	2007			2006
Net sales:
RV Segment	$	129,132		$	149,416
MH Segment		43,812			59,045
Total	$	172,944		$	208,461

Operating profit:
RV Segment	$	15,866		$	13,544
MH Segment		2,800			5,921
Total segment operating profit		18,666			19,465
Amortization of intangibles		(881	)		(430	)
Corporate and other		(1,887	)		(1,907	)
Other income		656			574
Operating profit	$	16,554		$	17,702

Consolidated Highlights

Net sales for the first quarter of 2007 decreased $36 million (17 percent) from the first quarter of 2006. The decrease in net sales this quarter consisted of a decline in hurricane-related sales of approximately $20 million, and an organic sales decline of about $31 million (approximately 15 percent) due to the weakness in both the RV and manufactured housing industries, partially offset by sales price increases of $10 million and sales growth of about $6 million due to acquisitions.

·	Net income for the first quarter of 2007 decreased 6 percent from the first quarter of 2006, less than the 17 percent decrease in net sales due to:

·	Losses in 2006 reduced operating profit by approximately $0.8 million ($0.5 million after taxes) related to the Indiana specialty trailer operation which was closed during the third quarter of 2006.

In response to the slowdowns in both the RV and manufactured housing industries, the Company closed several facilities and consolidated those operations into other existing facilities, and reduced fixed overhead where prudent, including reducing staff levels by more than 70 salaried employees. These facility consolidations and fixed overhead reductions increased operating profit in the first quarter of 2007 by approximately $1.0 million ($0.6 million after taxes). These cost cutting measures, along with others planned for the balance of 2007, are expected to improve operating profit by more than $5 million in 2007 (before taxes).

·	Improved production and procurement efficiencies.

DREW INDUSTRIES INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Continued)

·	A temporary decline in certain raw materials costs purchased during the fourth quarter of 2006, which favorably impacted cost of sales during the first quarter of 2007.

·	Increased profit margins on certain of the Company’s newer product lines which had been underperforming.

·	Lower workers compensation costs which improved operating profit by approximately $1.1 million ($0.7 million after taxes).

These favorable factors were partially offset by the negative impact on the first quarter of 2007 of spreading fixed costs over a smaller sales base.

On January 2, 2007, Lippert acquired Trailair, Inc. (“Trailair”) and certain assets and the business of Equa-Flex, Inc. (“Equa-Flex”), two affiliated companies, which manufacture several patented products, including innovative suspension systems used primarily for towable RVs. The minimum aggregate purchase price was $5.5 million, of which $3.3 million was paid at closing and the balance will be paid annually over the next five years. The aggregate purchase price, including non-compete agreements, could increase to a maximum of $8.1 million if certain sales targets for these products are achieved by Lippert over the next five years. The acquisition was financed with borrowings under the Company’s line of credit. The Company has integrated Trailair and Equa-Flex’s business into existing Lippert facilities.

During the last few years, the Company introduced several new products for the RV and specialty trailer markets, including products for the motorhome market, a relatively new RV category for the Company. New products include slide-out mechanisms and leveling devices for motorhomes, axles for towable RVs and specialty trailers, entry steps and suspension systems for towable RVs, and bed lifts, thermoformed bath and kitchen products, and exterior parts for both towable RVs and motorhomes. The Company estimates that the market potential of these products is over $700 million. In the first quarter of 2007, the Company’s sales of these products were running at an annualized rate of approximately $110 million, as compared to an annualized rate of approximately $85 million in the first quarter of 2006, an increase of more than 25 percent.

RV Segment

Net sales of the RV Segment in the first quarter of 2007 decreased 14 percent, or $20 million, as compared to the first quarter of 2006 due to:

·	A decline of approximately $17 million in hurricane-related sales as compared to the first quarter of 2006.

·	A 2007 organic sales decline of approximately $11 million, or 9 percent, of RV related products.

·	A decline of approximately $3 million in sales of specialty trailers partly due to the closure of the Indiana specialty trailer operation.

Partially offset by:

·	Sales price increases of approximately $5 million.

·	The impact of sales from acquisitions of approximately $6 million.

DREW INDUSTRIES INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Continued)

The 9 percent organic sales decline in the Company’s RV related products approximated the 8 percent decrease in industry shipments of travel trailers and fifth wheel RVs, which industry shipments exclude both the ELUs purchased by FEMA and the estimated 9,000 travel trailers purchased by dealers related to the 2005 Gulf Coast hurricanes during the first quarter of 2006. The Company’s average content for the RVs and ELUs purchased by FEMA was substantially less than the Company’s average content in typical travel trailers.

The Company’s average product content per type of RV, calculated based upon the Company’s net sales of components for the different types of RVs, excluding ELUs, for the twelve months ended March 31, divided by the wholesale shipments of the different types of RVs by the industry, excluding ELUs, for the twelve months ended March 31, are as follows:

	2007		2006		Percent Change
Content per Travel Trailer and
Fifth Wheel RVs	$	1,620	$	1,420		14	%
Content per Motorhomes	$	275	$	269		2	%
Content per all RVs	$	1,244	$	1,098		13	%

According to the RVIA, industry production for the twelve months ended March 31, are as follows:

	2007		2006		Percent Change
Travel Trailer and Fifth
Wheel RVs		277,000		297,300		(7	)%
Motorhomes		55,800		59,400		(6	)%
All RVs		373,200		399,000		(6	)%

ELUs		2,100		68,200		(97	)%

Operating profit of the RV Segment in the first quarter of 2007 increased 17 percent to $15.9 million due to an increase in the operating profit margin to 12.3 percent of net sales in the first quarter of 2007, compared to 9.1 percent of net sales in the first quarter of 2006, partially offset by the decline in sales.

The operating profit margin in the first quarter of 2007 was favorably impacted by:

·	The elimination of the losses incurred in the Company’s Indiana specialty trailer operation of $0.8 million in the first quarter of 2006.

·	Cost-cutting measures implemented.

·	Improved production and procurement efficiencies.

·	A temporary decline in certain raw materials costs purchased during the fourth quarter of 2006 which favorably impacted cost of sales during the first quarter of 2007.

·	Increased profit margins on certain of the Company’s newer product lines which had been underperforming.

·	Lower workers compensation costs.

DREW INDUSTRIES INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Continued)

Partially offset by:

·	The negative impact on the first quarter of 2007 of spreading fixed manufacturing costs over a smaller sales base.

·	Higher health insurance costs.

·	An increase in selling, general and administrative expenses to 11.2 percent of net sales in the first quarter of 2007 from 10.8 percent of net sales in the first quarter of 2006 due to the spreading of fixed costs over a smaller sales base and higher incentive compensation.

MH Segment

Net sales of the MH Segment in the first quarter of 2007 decreased 26 percent, or $15 million, as compared to the first quarter of 2006. Excluding the impact of sales price increases (approximately $5 million), organic sales of the MH Segment decreased approximately $20 million, or 34 percent, compared to a 36 percent decrease in industry-wide production of manufactured homes. This decline in industry-wide production of manufactured homes from 2006 to 2007 is partly a result of the units purchased by FEMA during the first three months of 2006, which did not recur in 2007. The Company estimates that its FEMA related sales in the first three months of 2006 was approximately $3 million. The purchases by FEMA in early 2006 were primarily single-section homes, in which the Company has substantially less product content per home than multi-section homes, which have represented 73 percent of industry sales since 1999.

The Company’s average product content per manufactured home produced by the industry and total manufactured home floors produced by the industry, calculated based upon the Company’s net sales of components for manufactured homes for the twelve months ended March 31, divided by the number of manufactured homes and manufactured home floors produced by the industry, respectively, for the twelve months ended March 31, are as follows:

	2007		2006		Percent Change
Content per Homes Produced	$	1,854	$	1,547		20	%
Content per Floors Produced	$	1,054	$	927		14	%

According to the MHI, industry production for the twelve months ended March 31, are as follows:

	2007		2006		Percent Change
Total Homes Produced		105,100		149,600		(30	)%
Total Floors Produced		184,900		249,600		(26	)%

Operating profit of the MH Segment in the first quarter of 2007 decreased 53 percent to $2.8 million due to the decrease in net sales, and a decrease in the operating profit margin to 6.4 percent of net sales in the first quarter of 2007, compared to 10.0 percent of sales in the first quarter of 2006. The operating profit margin of the MH Segment in the first quarter of 2007 was negatively impacted by (i) increases in material costs as a percent of sales, (ii) the spreading of fixed manufacturing costs over a smaller sales base, (iii) higher health insurance costs, and (iv) an increase in selling, general and administrative expenses as a percent of net sales, partially offset by lower workers compensation costs.

DREW INDUSTRIES INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Continued)

Selling, general and administrative expenses of this segment increased to 14.5 percent as a percent of net sales in the first quarter of 2007, from 13.8 percent in the first quarter of 2006. This increase was due to the spreading of fixed costs over a smaller sales base, partially offset by lower incentive compensation.

The Company has remained profitable in this segment despite the 69 percent decline in manufactured housing industry production since 1998. The Company continues to monitor the goodwill and other intangible assets related to this segment for potential impairment. A further significant downturn in this industry could result in an impairment of the goodwill or other intangible assets of this segment.

Corporate and Other

Corporate and other expenses for the first quarter of 2007 were consistent with the first quarter of 2006.

Other Income

Taxes

The effective tax rate for the first quarter of 2007 was approximately 38.7 percent, compared to 38.5 percent in the first quarter of 2006. The effective tax rate for the full year 2006 was 38.8 percent. The increase in the effective tax rate for 2007 is due to a change in the composition of pre-tax income for state tax purposes, partially offset by the Jobs Creation Act of 2004 which reduced the effective Federal tax rate on manufacturing activities by approximately 1 percent in 2006, and doubled to approximately 2 percent in 2007.

Interest Expense, Net

The decrease of approximately $0.2 million in interest expense, net, for the first quarter of 2007 as compared to the prior year, was due to a decrease in the average debt levels as a result of strong operating cash flows during the latter half of 2006 and the first quarter of 2007, which more than offset the $37 million the Company has invested in acquisitions since early 2006.

DREW INDUSTRIES INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Continued)

LIQUIDITY AND CAPITAL RESOURCES

The Statements of Cash Flows reflect the following for the three months ended March 31, (in thousands):

	2007			2006
Net cash flows provided by operating activities	$	11,533		$	9,519
Net cash flows used for investment activities	$	(4,102	)	$	(13,924	)
Net cash flows (used for) provided by financing activities	$	(2,192	)	$	8,494

Cash Flows from Operations

Net cash flows from operating activities in the first quarter of 2007 was consistent with the same period in 2006. The 2007 period was impacted by a concerted effort by management to reduce inventory on hand, while the 2006 period was impacted by higher working capital at the beginning of the period due to the unusually high sales levels resulting from hurricane-related business during the fourth quarter of 2005.

Cash Flows from Investing Activities:

Cash flows used for investing activities of $4.1 million in 2007 include approximately $3.5 million for the acquisition of businesses and $2.6 million for capital expenditures, offset by proceeds of $1.9 million received from the sale of fixed assets. Capital expenditures and the acquisition were financed with borrowings under the Company’s line of credit and cash flow from operations. Capital expenditures for 2007 are anticipated to be approximately $15 million and are expected to be funded by cash flow from operations.

Cash flows used for investing activities of $13.9 million in the first quarter of 2006 include $9.7 million in capital expenditures. The balance of the cash flows from investing activities consisted primarily of $4.3 million for the acquisition of businesses. Capital expenditures and the acquisition were financed with borrowings under the Company’s credit agreement and cash flow from operations.

Cash Flows from Financing Activities

Cash flows used for financing activities for the first quarter of 2007 of $2.2 million included a net decrease in debt of $3.2 million, and cash flows provided by the exercise of employee stock options of $1.0 million, which includes the related tax benefits. The decrease in debt is primarily due to debt payments of $3.4 million.

Cash flows provided by financing activities for the first quarter of 2006 of $8.5 million included a net increase in debt of $7.5 million, and cash flows provided by the exercise of employee stock options of $1.0 million, which includes the related tax benefits. The increase in debt includes a net increase in the amount borrowed under the Company’s Credit Agreement of $9.6 million, offset by debt payments of $2.1 million.

At March 31, 2007 and 2006, the Company had $11.5 million and $4.5 million, respectively, of cash invested in short-term investments.

DREW INDUSTRIES INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Continued)

Borrowings under the Company’s $70.0 million line of credit at March 31, 2007 were $11.0 million. The Company’s excess cash was not used to pay down these borrowings under the line of credit, as these borrowings are associated with an interest rate swap which results in a favorable fixed interest rate of 4.4 percent. The Company also had $2.7 million in outstanding letters of credit under the line of credit. Availability under the Company’s line of credit was $56.3 million at March 31, 2007. Such availability, along with anticipated cash flows from operations, is adequate to finance the Company’s working capital and anticipated capital expenditure requirements. The maximum borrowings under the line of credit can be increased by an additional $20.0 million, upon approval of the lenders.

The Company has a “shelf-loan” facility with Prudential Investment Management, Inc. (“Prudential”) under which the Company had borrowed $35.0 million, of which $26.4 million was outstanding at March 31, 2007. Pursuant to the terms of the shelf loan facility, the Company can issue, and Prudential’s affiliates may, in their sole discretion, consider purchasing in one or a series of transactions, Senior Promissory Notes of the Company in the aggregate principal amount of an additional $25.0 million, to mature no more than seven years after the date of original issue of each transaction. Prudential and its affiliates have no obligation to purchase the Senior Promissory Notes.

At March 31, 2007, the Company is in compliance with all of its debt covenants and expects to remain in compliance for the next twelve months. Certain of the Company’s loan agreements contain prepayment penalties.

CORPORATE GOVERNANCE

The Company is in compliance with the corporate governance requirements of the Securities and Exchange Commission and the New York Stock Exchange. The Company’s governance documents and committee charters and key practices have been posted to the Company’s website (www.drewindustries.com) and are updated periodically. The website also contains, or provides direct links to, all SEC filings, press releases and investor presentations. The Company has also established a toll-free hotline (877-373-9123) to report complaints about the Company’s accounting, internal controls, auditing matters or other concerns.

In May 2007, the Company received notification from Institutional Stockholders Services, Inc., (“ISS”) a Rockville, Maryland-based independent research firm that advises institutional investors, that the Company’s corporate governance policies outranked 96.1 percent of all companies listed in the Russell 3000 index. The Company has no business relationships with ISS.

CONTINGENCIES

Additional information required by this item is included under Item 1 of Part II of this quarterly report on Form 10-Q.

INFLATION

The prices of key raw materials, consisting primarily of steel, vinyl, aluminum, glass and ABS resin are influenced by demand and other factors specific to these commodities, such as the price of oil, rather than being directly affected by inflationary pressures. Prices of certain commodities have historically been volatile. The prices the Company paid for key raw materials remained volatile during 2006 and 2005. After a temporary decline in the fourth quarter of 2006, the Company received further cost increases for certain key raw materials, particularly steel and aluminum, during the first four months of 2007. The Company did not experience any significant increase in its labor costs in the first quarter of 2007 related to inflation.

DREW INDUSTRIES INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Continued)

NEW ACCOUNTING PRONOUNCEMENTS

USE OF ESTIMATES

The preparation of these financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, the Company evaluates its estimates, including, but not limited to, those related to product returns, accounts receivable, inventories, notes receivable, goodwill and other intangible assets, income taxes, warranty obligations, self insurance obligations, lease terminations, asset retirement obligations, long-lived assets, post-retirement benefits, segment allocations, and contingencies and litigation. The Company bases its estimates on historical experience, other available information and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other resources. Actual results may differ from these estimates under different assumptions or conditions.

The Company has remained profitable in the MH Segment despite the 69 percent decline in manufactured housing industry production since 1998. The Company continues to monitor the goodwill and other intangible assets related to the MH Segment for potential impairment. A further significant downturn in this industry could result in an impairment of the goodwill or other intangible assets of the MH Segment.

DREW INDUSTRIES INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Continued)

FORWARD-LOOKING STATEMENTS AND RISK FACTORS

This Form 10-Q contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to financial condition, results of operations, business strategies, operating efficiencies or synergies, competitive position, growth opportunities for existing products, plans and objectives of management, markets for the Company’s common stock and other matters. Statements in this Form 10-Q that are not historical facts are “forward-looking statements” for the purpose of the safe harbor provided by Section 21E of the Exchange Act and Section 27A of the Securities Act. Forward-looking statements, including, without limitation, those relating to our future business prospects, revenues, expenses and income, wherever they occur in this Form 10-Q, are necessarily estimates reflecting the best judgment of our senior management, at the time such statements were made, and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by forward-looking statements. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made. You should consider forward-looking statements, therefore, in light of various important factors, including those set forth in this Form 10-Q.

There are a number of factors, many of which are beyond the Company’s control, which could cause actual results and events to differ materially from those described in the forward-looking statements. These factors include pricing pressures due to domestic and foreign competition, costs and availability of raw materials (particularly steel and related components, vinyl, aluminum, glass and ABS resin), availability of retail and wholesale financing for manufactured homes, availability and costs of labor, inventory levels of retailers and manufacturers, levels of repossessed manufactured homes, the disposition into the market by FEMA by sale or otherwise of RVs or manufactured homes purchased by FEMA in connection with natural disasters, changes in zoning regulations for manufactured homes, the decline in the manufactured housing industry, the financial condition of our customers, retention of significant customers, interest rates, oil and gasoline prices, the outcome of litigation, and adverse weather conditions impacting retail sales. In addition, national and regional economic conditions and consumer confidence may affect the retail sale of recreational vehicles and manufactured homes.

DREW INDUSTRIES INCORPORATED

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is exposed to changes in interest rates primarily as a result of its financing activities.

On October 18, 2004, the Company entered into a five-year interest rate swap with KeyBank National Association with an initial notional amount of $20.0 million from which it will receive periodic payments at the 3 month LIBOR rate (5.36 percent at March 31, 2007 based upon the February 15, 2007 reset date), and make periodic payments at a fixed rate of 3.35 percent, with settlement and rate reset dates every November 15, February 15, May 15 and August 15. The notional amount of the interest rate swap decreases by $1.0 million on each quarterly reset date. At March 31, 2007, the notional amount was $11.0 million. The fair value of the swap was zero at inception, and $0.3 million at March 31, 2007. The Company has designated this swap as a cash flow hedge of certain borrowings under the line of credit and recognized the effective portion of the change in fair value as part of other comprehensive income, with the ineffective portion, which was insignificant, recognized in earnings currently.

On June 13, 2006, the Company entered into a seven-year interest rate swap with HSBC Bank USA, NA with an initial notional amount of $15.0 million from which it will receive periodic payments at the 3 month LIBOR rate (5.35 percent at March 31, 2007 based upon the March 28, 2007 reset date) and make periodic payments at a fixed rate of 5.39 percent, with settlement and rate reset dates on the last business day of every March, June, September and December. The notional amount of the interest rate swap decreases by $0.5 million on each quarterly reset date beginning September 29, 2006. At March 31, 2007, the notional amount was $13.4 million. The fair value of the swap was zero at inception, and ($0.2 million) at March 31, 2007. The Company has designated this swap as a cash flow hedge of the Senior Promissory Notes issued on June 13, 2006, and recognized the effective portion of the change in fair value as part of other comprehensive income, with the ineffective portion, which was insignificant, recognized in earnings currently.

At March 31, 2007, the Company had $24.9 million of fixed rate debt plus $24.4 million outstanding under the two interest rate swaps. Assuming there is a decrease of 100 basis points in the interest rate for borrowings of a similar nature subsequent to March 31, 2007, which the Company becomes unable to capitalize on in the short-term as a result of the structure of its fixed rate financing, future cash flows would be approximately $0.5 million lower per annum than if the fixed rate financing could be obtained at current market rates.

At March 31, 2007, the Company had $3.2 million of variable rate debt, excluding the $24.4 million outstanding under the two interest rate swaps. Assuming there is an increase of 100 basis points in the interest rate for borrowings under these variable rate loans subsequent to March 31, 2007, and outstanding borrowings of $3.2 million, future cash flows would be reduced by less than $0.1 million per annum.

In addition, the Company is periodically exposed to changes in interest rates as a result of temporary investments in money market funds; however, such investing activity is not material to the Company’s financial position, results of operations, or cash flow.

If the actual change in interest rates is substantially different than 100 basis points, or the outstanding borrowings change significantly, the net impact of interest rate risk on the Company’s cash flow may be materially different than that disclosed above. Additional information required by this item is included under the caption “Inflation” in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of this Report.

DREW INDUSTRIES INCORPORATED

Item 4. CONTROLS AND PROCEDURES

a)	Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure, in accordance with the definition of “disclosure controls and procedures” in Rule 13a-15 under the Exchange Act. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, cannot provide absolute assurance of achieving the desired control objectives. Management included in its evaluation the cost-benefit relationship of possible controls and procedures. The Company continually evaluates its system of internal controls over financial reporting to determine if changes are appropriate based upon changes in the Company’s operations or the business environment in which it operates.

As of the end of the period covered by this Form 10-Q, the Company performed an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and the Company’s Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based on the foregoing, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective.

b)	Changes in Internal Controls

There were no changes in the Company’s internal control over financial reporting during the quarter ended March 31, 2007 or subsequent to the date the Company completed its evaluation, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

During 2005, one of the Company’s subsidiaries installed new computer software and implemented certain functions of the new software. While to date there have been no significant changes in the Company’s internal controls related to the new computer software, the Company anticipates that it will implement certain additional functionalities of the new computer software to further strengthen the Company’s internal controls.

DREW INDUSTRIES INCORPORATED

PART II - OTHER INFORMATION

Item 1 - LEGAL PROCEEDINGS

Item 1A - RISK FACTORS

There have been no material changes to the matters discussed in Part I, Item 1A - Risk Factors in our Annual Report on Form 10-K as filed with the Securities and Exchange Commission on March 13, 2007, except as noted below.

Sales or other dispositions by FEMA of RVs or manufactured homes could cause a decline in the demand for our products.

Sales or other dispositions by FEMA of RVs and manufactured homes purchased by FEMA for use by victims of the Gulf Coast hurricanes may cause manufacturers of RVs and manufactured homes to reduce production of new RVs and manufactured homes, which could cause a decline in the demand for our products.

Item 6 - EXHIBITS

Exhibits as required by item 601 of Regulation 8-K:

1)	31.1 Certification of Chief Executive Officer pursuant to 13a-14(a) under the Securities Exchange Act of 1934. Exhibit 31.1 is filed herewith.

2)	31.2 Certification of Chief Financial Officer pursuant to 13a-14(a) under the Securities Exchange Act of 1934. Exhibit 31.2 is filed herewith.

3)	32.1 Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350. Exhibit 32.1is filed herewith.

4)	32.2 Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350. Exhibit 32.2 is filed herewith.

DREW INDUSTRIES INCORPORATED

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	DREW INDUSTRIES INCORPORATED Registrant

	By	/s/ Fredric M. Zinn
		Fredric M. Zinn Executive Vice President and Chief Financial Officer
May 9, 2007

Delaware		13-3250533
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

200 Mamaroneck Avenue, White Plains,		NY 10601
(Address of principal executive offices)		(Zip Code)

	Page
PART I - FINANCIAL INFORMATION

Item 1 - FINANCIAL STATEMENTS

CONDENSED CONSOLIDATED STATEMENTS OF INCOME		3

CONDENSED CONSOLIDATED BALANCE SHEETS		4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS		5

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY		6

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS		7-15

Item 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		16-27

Item 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		28

Item 4 - CONTROLS AND PROCEDURES		29

PART II - OTHER INFORMATION

Item 1 - LEGAL PROCEEDINGS		30-31

Item 1A - RISK FACTORS		31

Item 6 - EXHIBITS		31

SIGNATURES		32

EXHIBIT 31.1 - SECTION 302 CEO CERTIFICATION		33

EXHIBIT 31.2 - SECTION 302 CFO CERTIFICATION		34

EXHIBIT 32.1 - SECTION 906 CEO CERTIFICATION		35

EXHIBIT 32.2 - SECTION 906 CFO CERTIFICATION		36

	Three Months Ended March 31,
	2007		2006
(In thousands, except per share amounts)
Net sales	$	172,944	$	208,461
Cost of sales		133,772		164,760
Gross profit		39,172		43,701
Selling, general and administrative expenses		23,274		26,573
Other income		656		574
Operating profit		16,554		17,702
Interest expense, net		912		1,119
Income before income taxes		15,642		16,583
Provision for income taxes		6,053		6,378
Net income	$	9,589	$	10,205

Net income per common share:
Basic	$	.44	$	.47
Diluted	$	.44	$	.47

Weighted average common shares outstanding:
Basic		21,781		21,567
Diluted		21,958		21,898

	March 31,						December 31,
	2007			2006			2006
(In thousands, except shares and per share amount)

ASSETS
Current assets
Cash and cash equivalents	$	12,024		$	9,174		$	6,785
Accounts receivable, trade, less allowances		40,331			46,406			17,828
Inventories		83,882			102,245			83,076
Prepaid expenses and other current assets		9,688			9,977			13,351

Total current assets		145,925			167,802			121,040

Fixed assets, net		121,211			123,465			124,558
Goodwill		36,250			24,713			34,344
Other intangible assets		26,977			10,769			24,801
Other assets		6,573			6,724			6,533
Total assets	$	336,936		$	333,473		$	311,276

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Notes payable, including current maturities of
long-term indebtedness	$	9,971		$	10,948		$	9,714
Accounts payable, trade		25,236			31,999			12,027
Accrued expenses and other current liabilities		39,520			38,683			37,320

Total current liabilities		74,727			81,630			59,061

Long-term indebtedness		42,510			69,750			45,966
Other long-term liabilities		3,654			2,444			1,361

Total liabilities		120,891			153,824			106,388

Stockholders’ equity
Common stock, par value $.01 per share: authorized
30,000,000 shares; issued 23,900,885 shares at March 2007;
23,675,761 shares at March 2006 and 23,833,045 at
December 2006		239			237			238
Paid-in capital		55,604			49,349			53,973
Retained earnings		179,627			149,220			170,038
Accumulated other comprehensive income		42			310			106
		235,512			199,116			224,355
Treasury stock, at cost - 2,149,325 shares		(19,467	)		(19,467	)		(19,467	)
Total stockholders’ equity		216,045			179,649			204,888

Total liabilities and stockholders’ equity	$	336,936		$	333,473		$	311,276

										Accumulated
										Other			Total
	Common		Paid-in		Retained		Comprehensive			Treasury			Stockholders’
	Stock		Capital		Earnings		Income			Stock			Equity
(In thousands, except shares)

Balance - December 31, 2006	$	238	$	53,973	$	170,038	$	106		$	(19,467	)	$	204,888
Net income for the three months
ended March 31, 2007						9,589								9,589
Unrealized loss on interest rate
swap, net of taxes								(64	)					(64	)
Comprehensive income														9,525
Issuance of 67,840 shares of
common stock pursuant to stock
options exercised		1		477										478
Income tax benefit relating to
issuance of common stock
pursuant to stock options exercised				529										529
Stock-based compensation expense				625										625

Balance - March 31, 2007	$	239	$	55,604	$	179,627	$	42		$	(19,467	)	$	216,045

Net tangible assets acquired	$	545
Identifiable intangible assets		3,000
Goodwill		1,906
Total consideration		5,451
Less: Present value of future minimum payments		(1,979	)
Total cash consideration	$	3,472

	2007		2006
Weighted average shares outstanding for basic earnings per share		21,781		21,567
Common stock equivalents pertaining to
stock options		177		331
Total for diluted shares		21,958		21,898

	March 31,				December 31,
	2007		2006		2006
Finished goods	$	12,308	$	17,763	$	13,513
Work in process		3,607		3,662		3,868
Raw material		67,967		80,820		65,695
Total	$	83,882	$	102,245	$	83,076