May 2015ISSUE 3

Q & A With LT ............................ 1

Financial Report ......................... 2

The Joseph Umosella Jr. Award ..... 3

2014 Annual Meeting Awards ......... 4

Division of the Year ..................... 4

Vendor of the Year ...................... 4

Chairman’s Award ....................... 5

Acceleration Award ..................... 5

President’s Club Award ................ 6

Outstanding Leadership Award ...... 8

Manufacturing Operation Award .... 9

Sales Excellence Award ............. 10

Technology Excellence Award ...... 11

Working Capital Excellence Award 11

Distribution Excellence Award ..... 12

New Product Leadership Award .... 12

Feldman Lumber ...................... 13

Standard Lumber ...................... 14

K-I Lumber & Building Materials ... 15

Wallboard Supply Company ......... 16

Lumber Specialties ................... 17

US LBM 2015 ANNUAL MEETING

HIGHLIGHTS!

Q&A With LT:The following thoughtful questions were submitted by associates across the US LBM markets.

1. Andy Preble from Hines Supply asks, “As individualized operating entities – we tend to get caught up in the dynamics of our industry relative to our region of the country. How does US LBM prepare budgets accordingly when considering variances in economic factors from region to region?” Budgets start with the local market and our ability to grow and improve. We do look at national numbers to see how much “lift” we can expect overall or by region, but the main drivers are our own beliefs and abilities locally. We prefer the budgets are built by salesperson and by customer so they can be more targeted and accurate.

2. Lyndsey Kampen from Wisconsin Building Supply asks “I love how US LBM places such a strong value on their employees’, how will you maintain that value over the course of time and with national growth?” I believe the strength of our company is our ability to work together and share best practices. We encourage innovation and trying new and different processes rather than driving sameness. Our associates are extremely knowledgeable about our business, customers, and products which makes me confident in their decision making. Our company culture was founded on the local approach and empowering associates. Company size will not overtake those values.

3. Rose Aurora from East Haven Builders Supply asks, “Could the team share among the yards some good practices of what’s working and what’s not working? Some of the repeated issues that occur could be shared, and we could learn from the mistakes at weekly huddles with our team?”Best practice sharing is key to our model and we constantly find ways to improve this communication. Even with all we do to track and communicate our best practices, we still have only scratched the surface. I constantly encourage, and will continue to encourage, everyone to reach out across the companies and create groups and task forces to analyze and improve every aspect of our business.

4. Kurt Dallesasse from Hines Supply asks,“What is your take on how business will be conducted in the near future and how large a part E-Commerce will be taking as we go forward. Will Amazon be a direct competitor soon?”We understand Technology will change the way customers shop and purchase, but the game will still be won by those with the best and most efficient ability to get the product where it needs to go. We constantly invest and analyze our systems and resources to give each company the best advantage, but I believe relationships and great service will always create loyalty and value.

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Financial OverviewRick Kolaczewski | Chief Financial Officer

Over $1 Billion in Sales for 2014 - Congratulations!

US LBM achieved more than $1 billion in sales for 2014, achieving this milestone in only our fifth year. Our reported sales for 2014 increased 44% over 2013, making us the fastest growing company in our industry.

US LBM made 12 acquisitions in 2014 which contributed to the company’s growth. Even without those acquisitions, our team delivered double-digit sales growth through increases in market share and expansion of our PLM program. With housing starts in the Northeast and Midwest flat for 2014, the profitable growth that we delivered is truly outstanding performance.

Our strong gains in profitability were a result of our sales growth, US1 activities and our new mobile app. All of our operating companies had significant contributions to our profitability success in 2014 with Lyman (ABC Chetek, CCC, Chanhassen); Universal (Haddonfield Kitchens, Manahawkin); Wisconsin (Green Bay Truss); and Bellevue (Schenectady Truss) leading the way.

Thank you for all of your efforts in 2014. We are excited about an even better 2015!

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At the 2014 US LBM Annual Meeting Awards, Joseph Umosella, Jr. was named the recipient of The 2014 Lifetime Achievement Award. The award was given posthumously and presented to Joe’s son, Jeff Umosella. Truly an entrepreneur, Joe started Universal Supply in 1965 with one part-time employee, one pallet jack and a small building. That company has grown to include 11 locations, 190 employees and is nationally recognized as an industry leader.

Through his dedication and vision, Joe led several successful companies and developed many innovations that benefitted the entire building supply industry.

Joe lived his life committed to following “The Golden Rule,” whether in business or in his personal life. That value was instilled in him from the time he was a young child. He always strived to ensure that his employees and customers were treated well and had the tools they needed to succeed. He valued them for the unique role they played in his business and success. Joe was a visionary and was involved in many businesses and partnerships, some successful and some not, but Joe learned from each of those ventures to continue to develop as a businessman.

More important than his success in business, Joe was deeply committed to giving back to his community. He was dedicated to raising funds and supporting the research of The Cystic Fibrosis Foundation. He was involved with many different non-profit organizations and found great satisfaction in those relationships.

Joe has created a lasting legacy through his business successes and many contributions to the building supply industry. Starting in 2015, The Lifetime Achievement Award will be renamed “The Joseph Umosella Jr. Award” in his honor.

Joseph Umosella, Jr.Recipient of the 2014 US LBM Lifetime

Achievement Award

3Entrepreneur • Visionary • Risk Taker • Leader • Listener • Success

• Sales growth of 26% and EBITA growth of 72%

-Exceeded Sales and EBITDA Budget

-Aggressively added competitive personnel and increased market share

-Gross margins increased 72 basis points

-Truss Sales grew 69% and more than doubled profits

• Top 3 performer in Working Capital for all of US LBM

• The WBS team has moved into a leadership role regarding technology utilization adding:

-Visualizer and Virtual Construction Modeling to improve the customer experience and improve internal efficiency

-Serving as the Beta site for the Sales-I rollout

-Launched the App after Hines and still won the user sign up competition

2014 DIVISION OF THE YEAR: WISCONSIN BUILDING SUPPLY

(Pictured: Bill Imig, LT Gibson)

This award is given to the OpCo with outstanding financial performance. Their leadership role of developing and implementing improvements will benefit the entire industry.

(Pictured: Jeff Umosella, Brian Kimber, VP Sales GAF, Randy Aardema, Rick Kolaczewski, LT Gibson)

2014 VENDOR OF THE YEAR: GAFThis honor is presented to the Vendor-Partner that exhibits a strong commitment to the growth of US LBM.

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2014 US LBM Annual Meeting Awards

• Designed a special hybrid business model for US LBM which treats our companies like independents yet fosters personal relationships from local representation to the CEO

• Consistent top 5 vendor in terms of volume for US LBM, In 2014 GAF was #4, at just under $30 million

• Opened a relationship with three additional companies within US LBM; Coastal Roofing Supply, Hines, and Musselman and expecting new relationships with our companies this year

• Provided market intelligence and business guidance to our companies, including our new roofing ventures; Coastal Roofing Supply, Hines Roofing Supply and Lyman Roofing and Siding

• Lyman tripled purchase volume with GAF during 2014 and Musselman’s first year sales grew to $1.8 million

• Provided the most competitive pricing and rebates to the markets we serve by placing US LBM in their top tier accounts

• Systematically reduced the number of authorized distributors thereby providing the opportunity for us to grow faster and expand margins

Awarded to the OpCo that exhibits innovation and adaptation by managing their business model to increase profitability.

2014 ACCELERATION AWARD: WISCONSIN BUILDING SUPPLY

(Pictured: Allan Breidenbach, Bill Imig, LT Gibson)

• Sales Growth of 26% and EBITDA improvement of 68% over 2013

• Key driver of growth and market share gains by aggressively recruiting new employees from the competition

• Demonstrated a leadership role in developing “Customer Facing” technology solutions by serving as the Beta site for the Sales-I rollout

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Presented to the OpCo that achieves profits that are 10% or greater as a percentage of annual sales.

2014 CHAIRMAN’S AWARD: LYMAN COMPANIES

(Picture: Jason Runco, Dale Carlson, LT Gibson)

• Sales grew $10M & EBITA grew 16% • Gross margins improved by 142 basis points, “Best in US LBM”

Awarded to Individual Locations within the US LBM organization, that achieve profits that are 10% or greater as a percentage of sales annually.

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ABC TRUSS - LYMAN LUMBER COMPANY

(Pictured: Aaron Nichols, LT Gibson)

• Most Profitable Location in US LBM 3 years in a row

• Second most profitable in US LBM(Pictured: Greg Gaskell, LT Gibson)

SCHENECTADY TRUSS BELLEVUE BUILDERS SUPPLY

CAPE MAY COURT HOUSE UNIVERSAL SUPPLY COMPANY

• 4 Time Winner of The President’s Club Award(Pictured: Dante LaSasso accepting for Bill Atwood, LT Gibson)

CARPENTRY CONTRACTORS COMPANY LYMAN LUMBER COMPANY

• Sales Growth of 13% & 42% EBITDA Leverage(Pictured: Scott Gertjejansen, LT Gibson)

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GREEN BAY TRUSS - WISCONSIN BUILDING SUPPLY

• Sales Growth of 70% has more than doubled profits(Pictured: Mike Petrina, LT Gibson)

HADDONFIELD CABINETRY & DESIGN CENTER UNIVERSAL SUPPLY COMPANY

• Tripled Sales in 2014(Pictured: Mike Donzanti, LT Gibson)

MANAHAWKIN - UNIVERSAL SUPPLY COMPANY

• EBITDA growth of 10%

(Pictured: Dante LaSasso - accepting for Bill Potts, LT Gibson)

CHANHASSEN - LYMAN COMPANIES

• 2nd Largest location in all of US LBM with 7th best EBITA margin(Pictured: John Zirbes, LT Gibson)

2014 OUTSTANDING LEADERSHIP AWARD

(Pictured: Wendy Whiteash, LT Gibson) (Pictured: Senthil Arumugam, LT Gibson)

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Presented to individuals or teams within US LBM for their outstanding achievement and contribution to the success of the overall organization.

• Sales grew $10 million during the year while EBITDA grew 16%

• US1/Lean Initiative – early adopter of lean principles, rapidly deploying concept throughout organization

• Aggressive Management of Expenses and Working Capital as Building Activity Slowed

• Led US LBM in both EBITDA Return on Sales and Working Capital % of Sales

WENDY WHITEASH SENTHIL ARUMUGAM

(Pictured: Dale Carlson, LT Gibson)

LYMAN MANAGEMENT TEAM

“The outstanding leadership distinction is our most prestigious individual award. It is presented to an individual(s) who represent the es-sence of what the US LBM model is all about. They move the needle with passion, extraordinary effort and commitment. They use ‘outside of the box’ thinking to create value in new and different ways. Simply put, they change the game through their leadership and separate us from the herd.” – LT Gibson

2014 MANUFACTURING OPERATION OF THE YEAR

ABC CHETEK – LYMAN COMPANIES

• Largest & Most Profitable Manufacturing Operation/Location in US LBM

• Sales were just short of Budget but EBITDA exceeded Budget by 9%

(Pictured: Aaron Nichols, LT Gibson)

Awarded to the Manufacturing Operations exhibiting the greatest increases in profitability within the organization.

GREEN BAY TRUSS – WISCONSIN BUILDING SUPPLY

• Grew Sales 70% during 2014 & delivered EBITA Leverage of 23% • Exceeded Budget by $5 million in Sales and $1.3 million EBITDA

(Pictured: Mike Petrina, LT Gibson)

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Presented to the OpCo with the highest rate of sales growth within the US LBM organization

Presented to the OpCo with the highest rate of sales growth within the US LBM organization

2014 SALES EXCELLENCE AWARD: HINES SUPPLY

2014 SALES EXCELLENCE AWARD: WISCONSIN BUILDING SUPPLY

• 2014 Sales Growth of 43%

• Strong growth in all channels with New Construction, R&R and Commercial all up more than 50% for the year

• Sales were 31 points higher than growth in permits

• 5% of Sales from New Customers

(Pictured: Doug Jones, LT Gibson)

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• 2014 Sales Growth of 26%

• Strong growth in all channels - New Construction, R&R, and Commercial

• Truss sales up 70%, Millwork sales up 38%, and Cabinetry sales up 34%

(Pictured: Bill Imig, LT Gibson)

Awarded to the US LBM OpCo that embraces new technologies and shows leadership within the US LBM organization.

2014 TECHNOLOGY EXCELLENCE AWARD: HINES SUPPLY

(Pictured: Doug Jones, LT Gibson)

• Instrumental launch partners for the mobile App program

• Created App marketing template for all other divisions

• Increased usage every month since the Mobile App release, setting the standard for those to follow

Awarded to the Opco with the best Working Capital % of Sales 2014 WORKING CAPITAL EXCELLENCE: LYMAN COMPANIES

(Pictured: Dale Carlson, LT Gibson)

• Working Capital % of Sales – “Best in US LBM”

• DPO improved by 3 days

• Excellent job managing inventory to demand, as permit activity slowed in the Twin Cities

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Presented to the team that best embraces the US1 model of continuous improvement by addressing critical operational challenges or opportunities in their business.

2014 DISTRIBUTION EXCELLENCE: BELLEVUE BUILDERS SUPPLY

(Pictured: LT Gibson, Greg Gaskell)

• Attained $125K in labor savings and a 16% reduction in yard labor since implementation of Kaizen plan

• Addressed inefficiencies exposed by Metrics and Descarte

• The first Opco to execute a comprehensive lumber yard re-design using Lean-Kaizen method

• Key for the success - Involved the yard team and associates from other departments. Challenge them to come up with a solution.

• Looking forward to an acceleration in sharing best practices in 2014

Awarded to the OpCo that best exemplifies sales, financial results, and management leadership through market performance.

2014 NEW PRODUCT LEADERSHIP AWARD: HINES SUPPLY

(Pictured: Jeff Umosella, Doug Jones, LT Gibson, Rick Kolaczewski)

• After an initial slow start in penetrating the Roofing & Decking categories, the Hines team aggressively pursued “tuck-in” acquisition opportunities

• Added businesses in order to drive growth in new categories -Roofing - Acquired Builders Roofing in April 2014 -Decking – Acquired Mike’s Decking in April 2014

-These additions jump started Hines’ growth in new categories and added new team members focused on driving continued growth

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PRODUCT OVERVIEW: Lumber; Plywood, Metal Studs, Track & Accessories, Drywall & Accessories, Millwork; Hardware; Structural Steel & Deck, Insulation & Sound Proofing

To Learn More about Feldman Lumber, visit: www.feldmanlumber.com

FOUNDED: 1912

JOINED US LBM: August 8, 2014 MANAGEMENT: Kenny Feldman, President

“Becoming part of the US LBM family has been a win/win for both our associates and customers. We have been able to continue to do what we do well, while also benefitting from the best practices employed by the rest of the US LBM family.”

Kenny Feldman

FELDMAN LUMBER

FROM THE PRESIDENT

OUR STORY For more than 100 years, Feldman Lumber has been dedicated to providing their customers with a broad range of high quality products to meet the ever-changing needs of their businesses. Their four locations and dedication to customer satisfaction has made them a highly-respected supplier to contractors, builders and industrial companies in one the nation’s largest metropolitan areas. Feldman Lumber sales and delivery staff are highly-trained in the critical importance of on-time, convenient deliveries and take great pride in their commitment to meeting customers’ delivery needs, day or night. Feldman Lumber recognizes that the relationship between supplier and customer is the key to everyone’s success.

TERRITORY: Based in Brooklyn, NY, Feldman Lumber has four locations serving the NY, NJ, & CT Tri-State Area: Brooklyn – East Williamsburg Yard & Showroom; Long Island – Great Neck Showroom; Brooklyn (Brownsville) - Showroom; Queens – Maspeth Yard.

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FOUNDED: 1904

JOINED US LBM: September 30, 2014 MANAGEMENT: Tim Rottschafer, President

OUR STORY For more than a century, Standard Lumber has been dedicated to providing quality products, excellent customer service and competitive prices to building professionals and remodelers in Western Michigan. Founded by Omge and Kenelska Rottschafer, the now third-generation led Standard Lumber team is highly trained and committed to customer satisfaction. From hand-inspecting all products prior to delivery to ensuring their sales team’s technical knowledge is second to none, Standard Lumber has made “Service Excellence” their highest priority.

TERRITORY: Based in Grand Rapids, Standard Lumber serves Western Michigan through its six full-service building material distribution centers, eight cabinetry showrooms and a component manufacturing facility. Locations include: Grand Rapids, Ada, Sparta, Grand Valley, Montague, Ludington, Holland and Traverse City.

PRODUCT OVERVIEW: Cabinetry, Windows, Doors, Trusses, Components, Roofing, Siding, Framing Materials

To Learn More about Standard Lumber, visit: www.standardcompanies.com

FROM THE PRESIDENT“We have found the experience of joining US LBM to be rewarding and see many opportunities for growth and improvement through the educational programs offered by US LBM,” said Tim Rottschafer, President. “Our associates have been pleased with the seamless transition and the transparency with customers and vendors has been well received. We are happy about the potential for further investment in Western Michigan that will help us grow and be more profitable.”

Tim Rottschafer, President

STANDARD LUMBER

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FOUNDED: 1932

JOINED US LBM: November 14, 2014 MANAGEMENT: Bob DeFerraro, President

OUR STORY Founded by Walter Freeman, K-I Lumber began as a wholesale lumber operation and has grown into a full-service company providing a diverse line of building products to dealers, builders, remodelers, and general contractors. K-I Lumber has a top-notch customer service team to ensure customer orders are of the highest quality with competitive prices and prompt delivery.

TERRITORY: Headquartered in Louisville, KY, with corporate office and main distribution yard. K-I Lumber has full-service distribution centers in Lexington, KY; Clarksville, IN; Evansville, IN and K-I Truss & Building Components in Shelbyville, KY. K-I also produces trusses in Lexington, KY and Evansville, IN.

PRODUCT OVERVIEW: Cabinetry, Doors, Millwork, Drywall, Insulation, Lumber, Windows, Roofing, Siding, Trusses & Wall Panels, Hardware, Engineered Lumber Products, Installed Sales

To Learn More About K-I Lumber & Building Materials, visit: www.ki-lumber.com

FROM THE PRESIDENT“From the date of the transaction we started transforming our company into the US LBM corporate structure and philosophy. This has been an extension of our old company of focusing on K-I associates, customer relationships and driving sales every day. The global strength of US LBM in technology and best practices helped us grow as a company to a new level in the building materials industry.”

Bob DeFerraro, President

K-I LUMBER & BUILDING MATERIALS

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To Learn More about the Wallboard Supply Company, visit: www.wallboardsupplyco.com

FOUNDED: 1970

JOINED US LBM: November 25, 2014 TEAM: John Filion, President Ryan Filion, Vice President

OUR STORY A strong commitment to provide quality sheetrock and finishing products along with unparalleled customer service guides this third-generation, family-run company. With locations in multiple states, Wallboard Supply Company’s delivery fleet can deliver throughout New England quickly and conveniently. In the tradition set by founder Bob Filion, the Wallboard Supply Company team takes pride in forming a relationship with each of its customers to meet their needs with the best prices and service possible.

TERRITORY: Wallboard Supply Company has five locations to serve Greater New England including its headquarters in Londonderry, NH. Other facilities are located in Braintree, MA; Portland, ME; Hermon, ME; and Williston, VT. PRODUCT OVERVIEW: Drywall, Metal Framing, Insulation, Lumber, Ceilings, Windows & Siding

“The transition has been completely seamless and exactly what we had hoped for. The support from US LBM has been tremendous and the group energy is fantastic,” said Ryan Filion, Vice President. “We are pleased to be part of a great team.”

Ryan Filion, Vice President

WALLBOARD SUPPLY COMPANY

FROM THE PRESIDENT

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FOUNDED: 1983

JOINED US LBM: December 12, 2014 MANAGEMENT: Dennis Westhoff, President

OUR STORY Lumber Specialties is the Midwest’s largest independent truss and wall panel manufacturer. The company has grown from ten original employees to more than 200 employees in their two facilities. Utilizing computer-operated saws and laser projections systems, Lumber Specialties provides high quality products with competitive prices to the building professionals they serve.

TERRITORY: Based in Dyersville, IA, Lumber Specialties serves the Midwest from its two manufacturing & sales facilities in Dyersville and Story City, IA.

PRODUCT OVERVIEW: Roof Trusses, Floor Trusses, Agricultural Trusses, I-Joists, Wall Panels, Tall Walls, Steel Beams, Laminated Columns

To Learn More about Lumber Specialties, visit: www.lbrspecs.com

LUMBER SPECIALTIESFROM THE PRESIDENT “Our transition into the US LBM organization has been a very smooth and positive process,” said Dennis Westhoff, President. “We are excited about the support, education and growth opportunities that US LBM offers us as we move forward.”

Dennis Westhoff, President

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