exv99w2

EXHIBIT 99.2

EXHIBIT C

PROJECTED FINANCIAL INFORMATION

The Debtors have prepared projected operating and financial results on a consolidated basis for the period from May 1, 2006 to September 30, 2010 (the “Projections”). The Debtors have also prepared a pro-forma balance sheet of Integrated Electrical Services, Inc. (“IES”) based upon an assumed effective date of May 1, 2006.

The financial projection information discussed herein includes certain statements that may be deemed to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. See “Disclosure Regarding Forward-Looking Statements” on pp. iii-v and Section X — “Certain Factors to be Considered” of the Disclosure Statement.

The Projections were not prepared to comply with the guidelines for prospective financial statements published by the American Institute of Certified Public Accountants and the Rules and Regulations of the Securities and Exchange Commission. The Debtors’ independent accountants have neither examined nor compiled the Projections and accordingly do not express an opinion or any other form of assurance with respect to the Projections, assume no responsibility for the Projections and disclaim any association with the Projections. Except for purposes of this Disclosure Statement, the Debtors do not publish projections of their anticipated financial position or results of operations.

The Debtors believe that the Projections are based upon estimates and assumptions that are reasonable. The estimates and assumptions may not be realized, however, and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Debtors’ control. No representations can be or are made as to whether the actual results will be within the range set forth in the Projections. Therefore, although the Projections are necessarily presented with numerical specificity, the actual results of operations achieved during the projection period will vary from projected results. These variations may be material. Accordingly, no representation can be or is being made with respect to the accuracy of the Projections or the ability of the Reorganized Debtors to achieve the Projections. Some assumptions inevitably will not materialize, and events and circumstances occurring subsequent to the date on which the Projections were prepared may be different from those assumed, or may be unanticipated, and therefore may affect financial results in a material and possibly adverse manner. The Projections, therefore, may not be relied upon as a guarantee or other assurance of the actual results that will occur. In deciding whether to vote to accept or reject the Plan, Holders of Claims and Equity Interests must make their own determinations as to the reasonableness of such assumptions and the reliability of the Projections. See Section X — “Certain Factors to be Considered.”

The Projections should be read in conjunction with the assumptions, qualifications, and explanations set forth in the historical consolidated financial statements, including the notes and schedules thereto, incorporated herein by reference to IES’s Annual Report on Form 10-K for the year ended September 30, 2005, a copy of which is attached to the Disclosure Statement as Exhibit D.

The Projections have been prepared on the assumption that the Effective Date of the Plan will be May 1, 2006. Although the Debtors presently intend to seek to cause the Effective Date to occur as soon as practicable, there can be no assurance as to when the Effective Date will actually occur. The balance sheet adjustments in the column captioned “Non-Cash Reorganization

Adjustments” reflect the assumed affect of Confirmation and the consummation of the transactions contemplated by the Plan, including the settlement of various liabilities and the incurrence of new indebtedness.

Principal Assumptions for the Projections

General

	A.		Methodology. The Projections are based upon the Debtors’ detailed operating budget for the period ending September 30, 2006, which was developed on a consolidating basis, beginning at the subsidiary level. The projections for the fiscal years 2007 through 2010 were prepared on the same basis, but developed through trending analysis using key top-down assumptions and current construction industry outlook.

	B.		Plan Consummation. The operating assumptions assume the Plan will be confirmed and consummated by May 1, 2006.

	C.		Macroeconomic and Industry Environment. The Projections reflect the current outlook on commercial, industrial, and residential construction and take into account the estimated future raw material and commodity prices across the projection period.

II.

Projected Statements of Operations

	A.		Net Sales. Consolidated revenues, estimated to be $961 million in fiscal 2006, are projected to increase by approximately 6.0% in fiscal 2007, and then to continue to grow, peaking in fiscal 2010 at $1,129 million.

	B.		Gross Margin. Gross margin is projected to be 14.3% in fiscal 2006, increasing to 16.2% in fiscal 2010.

	C.		Sales, General and Administrative Expenses (“SG&A”). SG&A includes employee salaries and benefits. SG&A expenses as a percentage of revenues is projected to decline from 13.2% for fiscal 2006 to 12.6% for fiscal years 2007 through 2010.

	D.		Interest Expense. Interest expense assumptions are based upon the terms found in the DIP Facility, Revolving Exit Facility Commitment and Term Exit Facility Commitment. With respect to the Term Exit Facility, it is assumed that the Debtors opt to capitalize interest as additional principal (in lieu of cash interest) for the first 36 months the facility is outstanding.

	E.		Income Tax Provision. The Reorganized Debtors expect to offset a portion of future taxable income with operating loss carryforwards that the Company will hold as they emerge from Chapter 11. However, for purposes of the Projections, the effective annual tax rate is assumed to be 40% from May 1, 2006 through the duration of the projection period.

	F.		Income from Gain on Compromise of Indebtedness. For purposes of this projection, no income from gain on the exchange of the 9 3/8% Senior

Subordinated Notes into equity is included. It is anticipated that any such gain on the exchange of debt will be offset by NOLs and capitalized reorganization expenses.

III.

Projected Statements of Cash Flow

Capital Expenditures. Capital expenditures are expected to be $3.3 million for the five months ended September 30, 2006 and $12 million annually for fiscal years 2007 through 2010.

IV.

Projected Balance Sheet Statement

The estimated post-consummation balance sheet (“Reorganized Balance Sheet”) is based on an estimated pre-consummation balance sheet (“Pre-Consummation Balance Sheet”), as modified by “Reorganization” adjustments. The Pre-Consummation Balance Sheet provides estimates of assets and liabilities just prior to consummation; the Senior Subordinated Notes have been reclassified as “Liabilities Subject to Compromise” in the Pre-Consummation Balance Sheet. The Reorganization Adjustments adjust the Pre-Consummation Balance Sheet of the emerging entity to:

	1.		Reflect the reorganization value of the assets; and

	2.		Reflect the fair value of each liability at Confirmation.

Estimated Post-Consummation Stockholders’ Equity value is based on the midpoint of the valuation range contained herein. See Section VIII.D. — “VALUATION OF THE REORGANIZED DEBTORS.”

For purposes of the Projections, it is assumed that the Senior Convertible Notes will be refinanced with proceeds from the Term Exit Facility.

The foregoing assumptions and resulting computations were made solely for purposes of preparing the Projections. The Reorganized Debtors’ will be required to determine their reorganization value as of the Effective Date. Reorganization value may change depending upon the amount of cash retained and debt carried upon emergence. The actual reorganization and any adjustments will depend upon the balance sheet as of the actual confirmation date. In all events, the determination of reorganization value and the fair value of the Reorganized Debtors’ assets and the determination of their actual liabilities, will be made as of the Effective Date, and the changes between the amounts of any or all of the foregoing items as assumed in the Projections and the actual amounts thereof as of the Effective Date may be material.

EXHIBIT C

Balance Sheet (1) (Unaudited)


	Estimated Pre-						Estimated Post-
	Consummation			Reorganization			Consummation		As of September 30,
($ in thousands)	April 30, 2006			Adjustments			April 30, 2006		2006E		2007E		2008E		2009E		2010E

ASSETS
Current Assets:
Unrestricted Cash & Equivalents		12,500			0	(2)		12,500		19,699		12,500		32,036		42,178		51,732
Restricted Cash		20,000			0			20,000		20,000		20,000		20,000		20,000		20,000
Accounts Receivable Net		215,632			0			215,632		202,735		236,223		226,990		235,520		242,956
Inventory, Net		19,598			0			19,598		17,173		16,833		17,328		17,900		18,382

Underbillings on Contracts		25,798			0			25,798		24,034		25,469		26,360		27,351		28,214
Prepaid and other Current Assets		26,403			0			26,403		26,403		26,403		26,403		26,403		26,403
Total Current Assets		319,931			0			319,931		310,045		337,428		349,117		369,352		387,686

Property and Equipment, Net		22,565			0			22,565		23,010		28,080		33,149		38,219		43,288
Goodwill and Other Intangibles		0			7,372	(3)		7,372		7,372		7,372		7,372		7,372		7,372

Notes Receivable		0			0			0		0		0		0		0		0
Other Assets		15,863			0	(4)		15,863		15,863		15,863		15,863		15,863		15,863

Total Assets		358,359			7,372			365,731		356,290		388,742		405,501		430,805		454,209

LIABILITIES AND STOCKHOLDER’S EQUITY
Current Liabilities:
DIP Credit Facility		6,891			(6,891	)		0		0		0		0		0		0
Accounts Payable — Trade		45,542			0			45,542		42,962		52,258		48,271		49,864		51,206
Accrued Liabilities		60,494			0			60,494		56,358		59,722		61,812		64,135		66,160
Overbillings on Contracts		30,957			0			30,957		28,841		30,563		31,632		32,821		33,857
Accrual for Contract Losses		0			0			0		0		0		0		0		0
Deferred Income Taxes		0			0			0		0		0		0		0		0
Total Current Liabilities		143,885			(6,891	)		136,994		128,161		142,542		141,716		146,820		151,223

Non-Current Liabilities:
Senior Convertible Notes		50,981			(50,981	) (5)		0		0		0		0		0		0
Term Exit Facility		0			53,000			53,000		55,399		61,599		68,493		72,860		72,860
Deferred Income Taxes		0			0			0		0		0		0		0		0
Revolving Exit Facility		0			4,872			4,872		0		2,080		0		0		0
Other Long-Term Liabilities, Including Deferred Tax Liabilities		15,737			0			15,737		15,737		15,737		15,737		15,737		15,737
Total Non-Current Liabilities		66,718			6,891			73,609		71,136		79,416		84,230		88,597		88,597

Liabilities Subject to Compromise:
Senior Subordinated Notes Due 2009		181,574			(181,574	) (6)		0		0		0		0		0		0

Total Liabilities		392,177			(181,574	)		210,602		199,297		221,959		225,946		235,416		239,819

Total Stockholders Equity		(33,818	)		188,946	(7)		155,128		156,993		166,784		179,555		195,389		214,390

Total Liabilities & Stockholders Equity		358,359			7,372			365,731		356,290		388,742		405,501		430,805		454,209


(1)		The pro forma balance sheet adjustments contained herein for the periods April 30, 2006 and after account for (i) the reorganization and related transactions pursuant to the Plan. Adjustments are based on a total equity value of approximately $155 million consistent with the mid-point of Gordian’s valuation.

(2)		Cash and equivalents as of April 30, 2006 is net of all fees and expenses payable upon emergence, including Exit Financing fees.

(3)		Reflects an estimated fair value adjustment as a result of the decrease in stockholders’ equity.

(4)		Includes capitalization of DIP and Exit Financing fees.

(5)		Reflects satisfaction of Senior Convertible Noteholder claims through paydown with proceeds from Term Exit Facility.

(6)		Liabilities subject to compromise, specifically the Senior Subordinated Notes, are settled and eliminated at emergence in accordance with the Plan.

(7)		Reflects adjustment to stockholders’ equity based on the estimated equity value of Reorganized IES ($155 million).

EXHIBIT C

Income Statement (Unaudited)


	Estimated Pre-					Estimated Post-
	Consummation 7					Consummation 7			5 Months Ended
	Months Ended April			Reorganization		Months Ended April			September			Fiscal Year Ending September 30,
($ in thousands)	30, 2006			Adjustments		30, 2006			30, 2006			2007E			2008E			2009E			2010E

Revenue
Total Commercial Revenue	$	377,461		$	0.0	$	377,461		$	223,502		$	669,161		$	697,823		$	716,052		$	727,914
Residential Revenue		200,079			0.0		200,079			160,322			349,589			356,581			377,976			400,654

Total Revenue	$	577,540			0.0		577,540		$	383,825		$	1,018,751		$	1,054,404		$	1,094,028		$	1,128,568

Cost of Goods Sold
Commercial	$	335,232			0.0	$	335,232		$	195,670		$	584,297		$	605,899		$	618,185		$	624,811
Residential		163,131			0.0		163,131			130,268			281,419			285,265			302,381			320,524

Total COGS		498,363			0.0		498,363			325,938			865,716			891,164			920,566			945,335

Gross Profit
Commercial		42,229			0.0		42,229			27,832			84,865			91,924			97,867			103,103
% Margin		11.2	%				11.2	%		12.5	%		12.7	%		13.2	%		13.7	%		14.2	%

Residential		36,948			0.0		36,948			30,055			68,170			71,316			75,595			80,131
% Margin		18.5	%				18.5	%		18.7	%		19.5	%		20.0	%		20.0	%		20.0	%

Total Gross Profit		79,177			0.0		79,177			57,886			153,034			163,241			173,462			183,234
% Margin		13.7	%				13.7	%		15.1	%		15.0	%		15.5	%		15.9	%		16.2	%

SG&A
Total SG&A		75,354			0.0		75,354			51,728			128,433			132,710			137,640			142,133


Total EBIT		3,823			0.0		3,823			6,158			24,602			30,531			35,822			41,101
% Margin		0.7	%				0.7	%		1.6	%		2.4	%		2.9	%		3.3	%		3.6	%

EBITDA — Discontinued Operations		533			0.0		533			0			0			0			0			0

Total EBITDAR		8,362			0.0		8,362			9,046			31,532			37,462			42,752			48,032
% Margin		1.4	%				1.4	%		2.4	%		3.1	%		3.6	%		3.9	%		4.3	%

Reorganization Expenses (1)		14,436			0.0		14,436			0			0			0			0			0
Interest Expense Net (2)		13,052			0.0		13,052			3,343			8,283			9,245			9,433			9,433

PreTax Income		(23,665	)		0.0		(23,665	)		2,814			16,318			21,286			26,389			31,668

Taxes		211			0.0		211			950			6,527			8,514			10,555			12,667

Net Income		(23,876	)		0.0		(23,876	)		1,865			9,791			12,772			15,833			19,001


(1)		$800 thousand of reorganization expenses were capitalized in December 2005

(2)		Excludes any non-cash, accelerated write-offs of deferred financing costs

EXHIBIT C

Cash Flow Statement (Unaudited)


	5 Months Ended
	September			Fiscal Year Ending September 30,
($ in thousands)	30, 2006			2007E			2008E			2009E			2010E

Cash Flow From Operations
Net Income		1,865			9,791			12,772			15,833			19,001
Depreciation		2,888			6,931			6,931			6,931			6,931
Amortization		0			0			0			0			0
Non-Cash Interest Associated with Term Exit Facility		2,399			6,200			6,894			4,367			0
Non-Cash Amortization of Deferred Financing Fees		0			0			0			0			0
Non-Cash Charges related to Goodwill		0			0			0			0			0
Accounts Receivable Net		12,897			(33,487	)		9,233			(8,530	)		(7,436	)
Inventory, Net		2,425			340			(495	)		(572	)		(482	)
Underbillings on Contracts		1,764			(1,435	)		(891	)		(991	)		(864	)
Prepaid and other Current Assets		0			0			0			0			0
Accounts Payable — Trade		(2,580	)		9,296			(3,986	)		1,593			1,342
Accrued Liabilities		(4,136	)		3,364			2,090			2,323			2,025
Overbillings on Contracts		(2,116	)		1,722			1,070			1,189			1,036

Cash Flow From Operation		15,404			2,721			33,616			22,142			21,553

Cash Flow From Investing
Capital Expenditures		(3,333	)		(12,000	)		(12,000	)		(12,000	)		(12,000	)
Cash From Asset Sale		0			0			0			0			0

Beginning Unrestricted Cash Balance		12,500			19,699			12,500			32,036			42,178
Additions to Cash		12,071			(9,279	)		21,616			10,142			9,553
Revolver Draws		0			2,080			0			0			0
Revolver Repayment		(4,872	)		0			(2,080	)		0			0

Ending Unrestricted Cash Balance		19,699			12,500			32,036			42,178			51,732