     Net  income  per  common  share        $.01             **
     Weighted  average  common
      shares  outstanding             11,777,170     11,621,166

**Less  than  $.01

At  June  30,  2002  and  2001

                                         2002          2001
                                         ----          ----

     Total  assets                    $1,795,245     $1,204,868
     Working  capital                    238,942        172,994
     Shareholders'  equity             1,463,900      1,047,984

No  dividends  have  been  declared  or  paid  during  the  periods  presented.


Results of Operations
---------------------

For  the  Years  Ended  June  30,  2002  and  2001.

Sales

Revenues  for  the year ended June 30, 2002 were $1,844,354 versus $1,558,807 in
revenues  for  the  year  ended  June  30, 2001, an increase of $285,547 or 18%.
Retail sales consisted of product sales, installation fees and engineering fees.
The  increase was primarily attributable to the transition into the newly opened
facility  that  has  allowed  for  increased  growth  and  the  acquisition  of
Providence,  effective  January 1, 2002, that has increased engineering sales in
the  current  year.

Other  revenues included income from a legal settlement in the amount of $50,000
for the year ending June 30, 2001 whereby the Company was compensated for use of
its intellectual property. There was $72,499 and $13,100 in income for the years
ending  June  30,  2002  and  2001,  respectively,  for renting a portion of its
facilities  and  equipment  in  2002.

The  Company  plans  to  accelerate growth of sales in fiscal 2003 by increasing
expenditures on marketing, establishing more strategic relationships and growing
public  awareness  of  its  products  and  services.

Income  /  Loss

Net  income  for  the  year  ended June 30, 2002 was $122,557 as compared to net
income  of  $22,413  in the comparable period in 2001. The Company recognized an
increase  in  gross  profit  of  $223,479  for  the year ended June 30, 2002 and
incurred  an  increase  of  $78,155  in  expenses  as  detailed  below.

The Company expects to continue to remain profitable and increase its net income
over  the  next  year.  However,  there  can  be no assurance that the Company's
profitability  or  revenue  growth  can  be  sustained  in  the  future.

Expenses

Total expenses for the year ended June 30, 2002 were $796,892 versus $718,737 in
the  comparable  period in 2001. The following increases (decreases) in expenses
were  noted  during  the  year  ended  June  30,  2002:
     Consulting,  engineering  and professional fees decreased $38,999 primarily
due  to issuances of $28,404 in common stock for professional services in fiscal
2001  compared  to  only  $2,000  incurred  in  fiscal  2002  and  a decrease in
engineering  fees  paid in 2002 compared to 2001. This was offset by the $17,028
increase  in  2002  investor  relations  marketing.
     Salaries increased $67,668 from the cost of hiring and retaining quality
personnel to administer the Company's operations and market the Company's
products.
     Utilities decreased $15,064 due to the Company's operating out of its newly
owned facility in 2001 and the buildings incurring more electrical costs in
fiscal 2001 before the Company converted the buildings to become more energy
efficient in fiscal 2002.
     Depreciation, a non-cash expense, increased $30,360 due to additional
capital equipment acquisitions and property improvements in 2002.

 The  Company  anticipates  incurring  approximately  the  same  amount of these
expenses  during  fiscal  2003.

     Increases  are  expected  in  certain  expenses such as advertising through
fiscal  2003 as the Company moves toward increasing development and marketing of
our  products  and  services.
Cost  of  Sales

One  of  the  largest  factors  in  the  variations  in  the  cost of sales as a
percentage  of  net  sales  was  the cost of materials. The cost of materials is
directly  and  positively  correlative  to  sales.

Cost  of  sales for the year ended June 30, 2002 was $939,436 versus $877,368 in
the comparable period in fiscal 2001. The increase was primarily attributable to
an  increase  in  sales  for the year. Gross margins and product prices remained
relatively  constant  during  the  year.

Impact  of  Inflation

The  Company  believes  that inflation has had a negligible effect on operations
during  the period and inflationary increases in the cost of sales can be offset
by  increasing  sales  and  improving  operating  efficiencies.

Trends,  Events,  and  Uncertainties

Demand  for  the  Company's  products  will be dependent on, among other things,
market  acceptance  of  the  Company's  concept, the quality of its products and
general  economic  conditions, which are cyclical in nature. Inasmuch as a major
portion of the Company's activities is the receipt of revenues from the sales of
its products, the Company's business operations may be adversely affected by the
Company's  competitors  and  prolonged  recessionary  periods.

Liquidity  and  Capital  Resources
----------------------------------

For  the  Years  Ended  June  30,  2002  and  2001.

Cash  flows provided by operations were $69,023 for the year ended June 30, 2002
versus  $5,416  in  the  comparable  period  in  2001. Cash flows from operating
activities  were  primarily  attributable  to  net  income  from  operations;
depreciation  and services exchanged for stock, partially offset by increases in
inventory,  accounts  receivable  and  prepaid  expenses.

Cash  flows used in investing activities increased $12,418 to $117,259 in fiscal
2002.  Cash  used  in  investing activities in the comparable period in 2001 was
$104,841.  The  increase  was  primarily  attributable a increase in fixed asset
purchases  in  fiscal  2002.

Cash  flows generated from financing activities were $100,400 for the year ended
June  30,  2002  versus  $33,751  in  the  comparable period in fiscal 2001. The
increase was primarily attributable to borrowings in excess of repayments on its
bank  lines  of  credit  and  notes  payable  during  fiscal  2002.

The  Company has funded its cash needs from inception through June 30, 2002 with
a  series  of  debt  transactions  as  discussed  in  the  preceding  paragraph.

The  Company  will  substantially  rely on the existence of revenue from product
sales  and  from  the  projected revenues for its services. The Company projects
that  it  will  have  enough capital to fund its operations over the next twelve
months.

On  a  long-term  basis, liquidity is dependent on continuation and expansion of
operations,  receipt  of  revenues,  additional  infusions  of  capital and debt
financing.  The  Company  is  considering  launching  a wide-scale marketing and
advertising  campaign.  Its  current  available  capital  and  revenues  are not
sufficient  to  fund  such  a  campaign. If the Company chooses to launch such a
campaign,  it well require substantially more capital. If necessary, the Company
plans  to raise this capital through an additional follow-on stock offering. The
funds  raised  from  this  offering  would  be  used  to develop and execute the
Company's  marketing  and  advertising  strategy,  which  may include the use of
television,  radio,  print  and  internet  advertising. However, there can be no
assurance  that  the  Company  will  be able to obtain additional equity or debt
financing in the future, if at all. If the Company is unable to raise additional
capital,  the  Company's  growth  potential  will  be  adversely  affected.
Additionally,  the  Company  will  have  to  significantly  modify  its  plans.










Item  7.  Financial  Statements


                          INDEPENDENT AUDITORS' REPORT
                          ----------------------------

To the Board of Directors
Metwood, Inc. and Wholly Owned Subsidiary
819 Naff Road
Boones Mill, Virginia 24065

We have audited the accompanying consolidated balance sheet of Metwood, Inc. and
its  wholly-owned  subsidiary  as  of June 30, 2002 and the related consolidated
statements  of  income, stockholders' equity, and cash flows for the years ended
June 30, 2002 and June 30, 2001. These consolidated financial statements are the
responsibility  of the Company's management. Our responsibility is to express an
opinion  on  these  consolidated  financial  statements  based  on  our  audits.

We conducted our audits in accordance with auditing standards generally accepted
in  the  United  States  of  America.  Those  standards require that we plan and
perform  the  audits  to obtain reasonable assurance about whether the financial
statements  are free from material misstatement. An audit includes examining, on
a  test  basis, evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made  by  management,  as well as evaluating the overall
financial  statement  presentation.  We  believe  that  our  audits  provide  a
reasonable  basis  for  our  opinion.

In  our opinion, the consolidated financial statements referred to above present
fairly,  in  all  material  respects,  the  consolidated  financial  position of
Metwood,  Inc.  and  its  wholly  owned  subsidiary as of June 30, 2002, and the
consolidated  results  of  its operations and its cash flows for the years ended
June  30,  2002  and  June  30,  2001  in  conformity with accounting principles
generally  accepted  in  the  United  States  of  America.




Bongiovanni & Associates, P.A.
Charlotte, North Carolina
September 27, 2002





<TABLE>
<CAPTION>


                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
                                  BALANCE SHEET
                                 AT JUNE 30, 2002

<S>                                                               <C>

ASSETS
----------------------------------------------------------------
CURRENT ASSETS
----------------------------------------------------------------
  Cash and Cash Equivalents. . . . . . . . . . . . . . . . . . .  $   78,088
  Accounts Receivable. . . . . . . . . . . . . . . . . . . . . .     186,763
  Inventory. . . . . . . . . . . . . . . . . . . . . . . . . . .     263,157
  Due from Shareholders. . . . . . . . . . . . . . . . . . . . .      23,088
  Prepaid Expenses . . . . . . . . . . . . . . . . . . . . . . .       7,581
                                                                -------------
    TOTAL CURRENT ASSETS . . . . . . . . . . . . . . . . . . . .     558,677
                                                                -------------

FIXED ASSETS
----------------------------------------------------------------
  Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     177,000
  Buildings and Improvements . . . . . . . . . . . . . . . . . .     660,813
  Furniture, Fixtures and Equipment. . . . . . . . . . . . . . .      91,216
  Machinery and Shop Equipment . . . . . . . . . . . . . . . . .     155,013
  Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . .     119,918
  Accumulated Depreciation . . . . . . . . . . . . . . . . . . .    (197,392)
                                                                -------------
     Net Fixed Assets. . . . . . . . . . . . . . . . . . . . . .   1,006,568
                                                                -------------

OTHER ASSETS
----------------------------------------------------------------
  Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . .     230,000
                                                                -------------
    TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . .  $1,795,245
                                                                -------------

LIABILITIES AND STOCKHOLDERS' EQUITY
----------------------------------------------------------------

CURRENT LIABILITIES
----------------------------------------------------------------
  Accounts Payable and Accrued Expenses. . . . . . . . . . . . .  $   98,478
  Income Taxes Currently Payable . . . . . . . . . . . . . . . .      49,500
  Notes Payable. . . . . . . . . . . . . . . . . . . . . . . . .      21,757
  Bank Line of Credit. . . . . . . . . . . . . . . . . . . . . .     150,000
                                                                -------------
    TOTAL CURRENT LIABILITIES. . . . . . . . . . . . . . . . . .     319,735
                                                                -------------
LONG-TERM LIABILITIES
----------------------------------------------------------------
  Deferred Income Tax Credit . . . . . . . . . . . . . . . . . .  $   11,610
                                                                -------------

COMMITMENTS - SEE NOTES
----------------------------------------------------------------

STOCKHOLDERS' EQUITY
----------------------------------------------------------------
  Common Stock ($.001 par value, 100,000,000 shares authorized:
  12,053,549 shares issued and outstanding at June 30, 2002) . .      12,053
  Common Stock Not Yet Issued ($.001 par value, 4,000 shares). .           4
  Additional Paid-in-Capital . . . . . . . . . . . . . . . . . .   1,347,696
  Retained Earnings. . . . . . . . . . . . . . . . . . . . . . .     104,147
                                                                -------------
    TOTAL STOCKHOLDERS' EQUITY . . . . . . . . . . . . . . . . .   1,463,900
                                                                -------------
    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY . . . . . . . . .  $1,795,245
                                                                -------------

</TABLE>



   See notes to consolidated audited financial statements and auditors' report

<TABLE>
<CAPTION>


                                METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
                                            INCOME STATEMENTS
                               FOR THE YEARS ENDING JUNE 30, 2002 AND 2001



<S>                                                                           <C>           <C>
                                                                                     2002          2001
                                                                              ------------  ------------
REVENUES AND COST OF SALES:
----------------------------------------------------------------------------
  Sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $ 1,844,354   $ 1,558,807
  Cost of Sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     (939,436)     (877,368)
                                                                              ------------  ------------
    Gross Profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      904,918       681,439
                                                                              ------------  ------------

OPERATING EXPENSES:
----------------------------------------------------------------------------
  Advertising. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       64,446        50,045
  Bad Debt Expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        8,869             -
  Commissions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            -           679
  Consulting, Engineering and Professional Fees. . . . . . . . . . . . . . .       46,369        85,368
  Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       72,360        42,000
  Dues and Subscriptions . . . . . . . . . . . . . . . . . . . . . . . . . .        5,626             -
  Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       58,662        42,648
  Investor Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . .       17,028             -
  Other Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        8,356         1,888
  Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          720           850
  Repairs and Maintenance. . . . . . . . . . . . . . . . . . . . . . . . . .       19,013        46,668
  Salaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      343,700       276,032
  Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       31,760        84,447
  Taxes and Licenses . . . . . . . . . . . . . . . . . . . . . . . . . . . .       49,844        40,775
  Telephone. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       21,714        12,011
  Travel and Entertainment . . . . . . . . . . . . . . . . . . . . . . . . .        3,724             -
  Uniforms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        1,568         5,306
  Utilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        8,491        23,555
  Vehicle Expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       34,642         6,465
                                                                              ------------  ------------
    TOTAL EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      796,892       718,737
                                                                              ------------  ------------
      OPERATING INCOME (LOSS). . . . . . . . . . . . . . . . . . . . . . . .      108,026       (37,298)

OTHER INCOME (EXPENSE):
----------------------------------------------------------------------------
  Lawsuit Settlement Income. . . . . . . . . . . . . . . . . . . . . . . . .            -        50,000
  Rental Income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       72,499        13,100
  Interest Expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       (8,819)       (1,430)
  Interest Income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        8,151         3,341
                                                                              ------------  ------------
    TOTAL OTHER INCOME, NET. . . . . . . . . . . . . . . . . . . . . . . . .       71,831        65,011
                                                                              ------------  ------------

      INCOME BEFORE TAXES. . . . . . . . . . . . . . . . . . . . . . . . . .      179,857        27,713
      INCOME TAX EXPENSE . . . . . . . . . . . . . . . . . . . . . . . . . .      (57,300)       (5,300)
                                                                              ------------  ------------
      NET INCOME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $   122,557   $    22,413
                                                                              ============  ============
  Net Income Per Common Share
  Basic & Fully Diluted. . . . . . . . . . . . . . . . . . . . . . . . . . .  $      0.01   $        **
                                                                              ============  ============
  Weighted Average Common
  Shares Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . .   11,777,170    11,621,166
                                                                              ============  ============

  ** Less than $.01.
See notes to consolidated audited financial statements and auditors' report
</TABLE>



<TABLE>
<CAPTION>


                              METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
                                  STATEMENT OF STOCKHOLDERS' EQUITY
                             FOR THE YEARS ENDING JUNE 30, 2002 AND 2001
<S>                             <C>          <C>       <C>          <C>       <C>          <C>
                                                         Common      Common
                                                         Stock       Stock
                                  Common      Common     Not Yet     Not Yet    Additional  Retained
                                  Shares      Stock      Issued      Issued     Paid-in     Earnings
                                  (000's)   ($.001 Par)  (000's)   ($.001 Par)  Capital    (Deficit)
-----------------------------------------------------------------------------------------------------
Balances, July 1, 2000 . . . .       11,353  $ 11,353          -0-       -0-  $ 1,015,797  $ (13,734)

Distributions to stockholders.          -0-       -0-          -0-       -0-          -0-    (16,249)

Net income for year. . . . . .          -0-       -0-          -0-       -0-          -0-     22,413

Issuance of common stock
for services . . . . . . . . .            4         4          -0-       -0-        8,000        -0-

Issuance of common stock
to officers. . . . . . . . . .          400       400          -0-       -0-       20,000        -0-
-----------------------------------------------------------------------------------------------------
Balances, June 30, 2001. . . .       11,757  $ 11,757            -  $      -  $ 1,043,797  $  (7,570)

Net income for year. . . . . .          -0-       -0-          -0-       -0-          -0-    122,557

Distributions to stockholders
of Providence. . . . . . . . .          -0-       -0-          -0-       -0-          -0-    (10,840)

Common stock not yet issued
for services . . . . . . . . .          -0-       -0-            4         4        3,996        -0-

Issuance of common stock for
asset acquisition. . . . . . .          290       290          -0-       -0-      289,710        -0-

Issuance of common stock
for services . . . . . . . . .            6         6          -0-       -0-       10,193        -0-
-----------------------------------------------------------------------------------------------------
Balances, June 30, 2002. . . .       12,053  $ 12,053            4  $      4  $ 1,347,696  $ 104,147




</TABLE>



   See notes to consolidated audited financial statements and auditors' report


<TABLE>
<CAPTION>


                     METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
                             STATEMENTS OF CASH FLOWS
                    FOR THE YEARS ENDING JUNE 30, 2002 AND 2001



<S>                                                         <C>         <C>
                                                                 2002        2001
                                                            ----------  ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
----------------------------------------------------------
  Net income . . . . . . . . . . . . . . . . . . . . . . .  $ 122,557   $  22,413
  Adjustments to reconcile net income to net
  cash provided by operating activities:
    Depreciation . . . . . . . . . . . . . . . . . . . . .     72,360      42,000
    Services exchanged for stock . . . . . . . . . . . . .      2,000      28,404
    Deferred income taxes. . . . . . . . . . . . . . . . .      7,800       3,810
    (Increase) decrease in operating assets:
      Accounts receivable and related due from shareholder    (51,738)    (53,942)
      Inventory. . . . . . . . . . . . . . . . . . . . . .   (121,126)    (57,290)
      Accrued interest receivable. . . . . . . . . . . . .          -       4,500
      Prepaid expenses . . . . . . . . . . . . . . . . . .     (7,581)          -
    Increase (decrease) in operating liabilities:
      Accounts payable and accrued expenses. . . . . . . .     (3,259)     15,521
      Income taxes currently payable . . . . . . . . . . .     48,010           -
                                                          -----------   ----------
      NET CASH PROVIDED BY OPERATING ACTIVITIES. . . . . .     69,023       5,416
                                                          -----------   ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
----------------------------------------------------------
  Return of deposit. . . . . . . . . . . . . . . . . . . .          -       8,250
  Expenditures for fixed assets. . . . . . . . . . . . . .   (117,259)   (113,091)
                                                          -----------   ----------
      NET CASH USED IN INVESTING ACTIVITIES. . . . . . . .   (117,259)   (104,841)
                                                          -----------   ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
----------------------------------------------------------
  Borrowings of notes payable. . . . . . . . . . . . . . .     19,718           -
  Repayments of notes payable. . . . . . . . . . . . . . .     (8,478)          -
  Borrowings on bank lines of credit . . . . . . . . . . .    270,000      50,000
  Repayments on bank lines of credit . . . . . . . . . . .   (170,000)          -
  Distributions to stockholders. . . . . . . . . . . . . .    (10,840)    (16,249)
                                                          -----------   ----------
      NET CASH PROVIDED BY FINANCING ACTIVITIES. . . . . .    100,400      33,751
                                                          -----------   ----------
      NET INCREASE (DECREASE) IN CASH AND
      CASH EQUIVALENTS . . . . . . . . . . . . . . . . . .     52,164     (65,674)
                                                          -----------   ----------
CASH AND CASH EQUIVALENTS:
----------------------------------------------------------
      Beginning of year. . . . . . . . . . . . . . . . . .     25,924      91,598
                                                          -----------   ----------
      End of year. . . . . . . . . . . . . . . . . . . . .  $  78,088   $  25,924
                                                          -----------   ----------

</TABLE>



   See notes to consolidated audited financial statements and auditors' report

<TABLE>
<CAPTION>


                                           METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
                                               STATEMENTS OF CASH FLOWS (CONT.)
                                          FOR THE YEARS ENDING JUNE 30, 2002 AND 2001

                                                                   2002          2001
                                                                   ----          ----


<S>                                                               <C>         <C>
SUPPLEMENTAL DISCLOSURES OF NON-CASH
----------------------------------------------------------------
INVESTING AND FINANCING ACTIVITIES:
----------------------------------------------------------------

        Exchange of note receivable from stockholders for
        fixed assets . . . . . . . . . . . . . . . . . . . .      $        -  $300,000
                                                                  =========== ========
        Common stock exchanged for consulting services . . . . .  $    2,000  $ 28,404
                                                                  =========== ========
        Issuance of common stock for acquisition of assets . . .  $  290,000  $      -
                                                                  =========== ========
        Issuance of common stock for other fixed asset additions  $   12,199  $      -
                                                                  =========== ========
        Vehicles acquired with notes payable . . . . . . . . . .  $   10,670  $      -
                                                                  =========== ========

</TABLE>


























   See notes to consolidated audited financial statements and auditors' report



                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
               CONSOLIDATED NOTES TO AUDITED FINANCIAL STATEMENTS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001
                   ==========================================

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------------------

Business  Activity - Metwood, Inc. (the Company) was organized under the laws of
------------------
the  State  of  Virginia  on  April  7,  1993.

Effective  June  30,  2000,  the  Company  entered  an  Agreement  and  Plan  of
Reorganization  to  acquire  the  majority  of the outstanding common stock of a
publicly held shell corporation. The acquisition resulted in a tax-free exchange
for  federal  and  state  income tax purposes. Upon acquisition, the name of the
shell  corporation was changed to Metwood, Inc. (a Nevada corporation). Metwood,
Inc.  (a Virginia corporation) became a wholly owned subsidiary of Metwood, Inc.
(a Nevada corporation). The transaction was accounted for as a reverse merger in
accordance  with  Accounting Principles Board ("APB") Opinion No. 16 wherein the
stockholders  of Metwood, Inc. (a Virginia corporation) retained the majority of
the  outstanding  common  stock  of  the  Company after the merger. The publicly
traded  shell  corporation  did  not  have a material operating history over the
prior  several  years.

Effective  January  1,  2002,  the Company acquired certain assets of Providence
Engineering, Inc., a professional engineering company with customers in the same
proximity  as  the  Company. The Company paid $60,000 in cash and issued 290,000
common  shares  to  two  of  its  shareholders.  These shares were valued at the
closing  quoted  stock  price  of  $1.00  per share at the effective date of the
purchase.  See  footnote  herein  entitled "Business Acquisition" for additional
disclosures.  One  of  the  shareholders  was  also  an  officer  and  existing
shareholder  of  the  Company  prior  to  the  acquisition.  The transaction was
accounted  for  under  the  purchase  method  of  accounting.

The  Company  provides  construction  related  products and engineering services
primarily  to  home  building  customers  located  principally  in  southwestern
Virginia.  The  Company  operates  one  subsidiary:  Metwood,  Inc.  (a Virginia
corporation).

Basis  of  Presentation  -  The financial statements included herein include the
-----------------------
accounts  of  Metwood,  Inc.  and  its wholly owned subsidiary on a consolidated
basis,  prepared  under  the  accrual  basis  of  accounting.  All  significant
intercompany  balances  and  transactions  have  been  eliminated.

Accounts  Receivable  -  Accounts  receivable are charged to bad debt expense as
--------------------
they  are deemed uncollectible based upon a periodic review of the accounts. Bad
debt  expense  of $8,869 and $ -0-for the years ended June 30, 2002 and June 30,
2001,  respectively,  was  recorded.  At  June  30, 2002, a $1,500 allowance for
doubtful  accounts  was  deemed  necessary.

Credit  is  extended  to  customers  based  on  an evaluation of their financial
condition,  and  collateral is not required. The Company performs ongoing credit
evaluations  of  its  customers.


                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
               CONSOLIDATED NOTES TO AUDITED FINANCIAL STATEMENTS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001
                   ==========================================

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
-----------------------------------------------------------

Fixed  Assets  - Fixed assets are recorded at cost and include expenditures that
-------------
substantially  increase the productive lives of the existing assets. Maintenance
and  repair  costs  are expensed as incurred. Depreciation is provided using the
straight-line method. Depreciation of fixed assets is calculated over management
prescribed  recovery  periods  that  range  from  5  to  31  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  from  disposition  is  recorded  as  a  gain  or  loss.

Long-Lived Assets - The Company evaluates the recoverability of its fixed assets
-----------------
and other assets in accordance with Statements of Financial Accounting Standards
("SFAS")  No.  121,  "Accounting  for  the Impairment of Long-Lived Assets to be
Disposed  Of",  which requires recognition of impairment of long-lived assets in
the  event  the  net  book  value  of  such  assets exceeds the estimated future
undiscounted  cash  flows  attributable  to such assets or the business to which
such  assets  relate.

Cash  and Cash Equivalents - For purposes of the Consolidated Statements of Cash
--------------------------
Flows,  the  Company  considers  liquid investments with an original maturity of
three  months  or  less  to  be  cash  equivalents.

Management's  Use  of  Estimates  -  The  preparation  of consolidated financial
--------------------------------
statements  in conformity with generally accepted accounting principles 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.

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 provided 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 net operating
loss  carry  forwards,  where  applicable.




                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
               CONSOLIDATED NOTES TO AUDITED FINANCIAL STATEMENTS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001
                   ==========================================

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
-----------------------------------------------------------

Income  Taxes (Cont.) - Deferred tax assets are reduced by a valuation allowance
---------------------
when,  in  the  opinion of management, it is more likely than not that, and 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.

Net  Income  per  Common Share - SFAS No.128 requires dual presentation of basic
------------------------------
and  diluted earnings per share (EPS) with a reconciliation of the numerator and
denominator  of the EPS computations. 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.  Accordingly, this presentation has been adopted for the years presented.
There  were  no adjustments required to net income for the year presented in the
computation  of  diluted  earnings  per  share.

Advertising Costs - Advertising costs are expensed as incurred. The Company does
-----------------
not  incur  any  direct-response  advertising costs. Advertising expense totaled
approximately $64,000 and $50,000 for the years ended June 30, 2002 and June 30,
2001,  respectively.

Comprehensive Income (Loss) - The Company adopted Financial Accounting Standards
---------------------------
Board  SFAS  No.  130,  "Reporting  Comprehensive  Income,"  which  establishes
standards  for  the  reporting  and  display  of  comprehensive  income  and its
components  in  the  financial  statements. There were no items of comprehensive
income  (loss)  applicable  to  the  Company  during  the  years  covered in the
consolidated  financial  statements.

Inventory - Inventory, consisting of building parts and materials located in the
---------
vicinity  of  Roanoke,  Virginia, is valued at the lower of cost or market using
the  first-in,  first-out  (FIFO)  method.

Concentration of Credit Risk - At times during the years ended June 30, 2002 and
----------------------------
June  30,  2001,  the Company's cash on deposit with its bank exceeded federally
insured  limits.  This  presents  a  significant  concentration  of credit risk.

Fair  Value  of  Financial  Instruments  -  The carrying amounts reported in the
---------------------------------------
consolidated  balance  sheet for cash, accounts receivable, inventory, bank line
of  credit,  notes payable and accounts payable and accrued expenses approximate
fair  values  based  on  the  short-term  maturity  of  these  instruments.



                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
               CONSOLIDATED NOTES TO AUDITED FINANCIAL STATEMENTS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001
                   ==========================================

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
-----------------------------------------------------------

Web  Site  Research  and Development - All costs incurred during the application
------------------------------------
development  stage  of  web  site  research and development are capitalized. All
training  and  application  maintenance  costs  incurred  during  the  post
implementation (operation stage) are expensed. GJGene JohnstonThis is where we
changed this statement 4/12/00.All upgrades and enhancements incurred during the
post implementation (operations stage) are capitalized.

Recent Accounting Pronouncements - In July 2001, the Financial Accounting
--------------------------------
Standards Board issued SFAS No.143, "Accounting for Asset Retirement
Obligations" which addresses the accounting and reporting for obligations
associated with the retirement of tangible long-lived assets and the associated
retirement costs. SFAS No. 143 requires that the fair value of a liability for
an asset retirement obligation be recognized in the period in which it is
incurred if a reasonable estimate of fair value cannot be made. SFAS No. 143 is
effective for financial statements issued for fiscal years beginning after June
15, 2002. The Company does not expect SFAS No. 143 to have a material effect on
its consolidated financial condition or consolidated cash flows.

In  August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal  of  Long-Lived  Assets." SFAS No. 144 generally establishes a standard
framework  with which to measure impairment of long-lived assets and expands APB
Opinion  No. 30, "Reporting the Results of Operations - Reporting the Effects of
Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently
Occurring  Events and Transactions" to include a component of the entity (rather
than  a  segment  of  the  business).  SFAS  No.  144 is effective for financial
statements  issued  for  fiscal  years  beginning  after  December 15, 2001. The
Company  does  not  expect  SFAS  No.  144  to  have  a  material  effect on its
consolidated  financial  condition  and  consolidated  cash  flows.

NOTE B - SUPPLEMENTAL CASH FLOW INFORMATION
-------------------------------------------

Supplemental  disclosures  of cash flow information for the years ended June 30,
2002  and  June  30,  2001  are  summarized  as  follows:

Cash paid during the years for interest and income taxes are as follows:

                                                  2002         2001
                                                 -----         ----

          Income Taxes                          $  1,507     $     -
          Interest                              $  8,819     $  1,430



                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
               CONSOLIDATED NOTES TO AUDITED FINANCIAL STATEMENTS
               FOR THE YEARS ENDED JUNE 30, 2002 AND JUNE 30, 2001
               ===================================================

NOTE C - RELATED PARTY TRANSACTIONS
-----------------------------------

The  Company  contracts  with  a  construction  company  related  through common
ownership  from  whom  the  Company  earns construction-related fees. During the
years ended June 30, 2002 and 2001, the Company earned and collected $79,977 and
$-0-,  respectively,  in  equipment  rental and other revenue from this company.
There  were  no  amounts  receivable from the related party at June 30, 2002 and
June  30,  2001.

During  the  year  ended June 30, 2001, the Company received $300,000, including
interest  thereto,  worth  of  fair market value of certain services and related
fixed  assets  consisting of machinery, equipment and building improvements from
two  of  its stockholders and officers in exchange for full payment on its notes
receivable  from  stockholders.

During  the  year  ended June 30, 2002, the Company purchased five acres of land
adjacent  to its corporate offices and warehouses. The purchase price of $89,000
was  paid  to  an  entity  controlled  by the Company's officer and shareholder.

See  Note  E  below  for  related-party  common  stock  transactions.

NOTE  D  -  BANK  CREDIT  LINES
-------------------------------

During  the  year  ended  June 30, 2001, the Company borrowed on a $150,000 bank
line  of  credit  in  the amount of $50,000 including interest thereon. The bank
credit  line  outstanding  at  June  30,  2001 was $50,000. The bank credit line
available  at  June  30, 2001 was $100,000. The loan was payable on demand, with
interest  at the rate of prime plus .50% per annum and was unsecured. The actual
rate  of  interest  in  effect  at June 30, 2001 was 7.50%. This loan was closed
during  the  year  ended  June  30,  2002.  During the year ended June 30, 2002,
$120,000  and  $20,000  was  borrowed  and  repaid,  respectively and the ending
balance  of $150,000 was transferred to a new bank as discussed in the following
paragraph.

The  Company  opened  a  new  $400,000 demand line of credit, dated February 25,
2002,  with  a  different  bank  during  the  year  ended June 30, 2002 with the
transfer  of  the  $150,000 loan discussed above. During the year ended June 30,
2002,  the  Company  borrowed  and  repaid  $100,000,  respectively,  leaving an
outstanding  balance  due  at  June  30,  2002 of $150,000. The bank credit line
available  at  June  30,  2002 was $250,000. The loan is payable on demand, with
interest at the bank's prime rate. The actual rate of interest in effect at June
30,  2002  was  4.75%.  Accounts  receivable,  equipment,  general  intangibles,
inventory,  furniture  and  fixtures  secure  the  loan  under a signed Security
Agreement  dated  February  25,  2002.  The  Company's  shareholder  and officer
guarantees  the  loan.



                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
               CONSOLIDATED NOTES TO AUDITED FINANCIAL STATEMENTS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001
                   ==========================================


NOTE  E  -  EQUITY
------------------

During  the  year  ended  June 30, 2001, the Company originally issued unrelated
subcontractors  95,000  common  shares  of the Company's stock for services that
should  have  been  rendered.  These  common shares of the Company were properly
canceled  due  to  non-performance.

During  the  year ended June 30, 2001, the Company issued 4,000 common shares of
the  Company stock to unrelated parties in exchange for the fair market value of
consulting  services  received  in  the  amount  of  approximately  $8,000.

During  the  year  ended  June  30, 2001, the Company also issued 400,000 common
shares of the Company stock to its officers and stockholders in exchange for the
fair  market  value of professional engineering and consulting services received
in  the  amount  of  approximately  $20,000.

During  the  year ended June 30, 2002, the Company issued 5,666 common shares of
the Company stock in exchange for the fair market value of fixed asset additions
received  in  the  amount  of  $10,199.

NOTE F - EARNINGS PER SHARE (EPS)
---------------------------------

SFAS  No.  128  requires  dual  presentation  of  basic  and  diluted EPS with a
reconciliation  of  the numerator and denominator of the EPS computations. 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. Accordingly, this presentation has been
adopted  for  the  years  presented.  There  were no adjustments required to net
income for the years presented in the computation of diluted earnings per share.
The  basic  and  diluted weighted average shares outstanding for the years ended
June  30,  2002  and  June  30,  2001  are  as  follows:

                                           2002                2001
                                        -------               -----

Weighted average outstanding common shares used
   for basic and diluted EPS         11,777,170          11,621,166
                                     ===========         ==========





                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
               CONSOLIDATED NOTES TO AUDITED FINANCIAL STATEMENTS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001
                   ==========================================

NOTE  G  -  OPERATING  LEASE
----------------------------

The  Company  formerly  leased  its corporate office and warehouse facilities in
Botetourt  County,  Virginia  under  a  cancelable  month-to-month  industrial
operating  lease. The end of the lease term actually occurred in July 2000, with
final payment made at such time, and the Company terminated the lease by written
notice  upon  relocating to another facility. There are no future minimum annual
commitments  due  to the month-to-month provisions of the lease. Rental payments
and  related  expense for the years ended June 30, 2002 and June 30, 2001 were $
720  and  $  850,  respectively.

NOTE H - INCOME TAXES
---------------------

The  provision  for  income  taxes  consists  of:

                  2002                2001
               -------               -----
Current:
   Federal    $     40,700     $       1,064
   State             8,800               426
                  --------     -------------
                    49,500             1,490
                   =======     ==============

Deferred:
   Federal    $      6,400     $       2,720
   State             1,400             1,090
                  --------     --------------
                     7,800             3,810
                  ========     ==============

The effective income tax rate differed from the statutory federal income tax
rate due to the following items:
                                                       2002          2001
                                                       ----          ----
     Income tax computed at the federal statutory rate   $ 49,500    $ 1,490
     Non-deductible services paid with stock                  -0-     (3,764)
     Non-deductible expenses (meals, goodwill amortization) (800)        -0-
     Accelerated depreciation                             10,400       8,000
State income taxes                                        (1,800)       (426)
                                                       ----------     -------
Total effective income taxes                             $ 57,300    $ 5,300
                                                       ===========    ========

During  the  year  ended  June  30, 2001, the Company paid $16,249 in former "S"
Corporation  distributions  to  its  shareholders  in  conjunction  with  the
termination of its federal "S" election at such time. During the year ended June
30,  2002,  the  Company paid $10,840 in former "S" Corporation distributions to
former  Providence  shareholders.


                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
               CONSOLIDATED NOTES TO AUDITED FINANCIAL STATEMENTS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001
                   ==========================================

NOTE H - INCOME TAXES (CONT.)
-----------------------------

Deferred  income  taxes  reflect  the  net  tax effects of temporary differences
between  the  carrying amounts of assets and liabilities for financial reporting
purposes  and  the  amount  used  for  federal  and  state  income tax purposes.

NOTE I - OTHER INCOME
---------------------

During  the  years ended June 30, 2002 and 2001, the Company received $6,225 and
$13,100,  respectively, of income from the rental of a portion of its warehouses
to  an  unrelated  third  party.

During  the  year ended June 30, 2001, the Company received non-recurring income
in  the  amount  of $50,000 pertaining to a settlement of a lawsuit in which the
Company  was  the  plaintiff.

NOTE J - SEGMENT INFORMATION
----------------------------

Based  on  the criteria established by SFAS No. 131, "Disclosures about Segments
of an Enterprise and Related Information," the Company operates in two principal
business  segments  -  (1) construction-related products and consulting services
and  (2)  engineering  services. In accordance with SFAS No. 131, the Company is
required to describe its reportable segments and provide data that is consistent
with  the  data made available to the Company's management to assess performance
and  make  decisions. Summarized revenues and expense information by segment for
the year ending June 30, 2002, as excerpted from internal management reports, is
as  follows:

Construction related products and services:
-------------------------------------------

Sales                             $1,701,809
Cost of sales                       (861,156)
Corporate and other expenses        (748,158)
                                    ---------
     Segment income                   92,495

Total assets                       1,394,439

Capital expenditures                 117,259

Depreciation                          67,821

Interest expense                       7,997





                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
               CONSOLIDATED NOTES TO AUDITED FINANCIAL STATEMENTS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001
                   ==========================================

NOTE J - SEGMENT INFORMATION (CONT.)
------------------------------------

Engineering services:
---------------------

Sales                                  $ 142,545
Cost of sales                           ( 78,280)
Corporate and other expenses             (43,866)
                                      -----------
     Segment income                       20,399

Total assets                             400,806

Capital expenditures                          -0-

Depreciation                               4,539

Interest expense                             822

The  Company determined that it did not have any separately reportable operating
segments  as  of  June  30,  2001.

NOTE  K  -  BUSINESS  ACQUISITION
---------------------------------

During  the  year  ended  June 30, 2002, the Company purchased certain assets in
Providence  Engineering, Inc. The total purchase price of $350,000 was paid with
$60,000  in  cash  consideration and with 290,000 shares of the Company's common
stock  valued  at $1.00 per share, the closing active quoted market price of the
stock on the effective date of the acquisition. The purchase price was allocated
as  follows:

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

The  fixed  assets  are being depreciated over their estimated useful lives. The
goodwill  is  not  amortized  under  SFAS No. 142 and is periodically tested for
impairment. The period for which results of operations of Providence Engineering
are  included in the accompanying income statements is for the six months ending
June  30,  2002.  This  represents  the  date  of  acquisition through year-end.



                    METWOOD, INC. AND WHOLLY OWNED SUBSIDIARY
               CONSOLIDATED NOTES TO AUDITED FINANCIAL STATEMENTS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001
                   ==========================================

NOTE  L  -  NOTES  PAYABLE
--------------------------

The  Company  assumed two vehicles with related bank notes during the year ended
June  30,  2002  as  a  result  of  the Providence purchase. The vehicles have a
combined net book value of approximately $6,000 at June 30, 2002. The notes were
fully repaid subsequent to year-end with interest thereto of 14.245% and 11.434%
per  annum  on  the  notes.  The  vehicles  were  collateral  on  the  notes.

The  Company also incurred an insurance premium loan during the year ending June
30,  2002.  The  loan  balance  of  $1,323  at  June  30,  2002 was fully repaid
subsequent  to  year-end. The loan carried an effective interest rate of 10.793%
per  annum.

The Company incurred short-term financing from a bank during the year ended June
30,  2002.  The business credit line was for a maximum of $25,000 at an interest
rate  of  7.75%  per  annum.  The $13,760 unsecured balance at June 30, 2002 was
fully  repaid  subsequent  to  year-end.





Item 8. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure

None.

Item  9.  Directors  and  Executive  Officers  of  the  Registrant

Identification of Directors and Executive Officers
--------------------------------------------------

     The following table sets forth, in alphabetical order, the names and the
nature of all positions and offices held by all directors and executive officers
of the Company for the Company year ending June 30, 2002 and to the date hereof,
and the period or periods during which each such director or executive officer
served in his or her respective positions.

Name                          Position and background
----                          -----------------------

Robert M. (Mike) Callahan     President

Experience:  Mr.  Callahan  has  been involved in the building industry for over
thirty years.  He is well recognized in Southwestern Virginia as an innovator in
the  uses  of  passive  solar  design  and  wood/metal  products  in custom home
building.  Along  with  Mr.  Shiflett,  he formed Metwood, Inc. in 1993 to bring
light gage construction, used in commercial buildings for years, into common use
in  residential  construction.

Shawn A. Callahan     Secretary/Treasurer, Plant Manager

Education: B.S. Computer Science, 1996, Virginia Military Institute

B.S. Mathematics, 1996, Virginia Military Institute

Experience:  Since  starting  with  Metwood,  Inc. in May 1996, Mr. Callahan has
played  a  major  role in the restructure of the company, increasing production,
improving  efficiency,  and  developing  computer  aids  for  the  company.

Annette G. Mariano     Chief Financial Officer

Education: MBA (Emphasis in Accounting), 1975 San Diego State University

B.A. English 1969 Colorado Women's College

Experience: Ms. Mariano has 24 years experience as a CPA in both private and
public accounting. She has been with Metwood, Inc. since October 2001.

Ronald B. Shiflett     Vice President

Education:  B.S. Civil Engineering, 1973, Virginia Polytechnic Institute & State
University

M.S.  Civil Engineering, 1977, Virginia Polytechnic Institute & State University

Registered as a Professional Engineer in Virginia, North Carolina, West Virginia
and  Michigan.

Experience:  Mr.  Shiflett  has  been  engaged  in  the  structural  design  of
industrial,  commercial,  residential, and institutional buildings for 25 years.
He  is recognized by the design community in Western Virginia as an innovator in
the  use  and design of light-gage steel framing in building construction. Along
with  Mr.  Callahan,  he  formed  Metwood,  Inc.  in  1993.

Term of Office
--------------

The term of office of the current directors shall continue until new directors
are elected or appointed.

Family Relationships
--------------------

Robert (Mike) Callahan is the father of Shawn Callahan.

Involvement in Certain Legal Proceedings
----------------------------------------

Except  as  indicated  below and to the knowledge of management, during the past
five  years,  no  present  or  former  director,  person  nominated  to become a
director,  executive  officer,  promoter  or  control  person  of  the  Company:

(1)  was  a  general  partner or executive officer of any business by or against
which  any  bankruptcy petition was filed, whether at the time of such filing or
two  years  prior  thereto;

(2)  was  convicted  in  a criminal proceeding or named the subject of a pending
criminal  proceeding  (excluding  traffic  violations and other minor offenses);

(3) was the subject of any order, judgment or decree, not subsequently reversed,
suspended  or  vacated,  of  any court of competent jurisdiction, permanently or
temporarily enjoining, barring, suspending or otherwise limiting his involvement
in  any  type  of  business,  securities  or  banking  activities;  or

(4) was the subject of any order, judgment or decree, not subsequently reversed,
suspended  or  vacated, of any federal or state authority barring, suspending or
otherwise  limiting  for more than 60 days the right of such person to engage in
any  activity  described above under this Item, or to be associated with persons
engaged  in  any  such  activity;

(5)  was  found  by  a  court of competent jurisdiction (in a civil action), the
Commission  or  the  Commodity  Futures  Trading  Commission  to have violated a
federal  or  state  securities  or  commodities  law,  nor  has  a judgment been
reversed,  suspended,  or  vacated.

Compliance with Section 16(a) of the Exchange Act
-------------------------------------------------

No  director,  executive  officer or 10% shareholder of the Company has effected
any  transactions  in  the  Company's  securities  for the dates covered by this
report  since  the  date  of  filing  their  respective  Form  3  reports.

Item  10.  Executive  Compensation

The  following table sets forth in summary form the compensation received during
each  of  the Company's last three completed fiscal years by the Chief Executive
Officer  and  President  of  the  Company.


Summary Compensation Table
<TABLE>
<CAPTION>




<S>           <C>      <C>           <C>          <C>      <C>      <C>       <C>
              Other    Restricted    Restricted
Name and . .  Fiscal   Annual        Compen-      Stock    LTIP     Stock
Position . .  Year     Salary        Bonuses      sation   Awards   Options   Bonuses
------------  -------  ------------  -----------  -------  -------  --------  -------
                  (1)           (2)      (3) (7)      (4)      (5)       (6)
------------  -------  ------------  -----------  -------  -------  --------
Michael
Callahan,. .    2002   $   100,000          -0-      -0-      -0-       -0-       -0-
President &.    2001   $   100,000          -0-      -0-      -0-       -0-       -0-
 Director. .    2000   $   100,000          -0-      -0-      -0-       -0-       -0-
------------  -------  ------------  -----------  -------  -------  --------  -------
Ronald
Shiflett,. .    2002   $   34,700*          -0-      -0-      -0-       -0-       -0-
V.P.&. . . .    2001   $       -0-          -0-      -0-      -0-       -0-       -0-
Director . .    2000   $       -0-          -0-      -0-      -0-       -0-       -0-
------------  -------  ------------  -----------  -------  -------  --------  -------
Shawn
Callahan,. .    2002   $    54,000          -0-      -0-      -0-       -0-       -0-
Secretary, .    2001   $    54,000          -0-      -0-      -0-       -0-       -0-
Treas., Dir.    2000   $    44,000          -0-      -0-      -0-       -0-       -0-
------------  -------  ------------  -----------  -------  -------  --------  -------
</TABLE>




(1)     The dollar value of base salary (cash and non-cash) received.
Information on the stock-based compensation can be found in the accompanying
audited financial statements. * = Salary for Mr. Shiflett is for six months
ended June 30, 2002.

(2)     The dollar value of bonus (cash and non-cash) received.

(3)     During the periods covered by the Summary Compensation Table, the
Company did not pay any other annual compensation not properly categorized as
salary or bonus, including perquisites and other personal benefits, securities
or property.

(4)     During the periods covered by the Summary Compensation Table, the
Company did not make any award of restricted stock.

(5)     The Company has had no stock option plans.

(6)     The Company currently has no Restricted Stock Bonus Plans.

(7)     No other compensation

No  member  of  the  Company's  management  has been granted any option or stock
appreciation  right;  accordingly,  no  tables  relating to such items have been
included  within  this  Item.  See  the Summary Compensation Table of this Item.

Compensation of Directors
-------------------------

     There  are  no  standard  arrangements  pursuant  to  which  the  Company's
directors  are  compensated for any services provided as director. No additional
amounts  are  payable  to the Company's directors for committee participation or
special  assignments.

     There  are no arrangements pursuant to which any of the Company's directors
was  compensated during the Company's last completed fiscal year or the previous
two  fiscal  years  for  any  service  provided  as  director.  See  the Summary
Compensation  Table  of  this  Item.

Termination of Employment and Change of Control Arrangement
-----------------------------------------------------------

     There  are  no compensatory plans or arrangements, including payments to be
received  from  the  Company,  with  respect  to any person named in the Summary
Compensation  Table  set  out above which would in any way result in payments to
any  such  person  because  of  his  or  her  resignation,  retirement  or other
termination of such person's employment with the Company or its subsidiaries, or
any  change  in  control  of  the  Company,  or  a  change  in  the  person's
responsibilities  following  a  change  in  control  of  the  Company.

Item  11.  Security  Ownership  of  Certain  Beneficial  Owners  and  Management

     (a)  Security  Ownership  of  Certain  Beneficial  Owners

   The  following Table sets forth the shares held by those persons who own more
than  five  percent of Metwood's common stock as of October 11, 2002, based upon
12,053,549  shares  outstanding.

                     Name  and  address
Title  of  Class     of beneficial  owner  Number  of  shares   Percent of class
----------------     -----------------     ------------------   ----------------


Common     Robert  ('Mike')  Callahan       5,564,665  (1)           46.1%
           819 Naff Road
           Boones Mill, VA 24065

Common     Ronald  Shiflett                 2,151,282                17.8%
           819 Naff Road
           Boones Mill, VA 24065

Common     Shawn  Callahan                  1,004,550                 8.3%
           819 Naff Road
           Boones Mill, VA 24065

(1) Includes direct and indirect interests. There are 2,000,000 common shares
included in this amount that are owned in the names of family members of Mr.
Callahan.

(b) Security Ownership of Management

     The following table sets forth the shares held by Metwood directors and
officers as of October 11, 2002.

                     Name  and  address
Title  of  Class     of beneficial  owner  Number  of  shares   Percent of class
----------------     -----------------     ------------------   ----------------


Common     Robert  ('Mike')  Callahan      5,564,665  (1)           46.1%
           819 Naff Road
           Boones Mill, VA 24065

Common     Ronald  Shiflett                2,151,282                17.8%
           819 Naff Road
           Boones Mill, VA 24065

Common     Shawn  Callahan                 1,004,550                 8.3%
           819  Naff  Road
           Boones Mill, VA 24065

Ownership of shares by directors and officers of Metwood as a group: 72.2%

(1) Includes direct and indirect interests. There are 2,000,000 common shares
included in this amount that are owned in the names of family members of Mr.
Callahan.

     (c)  Changes  in  Control

We  know of no contractual arrangements which may at a subsequent date result in
a  change  of  control  in  the  Company.

Item 12. Certain Relationships and Related Transactions

Following  are  the  transactions  between  Metwood  and  members of management,
directors,  officers,  5%  shareholders,  and  promoters  of  Metwood:

The  Company  contracts  with  a  construction  company  related  through common
ownership  whereby  the  Company  earns fees from construction-related services.
During  the years ended June 30, 2002 and 2001, the Company earned and collected
$79,977  and $-0-, respectively, in equipment rental and other revenue from this
company.  There  were  no  amounts receivable from the related party at June 30,
2002  and  June  30,  2001.

During  the  year  ended June 30, 2001, the Company received $300,000, including
interest  thereto,  worth  of  fair market value of certain services and related
fixed  assets  consisting of machinery, equipment and building improvements from
two  of  its stockholders and officers in exchange for full payment on its notes
receivable  from  stockholders.

During  the  year  ended  June  30, 2001, the Company also issued 400,000 common
shares of the Company stock to its officers and stockholders in exchange for the
fair  market  value of professional engineering and consulting services received
in  the  amount  of  approximately  $20,000.

During  the  year  ended June 30, 2002, the Company purchased five acres of land
adjacent  to its corporate offices and warehouses. The purchase price of $89,000
was  paid  to  an  entity  controlled  by the Company's officer and shareholder.

Item  13.  Exhibits  and  Reports  on  Form  8-K

     (a)  Financial  Statements
1.  The  following financial statements of Metwood are included in Part II, Item
7:
Independent Auditors' Report                         19-20
Balance Sheet - June 30, 2002                           21
Statements of Income - Years Ended
     June 30, 2002 and 2001                             22
Statements of Cash Flows - Years Ended
     June 30, 2002 and 2001                             23
Statements of Stockholders' Equity - Years Ended
     June 30, 2002 and 2001                             24
Notes to Financial Statements                        25-31

          2. Exhibits
3. Articles of Incorporation as amended and bylaws are incorporated by reference
to  Exhibit  No.  3  of  Form  8-K  as  amended  filed  August  11,  2001.

23. Consent of Auditors

(b) Reports on Form 8-K

A Form 8-K and related 8-K/A were filed during the fourth quarter discussing the
Acquisition of all the assets of Providence Engineering.










                             SIGNATURE PAGE FOLLOWS
                             ----------------------





















                                   SIGNATURES
                                   ----------

Pursuant  to  the  requirements  of  the  Securities  Exchange  Act of 1934, the
Registrant has caused this report to be signed on its behalf by the undersigned,
hereunto  duly  authorized.

          METWOOD, INC.

Date: October 11, 2002     By: /s/ Robert ('Mike') Callahan
                           --------------------------------
                                   Robert ('Mike') Callahan
                                   President and Director

Date: October 11, 2002     By: /s/ Ronald Shiflet
                           ----------------------
                                   Ronald Shiflett
                                   Vice-President and Director

Date: October 11, 2002     By: /s/ Shawn Callahan
                           ----------------------
                                   Shawn Callahan
                                   Secretary, Treasurer and Director

Date: October 11, 2002     By: /s/ Annette G. Mariano
                           --------------------------
                                   Annette G. Mariano
                                   Chief Financial Officer