Brad West - Vice President, Controller Rod Hershberger - President, Chief Executive Officer Jeff Jackson - Chief Financial Officer, Executive Vice President - Operations

Sam Darkatsh - Raymond James Steve Dyer - Craig-Hallum Rob Hansen - Deutsche Bank Michael Dahl - Credit Suisse Desi DiPierro - RBC Capital Markets Jeremy Hamblin - Dougherty & Company

Good day, ladies and gentlemen, and welcome to your PGT Incorporated Fourth Quarter and 2013 Earnings Conference Call. At this time, all participants will be in a listen-only mode. Later, there will be a chance to ask questions and instructions will be given at that time. (Operator Instructions) And as a reminder, today's conference is being recorded. And now I'd like to turn it over to your host Brad West, Vice President and Controller.

Good morning, everyone, and welcome to PGT's quarterly and fiscal year end investor conference call. I'm Brad West, Corporate Controller and Vice President. And I'm joined today by Rod Hershberger, President and CEO; and Jeff Jackson, Executive Vice President and CFO. This morning we are pleased to provide an update on our fourth quarter and year end results and our outlook for 2014. Hopefully, everyone has had a chance to review our earnings release issued yesterday. Before we begin, let me remind everyone that today's conference call may contain statements concerning the company's future prospects, business strategies, and market outlook. Such statements are considered to be forward-looking. These statements do not relate strictly to historical or current facts, rather they are based on our current expectations and are subject to risk and uncertainty. Actual results may vary materially from those contained in the forward-looking statements. Please refer to our press release, our most recent Form 10-K and other documents filed with the SEC. We undertake no obligation to publicly update or revise any forward-looking statements. A copy of our press release is posted on the Investor Relations section of our corporate website at www.pgtindustries.com. Included in the press release, are the unaudited consolidated balance sheets and statements of operations prepared in accordance with GAAP and adjusted information, which was quantitatively reconciled to GAAP. Our company uses non-GAAP measurements as key metrics for evaluating performance internally. A detailed explanation of these non-GAAP measurements can be found in our press release, which was included as an exhibit to our Form 8-K filed February 19 with the SEC. These non-GAAP measurements are not intended to replace the presentation of financial results in accordance with GAAP. Rather, we believe these non-GAAP measurements provide additional information for investors to facilitate the comparison of past and present performance. We will provide an overview of our performance for the fourth quarter and year ended December 28, 2013. After our prepared remarks, we have ample time to address any questions that you may have. With that, let me turn the call over to our CEO, Rod Hershberger. Rod?

Thanks Brad. Good morning everyone. In the fourth quarter, we continued to capitalize on the improving economic conditions in housing market, with sales coming in at $62 million up 37.2% over fourth quarter of 2012. New construction sales led the sales growth charge. Despite a recent slow in growth trend and for the single-family housing starts, which grew only 17% in the fourth quarter, we enjoyed 56% growth in new construction sales, our third straight quarter of 50% plus growth. Repair remodeling also continued solid growth of 29%, thanks in part to share gains from targeted programs. Those markets also benefited from improved market conditions in Florida including rising home prices and reduced unemployment. For the quarter, new construction sales represented 35% of total sales, while r-and-r represented 65%. In terms of our product mix, impact sales grew 40% over the fourth quarter of 2012 and represented 77% of total sales. In addition, sales of non-impact products grew 13% over prior year. For the entire year, vinyl product sales grew at a strong rate of 47% and our aluminum products grew at 36%. Vinyl sales in our Southeast and Southwest Florida markets grew 58% in 2013, these markets have traditionally been dominated by aluminum and shows vinyl continues to be more accepted in Florida. We continue to bolster our vinyl products offering with product such as our new Vinyl French Door launched this last month, and we are currently working on a new vinyl window platform for both our impact and non-impact products. Returning to fourth quarter, net income was $5.3 million and adjusted net income was $5.9 million compared to net income of $3.2 million a year ago. Adjusted EBITDA was $9.5 million or 15.3% of sales. This is a $2.6 million or 37.6% increase over the fourth quarter of 2012. For the year, adjusted EBITDA was $37.8 million, an increase of $13 million, a result of increased sales and operating leverage on our fixed cost. Gross margin dollars increased $4.6 million to $20.6 million over the fourth quarter of 2012. This increase was driven by strong revenue growth as a percent, however, gross margin decreased to 33.2% of sales compared to 35.4% from the fourth quarter of 2012. The decrease in margin percentage is mainly the result of purchasing finished glass units from third party suppliers to support sales in excess of certain current internal capacities, a shift in mix toward new construction and labor and scrap inefficiencies. This more than offset the positive impact of leverage on higher sales and the price increase announced at the end of the third quarter. In previous quarters, we reported headwinds against our margin percentage related to an increase in labor cost and scrap, in connection with training a substantial number of new employees to support the high growth rate. In the fourth quarter, we saw improvement in both the labor and scrap categories not yet back to levels we strive to achieve but approximately 180 basis points better than the third quarter of 2013. Going into 2014, we will continue to take actions to drive operational efficiencies while adding employees in advance with anticipated growth when appropriate. SG&A cost as a percent of sales has dropped substantially due to strong leverage, these cost declined from 26.4% in the fourth quarter of 2012 to 22.2% for the fourth quarter of 2013. Also SG&A cost declined from 27% for the full year 2012 to 22.2% in 2013 after adjusting for cost associated with the secondary offering related debt refinance and the gain on the sale of Salisbury facility. Our fourth quarter represented our fifth straight quarter of substantial growth in both top and bottom line. I'm proud of our sales team for helping drive this growth and gaining share. I'm proud of our operations group for persevering beyond expectations to deliver on our value proposition to our customers and increasing production. Lastly, I'm proud of our support teams for quickly adapting to the changing environment and focusing on the future to ensure we continue to dominate our core market. With that I will turn the call back to Brad, who will review the result for the fourth quarter and full year in greater detail.

Thank you, Rod. In the fourth quarter sales and adjusted EBITDA grew 37.2% and 37.6% respectively over prior year. As Rod mentioned this marks the fifth straight quarter substantial year-over-year top line and bottom line growth. A 37% sales growth during the quarter generated a 29% increase in gross margin dollars. We also leveraged revenue growth during the quarter by reducing selling, general and administrative expenses as a percent of sales a 22.2% compared to 26.4% in the fourth quarter of 2012. We finished the quarter with $9.5 million in adjusted EBITDA which represent 15.3% of sales. For the full year of 2013, sales finished at $239.3 million which represents a 37.1% increase and adjusted EBITDA came in at $37.8 million, which was an increase of 52.7% and was 15.8% of sales. Year ending cash balance is $30.2 million, and we generated $25.7 million in cash from operations during the year. As stated in our press release, we reported net sales of $62.0 million for the fourth quarter of 2013, a 37% increase over the prior year. Breaking down our sales drivers for the fourth quarter compared to 2012 fourth quarter, we have WinGuard sales of $44.7 million versus $32.2 million an increase of $12.5 million or 38.8%; vinyl non-impact sales of $8.3 million versus $6.2 million, up 33.9% over prior year; aluminum non-impact sales of $6.2 million versus $5.0 million, up 24.0%; architectural systems and store front sales of $1.4 million versus $500,000, an increase of $900,000; and from new PremierVue sales of $1.4 million which was even with prior year. Gross margin dollars increased $4.6 million to $20.6 million for the fourth quarter of 2013. However, as a percent of sales, gross margin was 33.2% versus 35.4% in the fourth quarter of 2012. Our decrease in gross margin as a percent of sales of 2.2% is driven by a cost of purchasing finesses glass units from third party suppliers which negatively impacted margin by 190 basis points. Temporary inefficiencies related to hiring new employees to meet increasing demand for our products, which negatively impacted margins by 100 basis points. And the impact of the mix shift towards vinyl and new construction, which reduced margins 100 basis points. These factors were offset by leveraging our fixed cost on higher sales of 110 basis points and the impact of the price increase announced at the end of the third quarter which improved margins by 50 basis points. As discussed in the third quarter call, we are addressing our internal capacities for glass production to reduce our reliance on outsource finished glass units by constructing an additional glass plant. We officially broke ground on this plant on January 9 and expect operations to commence in our newer facility by the end of the third quarter of 2014. We estimate this initiative will improve our gross margins by approximately 2%. Our average cost of aluminum was approximately $0.83 per pound during the fourth quarter, comprised of spot purchases averaging $0.80 per pound or approximately 74% of our needs and hedged purchases averaging $0.92 per pound for 26% of our needs. This compares to the fourth quarter of 2012 weighted average of $0.95 per pound. As of today, we are hedged at approximately 37% of our estimated needs through the second quarter of 2015 at an average of $0.89 per pound. The current cash price is $0.78 per pound. Our selling, general and administrative expenses were $13.8 million, an increase of $1.9 million from the fourth quarter of 2012. As a percent of sales, SG&A cost declined from 26.4% to 22.2%. Highlights within our SG&A include an increase of $900,000 in an employee related expenses including increased healthcare costs, an increase of $700,000 in distribution cost necessary to support the increase in sales and an increase of $300,000 in marketing related spending. Interest expense was $1.0 million, compared to $800,000 in the fourth quarter of 2012 and our weighted average rate for the quarter was 3.37%. The increase in interest expense results from increased debt levels in connection with our new credit agreement that we entered into during the second quarter of 2013, which funded our stock repurchase transaction and originally increased our outstanding debt balance to $80 million. To mitigate the risk of raising interest rates, we hedged a portion of our debt this includes a forward starting swap which will the set LIBOR portion of our interest rate calculation and $40 million of our debt to 2.15% from Q3 of 2014 until the end of the term. Our tax expense in the fourth quarter was $519,000 and represents a true-up of the estimate of annual book earnings made in the second quarter when we released our deferred tax asset valuation allowance. We no longer have an evaluation allowance on deferred tax assets and accordingly in 2014 and beyond we expect to record tax expense at an effective rate of approximately 39%. From a cash tax perspective, we currently estimate our tax effective settle in that operating loss carryforwards to be approximately $4.4 million. We had net income in the fourth quarter of $5.3 million or $0.11 per diluted share versus $3.2 million or $0.06 per diluted share in the fourth quarter of our prior year. After adjusting for the tax guidance, adjusted net income in the fourth quarter was $5.9 million or $0.12 per diluted share. For the full year 2013, our expected net income and diluted income per share was $23.2 million and $0.34 per share respectively. Adjusted EBITDA was $9.5 million in the fourth quarter of 2013 versus EBITDA of $6.9 million in the fourth quarter of 2012. This increase in adjusted EBITDA of $2.6 is due primarily to $5.6 million which is attributable to higher volume and $600,000 impact from the price increase offsetting these increases was an increase in material cost of $1.1 million to the purchase of finished glass units related to certain capacity constrains an increase of $1.0 million from employee related cost, a $600,000 impact of temporary and efficiencies resulting from recent higher increasing demand for our products a negative mix shift of $600,000 and $300,000 in additional marketing expense. A reconciliation of net income and EBITDA, which I just discussed has been included in our earnings release for your reference. Turning to our balance sheet as of December 20, 2013, our net working capital excluding cash was $22.9 million of which decreased $1.2 million during the quarter driven mainly by decreases in inventory. DSOs increased to 35 days at the end of the fourth quarter compared to 32 days at the end of our subsequent third quarter due mainly to the shift towards new construction sales which only have longer terms. Our free cash flow for the quarter was $7.3 million mainly driven by EBITDA excluding non-cash items such as stock compensations of $9.6 million; we received $1.2 million in cash for working capital. We paid $2.5 million in capital addition and cash paid for interest was $800,000 for the quarter. At this time I'll turn the call over to Jeff for some summary remarks.

Thank you, Brad. 2013 was a long awaited turnaround year for both the Florida housing market and even more so for PGT. For the full year, we grew sales in the repair and remodeling market by 30% which we are confident represents substantial share gain in this category. Even with a certain volume, we were able to deliver on our value proposition with quality products, complete orders and on-time delivery. Also our new construction sales grew 54% in a year in which single family housing starts grew 28% finishing at about 54,000 starts. We believe a normalized level for housing starts in Florida for current population of approximately 19.5 million is around 110,000 starts a year. So housing should grow, should continue into 2014 led by positive fundamentals such as increasing home values, favorable job growth and favorable supply dynamics. Also of note, during 2013 JLL, our majority own partner since 2014 divested its portion in our company. The related increase in public float combined with the improved market conditions and our financial results have been favorably viewed by the market. Since December of 2012, our average daily trading volume has increased from 120,000 to 477,000 shares also our stock generated a 120% return over 2013. In connection with exit by JLL, three of the four JLL affiliates who served on our Board have decided to resign their positions, the fourth member Al Castaldi at our request has agreed to continue as a Board member and we look forward to his continued service. Looking into 2014, sales to-date represents an increase of approximately 30% over the same period a year ago. Our estimate for top line sales for the first quarter is $62 million to $65 million. However, comps began to get tougher as we head into the spring and summer months, those sales growths in those months near 40% in 2013. While we achieved labor material improvements in our fourth quarter versus our third quarter we still have work to do in driving better flow through on incremental sales. Our margin is strong will continue to be impacted by operational inefficiencies. Accordingly our EBITDA margins will remain in the mid teens until our labor and material inefficiencies improved in our new glass plant is complete and operational. We continue to hire and train new employees in order to ramp up for capacity and we are on track to complete the new glass plant by the end of our third quarter, which will allow us to increase our in-house glass capacities and improve our material cost. With that I'll conclude and I'll be happy to answer your questions. Operator, first question please.

Okay. (Operator Instructions) We will take our first question from Sam Darkatsh from Raymond James. Sam, please go ahead. Sam Darkatsh - Raymond James: Brad, how are you?

Good. Thank you. Sam Darkatsh - Raymond James: Three quick questions if I may, first off, once the glass plant is up and paid for, Rod and Jeff, where do you see as your most likely use of cash flow?

Well, in the glass plant we probably going to be all in close to $14 million in the glass plant this year may be some timing on some capital spending that will spill over into 2015 but this year's CapEx, I'm estimating at about $18 million to $20 million depending on timing. Once that's complete and behind us, we are and currently are actively looking for any potential acquisitions, that's definitely on the table as we continue to grow. We feel like any kind of a product category that would be in our kind of bandwidth of expertise would make sense. Obviously, we got to be careful on that because of our high margins, we need not want it to lead our margins, so it has to be a product growth – a product offering that fits within our portfolio and our expertise that we could well on. Apart from that we will have in the future additional capital needs, the current glass plant will get us to about $275 million in terms of cutting and tempering and laminating before we run up against laminating capacity. At that point we'll add some capital around our laminating equipment. So there is different CapEx coming over the next three or four years and as well as I mentioned earlier, we are looking at acquisitions.

Hey, Sam. I just came back from the industry meetings and the industry obviously is a lot more upbeat now than it was even a year ago. There is a lot of conversation about mergers and acquisitions. I think its kind of hard at this point to really put your finger on one because that kind of everyone who kind of plays it pretty close to the best. But we will definitely keep our eyes wide open for what happens out there as the industry change as I would anticipate some changes in it as we go through this year. So we might save a little bit of cash for that we'll keep an eye on that closely. Sam Darkatsh - Raymond James: So share repurchase a back burner at this point?

Yes. I think both share repurchase and/or dividend type use of cash those are back burners until unless we can't find a better use of that cash. Obviously, we think we can given some changes that we feel will take place in the market over the next 12 months or so.

Yes. The time we get our share repurchase before it was a great buy obviously we think it's still a pretty good buy. But we would look at dividends and stuff like that too. Sam Darkatsh - Raymond James: Two other questions if I might. And I apologize if these were in the prepared remarks and I missed them. Selling prices I know the aluminum costs are largely locked in with the amount of volume and the amount of productivity trap that you're trying to absorb, what are you doing with ASPs? And then my last question will be with respect to the ERP roll out, I know that WinGuard, I think was getting it in the first quarter how is that progressing?

I guess, I'll start at the back end of that. The ERP roll out is progressing on schedule. We anticipate starting to run parallel with the current system within the month and we'll run parallel as long as we need to, to make sure there is no hiccups along the way. We have had many roll outs of our like – like for example Eze-Breeze product offering is on the new system and we worked out the initial keys, if you will. And so we think the parallel and extra testing that we'd got in place will generate a positive result for this ERP system. Then we also expect the system to generate some efficiencies in terms of work flow throughs and what not throughout manufacturing. So we are on track with that. In terms of average selling price, we did take a price increase --

In the third quarter last year.

Yes. So we will look into 2014 since we've taken another price increase again relating kind of the market dynamics dictates that but all appear favorable at this point. And we are trying to glide higher priced items doors now present more than 40% of our sales and with the new Vinyl French Door offering that Rod as mentioned we launched at IBS this year. We are starting to get higher average sales prices for obviously the impact in line of our business. Sam Darkatsh - Raymond James: With your share why would you wait for to see what the market would be, why wouldn't you just be a price leader at this point based on the volume trends?

Well, I think we most likely will be a price leader there is not a lot of people. There were prices taken last year by some competitors. But in terms of this year there is no one came out yet with that. But again, we expect to be a price leader, but at the same time we are online to bring a glass plant on and we do have overhead related to that. So we want to continue to gain share and not price ourselves out of the market. We are on average 15% higher than our competitors currently so have to be very cognizant of that. Sam Darkatsh - Raymond James: Thank you. Very helpful. Good luck for the quarter.

Thanks Sam.

Okay. Thank you. And we'll take our next question coming from Steve Dyer from Craig-Hallum. So Steve, please go ahead with your question. Steve Dyer - Craig-Hallum: Good morning guys. Nice quarter.

Hey, Steve. How are you doing? Steve Dyer - Craig-Hallum: Good. Just want to make sure I have it correctly. I think you had said Jeff sales year-to-date were up 30% or so is that through January or is that literally to-date?

That was just to-date through last week and they were up 30%. Steve Dyer - Craig-Hallum: Great. And trying to kind of figure out where you think gross margins may go I know you'll get a couple of hundred basis point bump at the end of the year once the glass facility is done. Is most of your heavy hiring behind you in other words should we just kind of keep getting more efficient throughout the year?

I've kind of tacked this question a number of times Steve. And I think I'll just, I think we need to keep saying the same thing until we see a difference. But when we see 30% or north of 30% growth around that number, we have to keep hiring because that's pretty strong growth and we can't just kind of manpower through that with overtime and stuff like that. So the training, we're getting better at our training I think, we're getting a little more sophisticated but there is still a training curve and there is still, the training curve is labor efficiency and scrap efficiency. So when the comparable start getting more in that 15% to 20% range, I think you see the labor efficiencies get much better as long as it stays in the 30% range, we'll take a little bit of that on labor inefficiencies, we'll have to keep training. Steve Dyer - Craig-Hallum: Okay. That's helpful. And then your new construction business is by a factor of three or four outpacing single family starts in Florida in the fourth quarter. Is that a function of sort of the geographic area that you guys operate in more costal areas or help me kind of understand the difference there?

I think – and this is to think more than scientific, but I think what's driving some of that is the number of items. One of them being you buy the windows for the house a few months after the start took effect, so its just driven by a little bit of the pace of starts before that although what we've seen so far in the first quarter would kind of go against that a little bit. But I think the biggest driver for us is our value proposition, our complete on-time delivery and short lead time that's really important and as builders get busier and they need to make sure their product is there in-time because they have to hit schedules. Scheduling now is becoming more important than just I want the cheapest price, I can get for my product. So if you can't deliver a house full of windows and closing every opening in the house, the next trade can't come in. And so it's not getting almost complete in on-time delivery, it's getting a 100% complete on-time delivery with short lead time so the schedule of the builders can be met. Trades are a little harder to find right now, we've lost a lot of them during the downturn. So the ability to hit scheduling becomes more critical and more important and the big benefit we give anybody a new construction is, we're going tell you when the product is going to be there and its going be there and they're going to be able to move on with your job.

And, just add a little bit to that Steve. Back from the IPO, back in 2006 and even before then – when we were a product company 2005, 2004, we always outperformed the housing market in those days. I don't have the exact number but at times we will double that with new home construction market was up 20% would be a 40% that one in uncommon at all theme back to 2003, 2004, 2005, 2006. And so to see that now it's not surprising us because we've seen it before. Now its may be the magnitude this year was a lot but we do anticipate growing our new construction business greater than the market. Steve Dyer - Craig-Hallum: Got it. Okay. Congrats guys. Thanks.

Thanks Steve.

Thank you. And we'll take our next question which comes from Rob Hansen from Deutsche Bank. So Rob, please go ahead with your question. Rob Hansen - Deutsche Bank: Thanks. I just wanted to ask about the kind of growth in your sales operations, I know you hired a national sales manager just recently for national accounts. Are you hiring more sales people, what's the kind of outlook on that especially given the rapid growth that you're seeing here?

Yes. We actually are. If you look year-over-year we actually hired eight new sales reps versus this time last year. So we're definitely laying investment into that channel both international as well as local and we've added layer of management in there to also kind of backup those sales reps. So we've improved our footprint if you will into the Florida market and internationally and we will continue to do that depending on demand. Rob Hansen - Deutsche Bank: Okay. And then on the --

Hey, Rob. Let me just add one quick thing there. Rob Hansen - Deutsche Bank: Yes.

We also added some architect reps and we've added inside, Jeff mentioned this before but some of that is inside sales so that we can handle the quotes coming in and the business that comes inside what we can't physically get to a customer real quick. So we've kind of layered in everything that we need to make sure we're managing that sales portion really well. Rob Hansen - Deutsche Bank: So that on the architecture reps, does that mean you are seeing a little bit more in terms of commercial construction as well?

Yes. A combination architectural spec out things especially when you look at condos in that market and architectural lot of times will be involved in a condo retrofit also. So we want to make sure that we're calling on the architect and making sure our product is in there and getting spec. There is not a big difference in our market with the condo market and the loads required there versus single family construction they take kind of the same product its an operational window. So we want to make sure that we get in there early. Those projects tend to be, we might be talking to an architect now on a project that will come out of the ground in 2015 or 2016. Rob Hansen - Deutsche Bank: Got it. Okay. And then kind of I realized that the facility won't be – the new facility won't be operational until late 2014. When does that mean that you start hiring people to kind of staff up and train like how early in the process do you start that?

Will start now.

Yes. We're actually starting to hire now. We're running 24/7 shift on our current glass facility and what we will do is, we will take both experienced and new hires and put that into the new facility. So we are hiring now for the 24/7 still and once that's online we will hire full staff for that facility as well at least by July. It takes a good couple of months for people to get a speed on the equipment. Rob Hansen - Deutsche Bank: And so there is, you're not expecting any additional I guess cost and then I guess how does work in terms of the cost in the mean time here until how much of a drag is that?

Well, it's not really a drag yet, because again, we hire also because of attrition. We do have quite a bit of attrition. It's the training piece that we want to make sure we get in and get ahead of the curve if you will. So in terms of the drag it's all direct labor and it really decreases on over time as well. So in other words instead of working a 10 hour shift now they're working eight so there is inherent offsetting in that. The only cost if you will that's hard will be the healthcare related benefit costs you use it by 90-day waiting period there for healthcare anyway. So I mean if I hire somebody in June that will not hit me till the end of the third quarter. So it's not a big drag. It's not something that I think I would build into it any kind of a model at this point because again we do anticipate all that in the guidance we give.

The drag on labor is really not much. The drag that you will see is, we will have to purchase glass from the outside. I think continue doing that until the plant is operational. So that's where you really see the drag. Rob Hansen - Deutsche Bank: All right. Got it. I appreciate it. One last quick one just the WinGuard gross margin during the quarter what was that?

40%. Rob Hansen - Deutsche Bank: 40%. All right. Thank you very much.

You bet.

Okay. Thank you. And our next question comes from Michael Dahl from Credit Suisse. So Michael, please go ahead. Michael Dahl - Credit Suisse: Hi. Thanks guys. I wanted to drill down on the margins a bit more, when I think in the prepared remarks you noted that price added 60 basis points and just relative to the increase that you put through, do you think there is still – there is still more benefit to come from that in 1Q or what's kind of – what's the limiting factor there?

Well, the 50 basis points Michael was a function of timing in the fourth quarter. We actually knock that price increase towards the end of September and considering lead times and what not. We didn't really see that impacting towards the back half of the fourth quarter. The answer is a full quarter's worth of impact that you will see in the first quarter and if you will a pretty good estimate would be – we probably got half the quarters work in the fourth quarter. Michael Dahl - Credit Suisse: Okay. Great. That's helpful. And then on the mix issue, could you give us a sense of kind of the progress you made on lifting the vinyl margins, what's the differential today and what's the thought process around for the progress for 2014?

Yes. I think the mix issue in terms of the margin changing really, obviously with the door coming out that helped the product portfolio in terms of its margins. But in terms of our core vinyl products as they stand, we are going to be limited on how we increase those margins with efficiencies until redesign the product as I think was mentioned, we are actually looking at redesigning our vinyl platform both impact and non-impact we just didn't mind. We will be off – the goal would be of a single platform consolidate some suppliers, take cost out of the system, streamline the line and therefore improve margins. That's all in progress. That will be a 2015 type event, end of 2014, beginning of 2015 type of event and until then our vinyl margins, they are going to stay about the same absent any kind of change in pricing. Michael Dahl - Credit Suisse: Okay. Thank you. And I guess one final one, it's great to see the sales outpacing the overall new construction market to the degree that they are in and actually seem to be still accelerating. I was wondering, if you had a sense of breaking it down a little further what the impact resistant market sales were in 2014, I mean sorry, in 2013?

[indiscernible] Michael Dahl - Credit Suisse: Yes. I guess, the whole market that you would be more comparable with.

I think the question is, and the new construction starts has it been geared more towards the impact resistant market and that's why there are increases in more spend.

Well, you got the sales for – just the new construction impact we are just rolling. Selling, I will you more.

55%.

So our new construction sales impact only was 55% up. Michael Dahl - Credit Suisse: That's correct.

That's a tough question. I think people are still putting in shutters. I don't think the penetration play, again, we initially went public on penetration in the shutter market, I don't think we have seen yet at all Michael. I think that comes with education and awareness and unfortunately some storm activity. And so if you recall, shutters represent in 2006 probably 80% of that market. Now, maybe they are 70%, maybe there has been some penetration over 9 years but not much. So we think there is still a lot of growth left in the shutter penetration area in those markets. Michael Dahl - Credit Suisse: Okay. So even against your direct peers on impact resistant products, do you think you are far above what the market growth has been there?

Yes.

Yes. Michael Dahl - Credit Suisse: Okay. Thank you.

Okay. Thank you. And our next question comes from Robert Wetenhall from RBC Capital Markets. Robert, please go ahead. Desi DiPierro - RBC Capital Markets: This is actually Desi filling in for Bob. Just a first question on SG&A market performance was very strong in 2013, looks like amortization expense is expected to drop pretty significant in 2014, how should we think about the trajectory of SG&A spending over the next year to have recovery in Florida continues?

There is plenty of leverage left in SG&A, you picked up on a good point amortization does drop in the first quarter, Brad $1 million?

Yes. We are going to record $500,000 of amortization in the first quarter that compared to $1.5 million and both the first quarter last year and the fourth quarter of last year and the net amortization goes away in the second quarter. I think a good way to look at SG&A; it probably runs about 10% to 15% maybe 15% now variable, our transportation costs are in SG&A as an example, obviously, our warranty costs and commissions, those kind of things the variable. And as a reminder, our fourth quarter of last year is a better reflection of our level of hiring that we did here to support the increased sales relative to the first quarter. Sequentially that not may be a better comparison than year-over-year with this growth rate that we have experienced. Desi DiPierro - RBC Capital Markets: Got it. Thanks. And then, getting back to the topic of the addition of the sales reps that you guys talked about. Are there any states outside of Florida that you are actively targeting for expansion, do you have a timeline in mind?

There are no specific states. We look at the coast line any place that impact code is in place and any place that we can kind of drive impact code. But, we have got a couple of folks here that spend most of their time dealing with code and code enforcement and making sure we are teaching people. So we naturally expand into those areas. When we look at our – when we look internally at what our motivational driving force is, we own our backyard. Florida is coming back strong. We are seeing a lot of new construction growth; we are seeing a lot of the modeling growth. And everyone wants to come back and play. Back in 2005 and 2006, I think every window company wanted to be – wanted to have a pretty good presence in Florida. I don't know if it's quite to that point yet. But everyone sees the growth in Florida and it looks like a very attractive place to be. And we like to put fences around our customers and make sure that we kind of – are the bully in the backyard and that's what we want to be. And that's really what we focused on that international and then expanding along the coast line. And then we talked in the past about our relationship with our Eze-Breeze product line in the North and the Midwest and places like that were a little bit opportunistic. We saw a lot of interest at the International Builder Show for our product particularly in our doors. We think there is some markets that maybe attractive for them. But there are markets that are pretty far away and we want to kind of control our backyard before we go after those markets.

We've also had good success with book reps as well in the other states markets. Desi DiPierro - RBC Capital Markets: Got it. Thanks. That's helpful.

Okay. Thank you. And we will take our final question coming from Jeremy Hamblin from Dougherty & Company. Jeremy, please go ahead. Jeremy Hamblin - Dougherty & Company: Good morning guys. I wanted to first just clarify a couple of things from your prepared remarks. One, your laminating capacity is currently at what level?

Well, our laminating capacity, we could probably get up to about $275 million to $280 million in sales before we actually add a laminating line to the business. Jeremy Hamblin - Dougherty & Company: And then you also had in your prepared remarks some commentary or color around the flow of gross margins as we think about it in the context for 2014. Would you mind just restating that for me?

I think if you look at the first quarter, what I was saying given the growth we still are experiencing in the operational inefficiencies we are working through, even though we did improve as Rod has mentioned about 180 basis points versus Q3 into Q4. We are still run into some inefficiencies as we continue to hire, our scrap is not where we wanted to be and no it could be. So we will still fall in that mid-teen level for EBITDA type margins until one I guess, the glass thing comes online, which we have indicated would be about 2 percentage points Brad?

Yes.

Positive benefits to the gross margin and as we continue to train our folks. I do expect if everything runs right us to improve margins – EBITDA margins over the year, in other words it's not going to all come at the end of third quarter, getting into fourth quarter. I do expect our labor to continue to improve. We have demonstrated that I think you will see that. I don't know if you will see it necessarily right out of the gate in the first quarter. But again, I think you will see as the year progresses, we slowly start ratcheting up our results on the margin line. Jeremy Hamblin - Dougherty & Company: Great. And then, in terms of sales flow and the types of projects that you guys have been going after, are you seeing more opportunities and let's say condo or commercial projects that potentially have higher sales values, have you been participating at all in those types of deals?

Yes. We participate in those types of deals. The big surge for 2013 was single family residential. I mean that's what the market was. Multi-family starting to come back as it's commercial. But traditionally, those trial [ph] single family, so we will start and have participating in those – internationally I know we have signed a couple of good deals condo projects as well. Brad, you want to add?

Yes. I talked a little bit earlier about the architect reps that we have out there now that spend their day calling on our tax and looking at draws [ph] and looking at specs and some of those are – a lot of those are new construction related. So they maybe coming out of the ground quite a ways in the future, some of those are replacements of existing product that's a little bit shorter timeline. So we expect to be a little bit larger player in the condo market whether it would be new construction or repair and replacement. Jeremy Hamblin - Dougherty & Company: Great. And then just in the context of the color you provided on quarter-to-date sales, can you just provide additional color around whether it's been driven more by new construction or the r-on-r business in terms – is the split similar to what you saw in Q4.

We don't have a mechanism that tracks that to be able to give that to you. We get that at every quarter end basically when we determine exactly the buckets that we ended up growing the most in. So no, I can't provide that. Jeremy Hamblin - Dougherty & Company: And then coming back to kind of pricing power that you have and you have been seeing some negative drag from your vinyl product mix increasing. Do you think that you have more pricing power and part of that has been in educational process for the customers and distributors. But do you feel like – are you more likely to take price in 2014 on the vinyl side of the business as opposed to overall?

I don't know that I can give you a good answer on that. I think as we look at 2014 and we see it starting out a little bit like 2013 was, we are going to make sure that we maintain market share. Right now, it's so important that things grow to – its easier to maintain market share than it is to go out to try to get it back if you lose some of it. So we will look at our pricing, we look at market share; we will look at the programs we are running. We will look at the redesign of our vinyl lines and where that brings us in. And one of the things we won't do is, we won't get greedy in the middle of the year and say let's take a vinyl increase, so we can increase margins on vinyl and then next year we introduce new product line that we're a little more efficient on. And we can drop it back down that would not be a fair thing to do to our customers. So won't be pretty thoughtful about how we do it, but at this point, we would focus on market share a lot. Jeremy Hamblin - Dougherty & Company: And then last thing, in terms of the hiring a new – the rate of hiring slowed just touch in Q4 from where it has been in the prior two quarters. What you have been seeing in terms of retention rates in the staff, is it getting harder to find new hires and the quality of hires, is that any different, you guys actually made significant progress on labor and scrap inefficiencies in the quarter. So I'm guessing maybe the answer is no. But, can you speak to retention rates?

Yes. I don't know that I can give you an exact retention rate, it is a little bit difficult to hire and retain where we are at. This is not a manufacturing area. So we are having to – we are having to be very careful as we screen people and when we hire people about what their background is and how comfortable they are spending a day working on a factory floor. So that's one of the things we look at pretty closely. But, it typically is not a manufacturing area. So we are adding additional things to make sure that we are screening the people correctly. We are bringing in the right people and we are offering a pretty competitive package from paid benefits and from a training standpoint.

And we do a get a lot of that. Unemployment in Florida still 6.2 I think percent. The last thing I saw. So we still do that -- that comes in like Rod said it's a matter of screening those and being more picky in whom we hire.

And in our view, in this community we're viewed as an employee of choice – employer of choice. So finding employees is not terribly difficult to do. Jeremy Hamblin - Dougherty & Company: Great. Thank you for taking my questions.

Thanks Jeremy.

Okay. Thank you. And that appears – this concludes our Q&A session. So I would now like to turn it over to Mr. Bradley West for concluding remarks.

Thank you for joining us today. We look forward to speaking to you again, next quarter. If you have any questions, please call me. Have a good day.

Okay. Ladies and gentlemen, this does conclude your conference. You may now disconnect. And have a great day.