Mary Ann Jackson - Director of Investor Relations Russell Huffer - Chairman and Chief Executive Officer Jim Porter – Chief Financial Officer

Eric Glover - Canaccord Adams Steve Denault - Northland Securities Brent Thielman – D.A. Davidson Tom Hayes - Piper Jaffray Jonathan Braatz - Kansas City Capital Richard Nelson - Jesup & Lamont Securities Corporation Robert Kelly – Sidoti Robert Vermillion – Axial Capital

Welcome to the second quarter fiscal 2009 Apogee Enterprises, Inc. earnings conference call. (Operator Instructions) I would now like to turn the presentation over to your host for today’s call, Mary Ann Jackson.

With us on the line today are Russ Huffer, Chairman and CEO, and Jim Porter, CFO. Their remarks will focus on our second quarter results and the outlook for fiscal 2009. During the course of this conference call we will make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations and the current economic environment and are of course subject to risks and uncertainties which are beyond the control of management. These statements are not guarantees of future performance and actual results may differ materially. Important risks and other important factors that could cause actual results to differ materially from those in the forward-looking statements and projections are described in the company’s annual report on form 10-K for the fiscal year ended on March 1, 2008 and in our earnings release issued last night and filed this morning in form 8-Q. Russ will now give you a brief overview of the results and then Jim will cover the financials. After they conclude, Russ and Jim will answer your questions.

We continue to grow Apogee’s architectural business with great products and great services and despite internal operational challenges in the second quarter, grew our EPS in the period. In what we now see as challenging market conditions, we expect to grow revenues and earnings to record levels in fiscal 2009 while generating strong cash flow. We continue to see the benefits of our architectural glass products and services leadership position in the green building movement. During the second quarter, internal issues affected our profitability and changing commercial construction markets have affected our revenue growth outlook for the full year. As a result we have reduced our fiscal 2009 earnings guidance to $1.65 - $1.82 per share. We have seen significant changes to some sectors of our markets in a short period of time. We normally experience project delays in our business primarily driven by job site schedules. However, in the past six weeks, we have seen an unusual amount of project delays along with a small number but high dollar value of cancellations. Some of the delays are normal of course, but economic uncertainty has also become a factor. This is a rate of change we have not seen before and we continue to closely monitor near term market developments. The big question is what happened in the past two months to significantly change the outlook for Apogee’s architectural segment? The issues primarily relate to our Viracon architectural glass business with some market softness today for our Wausau window business. Two major Viracon casino projects were cancelled in early August including one already in production and we started seeing more project delays which are moving work from the current fiscal year into fiscal 2010. It has been difficult to fill this capacity that opened up due to the short notice and long selling cycle for much of our architectural glass and window work. As we attempted to fill the open capacity in our schedules, the shorter lead term work, it became apparent that there are fewer small to mid-size projects being financed, and given the state of the residential markets, there is more US competition and thus pricing pressure for these smaller jobs. At the same time, we experienced internal operational challenges in our large Minnesota architectural glass fabrication facility. These were worse and more extensive than we originally anticipated and took longer to resolve. These issues, which led to higher labor costs than planned to overcome production bottlenecks while maintaining our focus on delivering complete high quality product orders on time to customers, and also impacted the second quarter results and our full year outlook. As a result we have lowered our full year outlook for earnings and revenues. I am encouraged that we continue to expect to grow our business despite uncertain and softer market conditions and our internal operating problems at Viracon where production has been back to normal levels since the beginning of September. Turning to our second quarter results, our operating performance with the exception of Viracon was strong. Operating margins improved in our installation and window businesses as we had expected and operating margins were higher than anticipated in our picture framing business even though revenues declined due to the elimination of less profitable product lines and soft framing market conditions. During the quarter we completed our new Wausau window building where we are consolidating operations from three separate very old buildings into what we expect to be a silver LEED certified manufacturing facility, the first of its kind in this industry. We also continued to generate significant cash flow in the quarter with $18 million in free cash flow. We grew architectural segment revenues and earnings but our operating margin was impacted by the operational problems at Viracon. At 6.7% for the quarter, the operating margin was below our expectations and the prior year period’s 7.3%. Architectural segment backlog at $446.7 million was up 10% from the prior year period and down 10% from the first quarter. Backlog declined for all businesses compared to the first quarter. Cancellation of two casino projects removed $6 million from the fiscal 2009 backlog. Although bidding activity remains strong, future work is not filling our backlog as quickly as we had anticipated because the time between project bids and awards seems to be growing. And as I noted earlier, we are seeing more US competitors on mid-sized to smaller projects creating some pricing pressures. We are seeing a lower hit rate as we hold our margin requirements at this point. We are re-focusing our sales efforts on markets that continue to demand our value-added, energy efficient, aesthetic and hurricane glass products. The institutional market for education, healthcare, and government projects tends to remain steady through the ups and downs of commercial construction cycles and green building is a growing trend that’s here to stay. Turning to the large scale optical segment, our operating margin grew to 21.2% as our best value-added products were more than 50% of segment sales for the fourth consecutive quarter. Revenues declined 17% primarily due to the elimination of less profitable product lines and somewhat from soft picture framing market conditions. We successfully started our new coating capacity for our best picture framing products that control reflectivity and look forward to expanding current and new markets for these products. We have essentially doubled the capacity for our highest value-added picture framing products. Next I’ll cover our outlook. With the recent uncertainty and softness in our commercial construction markets, our visibility has clouded. For fiscal 2009, we are now expecting earnings of $1.65 to $1.82 per share, down from previous guidance of the lower end of the range of $1.82 to $1.94 per share. Our earnings outlook has declined primarily due to project delays and the cancellations I mentioned, with some impact from the Viracon operational issues. I am pleased that the improving margins in our window and installation businesses and in our picture framing business are expected to continue in the second half. In fact, we are increasing our operating margin outlook for the picture framing business to 22% from 18% to 19%. For the architectural segment, we continue to expect earnings and revenue growth, and I would like to emphasize with Viracon revenues up significantly from last year. However, our margin outlook has declined to 6.4% to 7% with the full year expected to be impacted by lower capacity utilization due to lower revenues as well as the Viracon second quarter operational challenges. I want to stress that we remain focused on Viracon operations to prevent a recurrence of these issues. Because our visibility has been reduced by uncertain and softer market conditions, we are waiting until our third quarter release to update our fiscal 2010 outlook. In closing, I want to assure you that I continue to believe our markets offer significant longer term opportunities. The increasing importance of green building, a sector demanding energy-efficient products that we supply, and the overall growth and use of value-added products in commercial construction projects both in broader US markets and internationally are positive trends for Apogee and its architectural businesses. We continue to build on our favorable market position with new products that has significant energy advantages. Jim will now comment on the financials.

We earned $0.43 per share in the quarter from continuing operations on revenues of $245 million which were up 13%. Operating income was up 9% to $18.8 million. We have commented in the past that fiscal 2009 performance is largely about our own execution. Our second quarter was impacted by execution with internal production challenges in our Viracon architectural glass fabrication business. Despite that, we had good performances in our other businesses during the quarter. We expected operating improvements in our installation and window businesses and they both delivered, as did the picture framing business and our large scale optical segment. We did see an increase in uncertainty of market conditions late in the quarter. We continued to see nice architectural segment growth at 15% while our operating margins came in at 6.7%, negatively impacted by the operating issues. We estimate the impact of the Viracon operational issues was roughly a 1 point drag on the segment operating margin for the quarter. Our large scale optical segment operating margin came in stronger than expected at 21.3% on lower revenues which were impacted by elimination of some less profitable product lines as well as softer picture framing markets. The second quarter earnings per share reconciliation between the current earnings from continuing operations of $0.43 per share and the $0.40 per share earned in the prior year period is the architectural segment operations added $0.02 per share. The large scale optical segment was neutral. The performance of equity and affiliates reduced earnings per share $0.03 and lower corporate expenses, lower average debt, and the impact of reduced shares improved earnings by $0.04 per share. EBITDA or earnings before interest, taxes, depreciation, and amortization from continuing operations was up 11% and we continue to have good cash flow performance. We ended the quarter with $63.7 million in long term debt. Debt declined from the first quarter as we continue to drive lower working capital requirements. Capital expenditures were $39.2 million which spending related to investments in our architectural and picture framing businesses. Spending included approximately $19 million for our new architectural window facility that opened in late August. In the second quarter we repurchased approximately 300,000 shares at an average price of $16.32 per share for a total of $4.9 million. We have remaining authorization to purchase just under 1 million shares. I’ll turn to our full year outlook for fiscal 2009. Market conditions that are causing delays and cancellations along with our second quarter Viracon challenges have led us to reduce our outlook and earnings guidance for fiscal 2009 and continuing operations to a range of $1.65 to $1.82 per share on revenue growth of 9% to 12%, down from previous guidance of $1.82 to $1.94. We spent considerable time evaluating opportunities and risks for individual businesses. The expanded earnings per share range accounts for the uncertainty associated with timing of project flow which impacts revenues for fiscal 2009, some of which is normal timing variation. We still expect to grow earnings and revenues from fiscal 2008 and go to a lower rate than previously expected. The biggest impact on earnings is the reduction in the architectural operating margin to a range of 6.4% to 7%, comparable to last year’s 6.7%. Operational costs at Viracon, along with project delays and cancellations which will impact second half capacity utilization and potentially fill in pricing, and some material cost increases, are reducing our architectural segment operating margin outlook. Somewhat offsetting these issues are the continued improving performances expected from our installation and window businesses and our large scale optical segment in the second half of fiscal 2009. Our architectural segment backlog remains high and provides us visibility for the balance of this year and into next year. As a reminder, our backlog includes the full contractual value of our window and installation businesses but only includes the phase of the project with a purchase order or about two months of production related to our largest and fastest-growing architectural glass business, Viracon. We experienced normal quarter to quarter variation in our backlog driven by timing, duration, and size of projects booked in the quarter. The decline in our second quarter was slightly greater than normal. We do continue to see strong bidding activity of good projects for future work. Our total backlog remains spread across commercial construction sectors with a project mix similar to that in the first quarter. The office sector makes up 40% to 45% of our backlog, institutional, which is education, healthcare, and government, continues to be 30% to 35% of backlog, high end condominiums remain at 15% to 20%, and hotel, entertainment, and casino projects continue at 5% to 10% of the backlog. Approximately $261 million or 59% of the backlog is scheduled to be delivered in fiscal 2009, approximately $157 million or 35% in fiscal 2010, and approximately $29 million is booked into fiscal 2011. For our large scale optical segment, we increased our operating margin outlook to approximately 22% from earlier guidance of 18% to 19% on a revenue decline of 6% to 7%. We continue to experience growth of our best value-added picture framing glass and acrylic products for which we added capacity, but soft overall framing market conditions, this growth is expected to be offset by the planned elimination of certain products and declines in the lower value-added or non value-added products. We expect the second half to be stronger than the first half for both large scale optical revenues and operating margins. We brought on our new capacity online late in the second quarter and will be leveraging that over the balance of the year. I’m going to briefly cover our cash flow outlook for the full year fiscal 2009. We are estimating EBITDA earnings before interest, taxes, depreciation, and amortization from continuing operations of $100 million to $107 million. Depreciation and amortization increased to approximately $30 million in fiscal 2009 due to depreciation on recent capital investments and amortization of intangibles related to the acquisition of Tubelite. We estimate net cash provided by continuing operations of $65 million to $75 million for the year. Capital expenditures are projected to be approximately $60 million. Fiscal 2009 strategic investment for capacity expansions and productivity improvements in both operating segments. We expect this will give us free cash flow of $5 million to $15 million. We’ll continue to focus on ways to invest in growing our business as a use for free cash flow. We have remaining authority to repurchase approximately almost 1 million shares. We define free cash flow as net cash flow provided by operating activity minus capital expenditures. We have great businesses supported by growing demand for green, energy-efficient building products and other value-added aesthetic and hurricane and blast-resistant glass products and services. Our goal remains to outperform our markets and we feel we are positioned to do this.

I’d like to go ahead and open up the call for questions at this time.

(Operator Instructions) Your first question comes from Eric Glover - Canaccord. Eric Glover - Canaccord Adams: I was just wondering if you could comment on the size of the small to mid-size architectural glass market in general and then relative to Viracon’s market; in other words, what percentage of Viracon’s sales historically have been to the small and mid-size market?

Eric, actually relatively small amount, probably about 20% of their capacity has typically gone to the smaller marketplace, but that marketplace has grown significantly in the use of the energy-efficient glass, and today represents an opportunity at least equal to the markets currently being served. Eric Glover - Canaccord Adams: Okay, thanks, and I was just also wondering if you could comment on whether you’ve seen a material slow down in the use of energy-efficient glass in general as you’ve experienced this slow down?

There’s no evidence that we have seen that is reducing the demand. In fact, we continue to see increasing demand for energy efficient products.

Your next question comes from Steve Denault - Northland Securities. Steve Denault - Northland Securities: When you make reference to in the last several weeks things really softening within just commercial construction in general, it’s interesting, I mean you’re not the first person to have suggested that. What do you think it is? Why recently, why would things head south they way they have so recently? Is there anything you can think of?

When we look at the two projects, and let me clarify, both of those projects were actually in production. One project was halted completely. The other project was significantly downsized. In the first instance, it was clearly financing of the project and demand for it. It was a Las Vegas project that fell with the market it appeared from what we were able to read that the markets were being overbuilt and this was one where financing would justify delay, so that’s what we saw particularly there. Beyond that, it’s still a matter of speculation on our part to make a comment on it. Clearly we think that financing has something to do with it, but I think a lot of it, and this is my opinion, I think people are just pulling back because of the general uncertainty.

I’ll just add to it a little bit, which is, we’re really still gathering data. This is pretty rash in terms of seeing this activity and it’s not broad-based across all of business, it’s been kind of spotty in terms of the delays happening, and we have to speculate, but we attribute more to general economic uncertainty. Other than the one project Russ mentioned, we have not specifically been notified as finance being specific issues for delays.

Your next question comes from Brent Thielman - D.A. Davidson. Brent Thielman – D.A. Davidson: The two casino projects, were those already in backlog, or were those commitments that were expected from the backlog in the quarter?

They were Viracon projects partially in the backlog. Remember, only about 8 weeks or so of a project goes into the backlog and Viracon. The rest of it was in commitment. It would have flowed in the backlog over the next several months, probably through the end of the fiscal year. So the portion that came out of the backlog was the portion that was stopped in mid-production. Brent Thielman – D.A. Davidson: Okay, so I guess on a year-over-year basis though, did your bookings grow without that project in backlog?

No. Bookings or commitments, our backlog did grow year-over-year even with those out. Brent Thielman – D.A. Davidson: And I guess as you look at some of the other projects you have in backlog and some of the commitments that extend out, have you assessed where the other potential for other project cancellations, I mean how comfortable are you with that there?

We normally communicate with our customers on a very regular basis obviously. There are several points where we get into detailed communications about coming work. One is where a commitment turns into a backlog. Lots of phone calls and activities surround that, and that normally results in load leveling our capacities. The second point is to just review longer term commitments on a quarterly basis. When we got into the position of the canceled projects, especially canceling out existing work that we needed to run through our factories, we reviewed that in order to try to find work to fill in and actually that was an earlier than normal review where we saw this higher than normal delay come about so we’re on top of this on a consistent basis. This one came very quickly.

: Brent Thielman – D.A. Davidson: And I guess as you look at your new guidance and I guess the possibility for further project cancellations, what needs to happen to get sort of towards that higher end of guidance? How comfortable are you with that?

The higher end of the guidance is achievable and we articulated a number of factors. I mean, we have some capacity now to fill in and so our success in filling in that capacity will be important to achieve the high end of the guidance, as well as no material new delays. Insuring that these operational issues truly are behind us as we believe and then material costs, particularly energy related, have moved around a lot, and if we continue to see lower or even declining oil prices, I mean that could be favorable. Those are some of the key factors that allow us to get to the higher end of the range. Brent Thielman – D.A. Davidson: Given sort of the environment that you’re seeing and that you’ve talked about in the last six weeks, how comfortable do you feel with one, the new capacity that you’ve added, and some of the planned capacity that you’re expecting to put in?

On the glass side we’re very pleased with the new capacity that’s come on board in St. George. It’s come up, it’s run efficiently, high quality, and really I’m very pleased with that. I think that this will give us a breathing chance to rebalance and bring some improved efficiencies to our largest operation which we really had full pressed against maximum capacity for some time, so I would actually expect to see some efficiencies come out of this a little bit for us in that particular arena.

We do continue to bid a lot of work and continue to see good work out there that really allows us to feel good about our ability to fill that capacity effectively.

Your next question comes from Tom Hayes - Piper Jaffray. Tom Hayes - Piper Jaffray: If you look at your comments on delays and cancellations as well as the sequential decline in the backlog, how is that activity compared to previous slowing cycles, if you look back at the ’03-ish area when non-res started slowing down?

We’ve asked that question. I would say to you that the quick change and the delay that Viracon, we did not see anything that fast in the previous cycle. That’s why, and again, my opinion, I feel that that’s more due to uncertainty than other conditions because in the last cycle, the buildings were just built out, certainly there was overbuilding, but it was, you could actually see the precipitous drop in dodge permits and AIA where this time we’ve certainly had some noise on the AI building index but we’ve had nothing that would have signaled a quick change like we saw, so that’s why my opinion again, more of a draw back due to just uncertainties. Tom Hayes - Piper Jaffray: To the point of the ABI index, we were five or six months in with reading, just wanted to get your interpretation of, maybe this is the tip of further slowing versus like you said, it kind of came out of nowhere.

I just can’t tell you what we see in bidding, what we see in opportunities remain on the positive side. That’s my best answer. Tom Hayes - Piper Jaffray: It looked like you guys did a great job on leveraging the SG&A expense for the quarter. I was just wondering if you could give a little insight on that going forward and what did you guys do to achieve that?

It’s a number of areas of managing cost but frankly a big component of it is with these revised guidance leads to a lower incentive accrual for the company.

Your next question comes from John Braatz - Kansas City Capital. Jonathan Braatz - Kansas City Capital: Given the sort of tumultuous financial markets this week, have you spoken to some of the project managers or project developers specifically the larger ones that are in your backlog as to how they are looking at their projects. Is everything continuing on schedule? I guess the question is, have you spoken to them this week?

In the last two weeks we have been very active in speaking with our customers and running those questions as far up as we can through this value strain and that’s what led us to project out a significant portion of these delays, so there’s no question that there are delays. There’s only two cancellations, so we do not have, we have not had a significant or an indication through this process of cancellations. What we’ve seen are significant delays. Jonathan Braatz - Kansas City Capital: When a project is in your backlog, does it have all of the necessary financing available?

Generally it does, yes. Jonathan Braatz - Kansas City Capital: When a project is cancelled, are there any costs that you need, that are written off or that have been capitalized or anything like that, that you need to expense?

The projects that were cancelled actually, the customer took delivery of the product that was produced at the stated pricing. Actually just one comment, one of the projects that was cancelled, the steel is in the ground and the owner has said that they expect to come back to this project in 9 to 12 months so they did take all product that was in process of production.

The impact of the cancellations was it left holes in capacity. Jonathan Braatz - Kansas City Capital: Can you update us a little bit on PPG and their sale of the auto glass segment, and in your release you talk about free tax earnings of $1.5 million for that joint venture if you want to call it that. Does that include some type of gain on the sale or is that “operating results” that you expect for the second half?

First of all, really what we know is what PPG has stated is that they continue to believe that the transaction is going to close this calendar year and there’s every indication that that’s the case and then our outlook for the income and equity in affiliates does include any expectation of gain related to the transaction. Jonathan Braatz - Kansas City Capital: Did you say does or does not?

It does. Jonathan Braatz - Kansas City Capital: When we look at the operating results by segment, the corporate costs were down significantly, in fact there was a credit versus last year’s $600,000 or something like that, what causes that huge swing in corporate cost?

Some of that was just timing of expenses and some of it was as I said an adjustment in terms of some accrual. Jonathan Braatz - Kansas City Capital: Okay, the incentive compensation?

Yes.

Your next question comes from Richard Nelson - Jesup and Lamont. Richard Nelson - Jesup & Lamont Securities Corporation: I know that you said that you won’t give detailed guidance until the third quarter, but last quarter you had mentioned something about at least general revenue growth over the next couple of years at being around 8% give or take obviously a percentage point or so. Are you still fairly comfortable with that range?

I think as we said, we think it’s very important for us to get through this period of time of this uncertainty and get to a more definitive outline of where we think the business, the marketplaces are headed and that’s why we said we need that time to get this done, because it would be too much speculation on our part given the recent events to do otherwise.

Your next question comes from Robert Kelly - Sidoti. Robert Kelly – Sidoti: In the release and during your prepared statement you had talked about some intensifying competitive pressures. Is that for projects that are currently in backlog commitment stage or the newer projects going to bid now?

That’s for newer projects going to bid now, and it’s also in an attempt for Viracon to go to the broader market. What we’ve found is that especially because of the residential, all of Viracon’s domestic competitors do both residential as well as commercial glass fabrication, so the extensive softness in the residential side as well as some softness on the commercial side has led to some pricing pressures there so that was part of it, but the rest of it is, I think people are being more aggressive in these uncertain times, trying to make sure they’ve bid enough work to fill their capacities, and so more people are bidding more work. Robert Kelly – Sidoti: Is it confined to the Viracon business?

No, that would be something we have seen increase throughout the marketplace.

Your last question comes from Robert Vermillion - Axial Capital. Robert Vermillion – Axial Capital: I was wondering, what was the revenue contribution from Tubelite in the quarter, and how is that trending towards last year and then in relation to your expectations?

One important point to talk about, it contributed about $15 million of new incremental revenue in the quarter.

Right, but remember Tubelite does not have a backlog.

And Tubelite is meeting our expectation, and that’s a business that services some of the kind of more volatile segments like retail and those kind of things, but actually they’ve maintained their business quite well.

Very well, we’re very pleased. Robert Vermillion – Axial Capital: And the margins in that business, is that higher or lower than the average for architectural glass?

They’re about the average. Robert Vermillion – Axial Capital: Also, I was wondering if you could give us a status on the World Trade Center sites, the bidding activity there and the timing?

The Freedom Tower project has been delayed, although it has not delayed our shipment, so we are in production on Freedom Tower. Towers, I think it’s two and three or three and four, I’m not sure, two and three, were not in commitments, not in backlog, and they were in early planning stages and they are delayed. Robert Vermillion – Axial Capital: Okay and how much of the Freedom Tower is in backlog now? Do you have a dollar amount?

We do not have a dollar amount. It would be low to mid single million dollars. Robert Vermillion – Axial Capital: Okay, and when does the City Center project get completed for you guys/

I think it’s early 2009 because they have a November 2009 opening date. Robert Vermillion – Axial Capital: And that’s on schedule?

Right. Robert Vermillion – Axial Capital: So we’ve got one more quarter’s worth of revenue from them?

Probably two more.

Yes, probably going into two more quarters.

This concludes our question and answer portion of the call.

Although our markets are currently softening, we really have a great leadership business with the right products for today and tomorrow for these commercial construction markets and we thank you very much for your time today.