##### 



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

|                                              |  |                                         
|--------------------------------------------- |  | ----------------------------------------
|For the quarterly period ended March 31, 2003 |  | Commission
          File Number 0-13147



LESCO,
INC.   (Exact name of registrant as specified in its charter)


|                                         |  |                                        
|---------------------------------------- |  | ---------------------------------------
|OHIO                                     |  | 34-0904517                             
|(State or other jurisdiction of          |  | (I.R.S. Employer Identification Number)
|incorporation or organization)           |  |                                        
|                                        
|15885 Sprague Road                       |  |                                        
|Strongsville, Ohio                       |  | 44136                                  
|(Address of principal executive offices) |  | (Zip Code)                             

(440) 783-9250
(Registrants telephone number,
including area code)

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

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

As of April 28, 2003, the registrant had outstanding 8,523,914 common shares,
without par value.

1



---



##### 



PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

LESCO, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS  UNAUDITED

|                                                                                              |                                              |      |                                     |        |   |   |         |        |  
|--------------------------------------------------------------------------------------------- | -------------------------------------------- | ---- | ----------------------------------- | ------ | - | - | ------- | ------ | -
|                                                                                              |                                              |      | Three Months Ended
        March 31
|                                                                                              |                                              |      |                                    
|(In
          thousands, except per share data)                                               |                                              | 2003 |                                     | 2002  
|                                                                                              |                                              |      |                                     |       
|Net
          sales                                                                           |                                              | $    | 94,450                              |        |   | $ | 93,479  |       
|                                                                                              | Cost
          of sales                      |      |                                     | 63,818 |   |   |         | 63,427 |  
|                                                                                              |                                              |      |                                     |        |   |   |         |       
|Gross
          profit on sales                                                               |                                              |      | 30,632                              |        |   |   | 30,052  |       
|                                                                                              | Warehouse
          & delivery expense       |      |                                     | 10,302 |   |   |         | 9,916  |  
|                                                                                              | Selling
          expense                    |      |                                     | 21,209 |   |   |         | 18,482 |  
|                                                                                              | General
          & administrative expense   |      |                                     | 7,353  |   |   |         | 8,009  |  
|                                                                                              | Severance
          expense                  |      |                                     |       |   |   |         | 2,042  |  
|                                                                                              | Bad
          debt expense                   |      |                                     | 429    |   |   |         | 405    |  
|                                                                                              |                                              |      |                                     |        |   |   |         |       
|                                                                                              |                                              |      | 39,293                              |        |   |   | 38,854  |       
|Income
          (loss) from operations                                                       |                                              |      | (8,661                              | )      |   |   | (8,802  | )     
|                                                                                              | Early
          retirement of debt agreement |      |                                     |       |   |   |         | (4,550 | )
|                                                                                              | Joint
          venture results              |      |                                     | 370    |   |   |         |       |  
|                                                                                              | Customer
          finance charges           |      |                                     | 393    |   |   |         | 386    |  
|                                                                                              | Other
          income                       |      |                                     | 180    |   |   |         | 142    |  
|                                                                                              | Other
          expense                      |      |                                     | (233   | ) |   |         | (415   | )
|                                                                                              |                                              |      |                                     |        |   |   |         |       
|                                                                                              |                                              |      | 710                                 |        |   |   | (4,437  | )     
|                                                                                              |                                              |      |                                     |        |   |   |         |       
|Loss
          before interest and taxes
and
          cumulative effect of accounting change |                                              |      | (7,951                              | )      |   |   | (13,239 | )     
|Interest
          expense                                                                    |                                              |      | 1,288                               |        |   |   | 1,334   |       
|                                                                                              |                                              |      |                                     |        |   |   |         |       
|Loss
          before taxes and cumulative effect of accounting change                        |                                              |      | (9,239                              | )      |   |   | (14,573 | )     
|Income
          taxes provision (benefit)                                                    |                                              |      | (3,492                              | )      |   |   | (5,465  | )     
|                                                                                              |                                              |      |                                     |        |   |   |         |       
|Loss
          before cumulative effect of accounting change                                  |                                              |      | (5,747                              | )      |   |   | (9,108  | )     
|Cumulative
          effect of accounting change for goodwill charge, net of taxes of $2,735  |                                              |      |                                    |        |   |   | 4,597   |       
|                                                                                              |                                              |      |                                     |        |   |   |         |       
|Net
          loss                                                                            |                                              | $    | (5,747                              | )      |   | $ | (13,705 | )     
|                                                                                              |                                              |      |                                     |        |   |   |         |       
|Basic
          loss per share:                                                               |                                              |      |                                     |        |   |   |         |       
|Loss
          before cumulative effect of accounting change                                  |                                              | $    | (0.68                               | )      |   | $ | (1.07   | )     
|Diluted
          loss per share:                                                             |                                              |      |                                     |        |   |   |         |       
|Loss
          before cumulative effect of accounting change                                  |                                              | $    | (0.68                               | )      |   | $ | (1.07   | )     
|Cumulative
          effect of accounting change, net of taxes                                |                                              |      |                                    |        |   |   | (0.54   | )     
|                                                                                              |                                              |      |                                     |        |   |   |         |       
|Basic
          and diluted loss per share:                                                   |                                              | $    | (0.68                               | )      |   | $ | (1.61   | )     
|                                                                                              |                                              |      |                                     |        |   |   |         |       

See Notes to Consolidated Financial Statements

2



---



##### 



LESCO, INC.
CONSOLIDATED BALANCE SHEETS

|                                               |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |         |         | 
|---------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------- | ------ | --------- | ------- | -------- | ------ | ----------- | ------- |  | ------ | ------- | ------- | 
|****                                           | ****                                                                                                                                                                                                                                                                       | ****                                                 | ****   | March 31  | ****    | March 31 |        | December 31
|(In
          thousands, except share data)    | ****                                                                                                                                                                                                                                                                       | 2003                                                 | ****   | 2002      |         | 2002    
|****                                           | ****                                                                                                                                                                                                                                                                       |                                                      | ****   |           | ****    |         
|****                                           | ****                                                                                                                                                                                                                                                                       | (unaudited)                                          | ****   | (audited)
|ASSETS                                         |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|CURRENT
          ASSETS:                      |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|                                               | Cash                                                                                                                                                                                                                                                                       |                                                      | $      | 3,459     |         |          | $      | 2,520       |         |  | $      | 1,354   |        
|                                               | Accounts
          receivable  net of allowance 
          of $4,825, $4,476 and $4,980, respectively                                                                                                                                                                     |                                                      |        | 81,995    |         |          |        | 82,375      |         |  |        | 68,188  |        
|                                               | Inventories                                                                                                                                                                                                                                                                |                                                      |        |           |         |          |        |             |         |  |        |         |        
|                                               |                                                                                                                                                                                                                                                                            | Raw
          materials                              |        |           | 13,694  |          |        |             | 12,469  |  |        |         | 10,977  | 
|                                               |                                                                                                                                                                                                                                                                            | Finished
          goods                             |        |           | 96,100  |          |        |             | 102,065 |  |        |         | 75,860  | 
|                                               |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|                                               |                                                                                                                                                                                                                                                                            | Total
          inventories                          |        |           | 109,794 |          |        |             | 114,534 |  |        |         | 86,837  | 
|                                               | Deferred
          income taxes                                                                                                                                                                                                                                            |                                                      |        | 3,003     |         |          |        | 3,113       |         |  |        | 3,400   |        
|                                               | Prepaid
          expenses and other assets                                                                                                                                                                                                                                |                                                      |        | 9,254     |         |          |        | 8,285       |         |  |        | 6,171   |        
|                                               |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|                                               |                                                                                                                                                                                                                                                                            | TOTAL
          CURRENT ASSETS                       |        |           | 207,505 |          |        |             | 210,827 |  |        |         | 165,950 | 
|Property,
          plant and equipment        |                                                                                                                                                                                                                                                                            |                                                      | 83,261 |           |         |          | 95,355 |             |         |  | 80,989 |        
|                                               | Less
          allowance for depreciation and amortization                                                                                                                                                                                                                 |                                                      |        | (48,531   | )       |          |        | (48,661     | )       |  |        | (47,051 | )      
|                                               |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|                                               |                                                                                                                                                                                                                                                                            | Net
          property, plant and equipment          |        |           | 34,730  |          |        |             | 46,694  |  |        |         | 33,938  | 
|Assets
          held for sale                 |                                                                                                                                                                                                                                                                            |                                                      | 325    |           |         |          | 653    |             |         |  | 325    |        
|Other
          assets                         |                                                                                                                                                                                                                                                                            |                                                      | 3,948  |           |         |          | 5,013  |             |         |  | 3,769  |        
|Deferred
          income taxes                |                                                                                                                                                                                                                                                                            |                                                      | 507    |           |         |          |       |             |         |  |       |        
|                                               |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|                                               |                                                                                                                                                                                                                                                                            | TOTAL
          ASSETS                               |        | $         | 247,015 |          |        | $           | 263,187 |  |        | $       | 203,982 | 
|                                               |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|LIABILITIES
          AND SHAREHOLDERS EQUITY |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|CURRENT
          LIABILITIES:                 |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|                                               | Accounts
          payable                                                                                                                                                                                                                                                 |                                                      | $      | 57,414    |         |          | $      | 71,813      |         |  | $      | 38,439  |        
|                                               | Other
          current liabilities                                                                                                                                                                                                                                        |                                                      |        | 12,244    |         |          |        | 8,285       |         |  |        | 16,290  |        
|                                               | Asset
          rationalization and severance                                                                                                                                                                                                                              |                                                      |        | 3,008     |         |          |        | 2,140       |         |  |        | 3,579   |        
|                                               | Revolving
          credit facility                                                                                                                                                                                                                                        |                                                      |        | 92,061    |         |          |        | 84,816      |         |  |        | 57,052  |        
|                                               | Current
          portion of debt                                                                                                                                                                                                                                          |                                                      |        | 1,150     |         |          |        | 1,140       |         |  |        | 1,148   |        
|                                               |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|                                               |                                                                                                                                                                                                                                                                            | TOTAL
          CURRENT LIABILITIES                  |        |           | 165,877 |          |        |             | 168,194 |  |        |         | 116,508 | 
|Long-term
          debt                       |                                                                                                                                                                                                                                                                            |                                                      | 9,941  |           |         |          | 12,148 |             |         |  | 10,227 |        
|Deferred
          income taxes                |                                                                                                                                                                                                                                                                            |                                                      |       |           |         |          | 901    |             |         |  | 314    |        
|SHAREHOLDERS
          EQUITY:                |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|                                               | Preferred
          shares without par value 500,000 shares authorized; 1,523
          share issued and outstanding in 2003, liquidation value $1,000 per share                                                                                                         |                                                      |        | 1,656     |         |          |        | 1,523       |         |  |        | 1,630   |        
|                                               | Common
          shareswithout par value 19,500,000 shares authorized; 8,637,563
          shares issued and 8,523,914 outstanding at March 31, 2003 and December 31,
          2002, at March 31, 2002 8,628,563 shares were issued and 8,536,786
          outstanding |                                                      |        | 864       |         |          |        | 863         |         |  |        | 864     |        
|                                               | Paid-in
          capital                                                                                                                                                                                                                                                  |                                                      |        | 34,901    |         |          |        | 34,800      |         |  |        | 34,901  |        
|                                               | Retained
          earnings                                                                                                                                                                                                                                                |                                                      |        | 36,869    |         |          |        | 46,503      |         |  |        | 42,642  |        
|                                               | Accumulated
          other comprehensive income (loss)                                                                                                                                                                                                                    |                                                      |        | (1,138    | )       |          |        | 209         |         |  |        | (1,149  | )      
|                                               | Less
          treasury shares, 113,649 at March 31, 2003, 91,777 at March 31,
          2002, and 113,649 at December 31, 2002                                                                                                                                            |                                                      |        | (1,955    | )       |          |        | (1,623      | )       |  |        | (1,955  | )      
|                                               | Unearned
          compensation                                                                                                                                                                                                                                            |                                                      |        |          |         |          |        | (331        | )       |  |        |        |        
|                                               |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|                                               |                                                                                                                                                                                                                                                                            | TOTAL
          SHAREHOLDERS EQUITY                 |        |           | 71,197  |          |        |             | 81,944  |  |        |         | 76,933  | 
|                                               |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        
|                                               |                                                                                                                                                                                                                                                                            | TOTAL
          LIABILITIES AND SHAREHOLDERS EQUITY |        | $         | 247,015 |          |        | $           | 263,187 |  |        | $       | 203,982 | 
|                                               |                                                                                                                                                                                                                                                                            |                                                      |        |           |         |          |        |             |         |  |        |        

See Notes to Consolidated Financial Statements.

3



---



##### 



LESCO, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                         |                                                                                             |                                                           |       |                                             |         |   |        |          |         |  
|---------------------------------------- | ------------------------------------------------------------------------------------------- | --------------------------------------------------------- | ----- | ------------------------------------------- | ------- | - | ------ | -------- | ------- | -
|                                         |                                                                                             |                                                           |       | For the three months
        ended March 31
|                                         |                                                                                             |                                                           |       |                                            
|(In
          thousands)                 |                                                                                             | 2003                                                      |       | 2002                                       
|                                         |                                                                                             |                                                           |       |                                            
|OPERATING
          ACTIVITIES:          |                                                                                             |                                                           |       |                                             |         |   |        |         
|                                         | Net
          income (loss), before cumulative effect of accounting change                  |                                                           | $     | (5,747                                      | )       |   | $      | (9,108   | )      
|                                         | Adjustments
          to reconcile net income to net cash provided by operating activities: |                                                           |       |                                             |         |   |        |          |        
|                                         |                                                                                             | Early
          retirement of debt agreement              |       |                                             |        |   |        |          | 4,550   |  
|                                         |                                                                                             | Depreciation
          and Amortization                   |       |                                             | 2,126   |   |        |          | 2,560   |  
|                                         |                                                                                             | Deferred
          income taxes                           |       |                                             | (430    | ) |        |          |        |  
|                                         |                                                                                             | Decrease
          (increase) in accounts receivable      |       |                                             | (14,236 | ) |        |          | (14,009 | )
|                                         |                                                                                             | Provision
          for uncollectible accounts receivable |       |                                             | 429     |   |        |          | 405     |  
|                                         |                                                                                             | (Increase)
          decrease in inventories              |       |                                             | (22,957 | ) |        |          | (21,538 | )
|                                         |                                                                                             | Increase
          (decrease) in accounts payable         |       |                                             | 15,540  |   |        |          | 27,735  |  
|                                         |                                                                                             | Increase
          (decrease) in other current items      |       |                                             | (7,683  | ) |        |          | (1,471  | )
|                                         |                                                                                             | Other                                                     |       |                                             | (439    | ) |        |          | (2,622  | )
|                                         |                                                                                             |                                                           |       |                                             |         |   |        |         
|                                         | NET
          CASH (USED) BY OPERATING ACTIVITIES                                           |                                                           |       | (33,397                                     | )       |   |        | (13,498  | )      
|INVESTING
          ACTIVITIES:          |                                                                                             |                                                           |       |                                             |         |   |        |         
|                                         | Purchase
          of property, plant and equipment -net                                    |                                                           |       | (2,658                                      | )       |   |        | (251     | )      
|                                         |                                                                                             |                                                           |       |                                             |         |   |        |         
|                                         | NET
          CASH USED IN INVESTING ACTIVITIES                                             |                                                           |       | (2,658                                      | )       |   |        | (251     | )      
|FINANCING
          ACTIVITIES:          |                                                                                             |                                                           |       |                                             |         |   |        |         
|                                         | Sale
          (purchase) of accounts receivable                                            |                                                           |       |                                            |         |   |        | (31,200  | )      
|                                         | Increase
          (decrease) in overdraft balances                                         |                                                           |       | 3,435                                       |         |   |        | (2,769   | )      
|                                         | Proceeds
          from borrowings                                                          |                                                           |       | 127,642                                     |         |   |        | 155,332  |        
|                                         | Reduction
          of borrowings                                                           |                                                           |       | (92,917                                     | )       |   |        | (108,339 | )      
|                                         | Deferred
          financing fees                                                           |                                                           |       |                                             |         |   |        | (1,790   | )      
|                                         |                                                                                             |                                                           |       |                                             |         |   |        |         
|                                         | NET
          CASH PROVIDED BY FINANCING ACTIVITIES                                         |                                                           |       | 38,160                                      |         |   |        | 11,234   |        
|                                         |                                                                                             |                                                           |       |                                             |         |   |        |         
|Net
          change in cash             |                                                                                             |                                                           | 2,105 |                                             |         |   | (2,515 | )       
|Cash
           Beginning of the period |                                                                                             |                                                           | 1,354 |                                             |         |   | 5,035  |         
|                                         |                                                                                             |                                                           |       |                                             |         |   |        |         
|                                         | CASH
           END OF THE PERIOD                                                          |                                                           | $     | 3,459                                       |         |   | $      | 2,520    |        
|                                         |                                                                                             |                                                           |       |                                             |         |   |        |         

See Notes to Consolidated Financial Statements.

4



---



##### 



LESCO, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A  Basis of Presentation

The accompanying unaudited financial statements have been prepared in
accordance with accounting principles generally accepted in the United States
for interim financial information and with the requirements of Regulation S-X
and Form 10-Q. The statements reflect all adjustments, consisting only of
normal recurring accruals, which are, in the opinion of management, necessary
for a fair presentation of the results for interim periods. For further
information, refer to the audited financial statements and footnotes thereto
for the year ended December 31, 2002 included in the Companys annual report on
Form 10-K.

Operating results for the three months ended March 31, 2003 are not
necessarily indicative of the results to be expected for the year due to the
seasonal nature of the Companys business. Certain costs have been
reclassified in the prior period to conform with current year presentation.

5



---



##### 



NOTE B  Earnings per Share

The following table sets forth the computation of basic and diluted earnings
per share:

|                                                                                              |                                                                |      |                                     |      |   |   |           |        |  
|--------------------------------------------------------------------------------------------- | -------------------------------------------------------------- | ---- | ----------------------------------- | ---- | - | - | --------- | ------ | -
|****                                                                                          | ****                                                           | **** | Three Months Ended
        March 31
|****                                                                                          | ****                                                           | **** |                                    
|(In
          thousands, except per share data)                                               | ****                                                           | 2003 |                                     | 2002
|****                                                                                          | ****                                                           |      | ****                                |     
|Numerator:                                                                                    |                                                                |      |                                     |      |   |   |           |       
|Income
          (loss) before cumulative effect of accounting change                         |                                                                | $    | (5,747                              | )    |   | $ | (9,108    | )     
|                                                                                              | Preferred
          stock dividends                            |      |                                     | (27  | ) |   |           | (27    | )
|                                                                                              |                                                                |      |                                     |      |   |   |           |       
|Income
          (loss) available to common shareholders                                      |                                                                |      | (5,774                              | )    |   |   | (9,135    | )     
|                                                                                              | Cumulative
          effect of accounting change, net of taxes |      |                                     |     |   |   |           | (4,597 | )
|                                                                                              |                                                                |      |                                     |      |   |   |           |       
|Net
          income (loss) available to common shareholders                                  |                                                                | $    | (5,774                              | )    |   | $ | (13,732   | )     
|                                                                                              |                                                                |      |                                     |      |   |   |           |       
|Denominator:                                                                                  |                                                                |      |                                     |      |   |   |           |       
|Basic
          earnings per share- weighted average shares                                   |                                                                |      | 8,523,914                           |      |   |   | 8,514,914 |       
|Effect
          of dilutive securities:                                                      |                                                                |      |                                     |      |   |   |           |       
|                                                                                              | Employee
          stock options                               |      |                                     |     |   |   |           |       |  
|                                                                                              |                                                                |      |                                     |      |   |   |           |       
|Diluted
          potential common shares                                                     |                                                                |      |                                    |      |   |   |          |       
|Diluted
          earnings per share adjusted weighted average shares and assumed conversions |                                                                |      | 8,523,914                           |      |   |   | 8,514,914 |       
|                                                                                              |                                                                |      |                                     |      |   |   |           |       
|Basic
          earnings (loss) per share:                                                    |                                                                |      |                                     |      |   |   |           |       
|Income
          (loss) before cumulative effect of accounting change                         |                                                                | $    | (0.68                               | )    |   | $ | (1.07     | )     
|Cumulative
          effect of accounting change, net of taxes                                |                                                                |      |                                    |      |   |   | (0.54     | )     
|                                                                                              |                                                                |      |                                     |      |   |   |           |       
|Basic
          earnings (loss) per share:                                                    |                                                                | $    | (0.68                               | )    |   | $ | (1.61     | )     
|                                                                                              |                                                                |      |                                     |      |   |   |           |       
|Diluted
          earnings (loss) per share:                                                  |                                                                |      |                                     |      |   |   |           |       
|Income
          (loss) before cumulative effect of accounting change                         |                                                                | $    | (0.68                               | )    |   | $ | (1.07     | )     
|Cumulative
          effect of accounting change, net of taxes                                |                                                                |      |                                    |      |   |   | (0.54     | )     
|                                                                                              |                                                                |      |                                     |      |   |   |           |       
|Diluted
          earnings (loss) per share:                                                  |                                                                | $    | (0.68                               | )    |   | $ | (1.61     | )     
|                                                                                              |                                                                |      |                                     |      |   |   |           |       

6



---



##### 



NOTE C  Sales Information

The Lawn Care customer channel (Lawn Care) operates 237 LESCO Service
Centers®, including 10 Service Centers opened in the first quarter of 2003.
The channel includes 68 lawn care sales representatives who market products on
a localized basis. The primary products sold by Lawn Care are turf care
products, including turf and pest control products, fertilizer, grass seed and
equipment. Lawn Care markets and sells products principally to lawn care
companies, landscapers, nurseries, municipalities, churches and condominium
associations. The Company plans to open an additional 12 Service Centers in the
remainder of 2003.

Additionally, the Lawn Care customer channel markets and sells products to
large national and regional lawn care customers through a separate group of 13
sales representatives. This sales group also distributes selected products
through Home Depot stores in the South, Southwest, Midwest, Mid-Atlantic and
Northeast areas of the country. Lawn Care also markets products by mail order
catalog and participates in national and regional lawn care trade shows. A
telemarketing sales group calls on inactive accounts and contacts customers not
currently serviced by the Companys outside sales forces. In addition, Lawn
Care markets products internationally principally through foreign distributors.

The Golf customer channel (Golf) markets and sells products to private and
public golf courses and other customers having large turf areas through Company
salespersons who operate a fleet of 78 LESCO Stores-on-Wheels® and through 46
golf sales representatives strategically located in various markets. The
primary products sold by Golf are turf care products, including turf and pest
control products, fertilizer, grass seed, hand held equipment and golf course
accessories. The Stores-on-Wheels are well stocked with a wide variety of turf
care products and golf course accessories, which are sold directly from the
trucks.

Sales results by customer channel, product lines and geographic zones are
as follows:

7



---



##### 



LESCO, INC.

|                           |                                             |      |                                     |        |   |  |   |        |  
|-------------------------- | ------------------------------------------- | ---- | ----------------------------------- | ------ | - |  | - | ------ | -
|                           |                                             |      | Three Months Ended
        March 31
|                           |                                             |      |                                    
|(In
          thousands)   |                                             | 2003 |                                     | 2002  
|                           |                                             |      |                                     |       
|Customer Channels          |                                             |      |                                     |        |   |  |   |       
|                           | Lawn
          Care                         |      | $                                   | 77,666 |   |  |   | 74,677 |  
|                           | Golf                                        |      |                                     | 17,845 |   |  |   | 19,639 |  
|                           | Sales
          credits and rebates         |      |                                     | (1,061 | ) |  |   | (837   | )
|                           |                                             |      |                                     |        |   |  |   |       
|                           | Net
          Sales                         |      | $                                   | 94,450 |   |  | $ | 93,479 |  
|                           |                                             |      |                                     |        |   |  |   |       
|Product
          Lines    |                                             |      |                                     |        |   |  |   |       
|                           | Fertilizer
          & combination products |      | $                                   | 46,404 |   |  |   | 46,054 |  
|                           | Control
          products                  |      |                                     | 21,336 |   |  |   | 21,862 |  
|                           | Equipment,
          parts & service        |      |                                     | 14,259 |   |  |   | 12,627 |  
|                           | Turfgrass
          seed                    |      |                                     | 6,790  |   |  |   | 6,937  |  
|                           | Pest
          Control                      |      |                                     | 3,304  |   |  |   | 3,110  |  
|                           | Other                                       |      |                                     | 3,418  |   |  |   | 3,726  |  
|                           | Sales
          credits and rebates         |      |                                     | (1,061 | ) |  |   | (837   | )
|                           |                                             |      |                                     |        |   |  |   |       
|                           | Net
          Sales                         |      | $                                   | 94,450 |   |  | $ | 93,479 |  
|                           |                                             |      |                                     |        |   |  |   |       
|Geographic
          Zones |                                             |      |                                     |        |   |  |   |       
|                           | Northeast                                   |      | $                                   | 15,915 |   |  |   | 17,503 |  
|                           | Mid
          Central                       |      |                                     | 15,666 |   |  |   | 13,236 |  
|                           | Transition                                  |      |                                     | 18,362 |   |  |   | 17,399 |  
|                           | Southeast                                   |      |                                     | 20,970 |   |  |   | 19,885 |  
|                           | West                                        |      |                                     | 3,204  |   |  |   | 3,279  |  
|                           | National
          Accounts                 |      |                                     | 21,394 |   |  |   | 23,014 |  
|                           | Sales
          credits and rebates         |      |                                     | (1,061 | ) |  |   | (837   | )
|                           |                                             |      |                                     |        |   |  |   |       
|                           | Net
          Sales                         |      | $                                   | 94,450 |   |  | $ | 93,479 |  
|                           |                                             |      |                                     |        |   |  |   |       

8



---



##### 



NOTE D  Other Assets

Other assets consist of the following:

|                                                   |  |          |       |          |  |             |       |   |  |   |       |  
|-------------------------------------------------- |  | -------- | ----- | -------- |  | ----------- | ----- | - |  | - | ----- | -
|                                                   |  | March 31 |       | March 31 |  | December 31
|(In thousands)                                     |  | 2003     |       | 2002     |  | 2002       
|                                                   |  |          |       |          |  |            
|Deferred
          financing                       |  |          | 1,866 |          |  |             | 2,710 |   |  |   | 2,226 |  
|Note
          receivable long term                |  |          | 930   |          |  |             |      |   |  |   | 930   |  
|Investment
          in joint venture (see NOTE I) |  |          | 448   |          |  |             | (271  | ) |  |   | (65   | )
|Deposits
          and other                       |  |          | 704   |          |  |             | 717   |   |  |   | 678   |  
|Patents
          and trademarks  net             |  |          |      |          |  |             | 1,857 |   |  |   |      |  
|                                                   |  |          |       |          |  |             |       |   |  |   |       |  
|Total
          other assets                       |  | $        | 3,948 |          |  | $           | 5,013 |   |  | $ | 3,769 |  
|                                                   |  |          |       |          |  |             |       |   |  |   |       |  

Deferred financing relates to costs incurred to obtain financing. These
costs are amortized over the life of the finance agreement. The note
receivable long term arose in connection with the sale of the Novex facility. Deposits
and other primarily includes deposits on properties the Company rents.

NOTE E  Asset Rationalization and Severance Expense

Major components of the asset rationalization and severance accrual as of
March 31, 2003 and December 31, 2002 are as follows:

|                            |      |             |      |                  |      |                    |       |       |  |   |       |   |  |   |       |  
|--------------------------- | ---- | ----------- | ---- | ---------------- | ---- | ------------------ | ----- | ----- |  | - | ----- | - |  | - | ----- | -
|(In thousands)              | **** | Lease Costs | **** | Other Exit Costs | **** | Severance Payments | ****  | Total
|                            |      |             |      |                  |      |                    |       |      
|December 31,
          2002 |      | $           | 634  |                  |      | $                  | 1,371 |       |  | $ | 1,574 |   |  | $ | 3,579 |  
|Utilized/spent              |      |             | (5   | )                |      |                    | (211  | )     |  |   | (361  | ) |  |   | (571  | )
|                            |      |             |      |                  |      |                    |       |       |  |   |       |   |  |   |       |  
|March 31,
          2003    |      | $           | 629  |                  |      | $                  | 1,160 |       |  | $ | 1,219 |   |  | $ | 3,008 |  
|                            |      |             |      |                  |      |                    |       |       |  |   |       |   |  |   |       |  

NOTE F  Debt

The Companys $122.3 million senior secured credit facility (Debt
Facility) includes an amortizing term loan of approximately
$7.3 million, of which $5.1 million remains outstanding, and a
revolving credit facility of up to $115 million, maturing in January 2005. The
variable interest on the Debt Facility is based on LIBOR plus 2.75% to 3.00% or
prime rates plus .25% to .50%. Availability under the revolving portion of the
Debt Facility is determined by a borrowing base formula calculated upon the
Companys eligible receivables and inventories. The Debt Facility contains
restrictive covenants, including limits on borrowings, lease payments and
capital expenditures; maintenance of certain operating and financial ratios;
maintenance of $70.0 million minimum net worth; and a restriction on dividend
payments. The Debt Facility is secured by substantially all of the Companys
assets. As of March 31, 2003, the Company is in compliance with all of the
restrictive covenants in its Debt Facility, as amended.

NOTE G  Stock Based Compensation

9



---



##### 



The Company follows the disclosure-only provisions of Statement of
Financial Accounting Standards No. 148 (SFAS No. 148), Accounting for
Stock-Based Compensation Transition and Disclosure an amendment to SFAS No.
123. Accordingly, the Company follows the accounting provisions of Accounting
Principles Board Opinion No. 25, Accounting for Stock Issued to Employees,
which, if applicable, recognizes as compensation cost the difference between
the fair market value and the exercise price of stock options at the date of
grant.

Accordingly, no compensation expense has been recognized for the stock
option plans, as permitted. Had compensation cost for the stock option plans
been determined based on the fair value at the grant date in accordance with
SFAS No. 148, the Companys net income and related earnings per share would
have been changed to the pro forma amounts indicated below:

|                                                |         |      |                                      |       |   |   |         |       |  
|----------------------------------------------- | ------- | ---- | ------------------------------------ | ----- | - | - | ------- | ----- | -
|                                                |         |      | Three months ended
        March 31,
|                                                |         |      |                                     
|(In
          thousands, except per share data) |         | 2003 |                                      | 2002 
|                                                |         |      |                                      |      
|Net (Loss) income  as reported                 |         | $    | (5,747                               | )     |   | $ | (13,705 | )    
|Net (Loss) income  pro forma                   |         | $    | (6,335                               | )     |   | $ | (14,124 | )    
|(Loss) Earnings per share  as reported         |         |      |                                      |       |   |   |         |      
|                                                | Basic   |      | $                                    | (0.68 | ) |   | $       | (1.61 | )
|                                                | Diluted |      | $                                    | (0.68 | ) |   | $       | (1.61 | )
|(Loss) Earnings per share  pro forma           |         |      |                                      |       |   |   |         |      
|                                                | Basic   |      | $                                    | (0.74 | ) |   | $       | (1.66 | )
|                                                | Diluted |      | $                                    | (0.74 | ) |   | $       | (1.66 | )
|                                                |         |      |                                      |       |   |   |         |      

Included in these pro forma disclosures are stock options issued in 2003
and 2002 that were assumed 100% vested by the end of the year in which the
options were granted. The fair value of each option grant is estimated on the
date of grant using the Black-Scholes option pricing model, with the following
weighted-average assumptions used for 2003 and 2002, respectively: dividend
yield of 0.00% and 0.00% expected stock price volatility of 0.37 and 0.37;
risk-free interest rate of 4.25% and 4.25%; and expected lives of four years.
This option valuation model requires input of highly subjective assumptions
and, in managements opinion, does not provide a reliable single measure of
fair value of its employee stock options.

NOTE H  Derivatives and Comprehensive Income / Loss

The Company entered
into an interest rate swap in accordance with its Debt Facility. The
Company will only enter into interest rate swap agreements with major
financial institutions that are considered to be market makers.

The interest rate swap agreement is a three-year, $40.5 million notional
amount interest rate swap expiring in January 2005, which converts existing
variable-rate (based on LIBOR or prime rates), plus applicable borrowing margin
of 2.75% to 3.00%, payments to 4.2% fixed-rate, plus applicable borrowing
margin, payments. The fair value of the interest rate swap is determined by the
estimated cost to terminate the agreement, as determined by the bank. The
Company recognizes the $1.9 million fair market value of the swap agreement as
a liability on the balance sheet at March 31, 2003. Since the swap is
completely effective, changes in the fair market value are recorded in
accumulated other comprehensive income under Shareholders

10



---



##### 



Equity, net of tax. The Companys comprehensive losses for three months
ended March 31, 2003 and March 31, 2002 were as follows:

|                                  |  |                                    |        |                |  |   |         |  
|--------------------------------- |  | ---------------------------------- | ------ | -------------- |  | - | ------- | -
|                                  |  | For the three months
        ended
|                                  |  |                                   
|(In thousands)                    |  | March 31, 2003                     |        | March 31, 2002
|                                  |  |                                    |        |               
|Net income (loss)                 |  | $                                  | (5,747 | )              |  | $ | (13,705 | )
|Other comprehensive income        |  |                                    | 11     |                |  |   | 209     |  
|                                  |  |                                    |        |                |  |   |         |  
|Total comprehensive income (loss) |  | $                                  | (5,736 | )              |  | $ | (13,496 | )

NOTE I  Investment in Commercial Turf Products, LTD.

The Company has a 50% investment in Commercial Turf Products, Ltd. (CTP)
that is accounted for under the equity method of accounting. CTPs net sales
for the three months ended March 31, 2003 were $15.8 million. CTPs gross
profit and pre-tax income for the three months ended March 31, 2003 were $1.8
million and $1.0 million, respectively. Under the equity method of accounting,
the Company has recorded its portion of pre-tax income of $370,000. The
Companys net investment of $448,000 in CTP is included in Other Assets. Each
Owner has guaranteed 50% of certain liabilities of CTP aggregating $9,150,000
at March 31, 2003. These liabilities mature through 2004 and bear interest at
rates ranging from 1.7% to 4.25%.

NOTE J  Depreciation Expense

Depreciation expense consists of the following:

|                                   |       |      |           |       |  |  |       |       | 
|---------------------------------- | ----- | ---- | --------- | ----- |  |  | ----- | ----- | 
|                                   |       |      | March 31,
|                                   |       |      |          
|(in thousands)                     |       | 2003 |           | 2002 
|                                   |       |      |           |      
|Cost of Sales                      |       |      | 697       |       |  |  | 1,137 |      
|                                  
|                                  
|                                  
|                                  
|Warehouse & delivery expense       |       |      | 126       |       |  |  | 93    |      
|                                  
|                                  
|                                  
|                                  
|Selling expense                    |       |      | 147       |       |  |  | 224   |      
|                                  
|                                  
|                                  
|                                  
|General and Administrative expense |       |      | 896       |       |  |  | 861   |      
|                                   |       |      |           |       |  |  |       |      
|                                   | Total |      | $         | 1,866 |  |  |       | 2,315 | 
|                                   |       |      |           |       |  |  |       |      

NOTE K  Impact of Recently Issued Accounting Standards

Upon the adoption of SFAS No. 142, the Company wrote off all its goodwill
taking a $4.6 million charge, net of taxes, as a cumulative effect of
accounting change as of January 1, 2002.

As of May 15, 2002, FASB issued SFAS No. 145, Rescission of FASB
Statements No. 4, 44 and 64, amendment of FASB Statement No. 13 and technical
corrections. The Company is required to adopt this statement for fiscal year
beginning January 1, 2003. The Company adopted this statement in the first
quarter of 2003 and reclassified the extraordinary charge of $4.6 million
related to the early extinguishment of debt in the first quarter 2002 to
continuing operations.

11



---



##### 



LESCO, INC.
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

New Operations

In the first quarter of 2003, the Company opened ten new Service Center
locations and one Store-on-Wheels vehicle. The 10 new Service Center locations
and one new Store on Wheels added $238,000 in revenue growth to the Company for
the first quarter 2003. The new service centers operating costs, included in
selling expense was $439,000 including preopening costs for the quarter of
$166,000. The Company plans to open a total of 22 Service Centers in 2003.

Results of Operations

The Company incurred certain charges in the first quarter of 2002 that
were not incurred in 2003 (see following schedule). Management believes that
the 2002 results excluding these charges are useful to investors because they
provide a better comparison to the 2003 operating results. For purposes of
reconciliation and better comparability, the following statement includes the
2002 operating results with these charges, in accordance with generally
accepted accounting principles (GAAP), in column 2, the charges in column 3 and
the operating results excluding the charges in column 4. The schedule includes
a reconciliation of earnings before interest and taxes, net loss and basic and
fully diluted net loss per share for 2002 including the charges in column 2,
the effect of the charges in column 3, and excluding the charges in column 4.
The discussion following the schedule references reported results unless
otherwise indicated.

LESCO, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS- UNAUDITED

|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |        |  
|-------------------------------------------------------------------------------------------- | -------------------------------------------- | -------- | ------------ | -------- | ------------ | ------- | ------- | ------- | - | - | --------- | ------ | ---- | - | ------ | ------ | -
|                                                                                             |                                              |          | 2003         |          | 2002        
|                                                                                             |                                              |          |              |          |             
|                                                                                             |                                              |          | Three Months |          | Three Months |         |         |         |   |   | Results  
|                                                                                             |                                              |          | Ended        |          | Ended        |         |         |         |   |   | Excluding
|(In
          thousands, except per share data)                                              |                                              | March 31 |              | March 31 |              | Charges |         | Charges
|                                                                                             |                                              |          |              |          |              |         |         |        
|Net
          sales                                                                          |                                              | $        | 94,450       |          |              | $       | 93,479  |         |   | $ |          |        |      | $ | 93,479 |       
|                                                                                             | Cost
          of Sales                      |          |              | 63,818   |              |         |         | 63,427  |   |   |           |       |      |   |        | 63,427 |  
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       
|Gross
          profit on sales                                                              |                                              |          | 30,632       |          |              |         | 30,052  |         |   |   |          |        |      |   | 30,052 |       
|                                                                                             | Warehouse
          & delivery expense       |          |              | 10,302   |              |         |         | 9,916   |   |   |           |       |      |   |        | 9,916  |  
|                                                                                             | Selling
          expense                    |          |              | 21,209   |              |         |         | 18,482  |   |   |           |       |      |   |        | 18,482 |  
|                                                                                             | General
          & administrative expense   |          |              | 7,353    |              |         |         | 8,009   |   |   |           |       |      |   |        | 8,009  |  
|                                                                                             | Severance
          expense                  |          |              |         |              |         |         | 2,042   |   |   |           | (2,042 | )(a) |   |        |       |  
|                                                                                             | Bad
          debt expense                   |          |              | 429      |              |         |         | 405     |   |   |           |       |      |   |        | 405    |  
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       
|                                                                                             |                                              |          | 39,293       |          |              |         | 38,854  |         |   |   | (2,042    | )      |      |   | 36,812 |       
|Income
          (loss) from operations                                                      |                                              |          | (8,661       | )        |              |         | (8,802  | )       |   |   | (2,042    | )      |      |   | (6,760 | )     
|                                                                                             | Early
          retirement of debt agreement |          |              |         |              |         |         | (4,550  | ) |   |           | (4,550 | )(b) |   |        |       |  
|                                                                                             | Joint
          venture results              |          |              | 370      |              |         |         |        |   |   |           |       |      |   |        |       |  
|                                                                                             | Customer
          finance charges           |          |              | 393      |              |         |         | 386     |   |   |           |       |      |   |        | 386    |  
|                                                                                             | Other
          income                       |          |              | 180      |              |         |         | 142     |   |   |           |       |      |   |        | 142    |  
|                                                                                             | Other
          expense                      |          |              | (233     | )            |         |         | (415    | ) |   |           |       |      |   |        | (415   | )
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       
|                                                                                             |                                              |          | 710          |          |              |         | (4,437  | )       |   |   | (4,550    | )      |      |   | 113    |       
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       
|Earnings
          (loss) before interest and taxes (EBIT)                                   |                                              |          | (7,951       | )        |              |         | (13,239 | )       |   |   | (6,592    | )      |      |   | (6,647 | )     
|Interest
          expense                                                                   |                                              |          | 1,288        |          |              |         | 1,334   |         |   |   |          |        |      |   | 1,334  |       
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       
|Income
          (loss) before taxes                                                         |                                              |          | (9,239       | )        |              |         | (14,573 | )       |   |   | (6,592    | )      |      |   | (7,981 | )     
|Income
          taxes (benefit)                                                             |                                              |          | (3,492       | )        |              |         | (5,465  | )       |   |   | (2,479    | )      |      |   | (2,986 | )     
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       
|Net
          income (loss) before cumulative effect of accounting change                    |                                              | $        | (5,747       | )        |              | $       | (9,108  | )       |   | $ | (4,113    | )      |      | $ | (4,995 | )     
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       
|Cumulative
          effect of accounting change for goodwill charge, net of taxes of $2,735 |                                              |          |             |          |              |         | 4,597   |         |   |   | (4,597    | )(c)   |      |   |       |       
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       
|Net
          Income (loss)                                                                  |                                              | $        | (5,747       | )        |              | $       | (13,705 | )       |   | $ | (8,710    | )      |      | $ | (4,995 | )     
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       
|Basic
          and diluted loss per share before cumulative effect of accounting change     |                                              | $        | (0.68        | )        |              | $       | (1.07   | )       |   | $ | 0.48      |        |      | $ | (0.59  | )     
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       
|Basic
          and diluted loss per share                                                   |                                              | $        | (0.68        | )        |              | $       | (1.61   | )       |   | $ | 1.02      |        |      | $ | (0.59  | )     
|                                                                                             |                                              |          |              |          |              |         |         |         |   |   |           |        |      |   |        |       



|(a) |  | The Company recorded a $2.0 million pre-tax
      charge relative to severance for executive terminations.                                                                                       
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) |  | The Company recorded a $4.6 million pre-tax
      charge related to the early termination of debt.                                                                                               
|(c) |  | The Company wrote off all its goodwill in accordance
      with SFAS No. 142 taking a $4.6 million charge, net of taxes,
      as a cumulative effect of accounting change as of January 1, 2002.

Sales for the first quarter ended March 31, 2003 rose 1.0% to $94.5
million compared with $93.5 million in 2002. Unit sales volume was slightly
higher in 2003 causing a favorable impact of $2.3 million. Average selling
prices were down slightly from the same period of 2002 causing a $1.3 reduction
in sales. Sales increased for the Companys Lawn Care customer channel by $3.0
million, with increases in the Mid Central, Transition and Southeast offsetting
flat sales in the Northeast and declines in the West and in bulk sales. Golf
sales in 2003 were $1.8 million less than 2002 due to lower sales in Northeast
caused by the late spring and poor economic conditions. The Lawn Care customer
channel operated 237 LESCO Service Centers ® during the first quarter 2003
compared with 227 stores during 2002. The Golf customer channel operated 78
LESCO Stores-On-Wheels® during the first quarter 2002 compared with 77 in 2002.
Sales of the Companys fertilizer and combination, equipment and pest control
rose in the first quarter 2003 over 2002, while sales of control, seed and
other products declined.

Gross profit, as a percent of sales, was 32.43% for the quarter ended
March 31, 2003, compared with 32.15% for 2002. The increase of 0.28% resulted
from the impact of lower manufacturing expenses of 1.97% and lower inventory
shrink expense of 0.96% partially offset by increased cost of raw materials and
purchased products of (1.72%) and slightly lower selling prices of (0.93%).

12



---



##### 



Delivery and warehouse expenses increased to $10.3 million in the first
quarter 2003 from $9.9 million in 2002. Delivery and warehouse costs increased
to 10.9% of sales in first quarter 2003 compared to 10.6% of sales in 2002.
This increase is due to three new distribution hubs located in Atlanta, GA,
Chicago, IL and Plano, TX not in operation in 2002.

Selling expense was 22.5% of sales in the first quarter 2003 compared to
19.5% in the first quarter 2002. Total selling expense increased by $2.7
million in 2003, primarily due to the increase in the number of lawn care sales
representatives totaling $600,000 and the timing effect from the change in the
sales force commission program ($1.0 million). Under the Companys current
commission program, progress payments will be earned, expensed and paid each
quarter. Under the Companys previous commission program, no commissions were
earned, expensed or paid in the first quarter. An additional 10 Service Center
locations and 1 Store on Wheels were added in the first quarter 2003 with
additional operating costs of approximately $439,000. Advertising and
promotional costs were higher by $375,000 and utilities increased $236,000 due
to colder climate conditions early in the year.

General and administrative costs decreased in 2003 over 2002 by $2.7
million principally due to severance costs of $2.0 million related to senior
management changes in the first quarter 2002. Additional decreases in general
and administrative were payroll related costs of $395,000, consulting and
outside labor of $238,000 and insurance expenses of $153,000. These decreases
were partially offset by other administrative costs increases of
$86,000.

Interest expense decreased $46,000 for the first quarter 2003 compared to
the first quarter 2002. The effective interest rate for the first quarter 2003
was 6.10% compared to 5.85% for the first quarter 2002. The average borrowing
levels were lower by $7.1 million for the first quarter ended March 31, 2003
compared to first quarter 2002.

Other expense consists primarily of losses on the sale of fixed assets,
royalty expense and other miscellaneous expenses.

The Companys net loss was $5.7 million or $0.68 per share in the quarter
ended March 31, 2003 compared with a net loss of $13.7 million or $1.61 per share
in the quarter ended March 31, 2002. Net loss for the first quarter 2002
excluding severance charges, the early retirement of debt and cumulative effect
of accounting change was $5.0 million or $0.59 per share.

Liquidity and Capital Resources

The Companys $122.3 million senior secured credit facility (Debt
Facility) includes an amortizing term loan of approximately $7.3 million, of
which $5.1 million remains outstanding, and a revolving credit facility of up
to $115 million, maturing in January 2005. The variable interest on the Debt
Facility is based on LIBOR plus 2.75% to 3.00% or prime rates plus
..25% to .50%. Availability under the revolving portion of the Debt Facility is
determined by a borrowing base formula calculated upon the Companys eligible
receivables and inventories. The Debt Facility contains restrictive covenants,
including limits on additional borrowings, lease payments and capital
expenditures; maintenance of certain operating and financial ratios;
maintenance of

13



---



##### 



$70.0 million minimum net worth; and a restriction on dividend payments.
The Debt Facility is secured by substantially all of the Companys assets.

As of March 31, 2003, the Company is in compliance with all of the
restrictive covenants in its Debt Facility, as amended. The Company had $17.0
million available to borrow under its Debt Facility as of March 31, 2003.

Total outstanding debt was $103.2 million as of March 31, 2003 compared to
$98.1 million as of March 31, 2002 and $68.4 million as of December 31, 2002.

The Companys invested capital (total assets less non-debt related
liabilities) as of March 31, 2003 was $174.4 million compared to $180.1 million
as of March 31, 2002 and $145.3 million as of December 31, 2002.

|                                             |                                             |                                                     |       |          |       |          |       |             |       |   |       |       |       |  
|-------------------------------------------- | ------------------------------------------- | --------------------------------------------------- | ----- | -------- | ----- | -------- | ----- | ----------- | ----- | - | ----- | ----- | ----- | -
|                                             |                                             |                                                     |       | March 31 |       | March 31 |       | December 31
|(in thousands)                               |                                             | 2003                                                |       | 2002     |       | 2002    
|                                             |                                             |                                                     |       |          |       |         
|Assets                                       |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|                                             | Accounts
          receivable  net         |                                                     | $     | 81.9     |       |          | $     | 82.4        |       |   | $     | 68.2  |      
|                                             | Inventory                                   |                                                     |       | 109.8    |       |          |       | 114.5       |       |   |       | 86.8  |      
|                                             | Net
          property, plant and equipment |                                                     |       | 34.7     |       |          |       | 46.7        |       |   |       | 33.9  |      
|                                             | Remaining
          other assets            |                                                     |       | 20.6     |       |          |       | 19.6        |       |   |       | 15.0  |      
|                                             |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|Total
          Assets                       |                                             | $                                                   | 247.0 |          |       | $        | 263.2 |             |       | $ | 203.9 |      
|Less:
          Non-debt related liabilities |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|                                             | Accounts
          payable                  |                                                     |       | (57.4    | )     |          |       | (71.8       | )     |   |       | (38.4 | )    
|                                             | Other
          current liabilities         |                                                     |       | (15.2    | )     |          |       | (10.4       | )     |   |       | (19.9 | )    
|                                             | Deferred
          income taxes             |                                                     |       |         |       |          |       | (0.9        | )     |   |       | (0.3  | )    
|                                             |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|Invested
          Capital                   |                                             | $                                                   | 174.4 |          |       | $        | 180.1 |             |       | $ | 145.3 |      
|                                             |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|Return
          on invested capital:        |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|                                             |                                             | EBIT
          as reported rolling 12 months        |       | $        | (9.0  | )        |       |             | (0.3  | ) |       |       | (14.4 | )
|                                             |                                             | Addback
          effect of:                        |       |          |       |          |       |             |       |   |       |       |       |  
|                                             |                                             | Severance
          expense                         |       |          | 1.4   |          |       |             | 2.0   |   |       |       | 3.4   |  
|                                             |                                             | Early
          retirement of debt agreement        |       |          |      |          |       |             | 4.6   |   |       |       | 4.6   |  
|                                             |                                             | Inventory
          markdown                        |       |          | 9.2   |          |       |             |      |   |       |       | 9.2   |  
|                                             |                                             | Asset
          rationalization                     |       |          | 12.0  |          |       |             |      |   |       |       | 12.0  |  
|                                             |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|                                             |                                             | EBIT
          for ROIC                             |       | $        | 13.6  |          |       | $           | 6.3   |   |       | $     | 14.8  |  
|                                             |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|                                             |                                             | Earnings
          before interest and taxes (EBIT) |       | $        | 13.6  |          |       | $           | 6.3   |   |       | $     | 14.8  |  
|                                             |                                             | Taxes
          on EBIT                             |       |          | 5.1   |          |       |             | 2.4   |   |       |       | 5.6   |  
|                                             |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|                                             |                                             | Net
          operating profit after taxes (NOPAT)  |       | $        | 8.5   |          |       | $           | 3.9   |   |       | $     | 9.2   |  
|                                             |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|                                             |                                             | Invested
          capital at period end            |       | $        | 174.4 |          |       | $           | 180.1 |   |       | $     | 145.3 |  
|                                             |                                             |                                                     |       |          |       |          |       |             |       |   |       |      
|Return
          on Invested Capital (ROIC)  |                                             |                                                     | 4.9   | %        |       |          | 2.2   | %           |       |   | 6.3   | %    
|                                             |                                             |                                                     |       |          |       |          |       |             |       |   |       |      

14



---



##### 



Invested capital at March 31, 2003 was $174.4 million compared to $180.1
million at March 31, 2002 and $145.3 million at December 31, 2002. The
decrease in invested capital of $5.7 million from March 31, 2002 is due
primarily to lower inventory of $4.7 million and property, plant and equipment
of $12.0 million, offset by lower payables and other liabilities of $10.5
million. The increase in invested capital of $29.1 million from December 31,
2002 is due primarily to higher seasonal inventory levels of inventory of $23.0
million and accounts receivable or $13.7 million.

Return on invested capital, increased 2.7% for the twelve months
ended March 31, 2003 compared with the same period in 2002. For the full year
ended December 31, 2002, return on invested capital was 6.3%. The increase
over March 31, 2002 relates principally to improved earnings before interest
and taxes compared to 2002 and lower invested capital. The lower invested
capital was due to the reasons stated in the preceding paragraph.

Capital expenditures for the first three months of 2003 totaled $2.7
million. These expenditures consisted of improvements to the Companys
information systems totaling $1.6 million which includes $1.4 million for the
Unity point of sales system, improvements to manufacturing and hub facilities
totaling $507,000 and opening and remodeling Companys Service Centers and
Stores-On-Wheels for a total cost of $599,000.

The Company believes its current borrowing capacity is adequate to
maintain operations and capital requirements through the maturity of
the Debt Facility, in January 2005.

Forward-Looking Statements

Certain statements included in this report are forward-looking statements
that involve a number of risks and uncertainties are based on managements
current belief, assumptions and expectations. These forward-looking statements
can be identified by the use of predictive or future tense terms such as
anticipate, estimate, expect, believe, project, may, will or
similar terms. These statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. The
Companys actual results may differ materially from those stated, implied or
anticipated in the forward-looking statements, as a result of a number of
factors that include, but are not limited to, potential regulations; the
Companys ability to effectively manufacture, market and distribute new
products; the success of the Companys operating plans; regional weather
conditions; the condition of the industry and the economy; site availability in
designated markets; zoning and other local regulations; and the ability to hire
qualified individuals to operate Service Centers. For a further discussion of
risk factors, investors should refer to the Companys Securities and Exchange
Commission reports, including but not limited to Form 10-K for the year ended
December 31, 2002.

ITEM 3. QUANTITATIVE AND
  QUALITATIVE DISCLOSURE OF MARKET RISK

Not applicable.

ITEM 4. DISCLOSURE CONTROLS
  AND PROCEDURES

Within 90 days of the date of this report, the Company performed an
evaluation under the supervision and with the participation of the Companys
management including the Chief Executive Officer and Senior Vice President and
Chief Financial Officer, of the effectiveness of the Companys disclosure
controls and

15



---



##### 



procedures. Based on that evaluation, the Companys management, including
the Chief Executive Officer and Senior Vice President and Chief Financial
Officer, concluded that the Companys disclosure controls and procedures were
effective in ensuring that material information relating to the Company with
respect to the period covered by this report was made known to them. There
have been no significant changes in the Companys internal controls or in other
factors that could significantly affect these controls subsequent to the date
of the evaluation.

PART II  OTHER INFORMATION

Except as noted below, the items in Part II are inapplicable or, if
applicable, would be answered in the negative. These items have been omitted
and no other reference is made thereto.

Item 6  Exhibits and Reports on Form 8-K

|    |  |           |  |              |  |                                        
|--- |  | --------- |  | ------------ |  | ---------------------------------------
|(a) |  | Exhibits: |  | Exhibit 99.1 |  | Michael P. DiMino 906 Certification    
|    |  |           |  | Exhibit 99.2 |  | Jeffrey L. Rutherford 906 Certification

|    |  |                                                                                                                                         
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------
|(b) |  | Reports on Form 8-K:                                                                                                                    
|    |  |                                                                                                                                         
|    |  | On February 24, 2003, the Company filed a Form 8-K relating to the
Company's 2002 Earnings Release for the year ended December 31, 2002.

SIGNATURES

Pursuant to 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.

|            |  |                                                                                                                       
|----------- |  | ----------------------------------------------------------------------------------------------------------------------
|            |  | LESCO, INC.                                                                                                           
|           
|May 2, 2003 |  | /s/ Jeffrey L. RutherfordJeffrey L. Rutherford
Senior Vice President, Chief
Financial Officer, Treasurer and
Secretary

16



---



##### 



CERTIFICATIONS

I, Michael P. DiMino, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of LESCO, Inc.;                                                                                                                                                                                                                                                          
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Based on my knowledge, this quarterly report does not contain any untrue
statement of material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
|  
|3. |  | Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;                 
|  
|4. |  | The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
have:                                                                                                   



| | a. |  | Designed such disclosure controls and procedures to ensure
that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the
period in which the quarterly report is being prepared;
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b. |  | Evaluated the effectiveness of the registrants disclosure
controls and procedures as of a date within 90 days prior to
the filing date of this quarterly report (the Evaluation
Date); and                                                                                                 
| | c. |  | Presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;                                                                                                                       



|5. |  | The registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a. |  | All significant deficiencies in the design or operation of
internal controls which could adversely affect the
registrants ability to record, process, summarize and report
financial data and have identified for the registrants
auditors any material weaknesses in internal controls: and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b. |  | Any fraud, whether or not material, that involves management
or other employees who have a significant role in the
registrants internal controls; and                                                                                                                                        



|6. |  | The registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and
material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|            |  |                                      
|----------- |  | -------------------------------------
|May 2, 2003 |  |                                      
|            |  | /s/ Michael P. DiMino                
|            |  | Michael P. DiMino                    
|            |  | President and Chief Executive Officer

17



---



##### 



I, Jeffrey L. Rutherford, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of LESCO, Inc.;                                                                                                                                                                                                                                                          
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Based on my knowledge, this quarterly report does not contain any untrue
statement of material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
|  
|3. |  | Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;                 
|  
|4. |  | The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
have:                                                                                                   



| | a. |  | Designed such disclosure controls and procedures to ensure
that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the
period in which the quarterly report is being prepared;
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b. |  | Evaluated the effectiveness of the registrants disclosure
controls and procedures as of a date within 90 days prior to
the filing date of this quarterly report (the Evaluation
Date); and                                                                                                 
| | c. |  | Presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;                                                                                                                       



|5. |  | The registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a. |  | All significant deficiencies in the design or operation of
internal controls which could adversely affect the
registrants ability to record, process, summarize and report
financial data and have identified for the registrants
auditors any material weaknesses in internal controls: and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b. |  | Any fraud, whether or not material, that involves management
or other employees who have a significant role in the
registrants internal controls; and                                                                                                                                        



|6. |  | The registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and
material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|            |  |                                                
|----------- |  | -----------------------------------------------
|May 2, 2003 |  |                                                
|            |  | /s/ Jeffrey L. Rutherford                      
|            |  | Jeffrey L. Rutherford                          
|            |  | Senior Vice President, Chief Financial Officer,
|            |  | Treasurer and Secretary                        

18