SOURCE: Packaged Home Solutions, Inc.

October 25, 2006 11:51 ET

PHS Home Services, Inc. Announces Letter of Intent to Purchase Quality Oriented, Successful Sunroom Dealer in the Jacksonville, Florida Market, Further Enhancing the PHS Product Offering for

Their Customer Base

CINCINNATI, OH -- (MARKET WIRE) -- October 25, 2006 --Packaged Home Solutions, Inc. (PINKSHEETS: PKGH) (www.packagedhomesolutions.com) ("PHS" or "The Company"), is today announcing that it has agreed to terms in a Letter of Intent to purchase a well-established and successful Jacksonville, Florida Sunroom company. The Company will be acquiring Suntastic, Inc., a local company known throughout the local metropolitan area for its strong commitment to homeowners, providing them with quality service at an affordable price. Suntastic, a Craft-Bilt Dealer, has been a fixture in Jacksonville for 10 years. Their success is demonstrated with over 1000 customers and by the inordinately large number of referred customers. Atypical of the industry, Suntastic has built a sound business with limited advertising, strong attention to product installation and fiscal responsibility. The acquisition of the Sunroom Dealer allows for PHS to enhance their business interests by expanding on the Suntastic name and reputation. PHS will be merging their existing Kitchen and Bath Division in Jacksonville and adding other Exterior Products to include: Vinyl Windows, Seamless Aluminum Gutters and Gutter Protection, Vinyl Siding, Hurricane Protection and Exterior Doors.

Suntastic is trending in 2006 to improve on their almost $1.4M in Gross Revenue last year, and with the additional product offerings to the marketplace the Company has early projections for 2007 in the $4M-$5M range, 40% Gross Profit and 18% Net, within the Jacksonville Market alone. This acquisition further develops the Company's strategy of combining fixed expenses and resources, while developing multiple income streams within a sole market. This approach makes for a solid fiscal model in that all local enterprises are provided for by a central support location with state of the art systems technologies to generate real time reporting, capturing the key trends and metrics to effectively manage their initiatives.

The former management team has agreed to stay on in their current positions which further allows for other key PHS Managers to focus on the continued development of additional income streams through acquisitions. Each of the two key owners has reached terms with the Company to continue in their present managerial capacities for the next three years.

Danny Smith, President of PHS, states, "The acquisition of a company with an outstanding reputation, one that is fiscally sound, which can contribute to our strategy of being able to provide multiple services to our customers is dynamic in its own right. Yet, what makes this acquisition so much greater is the fact that we have additional income streams developing that drives a symbiotic atmosphere and business strategy. The results will be an even more diversified and stable company with fixed cost burdens reduced as a percentage of gross revenue and a low cost referral business crossing product lines. Ultimately, we will establish a database of customers far larger than any competitor, driving a traditionally high variable cost down and our net margin further upward."

About Packaged Home Solutions

Packaged Home Solutions, Inc., formed in 2004, has created a systematized approach that makes remodeling fast and as "customer-friendly" as possible. The Company's executives have over 138 years of experience in the home improvement business, including senior positions with several of the largest retail home improvement chains in the US. The Company was established to provide consumers with reliable, attractive home improvement solutions, including kitchens, bathrooms, basement and exterior improvements that provide the best in product selection and installation services. The Company focuses on the middle market home in range of $100,000 to $500,000, specializing in improvements to increase the value of the home, and maximizing value of the home for sale in a softening real estate market.

PHS currently has seven offices located in Cincinnati and Dayton Ohio, Indianapolis, Indiana, Louisville, Kentucky, Jacksonville (2) and Miami, Florida. The Company's intention is to open a regional office in Tampa, Florida prior to the year's end, as well opening additional satellite offices in Cincinnati and Miami. The Company will be opening regional offices in 2007 in Atlanta, Dallas, Phoenix, Denver and Southern California. These regional offices will then open satellite offices as each market matures. By the end of 2007, the Company plans to have 30 operational offices, making it one of, if not the largest home improvement services company in the United States. At that the time, the management of the Company will consider various options to maximize shareholders' value, including a sale to an industry participant.

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FORWARD-LOOKING STATEMENTS

Statements about Packaged Home Solutions, Inc.'s expectations, including future revenues and earnings, and all other statements in this press release other than historical facts are "forward-looking statements" within the meaning of section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as the term is defined in the Private Litigation Reform Act of 1995. Packaged Home Solutions' actual results could differ materially from expected results. Packaged Home Solutions undertakes no obligation to update forward-looking statements to reflect subsequently occurring events or circumstances. Should events occur which materially affect any comments made within this press release; Packaged Home Solutions will appropriately inform the public.

Contact Information

  • Contacts:
    Investor Relations Contact:
    Gerald Kieft
    Ryan Audin
    Wall Street Resources, Inc.
    2646 SW Mapp Road, Suite 303
    Palm City, Florida 34990
    772-219-7525
    http://www.wallstreetresources.net

    Packaged Home Solutions:
    Mike Klieber
    513-733-1800
    888-818-4172