<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>a60610q.txt
<DESCRIPTION>EMCOR 2ND QTR 10-Q
<TEXT>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q


           [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 2006

                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934

             For the transition period from __________ to __________


                          Commission file number 1-8267

                                EMCOR Group, Inc.
       -------------------------------------------------------------------
             (Exact Name of Registrant as Specified in Its Charter)

            Delaware                                        11-2125338
---------------------------------                -------------------------------
  (State or Other Jurisdiction                   (I.R.S. Employer Identification
of Incorporation or Organization)                             Number)

301 Merritt Seven Corporate Park
      Norwalk, Connecticut                                  06851-1060
---------------------------------                -------------------------------
(Address of Principal Executive                             (Zip Code)
           Offices)
                                 (203) 849-7800
              ----------------------------------------------------
              (Registrant's Telephone Number, Including Area Code)

                                       N/A
--------------------------------------------------------------------------------
              (Former Name, Former Address and Former Fiscal Year,
                         if Changed Since Last Report)

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934 (the  "Exchange  Act") during the  preceding 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes |X| No |_|

     Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer or a non-accelerated filer (as defined in Rule 12b-2 of the
Exchange Act).

Large accelerated filer |X|  Accelerated filer  |_|   Non-accelerated filer  |_|

     Indicate  by check mark  whether  the  registrant  is a shell  company  (as
defined by Rule 12b-2 of the Exchange Act). Yes |_| No |X|

                      Applicable Only To Corporate Issuers
     Number of shares of Common Stock outstanding as of the close of business on
July 19, 2006: 31,555,380 shares.


<PAGE>


                                EMCOR GROUP, INC.
                                      INDEX


                                                                        Page No.


PART I - Financial Information

Item 1     Financial Statements

           Condensed Consolidated Balance Sheets -
           as of June 30, 2006 and December 31, 2005                           1

           Condensed Consolidated Statements of Operations -
           three months ended June 30, 2006 and 2005                           3

           Condensed Consolidated Statements of Operations -
           six months ended June 30, 2006 and 2005                             4

           Condensed Consolidated Statements of Cash Flows -
           six months ended June 30, 2006 and 2005                             5

           Condensed Consolidated Statements of Stockholders'
           Equity and Comprehensive Income -
           six months ended June 30, 2006 and 2005                             6

           Notes to Condensed Consolidated Financial Statements                7


Item 2     Management's Discussion and Analysis of Financial Condition
           and Results of Operations                                          15

Item 3     Quantitative and Qualitative Disclosures about Market Risk         26

Item 4     Controls and Procedures                                            26


PART II - Other Information

Item 1     Legal Proceedings                                                  27

Item 1A    Risk Factors                                                       27

Item 4     Submission of Matters to a Vote of Security Holders                27

Item 6     Exhibits                                                           28
<PAGE>



PART I. - FINANCIAL INFORMATION.

ITEM 1. FINANCIAL STATEMENTS.

EMCOR Group, Inc. and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
--------------------------------------------------------------------------------
                                                      June 30,      December 31,
                                                        2006           2005
                                                    (Unaudited)
--------------------------------------------------------------------------------
                                ASSETS

Current assets:
   Cash and cash equivalents                       $  180,900         $  103,785
   Accounts receivable, net                         1,078,615          1,046,380
   Costs and estimated earnings in excess
      of billings on uncompleted contracts            158,922            185,634
   Inventories                                         13,112             10,175
   Prepaid expenses and other                          47,514             43,829
                                                   ----------         ----------
   Total current assets                             1,479,063          1,389,803

Investments, notes and other long-term
   receivables                                         25,453             28,659

Property, plant and equipment, net                     47,070             46,443

Goodwill                                              283,039            283,412

Identifiable intangible assets, net                    15,429             16,990

Other assets                                            9,925             13,634
                                                   ----------         ----------
   Total assets                                    $1,859,979         $1,778,941
                                                   ==========         ==========

See Notes to Condensed Consolidated Financial Statements.

<PAGE>
EMCOR Group, Inc. and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
--------------------------------------------------------------------------------
                                                        June 30,    December 31,
                                                         2006          2005
                                                      (Unaudited)
--------------------------------------------------------------------------------

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
 Borrowings under working capital credit line         $        -     $        -
 Current maturities of long-term debt and capital
   lease obligations                                         659            551
 Accounts payable                                        452,860        452,709
 Billings in excess of costs and estimated
   earnings on uncompleted contracts                     388,146        330,235
 Accrued payroll and benefits                            128,427        154,276
 Other accrued expenses and liabilities                   96,108        107,545
                                                      ----------     ----------

 Total current liabilities                             1,066,200      1,045,316

Long-term debt and capital lease obligations               1,377          1,406

Other long-term obligations                              133,628        116,783
                                                      ----------     ----------

 Total liabilities                                     1,201,205      1,163,505
                                                      ----------     ----------

Stockholders' equity:
 Preferred stock, $0.01 par value, 1,000,000 shares
   authorized, zero issued and outstanding                     -              -
 Common stock, $0.01 par value, 80,000,000 shares
   authorized, 33,508,232 and 33,266,154 shares
   issued, respectively                                      335            333
 Capital surplus                                         338,621        325,232
 Accumulated other comprehensive income (loss)               712         (5,370)
 Retained earnings                                       337,044        313,170
 Treasury stock, at cost 1,961,718 and 2,162,388
   shares, respectively                                  (17,938)       (17,929)
                                                      ----------     ----------

 Total stockholders' equity                              658,774        615,436
                                                      ----------     ----------

Total liabilities and stockholders' equity            $1,859,979     $1,778,941
                                                      ==========     ==========

See Notes to Condensed Consolidated Financial Statements.

<PAGE>
EMCOR Group, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)(Unaudited)
--------------------------------------------------------------------------------
Three months ended June 30,                              2006           2005
--------------------------------------------------------------------------------

Revenues                                              $1,220,423     $1,168,831
Cost of sales                                          1,086,895      1,056,860
                                                      ----------     ----------
Gross profit                                             133,528        111,971
Selling, general and administrative expenses             108,194         96,994
Restructuring expenses                                         -            301
                                                      ----------     ----------
Operating income                                          25,334         14,676
Interest expense                                            (642)        (2,353)
Interest income                                            1,132            716
Minority interest                                           (672)          (987)
                                                      ----------     ----------
Income from continuing operations before income taxes     25,152         12,052
Income tax provision                                       8,291          4,413
                                                      ----------     ----------
Income from continuing operations                         16,861          7,639
Income from discontinued operations,
   net of income taxes                                         -            294
                                                      ----------     ----------
Net income                                            $   16,861     $    7,933
                                                      ==========     ==========

Net income per common share - Basic
   From continuing operations                         $     0.53     $     0.24
   From discontinued operations                                -           0.01
                                                      ----------     ----------
                                                      $     0.53     $     0.25
                                                      ==========     ==========

Net income per common share - Diluted
   From continuing operations                         $     0.52     $     0.24
   From discontinued operations                                -           0.01
                                                      ----------     ----------
                                                      $     0.52     $     0.25
                                                      ==========     ==========

See Notes to Condensed Consolidated Financial Statements.

<PAGE>
EMCOR Group, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)(Unaudited)
--------------------------------------------------------------------------------
Six months ended June 30,                                2006           2005
--------------------------------------------------------------------------------

Revenues                                              $2,371,500     $2,252,586
Cost of sales                                          2,123,139      2,041,413
                                                      ----------     ----------
Gross profit                                             248,361        211,173
Selling, general and administrative expenses             210,700        189,301
Restructuring expenses                                         -          1,472
                                                      ----------     ----------
Operating income                                          37,661         20,400
Interest expense                                          (1,341)        (4,566)
Interest income                                            2,069          1,289
Minority interest                                           (928)        (1,852)
                                                      ----------     ----------
Income from continuing operations before income taxes     37,461         15,271
Income tax provision                                      12,967          5,598
                                                      ----------     ----------
Income from continuing operations                         24,494          9,673
(Loss) income from discontinued operations,
   net of income taxes                                      (620)           173
                                                      ----------     ----------
Net income                                            $   23,874     $    9,846
                                                      ==========     ==========

Net income (loss) per common share - Basic
   From continuing operations                         $     0.78     $     0.31
   From discontinued operations                            (0.02)          0.01
                                                      ----------     ----------
                                                      $     0.76     $     0.32
                                                      ==========     ==========

Net income (loss) per common share - Diluted
   From continuing operations                         $     0.75     $     0.31
   From discontinued operations                            (0.02)          0.00
                                                      ----------     ----------
                                                      $     0.73     $     0.31
                                                      ==========     ==========


See Notes to Condensed Consolidated Financial Statements.
<PAGE>
EMCOR Group, Inc. and Subsidiaries
<TABLE>
<CAPTION>

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)(Unaudited)
------------------------------------------------------------------------------------------------------------
Six months ended June 30,                                                         2006                2005
------------------------------------------------------------------------------------------------------------

Cash flows from operating activities:
<S>                                                                            <C>                 <C>
   Net income                                                                  $  23,874           $   9,846
   Depreciation and amortization                                                   8,766               9,031
   Amortization of identifiable intangibles                                        1,550               1,722
   Minority interest                                                                 928               1,852
   Deferred income taxes                                                           3,716               6,904
   Loss on sale of discontinued operation, net of income taxes                       620                   -
   Excess tax benefits from share-based compensation                              (2,724)                  -
   Equity income from unconsolidated entities                                     (3,597)               (749)
   Other non-cash items                                                            5,097               1,211
   Distributions from unconsolidated entities                                      6,229                 638
   Changes in operating assets and liabilities                                    32,971              (2,323)
                                                                               ---------           ---------
Net cash  provided by operating activities                                        77,430              28,132
                                                                               ---------           ---------

Cash flows from investing activities:
   Payments for acquisition of a business and earn-out agreements                 (786)               (497)
   Proceeds from sale of discontinued operation                                    1,203                   -
   Proceeds from sale of property, plant and equipment                               313                 752
   Purchase of property, plant and equipment                                      (9,716)             (5,928)
   Investment in and advances to unconsolidated entities and joint ventures         (277)             (1,797)
   Net proceeds (disbursements) related to other investments                         851                (171)
                                                                               ---------           ---------
Net cash used in investing activities                                             (8,412)             (7,641)
                                                                               ---------           ---------

Cash flows from financing activities:
   Proceeds from working capital credit line                                     149,500             517,700
   Repayments of working capital credit line                                    (149,500)           (527,700)
   Net repayments for long-term debt                                                 (24)                (33)
   Repayments for capital lease obligations                                         (106)               (105)
   Proceeds from exercise of stock options                                         5,503               1,172
   Excess tax benefits from share-based compensation                               2,724                   -
                                                                               ---------           ---------
Net cash provided by (used in) financing activities                                8,097              (8,966)
                                                                               ---------           ---------
Increase in cash and cash equivalents                                             77,115              11,525
Cash and cash equivalents at beginning of year                                   103,785              59,109
                                                                               ---------           ---------
Cash and cash equivalents at end of period                                     $ 180,900           $  70,634
                                                                               =========           =========

Supplemental cash flow information:
   Cash paid for:
     Interest                                                                  $     927           $   3,662
     Income taxes                                                              $  13,989           $   4,704
   Non-cash financing activities:
     Assets acquired under capital lease obligations                           $     209           $      86
     Note receivable from sale of subsidiary                                   $     246           $       -

See Notes to Condensed Consolidated Financial Statements.
</TABLE>

<PAGE>
EMCOR Group, Inc. and Subsidiaries
<TABLE>
<CAPTION>

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
AND COMPREHENSIVE INCOME
(In thousands, except share data)(Unaudited)
------------------------------------------------------------------------------------------------------------------------------------
                                                                          Accumulated
                                                                             other
                                                  Common     Capital     comprehensive      Retained     Treasury     Comprehensive
                                       Total       stock     surplus    income(loss)(1)     earnings      stock          income
------------------------------------------------------------------------------------------------------------------------------------
<S>                                   <C>            <C>     <C>           <C>              <C>          <C>             <C>
Balance, January 1, 2005              $562,361       $326    $317,959      $ 7,699          $253,128     $(16,751)
 Net income                              9,846          -           -            -             9,846            -        $ 9,846
 Foreign currency translation
   adjustments                          (2,648)         -           -       (2,648)                -            -         (2,648)
                                                                                                                         -------
 Comprehensive income                                                                                                    $ 7,198
                                                                                                                         =======
 Issuance of treasury stock
   for restricted stock units (3)            -          -        (540)           -                 -          540
 Treasury stock, at cost (4)              (871)         -           -            -                 -         (871)
 Common stock issued under
   stock option plans, net (5)           1,172          6       2,057            -                 -         (891)
 Value of restricted stock units (2)     1,358          -       1,358            -                 -            -
                                      --------       ----    --------      -------          --------     --------
Balance, June 30, 2005                $571,218       $332    $320,834      $ 5,051          $262,974     $(17,973)
                                      ========       ====    ========      =======          ========     ========

Balance, January 1, 2006              $615,436       $333    $325,232      $(5,370)         $313,170     $(17,929)
 Net income                             23,874          -           -            -            23,874            -        $23,874
 Foreign currency translation
   adjustments                           6,082          -           -        6,082                 -            -          6,082
                                                                                                                         -------
 Comprehensive income                                                                                                    $29,956
                                                                                                                         =======
 Issuance of treasury stock
   for restricted stock units (3)            -          -        (551)           -                 -          551
 Treasury stock, at cost (4)            (1,587)         -           -            -                 -       (1,587)
 Common stock issued under
   stock option plans, net (5)          10,070          2       9,041            -                 -        1,027
 Value of issued restricted stock units  1,091          -       1,091            -                 -            -
 Share-based compensation expense        3,808          -       3,808            -                 -            -
                                      --------       ----    --------      -------          --------     --------
Balance, June 30, 2006                $658,774       $335    $338,621      $   712          $337,044     $(17,938)
                                      ========       ====    ========      =======          ========     ========

</TABLE>


(1)  Represents cumulative foreign currency translation  adjustments and minimum
     pension liability adjustments.
(2)  Shares of common stock will be issued in respect of restricted  stock units
     granted  pursuant  to EMCOR's  Executive  Stock  Bonus  Plan.  This  amount
     represents the value of restricted stock units at the date of grant.
(3)  Represents  common stock  transferred  at cost from treasury stock upon the
     vesting of restricted stock units.
(4)  Represents value of shares of common stock withheld by EMCOR for income tax
     withholding requirements upon the vesting of restricted stock units.
(5)  Includes the tax benefit of stock option exercises.

See Notes to Condensed Consolidated Financial Statements.

<PAGE>

EMCOR Group, Inc.  and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE A Basis of Presentation

The accompanying  condensed consolidated financial statements have been prepared
without audit,  pursuant to the interim period  reporting  requirements  of Form
10-Q.  Consequently,  certain information and note disclosures normally included
in  financial  statements  prepared in  accordance  with  accounting  principles
generally  accepted  in the  United  States  have  been  condensed  or  omitted.
References  to the  "Company,"  "EMCOR,"  "we," "us," "our" and words of similar
import refers to EMCOR Group, Inc. and its consolidated  subsidiaries unless the
context  indicates  otherwise.  Readers  of  this  report  should  refer  to the
consolidated  financial  statements and the notes thereto included in our latest
Annual Report on Form 10-K filed with the Securities and Exchange Commission.

In our opinion,  the accompanying  unaudited  condensed  consolidated  financial
statements  contain  all  adjustments  (consisting  only of a  normal  recurring
nature)  necessary to present  fairly our financial  position and the results of
our  operations.  The results of operations  for the three and six month periods
ended June 30, 2006 are not necessarily indicative of the results to be expected
for the year ending December 31, 2006.

On February 10, 2006,  we effected a 2-for-1  stock split in the form of a stock
distribution  of one common share for each common share owned on the record date
of January 30, 2006. The capital stock accounts, all share data and earnings per
share  data give  effect to the stock  split,  applied  retrospectively,  to all
periods presented.

The  results  of  operations  for all  periods  presented  reflect  discontinued
operations  accounting due to the sale of a subsidiary in each of September 2005
and January 2006.

Certain  reclassifications  of prior year  amounts  have been made to conform to
current year presentation.

NOTE B Discontinued Operations

On  January  31,  2006,  we sold a  subsidiary  that had been part of our United
States mechanical construction and facilities services segment. On September 30,
2005, we sold a subsidiary  that had been part of our United  States  facilities
services  segment.  Results of these operations for all periods presented in our
Consolidated  Financial Statements reflect discontinued  operations  accounting.
Included in the results of discontinued operations for the six months ended June
30,  2006 was a loss of $0.6  million  (net of  income  taxes)  by reason of the
January  2006 sale of the  subsidiary  that had been part of our  United  States
mechanical  construction and facilities  services segment.  An aggregate of $4.0
million in cash and notes in the aggregate principal amount of $1.6 million were
received as  consideration  for both of these sales. The principal amount of the
notes  outstanding as of June 30, 2006 was $0.04 million.  The components of the
results of operations for the discontinued  operations are not presented as they
are not material to the consolidated results of operations.

NOTE C Earnings Per Share

Calculation of Basic and Diluted Earnings Per Share

The following tables summarize our calculation of Basic and Diluted Earnings Per
Share ("EPS") for the three and six month periods ended June 30, 2006 and 2005:
<PAGE>
EMCOR Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE C Earnings Per Share - (continued)

<TABLE>
<CAPTION>
                                                                                         Three Months Ended
                                                                                              June 30,
                                                                                  -------------------------------
                                                                                      2006                2005
                                                                                      ----                ----
Numerator:
<S>                                                                               <C>                  <C>
Income before discontinued operations                                             $16,861,000          $7,639,000
Income from discontinued operations                                                         -             294,000
                                                                                  -----------          ----------
Net income available to common stockholders                                       $16,861,000          $7,933,000
                                                                                  ===========          ==========
Denominator:
Weighted average shares outstanding used to compute basic earnings per share       31,571,736          31,281,690
Effect of diluted securities                                                        1,139,146             495,470
                                                                                  -----------          ----------
Shares used to compute diluted earnings per share                                  32,710,882          31,777,160
                                                                                  ===========          ==========
Basic earnings per share:
   Continuing operations                                                          $      0.53          $     0.24
   Discontinued operations                                                                  -                0.01
                                                                                  -----------          ----------
   Total                                                                          $      0.53          $     0.25
                                                                                  ===========          ==========
Diluted earnings per share:
   Continuing operations                                                          $      0.52          $     0.24
   Discontinued operations                                                                  -                0.01
                                                                                  -----------          ----------
   Total                                                                          $      0.52          $     0.25
                                                                                  ===========          ==========

</TABLE>
<TABLE>
<CAPTION>

                                                                                          Six Months Ended
                                                                                              June 30,
                                                                                  -------------------------------
                                                                                      2006                2005
                                                                                      ----                ----
Numerator:
<S>                                                                               <C>                  <C>
Income before discontinued operations                                             $24,494,000          $9,673,000
(Loss)income from discontinued operations                                            (620,000)            173,000
                                                                                  -----------          ----------
Net income available to common stockholders                                       $23,874,000          $9,846,000
                                                                                  ===========          ==========
Denominator:
Weighted average shares outstanding used to compute basic earnings per share       31,444,264          30,997,812
Effect of diluted securities                                                        1,049,790             593,992
                                                                                  -----------          ----------
Shares used to compute diluted earnings per share                                  32,494,054          31,591,804
                                                                                  ===========          ==========
Basic earnings (loss) per share:
   Continuing operations                                                          $      0.78          $     0.31
   Discontinued operations                                                              (0.02)               0.01
                                                                                  -----------          ----------
   Total                                                                          $      0.76          $     0.32
                                                                                  ===========          ==========
Diluted earnings (loss) per share:
   Continuing operations                                                          $      0.75          $     0.31
   Discontinued operations                                                              (0.02)               0.00
                                                                                  -----------          ----------
   Total                                                                          $      0.73          $     0.31
                                                                                  ===========          ==========
</TABLE>

<PAGE>

EMCOR Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE C Earnings Per Share - (continued)

There were zero  anti-dilutive  stock  options that were required to be excluded
from the  calculation  of diluted EPS for the three and six month  periods ended
June 30, 2006, respectively.  There were 287,230 and 484,999 anti-dilutive stock
options that were  required to be excluded from the  calculation  of diluted EPS
for the three and six month periods ended June 30, 2005, respectively.

NOTE D Valuation of Stock Option Grants

We have  various  types of stock  compensation  plans  and  programs  which  are
administered by the compensation  committee of our board of directors.  Note I -
Stock  Options  and  Stock  Plans  of the  Notes to the  Consolidated  Financial
Statements contained in the Annual Report on Form 10-K for the fiscal year ended
December 31, 2005 should be referred to for additional information regarding the
stock-based compensation plans and programs.

On January 1,  2006,  we adopted  Statement  No.  123(R)  "Share-Based  Payment"
("Statement   123(R)")  issued  by  the  Financial  Accounting  Standards  Board
("FASB"). With the adoption of Statement 123(R), all share-based payments to our
employees and non-employee  directors,  including grants of stock options,  have
been recognized in the income statement based on their fair values utilizing the
modified  prospective  method  of  accounting.  The  impact of the  adoption  of
Statement  123(R)  resulted  in $2.3  million and $2.9  million of  compensation
expense in the three and six  months  ended June 30,  2006,  respectively.  As a
result,  net income was adversely  impacted in these periods by $1.3 million and
$1.7  million and  diluted  earnings  per share  ("Diluted  EPS") was  adversely
impacted  by $0.04  and  $0.05,  respectively.  Approximately  $1.9  million  of
compensation  expense,  net  of  income  taxes,  will  be  recognized  over  the
approximately 21 month remaining vesting period for stock options outstanding at
June 30, 2006. Prior to January 1, 2006, we applied Accounting  Principles Board
Opinion No. 25,  "Accounting  for Stock Issued to Employees"  ("Opinion 25") and
related  interpretations  in  accounting  for  stock  options.  Accordingly,  no
compensation   expense  has  been  recognized  in  the  accompanying   Condensed
Consolidated  Statements of  Operations  for the three and six months ended June
30, 2005 in respect of stock options  granted during that period  inasmuch as we
granted  stock options at fair market value.  Had  compensation  expense for the
options for the three and six month periods ended June 30, 2005 been  determined
consistent   with  FASB   Statement  No.  123,   "Accounting   for   Stock-Based
Compensation"   and  FASB  Statement  No.  148,   "Accounting   for  Stock-Based
Compensation - Transition and  Disclosure,"  our net income,  basic earnings per
share  ("Basic  EPS") and  Diluted  EPS would  have  been  reduced  from the "as
reported  amounts" below to the "pro forma amounts" below (in thousands,  except
per share amounts):



                                                  For the three     For the six
                                                   months ended     months ended
                                                     June 30,        June 30,
                                                       2005             2005
                                                  -------------     ------------
Income from continuing operations:
 As reported                                          $7,639           $9,673
 Less:  Total stock-based compensation expense
   determined under fair value based method,
   net of related tax effects                            814            1,229
                                                      ------           ------
 Pro Forma                                            $6,825           $8,444
                                                      ======           ======
Basic EPS:
 As reported                                          $ 0.24           $ 0.31
 Pro Forma                                            $ 0.22           $ 0.27
Diluted EPS:
 As reported                                          $ 0.24           $ 0.31
 Pro Forma                                            $ 0.21           $ 0.27
<PAGE>

EMCOR Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE D Valuation of Stock Option Grants - (continued)

The fair value on the date of grant was calculated using the Black-Scholes
option pricing model with the following weighted average assumptions used for
grants during the periods indicated:

                                    For the three months      For the six months
                                       ended June 30,           ended June 30,
                                     2006        2005         2006         2005
                                    --------------------      ------------------
Dividend yield                         0%          0%           0%            0%
Expected volatility                 35.0%       34.9%        35.0%         36.7%
Risk-free interest rate              5.1%        3.9%         5.0%          3.9%
Expected life of options in years    6.36        6.36         6.36          6.33
Weighted average grant
   date fair value                 $21.11      $10.60       $20.33        $ 8.17

Forfeitures  of  stock  options  have  been   historically   immaterial  to  the
calculation and are estimated as zero in both periods presented.

As of December 31, 2005, there were 3,648,728 stock options outstanding. For the
three  months  ended June 30,  2006,  there were 60,000  stock  options  granted
(average  exercise  price of $46.20  per  share),  172,138  stock  options  were
exercised  (average  exercise  price of $18.27 per  share) and no stock  options
expired or were  forfeited.  For the six months ended June 30, 2006,  there were
79,062  stock  options  granted  (average  exercise  price of $42.77 per share),
379,338  stock  options were  exercised  (average  exercise  price of $14.71 per
share) and no stock options expired or were forfeited.  At June 30, 2006,  there
were 3,348,452  options  outstanding at an average  exercise price of $20.08 per
share with a remaining contractual life of 5.8 years, and 2,769,797 options were
exercisable at an average exercise price of $19.57 per share which options had a
remaining  contractual life of 5.3 years. As a result of stock option exercises,
$5.5  million of proceeds  were  received  during the six months  ended June 30,
2006.  The income tax  benefit  derived as a result of such  exercises  was $4.6
million,  of which $2.7 million represented excess tax benefits from share-based
compensation.  This  compares  to $1.2  million of  proceeds  from stock  option
exercises  for the six  months  ended  June 30,  2005,  on which the  income tax
benefit from stock option exercises was $2.4 million.

Additionally,  5,095 and 152,281  restricted share units were awarded during the
three and six months  ended June 30,  2006  pursuant to  non-employee  director,
key-person long term incentive plans and a separation agreement,  for which $0.4
million and $0.8 million of compensation expense was recognized during the three
and six  months  ended June 30,  2006,  respectively.  We also have  outstanding
phantom equity units accounted for as liability awards under 123(R), pursuant to
which  a $0.2  million  expense  reduction  and  $1.2  million  of  expense  was
recognized for the three and six months ended June 30, 2006,  respectively,  due
to changes in the market price of our common stock from the award date.

Common Stock

As of June 30, 2006 and December 31, 2005,  31,546,514 and 31,103,766  shares of
our common stock were outstanding, respectively.

<PAGE>

EMCOR Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE E Segment Information

We have the following reportable segments which provide services associated with
the design,  integration,  installation,  startup,  operation and maintenance of
various  systems:  (a) United  States  electrical  construction  and  facilities
services (involving systems for generation and distribution of electrical power,
lighting   systems,   low-voltage   systems   such  as  fire  alarm,   security,
communication  and  process  control  systems and voice and data  systems);  (b)
United States mechanical construction and facilities services (involving systems
for heating, ventilation, air conditioning, refrigeration and clean-room process
ventilation  systems,  fire  protection  systems,  and  plumbing,   process  and
high-purity piping systems);  (c) United States facilities services;  (d) Canada
construction  and  facilities  services;  (e) United  Kingdom  construction  and
facilities  services;  and (f) Other  international  construction and facilities
services.  The segment "United States facilities services"  principally consists
of those  operations which provide a portfolio of services needed to support the
operation  and  maintenance  of  customers'  facilities  (mobile  operation  and
maintenance services,  site-based operation and maintenance  services,  facility
planning and consulting services,  energy management programs and the design and
construction  of  energy-related  projects)  which  services  are not  generally
related to customers'  construction  programs.  The Canada,  United  Kingdom and
Other  international  segments  perform  electrical   construction,   mechanical
construction  and facilities  services.  "Other  international  construction and
facilities  services"  represents our  operations  outside of the United States,
Canada  and  the  United  Kingdom  (primarily  in the  Middle  East)  performing
electrical  construction,  mechanical  construction and facilities services. The
following  tables present  information  about  industry  segments and geographic
areas (in thousands):
<TABLE>
<CAPTION>
                                                                     For the three months ended June 30,
                                                                     -----------------------------------
                                                                         2006                   2005
                                                                         ----                   ----
Revenues from unrelated entities:
<S>                                                                  <C>                     <C>
   United States electrical construction and facilities services     $  307,499              $  300,125
   United States mechanical construction and facilities services        418,770                 425,834
   United States facilities services                                    232,201                 187,780
                                                                     ----------              ----------
   Total United States operations                                       958,470                 913,739
   Canada construction and facilities services                           84,671                  84,273
   United Kingdom construction and facilities services                  177,282                 170,819
   Other international construction and facilities services                   -                       -
                                                                     ----------              ----------
   Total worldwide operations                                        $1,220,423              $1,168,831
                                                                     ==========              ==========
</TABLE>
<TABLE>
<CAPTION>
                                                                     For the three months ended June 30,
                                                                     -----------------------------------
                                                                         2006                   2005
                                                                         ----                   ----
Total revenues:
<S>                                                                  <C>                     <C>
   United States electrical construction and facilities services     $  308,228              $  303,775
   United States mechanical construction and facilities services        422,645                 427,688
   United States facilities services                                    233,609                 188,661
   Less intersegment revenues                                            (6,012)                 (6,385)
                                                                     ----------              ----------
   Total United States operations                                       958,470                 913,739
   Canada construction and facilities services                           84,671                  84,273
   United Kingdom construction and facilities services                  177,282                 170,819
   Other international construction and facilities services                   -                       -
                                                                     ----------              ----------
   Total worldwide operations                                        $1,220,423              $1,168,831
                                                                     ==========              ==========
</TABLE>
<PAGE>
EMCOR Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE E Segment Information - (continued)
<TABLE>
<CAPTION>

                                                                     For the six months ended June 30,
                                                                     ----------------------------------
                                                                         2006                   2005
                                                                         ----                   ----
Revenues from unrelated entities:
<S>                                                                  <C>                     <C>
   United States electrical construction and facilities services     $  617,718              $  576,009
   United States mechanical construction and facilities services        799,073                 817,133
   United States facilities services                                    450,711                 371,203
                                                                     ----------              ----------
   Total United States operations                                     1,867,502               1,764,345
   Canada construction and facilities services                          164,239                 150,475
   United Kingdom construction and facilities services                  339,759                 337,766
   Other international construction and facilities services                   -                       -
                                                                     ----------              ----------
   Total worldwide operations                                        $2,371,500              $2,252,586
                                                                     ==========              ==========
</TABLE>
<TABLE>
<CAPTION>
                                                                     For the six months ended June 30,
                                                                     ----------------------------------
                                                                         2006                   2005
                                                                         ----                   ----
Total revenues:
<S>                                                                  <C>                     <C>
   United States electrical construction and facilities services     $  620,373              $  583,500
   United States mechanical construction and facilities services        806,092                 820,667
   United States facilities services                                    452,871                 372,555
   Less intersegment revenues                                           (11,834)                (12,377)
                                                                     ----------              ----------
   Total United States operations                                     1,867,502               1,764,345
   Canada construction and facilities services                          164,239                 150,475
   United Kingdom construction and facilities services                  339,759                 337,766
   Other international construction and facilities services                   -                       -
                                                                     ----------              ----------
   Total worldwide operations                                        $2,371,500              $2,252,586
                                                                     ==========              ==========
</TABLE>
<TABLE>
<CAPTION>

                                                                     For the three months ended June 30,
                                                                     -----------------------------------
                                                                         2006                   2005
                                                                         ----                   ----
Operating income (loss):
<S>                                                                  <C>                     <C>
   United States electrical construction and facilities services     $   11,063              $   12,052
   United States mechanical construction and facilities services         11,011                   4,370
   United States facilities services                                     10,080                   7,551
                                                                     ----------              ----------
   Total United States operations                                        32,154                  23,973
   Canada construction and facilities services                            2,089                  (1,525)
   United Kingdom construction and facilities services                    3,694                   2,365
   Other international construction and facilities services                 (41)                     13
   Corporate administration                                             (12,562)                 (9,849)
   Restructuring expenses                                                     -                    (301)
                                                                     ----------              ----------
   Total worldwide operations                                            25,334                  14,676

Other corporate items:
   Interest expense                                                        (642)                 (2,353)
   Interest income                                                        1,132                     716
   Minority interest                                                       (672)                   (987)
                                                                     ----------              ----------
   Income from continuing operations before income taxes             $   25,152              $   12,052
                                                                     ==========              ==========
</TABLE>

<PAGE>
EMCOR Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE E Segment Information - (continued)
<TABLE>
<CAPTION>

                                                                   For the six months ended June 30,
                                                                   ---------------------------------
                                                                       2006                   2005
                                                                       ----                   ----
Operating income (loss):
<S>                                                                <C>                    <C>
   United States electrical construction and facilities services     $ 19,437               $ 28,048
   United States mechanical construction and facilities services       18,436                    896
   United States facilities services                                   14,727                 12,592
                                                                     --------               --------
   Total United States operations                                      52,600                 41,536
   Canada construction and facilities services                          3,081                 (2,251)
   United Kingdom construction and facilities services                  5,381                  1,892
   Other international construction and facilities services               732                    (38)
   Corporate administration                                           (24,133)               (19,267)
   Restructuring expenses                                                   -                 (1,472)
                                                                     --------               --------
   Total worldwide operations                                          37,661                 20,400

Other corporate items:
   Interest expense                                                    (1,341)                (4,566)
   Interest income                                                      2,069                  1,289
   Minority interest                                                     (928)                (1,852)
                                                                     --------               --------
   Income from continuing operations before income taxes             $ 37,461               $ 15,271
                                                                     ========               ========
</TABLE>
<TABLE>
<CAPTION>

                                                                     June 30,            December 31,
                                                                      2006                   2005
                                                                   ----------            ------------
Total assets:
<S>                                                                <C>                    <C>
   United States electrical construction and facilities services   $  349,973             $  357,368
   United States mechanical construction and facilities services      666,007                673,315
   United States facilities services                                  350,025                331,495
                                                                   ----------             ----------
   Total United States operations                                   1,366,005              1,362,178
   Canada construction and facilities services                        113,400                137,241
   United Kingdom construction and facilities services                252,034                154,633
   Other international construction and facilities services             1,067                  3,008
   Corporate administration                                           127,473                121,881
                                                                   ----------             ----------
   Total worldwide operations                                      $1,859,979             $1,778,941
                                                                   ==========             ==========
</TABLE>
<PAGE>

EMCOR Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE F Retirement Plans

Components of Net Periodic Pension Benefit Cost

The components of net periodic pension benefit cost for the three and six months
ended June 30, 2006 and 2005 were as follows (in thousands):
<TABLE>
<CAPTION>

                                      For the three months ended June 30,   For the six months ended June 30,
                                      -----------------------------------   ---------------------------------
                                           2006               2005                  2006            2005
                                           ----               ----                  ----            ----

<S>                                      <C>                <C>                   <C>             <C>
Service cost                             $ 1,062            $   999               $ 2,080         $ 2,004
Interest cost                              2,598              2,480                 5,091           4,979
Expected return on plan assets            (2,770)            (2,528)               (5,427)         (5,076)
Amortization of prior service cost            18                 22                    36              45
Amortization of net loss                     415                345                   813             693
                                         -------            -------               -------         -------
Net periodic pension benefit cost        $ 1,323            $ 1,318               $ 2,593         $ 2,645
                                         =======            =======               =======         =======
</TABLE>

Employer Contributions

For the six months  ended  June 30,  2006,  EMCOR's  United  Kingdom  subsidiary
contributed  $3.1 million to its defined  benefit  pension plan and  anticipates
contributing an additional $3.3 million during the remainder of 2006.

NOTE G Income Taxes

For the three months ended June 30, 2006 and 2005,  the income tax provision was
$8.3 million and $4.4 million,  respectively.  For the six months ended June 30,
2006 and 2005,  the income tax  provision  was $13.0  million and $5.6  million,
respectively.  The estimated effective income tax rate was 38% for the three and
six months ended June 30, 2006 compared to 37% for the comparable  2005 periods.
The  reported tax  provision  includes an  adjustment  made as it relates to the
deductibility of certain compensation arrangements for income tax purposes.


NOTE H Legal Proceedings

See Part II - Other Information, Item 1 - Legal Proceedings.

<PAGE>
ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

We are one of the largest mechanical and electrical  construction and facilities
services  firms in the United  States,  Canada,  the United  Kingdom  and in the
world. We provide services to a broad range of commercial,  industrial,  utility
and  institutional   customers  through  approximately  70  principal  operating
subsidiaries  and joint venture  entities.  Our offices are located in 41 states
and the District of Columbia in the United  States,  six provinces in Canada and
12 primary locations in the United Kingdom.

Overview

Our revenues for the second quarter of 2006 were $1.22 billion compared to $1.17
billion for the second quarter of 2005. Our net income was $16.9 million for the
second  quarter of 2006 compared to $7.9 million for the second quarter of 2005.
Diluted  earnings per share were $0.52 per share for the second quarter compared
to $0.25 per share for the second quarter of 2005.

Our revenues for the six months ended June 30, 2006 were $2.37 billion  compared
to $2.25  billion  for the six months  ended June 30,  2005.  Our net income was
$23.9  million for the six months  ended June 30, 2006  compared to $9.8 million
for the six months  ended June 30, 2005.  Diluted  earnings per share were $0.73
per share for the six months ended June 30, 2006 compared to $0.31 per share for
the six months ended June 30, 2005.

Our revenues  increased in the three and six months ended June 30, 2006 compared
to the  same  periods  in 2005  principally  due to  increased  availability  of
higher margin project work.

Our net income and diluted earnings per share for the three and six months ended
June 30,  2006  compared  to the three and six months  ended June 30,  2005 were
positively  impacted by (a) generally  improved  performance and increased gross
profit  on  United  States  mechanical   construction  and  Canada  construction
contracts and (b) increased  availability of generally  higher gross margin work
in the United States.  Additionally,  our 2006 six month results were positively
impacted  by the absence of an $8.7  million  non-cash  expense  recorded in the
first quarter of 2005 as a result of  proceedings in a civil action brought by a
joint venture between our subsidiary  Poole & Kent  Corporation and an unrelated
company against the Upper Occoquan Sewage  Authority.  Negatively  impacting our
2006 six month results, when compared to the prior year's six month results, was
the absence of a $5.6 million  favorable  insurance  settlement  recorded in the
first quarter of 2005 (which  primarily  affected the United  States  electrical
construction   and   facilities   services   segment).   Selling,   general  and
administrative  expenses  were higher in the three and six months ended June 30,
2006,  compared  to the same  periods of 2005,  primarily  due to an increase in
compensation   expense  as  a  result  of  improved  operating   results.   Also
contributing to the improvement  were $2.1 million and $4.0 million of increases
in net  interest  income  for the  three and six  months  ended  June 30,  2006,
respectively,  compared to the comparable  periods in 2005,  primarily due to an
increase in cash available for  investment  and a reduction in borrowings  under
the working capital credit line.

In September  2005 and January 2006, we sold a subsidiary  that had been part of
our United States  facilities  services  segment and a subsidiary  that had been
part of our  United  States  mechanical  construction  and  facilities  services
segment,  respectively.  Consequently,  results of  operations  for all  periods
presented reflect discontinued operations accounting.  Our results of operations
for the six months  ended June 30, 2006  reflect a loss of $0.6  million (net of
income taxes) by reason of the January 2006 sale of the subsidiary that had been
part of our  United  States  mechanical  construction  and  facilities  services
segment.

We have  stock-based  compensation  plans and  programs.  On January 1, 2006, we
adopted Statement No. 123(R) "Share-Based  Payment"  ("Statement 123(R)") issued
by the  Financial  Accounting  Standards  Board  ("FASB").  With the adoption of
Statement  123(R),  all share-based  payments to our employees and  non-employee
directors, including grants of stock options, have been recognized in the income
statement based on their fair values utilizing the modified  prospective  method
of accounting.  The impact of the adoption of Statement  123(R) resulted in $2.3
million  and $2.9  million of  compensation  expense in the three and six months
ended  June 30,  2006,  respectively.  As a result,  net  income  was  adversely
impacted in these periods by $1.3 million and $1.7 million and diluted  earnings
per share was adversely impacted by $0.04 and $0.05, respectively. Approximately
$1.9 million of compensation  expense,  net of income taxes,  will be recognized
over the  approximately  21 month  remaining  vesting  period for stock  options
outstanding  at June 30, 2006.  Prior to January 1, 2006, we applied  Accounting
Principles  Board  Opinion No. 25,  "Accounting  for Stock Issued to  Employees"
("Opinion  25") and related  interpretations  in accounting  for stock  options.
Accordingly,  no compensation  expense has been  recognized in the  accompanying
Condensed  Consolidated  Statements of  Operations  for the three and six months
ended June 30, 2005 in respect of stock  options  granted  during those  periods
inasmuch as we granted stock options at fair market value.

Operating Segments

We have the following reportable segments which provide services associated with
the design,  integration,  installation,  startup,  operation and maintenance of
various  systems:  (a) United  States  electrical  construction  and  facilities
services (involving systems for generation and distribution of electrical power,
lighting   systems,   low-voltage   systems   such  as  fire  alarm,   security,
communication  and  process  control  systems and voice and data  systems);  (b)
United States mechanical construction and facilities services (involving systems
for heating, ventilation, air conditioning, refrigeration and clean-room process
ventilation  systems,  fire  protection  systems,  and  plumbing,   process  and
high-purity piping systems);  (c) United States facilities services;  (d) Canada
construction  and  facilities  services;  (e) United  Kingdom  construction  and
facilities  services;  and (f) Other  international  construction and facilities
services.  The segment "United States facilities services"  principally consists
of those  operations which provide a portfolio of services needed to support the
operation  and  maintenance  of  customers'  facilities  (mobile  operation  and
maintenance services,  site-based operation and maintenance  services,  facility
planning and consulting services,  energy management programs and the design and
construction  of  energy-related  projects)  which  services  are not  generally
related to customers'  construction  programs.  The Canada,  United  Kingdom and
Other  international  segments  perform  electrical   construction,   mechanical
construction  and facilities  services.  "Other  international  construction and
facilities  services"  represents our  operations  outside of the United States,
Canada  and  the  United  Kingdom  (primarily  in the  Middle  East)  performing
electrical construction, mechanical construction and facilities services.

Results of Operations

The results presented reflect certain  reclassifications of prior period amounts
to conform to current year presentation.

Revenues

The following  table  presents our  operating  segment  revenues from  unrelated
entities and their respective percentage of total revenues (in thousands, except
for percentages):
<TABLE>
<CAPTION>

                                                                                   For the three months ended June 30,
                                                                          --------------------------------------------------
                                                                                          % of                         % of
                                                                              2006        Total            2005        Total
                                                                          ---------------------        ---------------------
Revenues:
<S>                                                                       <C>              <C>         <C>              <C>
   United States electrical construction and facilities services          $  307,499       25%         $  300,125       26%
   United States mechanical construction and facilities services             418,770       34%            425,834       36%
   United States facilities services                                         232,201       19%            187,780       16%
                                                                          ----------                   ----------
   Total United States operations                                            958,470       79%            913,739       78%
   Canada construction and facilities services                                84,671        7%             84,273        7%
   United Kingdom construction and facilities services                       177,282       15%            170,819       15%
   Other international construction and facilities services                        -        -                   -         -
                                                                          ----------                   ----------
   Total worldwide operations                                             $1,220,423      100%         $1,168,831      100%
                                                                          ==========                   ==========
</TABLE>
<TABLE>
<CAPTION>

                                                                                    For the six months ended June 30,
                                                                          -------------------------------------------------
                                                                                          % of                         % of
                                                                              2006        Total            2005       Total
                                                                          ---------------------        --------------------
Revenues:
<S>                                                                       <C>              <C>         <C>              <C>
   United States electrical construction and facilities services          $  617,718       26%         $  576,009       26%
   United States mechanical construction and facilities services             799,073       34%            817,133       36%
   United States facilities services                                         450,711       19%            371,203       16%
                                                                          ----------                   ----------
   Total United States operations                                          1,867,502       79%          1,764,345       78%
   Canada construction and facilities services                               164,239        7%            150,475        7%
   United Kingdom construction and facilities services                       339,759       14%            337,766       15%
   Other international construction and facilities services                        -         -                  -         -
                                                                          ----------                   ----------
   Total worldwide operations                                             $2,371,500      100%         $2,252,586      100%
                                                                          ==========                   ==========
</TABLE>

Our revenues for the second quarter of 2006 were $1.22 billion compared to $1.17
billion for the second quarter of 2005. Our net income was $16.9 million for the
second  quarter of 2006 compared to $7.9 million for the second quarter of 2005.
Diluted  earnings per share were $0.52 per share for the second quarter compared
to $0.25 per share for the second quarter of 2005.

Our revenues for the six months ended June 30, 2006 were $2.37 billion  compared
to $2.25  billion  for the six months  ended June 30,  2005.  Our net income was
$23.9  million for the six months  ended June 30, 2006  compared to $9.8 million
for the six months  ended June 30, 2005.  Diluted  earnings per share were $0.73
per share for the six months ended June 30, 2006 compared to $0.31 per share for
the six months ended June 30, 2005.

Our  contract  backlog  at June 30,  2006 was $3.22  billion  compared  to $2.72
billion at June 30, 2005. Our contract backlog was $2.76 billion at December 31,
2005.  These increases in backlog,  which were primarily  attributable to United
States operations, were due to increased availability of commercial construction
projects. Backlog is not a term recognized under accounting principles generally
accepted in the United States;  however,  it is a common measurement used in our
industry.  Our  backlog  includes  unrecognized  revenues  to be  realized  from
uncompleted  construction  contracts plus  unrecognized  revenues expected to be
realized over the remaining term of facilities services  contracts.  However, if
the  remaining  term of any of our  facilities  services  contracts  exceeds  12
months, the unrecognized revenues attributable to any such contracts included in
backlog are limited to only 12 months of such contracts' revenues.

Revenues of our United States  electrical  construction and facilities  services
segment for the three and six months ended June 30, 2006  increased $7.4 million
and $41.7  million  compared  to the three and six months  ended June 30,  2005,
respectively.  The revenues increases were due to the increased  availability of
commercial and government project work.

Revenues of our United States  mechanical  construction and facilities  services
segment for the three and six months ended June 30, 2006  decreased $7.1 million
and $18.1  million  compared  to the three and six months  ended June 30,  2005,
respectively.  The revenues  decreases were primarily  attributable to a planned
decrease in activities of certain  subsidiaries  resulting in the curtailment of
their bidding on certain public sector  projects,  partially offset by increased
commercial work.

Our United States facilities  services revenues,  which include those operations
that principally  provide maintenance and consulting  services,  increased $44.4
million  and $79.5  million  for the three and six months  ended  June 30,  2006
compared to the three and six months  ended June 30, 2005,  respectively.  These
increases in revenues  were  primarily  attributable  to  site-based  government
related work and to mobile  services  offered by this  segment,  and to revenues
from a mobile services company acquired in November 2005.

Revenues of our Canada  construction and facilities  services  increased by $0.4
million  and $13.8  million  for the three and six months  ended  June 30,  2006
compared  to the same  periods in 2005,  respectively.  The  revenues  increases
primarily  reflected  increases of $8.3 million and $12.9  million for the three
and six  month  periods,  respectively,  relating  to the  change in the rate of
exchange for Canadian dollars to United States dollars due to the  strengthening
of the Canadian  dollar.  The increase in revenues due to the change in the rate
of exchange for the three  months ended June 30, 2006  compared to the same 2005
period was partially offset by a temporary decrease in oil and gas work.

Our United Kingdom  construction and facilities services revenues increased $6.5
million  and $2.0  million  for the three and six  months  ended  June 30,  2006
compared to the same periods in 2005,  respectively,  primarily due to increased
work on rail  projects.  The increases  were offset by decreases of $2.6 million
and $13.6 million for the three and six month periods, respectively, relating to
the rate of exchange for British  pounds to United States dollars as a result of
the weakening of the British pound.

<PAGE>

Cost of sales and Gross profit

The following table presents our cost of sales,  gross profit,  and gross profit
as a percentage of revenues (in thousands, except for percentages):

<TABLE>
<CAPTION>

                                             For the three months ended June 30,       For the six months ended June 30,
                                             -----------------------------------       ---------------------------------
                                                   2006             2005                     2006             2005
                                                   ----             ----                     ----             ----
<S>                                            <C>              <C>                      <C>              <C>
Cost of sales                                  $1,086,895       $1,056,860               $2,123,139       $2,041,413
Gross profit                                      133,528          111,971                  248,361          211,173
Gross profit, as a percentage of revenues            10.9%             9.6%                    10.5%             9.4%
</TABLE>


Our gross profit (revenues less cost of sales) increased $21.6 million and $37.2
million for the three and six months ended June 30, 2006, respectively, compared
to the same periods in 2005.  Gross profit as a percentage of revenues was 10.9%
and 10.5%  for the  three and six  months  ended  June 30,  2006,  respectively,
compared  to 9.6% and 9.4% for the three and six  months  ended  June 30,  2005,
respectively.  The  increase in gross  profit for the three and six months ended
June 30, 2006 compared to the same periods in 2005 was primarily attributable to
(a) generally improved performance on United States mechanical  construction and
Canadian  construction  contracts  and (b) increased  availability  of generally
higher  margin  work in the United  States.  Additionally,  results  for the six
months  ended June 30, 2006 were  positively  impacted by the absence of an $8.7
million  non-cash  expense  recorded in the first quarter of 2005 as a result of
proceedings in a civil action brought by a joint venture  between our subsidiary
Poole & Kent  Corporation  and an unrelated  company  against the Upper Occoquan
Sewage Authority.  Negatively impacting the 2006 six month results when compared
to the prior year period was the absence of a $5.6 million  favorable  insurance
settlement  recorded in the first quarter of 2005 (which primarily  affected the
United States electrical construction and facilities services segment).

Selling, general and administrative expenses

The following table presents our selling,  general and administrative  expenses,
and selling, general and administrative expenses as a percentage of revenues (in
thousands, except for percentages):

<TABLE>
<CAPTION>

                                             For the three months ended June 30,       For the six months ended June 30,
                                             -----------------------------------       ---------------------------------
                                                   2006             2005                     2006             2005
                                                   ----             ----                     ----             ----
<S>                                             <C>               <C>                      <C>              <C>
Selling, general and administrative expenses    $108,194          $96,994                  $210,700         $189,301
Selling, general and administrative expenses,
   as a percentage of revenues                       8.9%             8.3%                      8.9%             8.4%

</TABLE>

Our selling, general and administrative expenses for the three months ended June
30, 2006 increased by $11.2 million to $108.2 million  compared to $97.0 million
for the three months ended June 30, 2005.  Selling,  general and  administrative
expenses as a percentage  of revenues  were 8.9% for the three months ended June
30, 2006 compared to 8.3% for the three months ended June 30, 2005. Our selling,
general  and  administrative  expenses  for the six months  ended June 30,  2006
increased by $21.4 million to $210.7 million when compared to $189.3 million for
the six months ended June 30, 2005. Selling, general and administrative expenses
as a  percentage  of revenues  were 8.9% for the six months  ended June 30, 2006
compared to 8.4% for the six months ended June 30,  2005.  For the three and six
month periods ended June 30, 2006 compared to the same periods in 2005, selling,
general and administrative expenses increased both in amount and as a percentage
of revenues primarily as a result of an increase in incentive-based compensation
expense.  Selling,  general and  administrative  expenses also  increased due to
compensation  expense of $2.3  million  and $2.9  million  for the three and six
months  ended  June 30,  2006,  respectively,  as a result  of the  adoption  of
Statement 123(R) on January 1, 2006.

<PAGE>
Restructuring expenses

Restructuring  expenses,  primarily relating to employee severance  obligations,
were $0.3  million and $1.5  million for the three and six months ended June 30,
2005. As of June 30, 2006, there were no unpaid restructuring obligations.

Operating income

The following table presents our operating  income (loss),  and operating income
(loss)  as  a  percentage  of  segment  revenues  from  unrelated  entities  (in
thousands, except for percentages):
<TABLE>
<CAPTION>

                                                                                 For the three months ended June 30,
                                                                    ----------------------------------------------------------
                                                                                    % of                         % of
                                                                                   Segment                      Segment
                                                                      2006        Revenues          2005       Revenues
                                                                      ----        --------          ----       --------
Operating income (loss):
<S>                                                                 <C>             <C>            <C>            <C>
   United States electrical construction and facilities services    $ 11,063        3.6%           $12,052        4.0%
   United States mechanical construction and facilities services      11,011        2.6%             4,370        1.0%
   United States facilities services                                  10,080        4.3%             7,551        4.0%
                                                                    --------                       -------
   Total United States operations                                     32,154        3.4%            23,973        2.6%
   Canada construction and facilities services                         2,089        2.5%            (1,525)      (1.8)%
   United Kingdom construction and facilities services                 3,694        2.1%             2,365        1.4%
   Other international construction and facilities services              (41)                           13
   Corporate administration                                          (12,562)                       (9,849)
   Restructuring expenses                                                  -                          (301)
                                                                    --------                       -------
   Total worldwide operations                                         25,334        2.1%            14,676        1.3%

Other corporate items:
   Interest expense                                                     (642)                       (2,353)
   Interest income                                                     1,132                           716
   Minority interest                                                    (672)                         (987)
                                                                    --------                       -------
Income from continuing operations before income taxes               $ 25,152                       $12,052
                                                                    ========                       =======
</TABLE>
<TABLE>
<CAPTION>
                                                                                For the six months ended June 30,
                                                                    ----------------------------------------------------------
                                                                                    % of                          % of
                                                                                   Segment                      Segment
                                                                      2006        Revenues          2005       Revenues
                                                                      ----        --------          ----       --------
Operating income (loss):
<S>                                                                 <C>             <C>           <C>             <C>
   United States electrical construction and facilities services    $ 19,437        3.1%          $ 28,048        4.9%
   United States mechanical construction and facilities services      18,436        2.3%               896        0.1%
   United States facilities services                                  14,727        3.3%            12,592        3.4%
                                                                    --------                      --------
   Total United States operations                                     52,600        2.8%            41,536        2.4%
   Canada construction and facilities services                         3,081        1.9%            (2,251)      (1.5)%
   United Kingdom construction and facilities services                 5,381        1.6%             1,892        0.6%
   Other international construction and facilities services              732                           (38)
   Corporate administration                                          (24,133)                      (19,267)
   Restructuring expenses                                                  -                        (1,472)
                                                                    --------                      --------
   Total worldwide operations                                         37,661        1.6%            20,400        0.9%

Other corporate items:
   Interest expense                                                   (1,341)                       (4,566)
   Interest income                                                     2,069                         1,289
   Minority interest                                                    (928)                       (1,852)
                                                                    --------                      --------
Income from continuing operations before income taxes               $ 37,461                      $ 15,271
                                                                    ========                      ========
</TABLE>


As  described  below in more detail,  our  operating  income  increased by $10.7
million for the three  months ended June 30, 2006 to $25.3  million  compared to
operating  income of $14.7 million for the three months ended June 30, 2005. Our
operating  income  increased by $17.3  million for the six months ended June 30,
2006 to $37.7 million  compared to operating income of $20.4 million for the six
months ended June 30, 2005.

Our United States  electrical  construction  and facilities  services  operating
income of $11.1 million for the three months ended June 30, 2006  decreased $1.0
million compared to operating income of $12.1 million for the three months ended
June 30, 2005.  Operating  income of $19.4 million for the six months ended June
30, 2006  decreased $8.6 million  compared to operating  income of $28.0 million
for the six months ended June 30, 2005. The decrease in operating income for the
three and six months  ended June 30,  2006 was  primarily  the result of reduced
transportation  infrastructure and financial  services projects,  which produced
higher operating  margins in the 2005 periods.  Absent from the six months ended
June 30, 2006 was  approximately  $4.5 million in income from the  settlement of
the insurance  coverage  related  dispute  recorded  during the first quarter of
2005.  Selling,  general and administrative  expenses increased primarily due to
increased  variable  compensation  expense,  at  certain  subsidiaries  in  this
segment,  pertaining  to  incentive-based  compensation  programs in each of the
three and six month periods.

Our United States  mechanical  construction  and facilities  services  operating
income of $11.0 million for the three months ended June 30, 2006  increased $6.6
million  compared to operating income of $4.4 million for the three months ended
June 30, 2005.  Operating  income of $18.4 million for the six months ended June
30, 2006 increased  $17.5 million  compared to operating  income of $0.9 million
for the six months ended June 30, 2005.  This segment  benefited  from increased
operating  income from  high-tech  and  specialty-type  processing  work.  These
improvements were also partially  attributable to planned curtailment of bidding
by certain  subsidiaries  on certain public sector  contracts which had recorded
operating  losses in the 2005  periods.  The  increase in  selling,  general and
administrative  expenses  was  primarily  related to  increased  incentive-based
compensation  expense,  at certain  subsidiaries in this segment, in each of the
three and six month periods.  The operating income for the six months ended June
30, 2005 reflects an approximately  $8.7 million  reduction in gross profit as a
result of the write-off of  unrecovered  costs with respect to an action against
the Upper Occoquan Sewage Authority. In addition,  absent was approximately $1.1
million in income  related to the  settlement of an insurance  coverage  related
dispute recorded in the first quarter of 2005.

Our United  States  facilities  services  operating  income for the three months
ended June 30,  2006 was $10.1  million  compared  to  operating  income of $7.6
million for the three months ended June 30, 2005.  Operating  income for the six
months ended June 30, 2006 was $14.7  million  compared to  operating  income of
$12.6 million for the six months ended June 30, 2005.  Operating income improved
for the 2006  periods,  compared  to the 2005  periods,  due to  improved  gross
margins on mobile services work and to operating income contributed by a company
acquired in November 2005;  however,  these  increases were offset  partially by
incentive-based  compensation  expense and to less operating income from certain
site-based operations contracts.

Our  Canada  construction  and  facilities  services  operating  income was $2.1
million for the three months ended June 30, 2006  compared to an operating  loss
of $1.5 million for the three months ended June 30, 2005.  Operating  income was
$3.1  million for the six months  ended June 30, 2006  compared to an  operating
loss of $2.3 million for the six months ended June 30, 2005. The improvements in
operating  income  were  attributable  to  improved  hospital,  mining  and auto
manufacturing  construction  contract  performance  and a planned  reduction  in
selling, general and administrative expenses.

Our United Kingdom construction and facilities services operating income for the
three months ended June 30, 2006 was $3.7 million  compared to operating  income
of $2.4 million for the three months ended June 30, 2005.  Operating  income for
the six months ended June 30, 2006 was $5.4 million compared to operating income
of $1.9  million for the six months  ended June 30,  2005.  These  increases  in
operating  income were primarily  attributable to increased  performance of, and
gross profit earned on, rail projects and to increased facilities services work.

Other  international  construction  and facilities  services  operating loss was
$0.04  million for the three  months  ended June 30, 2006  compared to operating
income of $0.01  million for the three  months  ended June 30,  2005.  Operating
income was $0.7  million  for the six months  ended June 30,  2006  compared  to
operating losses of $0.04 million for the six months ended June 30, 2005.

Corporate  administration expenses for the three months ended June 30, 2006 were
$12.6 million compared to $9.8 million for the three months ended June 30, 2005.
Corporate  administration  expenses  for the six months  ended June 30, 2006 was
$24.1 million  compared to $19.3 million for the six months ended June 30, 2005.
The increase in expenses was  primarily  due to $2.3 million and $2.9 million of
expenses related to the adoption of Statement 123(R) for the three and six month
periods  ended June 30, 2006,  respectively,  and  increases in  incentive-based
compensation of $0.6 million and $1.9 million for the three and six months ended
June 30, 2006, respectively, compared to the same periods in 2005.

Restructuring  expenses,  primarily relating to employee severance  obligations,
were $0.3  million and $1.5  million for the three and six months ended June 30,
2005.

Interest  expense  for the three  months  ended June 30,  2006 and 2005 was $0.6
million  and $2.4  million,  respectively.  Interest  expense for the six months
ended June 30, 2006 and 2005 was $1.3  million and $4.6  million,  respectively.
The decrease in interest expense was primarily due to the reduction in borrowing
levels  during the three and six  months  ended June 30,  2006  compared  to the
borrowing  levels in the three and six  months  ended  June 30,  2005.  Interest
income for the three  months  ended June 30, 2006 was $1.1  million  compared to
$0.7 million for the three months ended June 30, 2005.  Interest  income for the
six months ended June 30, 2006 was $2.1 million compared to $1.3 million for the
six months ended June 30, 2005. The increases in interest  income were primarily
related to an increase in cash available for investment.

The  estimated  effective  income  tax rate was 38% for the three and six months
ended  June 30,  2006  compared  to 37% for the  comparable  2005  periods.  The
reported  tax  provision  includes  an  adjustment  made  as it  relates  to the
deductibility of certain compensation arrangements for income tax purposes.

Liquidity and Capital Resources

The  following  table  presents  our net cash  provided  by (used in)  operating
activities, investing activities and financing activities (in thousands):

                                                     For the six months ended
                                                              June 30,
                                                     ---------------------------
                                                         2006         2005
                                                         ----         ----
Net cash provided by operating activities              $77,430      $28,132
Net cash used in investing activities                  $(8,412)     $(7,641)
Net cash provided by (used in) financing activities    $ 8,097      $(8,966)

Our consolidated cash balance increased by approximately $77.1 to $180.9 million
at June 30, 2006 from $103.8  million at December 31, 2005.  The increase in net
cash  provided by  operating  activities  for the six months ended June 30, 2006
compared to the six months ended June 30, 2005 was  primarily due to an increase
in working  capital as a result of an  increase in net  over-billings.  Net cash
used in investing  activities  of $8.4 million for the six months ended June 30,
2006 increased $0.8 million  compared to $7.6 million for the same period in the
prior year  primarily due to an increase in the purchase of property,  plant and
equipment of $3.8 million from the same period in the prior year,  of which $2.3
million in  purchases  of  equipment  related to the  start-up  of a  site-based
contract in our United States facilities  services segment,  partially offset by
$1.2  million  of  proceeds  from the sale of a  discontinued  operation  and an
increase in net proceeds from other investing  activities.  Net cash provided by
financing  activities  of $8.1  million  for the six months  ended June 30, 2006
increased  $17.1  million  compared to net cash used in financing  activities of
$9.0 million for the six months ended June 30, 2005. This increase was primarily
attributable  to the absence of net borrowings  under the working capital credit
line for 2006  compared  to $10.0  million  of net  borrowings  for 2005,  to an
increase in the proceeds from the exercise of stock options of $4.3 million, and
to the excess tax benefit from share-based  compensation of $2.7 million for the
six months ended June 30, 2006.

<PAGE>
<TABLE>
<CAPTION>

                                                                                             Payments Due by Period
                                                                                ------------------------------------------------
                                                                                 Less
                    Contractual                                                  than           1-3          4-5          After
                    Obligations                                Total            1 year         years        years        5 years
---------------------------------------------                  -----            ------         -----        -----        -------

<S>                                                           <C>               <C>           <C>           <C>          <C>
Other long-term debt                                          $    0.4          $  0.1        $  0.2        $ 0.1        $   -
Capital lease obligations                                          1.7             0.6           0.8          0.3            -
Operating leases                                                 243.2            52.8          92.6         64.7         33.1
Minimum funding requirement for pension plan                       6.4             6.4             -            -            -
Open purchase obligations (1)                                    684.4           571.5         112.2          0.7            -
Other long-term obligations (2)                                  138.3            15.6         122.7            -            -
                                                              --------          ------        ------        -----        -----
Total Contractual Obligations                                 $1,074.4          $647.0        $328.5        $65.8        $33.1
                                                              ========          ======        ======        =====        =====
</TABLE>
<TABLE>
<CAPTION>


                                                                                    Amount of Commitment Expiration by Period
                                                                                ------------------------------------------------
                                                                                 Less
                  Other Commercial                             Total             than           1-3          4-5          After
                    Commitments                              Committed          1 year         years        years        5 years
---------------------------------------------                ---------          ------         -----        -----        -------

<S>                       <C>                                   <C>              <C>           <C>            <C>         <C>
Revolving credit facility (3)                                   $   -            $   -         $   -          $ -         $   -
Letters of credit                                                61.8                -          61.8            -             -
Guarantees                                                       25.0                -             -            -          25.0
                                                                -----            -----         -----          ---         -----
Total Commercial Obligations                                    $86.8            $   -         $61.8          $ -         $25.0
                                                                =====            =====         =====          ===         =====
</TABLE>

(1)  Represent  open  purchase  orders for  material  and  subcontracting  costs
     related to the Company's construction and service contracts. These purchase
     orders are not reflected in our  consolidated  balance sheet and should not
     impact  future cash flows as amounts  will be  recovered  through  customer
     billings.

(2)  Represent  primarily  insurance  related  liabilities,  classified as other
     long-term liabilities in our consolidated balance sheets. Cash payments for
     insurance related  liabilities may be payable beyond three years, but it is
     not practical to estimate.

(3)  We classify  these  borrowings as short-term  on its  consolidated  balance
     sheet  because  of our  intent  and  ability  to  repay  the  amounts  on a
     short-term basis.

Our revolving credit agreement (the "Revolving Credit Facility")  provides for a
credit facility of $375.0 million. As of June 30, 2006 and December 31, 2005, we
had  approximately  $61.8  million  and  $53.3  million  of  letters  of  credit
outstanding,  respectively,  under the Revolving Credit Facility.  There were no
borrowings  under the Revolving Credit Facility as of June 30, 2006 and December
31, 2005.

One of our subsidiaries has guaranteed indebtedness of a venture in which it has
a 40% interest; the other venture partner, Baltimore Gas and Electric, has a 60%
interest. The venture designs,  constructs, owns, operates, leases and maintains
facilities  to  produce  chilled  water  for  sale to  customers  for use in air
conditioning commercial properties.  These guarantees are not expected to have a
material  effect on our  financial  position  or results of  operations.  We and
Baltimore  Gas and Electric are jointly and  severally  liable,  in the event of
default, for the venture's $25.0 million borrowing due December 2031.

The terms of our construction  contracts  frequently require that we obtain from
surety companies  ("Surety  Companies") and provide to our customers payment and
performance  bonds  ("Surety  Bonds")  as a  condition  to  the  award  of  such
contracts. The Surety Bonds secure our payment and performance obligations under
such  contracts,  and we have  agreed to  indemnify  the  Surety  Companies  for
amounts,  if any,  paid by them in respect of Surety Bonds issued on our behalf.
In  addition,  at the  request  of  labor  unions  representing  certain  of our
employees,  Surety Bonds are sometimes  provided to secure obligations for wages
and benefits payable to or for such employees.  Public sector contracts  require
Surety Bonds more frequently than private sector contracts, and accordingly, our
bonding  requirements  typically  increase  as the amount of public  sector work
increases. As of June 30, 2006, Surety Companies had issued Surety Bonds for our
account in the aggregate amount of approximately $1.8 billion.  The Surety Bonds
are issued by Surety  Companies in return for premiums,  which vary depending on
the size and type of bond.  The largest single Surety Bond  outstanding  for our
account is approximately $170.0 million.

We do not have any other  material  financial  guarantees or  off-balance  sheet
arrangements other than those disclosed herein.

Our primary  source of  liquidity  has been,  and is expected to continue to be,
cash generated by operating  activities.  We also maintain the Revolving  Credit
Facility that may be utilized,  among other things, to meet short-term liquidity
needs in the event cash generated by operating activities is insufficient, or to
enable us to seize  opportunities  to  participate  in joint ventures or to make
acquisitions  that may require  access to cash on short  notice or for any other
reason. We may also increase  liquidity through an equity offering or other debt
instruments.  Short-term  changes  in  macroeconomic  trends may have an effect,
positively or negatively,  on liquidity.  Our focus on the  facilities  services
market is  intended  to  provide a buffer  against  economic  downturns,  as the
facilities  services market is characterized by annual and multi-year  contracts
that  provide a more  predictable  stream  of cash  flow  than the  construction
market.  Short-term  liquidity  is also  impacted  by the  type  and  length  of
construction contracts in place. During economic downturns, such as the downturn
during 2001 through 2004 in the  commercial  construction  industry,  there were
typically  fewer small and  discretionary  projects from the private  sector and
companies like us more aggressively bid more large long-term  infrastructure and
public  sector  contracts.  Performance  of long  duration  contracts  typically
requires working capital until initial billing milestones are achieved. While we
strive to maintain a net over-billed  position with our customers,  there can be
no  assurance  that a net  over-billed  position  can  be  maintained.  Our  net
over-billings, defined as the balance sheet accounts billings in excess of costs
and estimated earnings on uncompleted contracts less cost and estimated earnings
in excess of billings on uncompleted  contracts,  were $229.2 million and $144.6
million as of June 30, 2006 and December 31, 2005, respectively.

Long-term  liquidity  requirements  can  be  expected  to be  met  through  cash
generated  from  operations,  the  Revolving  Credit  Facility,  and the sale of
various  secured or  unsecured  debt and/or  equity  interests in the public and
private markets.  Based upon our current credit ratings and financial  position,
we can reasonably  expect to be able to issue long-term debt instruments  and/or
equity.  Over the long term, our primary revenue risk factor continues to be the
level of demand  for  non-residential  construction  services,  which is in turn
influenced by  macroeconomic  trends  including  interest rates and governmental
economic policy. Our ability to perform work at profitable levels is critical to
meeting long-term liquidity requirements.

We believe that our current cash balances and our borrowing  capacity  available
under the  Revolving  Credit  Facility  or other  forms of  financing  available
through debt or equity  offerings,  combined  with cash expected to be generated
from  operations,   will  be  sufficient  to  provide  us  with  short-term  and
foreseeable  long-term  liquidity  and to  enable  us to meet  expected  capital
expenditure  requirements.  However,  we  are a  party  to  lawsuits  and  other
proceedings in which other parties seek to recover from us amounts  ranging from
a few thousand dollars to over $67.0 million. If we were required to pay damages
in one or more such  proceedings,  such payments  could have a material  adverse
effect on our financial position, results of operations and/or cash flows.

Certain Insurance Matters

As of June 30, 2006 and  December  31,  2005,  we utilized  approximately  $57.8
million and $49.4 million, respectively, of letters of credit obtained under our
revolving credit facility as collateral for our insurance obligations.

Adoption of New Accounting Pronouncements

During the six months  ended June 30,  2006,  we adopted  Statement  No.  123(R)
"Share-Based  Payment"  ("Statement  123(R)") issued by the Financial Accounting
Standards Board ("FASB").  Statement  123(R) is a revision of FASB Statement No.
123, "Accounting for Stock-Based Compensation" ("Statement 123"), supersedes APB
Opinion No. 25  "Accounting  for Stock Issued to Employees"  ("Opinion  25") and
amends FASB Statement No. 95 "Statement of Cash Flows".  Generally, the approach
in  Statement  123(R) is similar to the approach  described  in  Statement  123.
However,  with the  adoption  of  Statement  123(R)  on  January  1,  2006,  all
share-based payments to employees,  including grants of stock options, have been
recognized in the income statement based on their fair values,  accounted for by
utilizing the modified prospective basis of accounting.

Application of Critical Accounting Policies

The condensed  consolidated financial statements are based on the application of
significant  accounting  policies,  which require management to make significant
estimates and assumptions.  Our significant accounting policies are described in
Note B - Summary of Significant Accounting Policies of the notes to consolidated
financial  statements  included in Item 7 of the annual  report on Form 10-K for
the year ended December 31, 2005.

We believe that some of the more critical  judgment areas in the  application of
accounting   policies  that  affect  our  financial  condition  and  results  of
operations  are estimates and  judgments  pertaining to (a) revenue  recognition
from (i) long-term construction contracts for which the percentage of completion
method of accounting is used and (ii) services contracts,  (b) collectibility or
valuation of accounts receivable,  (c) insurance  liabilities,  (d) income taxes
and (e) intangible assets.

Revenue Recognition for Long-term Construction Contracts and Services Contracts

We believe  our most  critical  accounting  policy is revenue  recognition  from
long-term construction  contracts for which we use the  percentage-of-completion
method of  accounting.  Percentage-of-completion  accounting  is the  prescribed
method of accounting  for  long-term  contracts in  accordance  with  accounting
principles  generally  accepted in the United States,  Statement of Position No.
81-1,   "Accounting   for   Performance   of   Construction-Type   and   Certain
Production-Type  Contracts,"  and,  accordingly,  the  method  used for  revenue
recognition within our industry.  Percentage-of-completion  for each contract is
measured  principally  by the ratio of costs  incurred  to date to perform  each
contract to the estimated  total costs to perform such  contract at  completion.
Certain    of   our    electrical    contracting    business    units    measure
percentage-of-completion  by the  percentage of labor costs  incurred to date to
perform  each  contract  to the  estimated  total  labor  costs to perform  such
contract.  Provisions  for the  entirety  of  estimated  losses  on  uncompleted
contracts  are  made  in  the  period  in  which  such  losses  are  determined.
Application of percentage-of-completion accounting results in the recognition of
costs and estimated  earnings in excess of billings on uncompleted  contracts in
our  consolidated  balance  sheets.  Costs and  estimated  earnings in excess of
billings on uncompleted  contracts reflected in the consolidated  balance sheets
arise when revenues have been  recognized but the amounts cannot be billed under
the terms of contracts. Such amounts are recoverable from customers upon various
measures of performance, including achievement of certain milestones, completion
of specified units or completion of a contract.  Costs and estimated earnings in
excess of billings on uncompleted contracts also include amounts we seek or will
seek to collect  from  customers  or others  for  errors or changes in  contract
specifications or design,  contract change orders in dispute or unapproved as to
both  scope  and  price,  or  other  customer-related  causes  of  unanticipated
additional contract costs. Such amounts are recorded at estimated net realizable
value and take into account factors that may affect the ability to bill unbilled
revenues and collect  amounts after billing.  Due to  uncertainties  inherent in
estimates employed in applying  percentage-of-completion  accounting,  estimates
may   be    revised    as    project    work    progresses.    Application    of
percentage-of-completion   accounting   requires  that  the  impact  of  revised
estimates be reported prospectively in the consolidated financial statements.

In addition to revenue  recognition  for long-term  construction  contracts,  we
recognize revenues from service contracts as such contracts are accounted for in
accordance with Staff Accounting Bulletin No. 104, "Revenue Recognition, revised
and updated" ("SAB 104"). There are two basic types of services  contracts:  (a)
fixed price  services  contracts  which are signed in advance  for  maintenance,
repair and retrofit work over periods  typically ranging from one to three years
(pursuant to which our employees may be at a customer's  site full time) and (b)
services  contracts  which  may or may not be  signed  in  advance  for  similar
maintenance, repair and retrofit work on an as needed basis (frequently referred
to as time and material  work).  Fixed price  services  contracts  are generally
performed over the contract period, and, accordingly, revenue is recognized on a
pro-rata  basis  over the life of the  contract.  Revenues  derived  from  other
services  contracts are recognized when the services are performed in accordance
with SAB 104.  Expenses  related to all services  contracts  are  recognized  as
incurred.

Accounts Receivable

We are  required to  estimate  the  collectibility  of  accounts  receivable.  A
considerable  amount of judgment is required in  assessing  the  probability  of
collection  of  receivables.  Relevant  assessment  factors  include  the credit
worthiness of the customer,  our prior collection  history with the customer and
related aging of the past due  balances.  The provision for bad debts during the
six months  ended June 30,  2006 and 2005 were $1.3  million  and $0.4  million,
respectively.  At June 30, 2006 and December 31, 2005,  accounts  receivable  of
$1,078.6  million and $1,046.4  million,  respectively,  included  allowances of
$28.4 million and $30.0 million, respectively.  Specific accounts receivable are
evaluated  when we  believe  a  customer  may not be able to meet its  financial
obligations due to a  deterioration  of its financial  condition.  The allowance
requirements  are based on the best  facts  available  and are  re-evaluated  as
additional information is received.


<PAGE>
Insurance Liabilities

We have deductibles for certain workers' compensation,  auto liability,  general
liability and property claims,  have  self-insured  retentions for certain other
casualty claims, and are self-insured for  employee-related  health care claims.
Losses are recorded  based upon  estimates of the liability for claims  incurred
and an estimate of claims incurred but not reported. The liabilities are derived
from  known  facts,  historical  trends  and  industry  averages  utilizing  the
assistance of an actuary to determine the best estimate of these obligations. We
believe our  liabilities  for these  obligations  are  adequate.  However,  such
obligations  are  difficult  to assess and  estimate  due to  numerous  factors,
including severity of injury,  determination of liability in proportion to other
parties,  timely  reporting of occurrences and  effectiveness of safety and risk
management   programs.   Therefore,   if  actual  experience  differs  from  the
assumptions and estimates used for recording the liabilities, adjustments may be
required and are then recorded in the period that the experience becomes known.

Income Taxes

We have net deferred tax assets  primarily  resulting from deductible  temporary
differences  of $8.6  million at June 30,  2006,  compared to net  deferred  tax
assets of $12.3 million at December 31, 2005,  which will reduce  taxable income
in future periods. A valuation allowance is required when it is more likely than
not that all or a portion of a deferred  tax asset will not be  realized.  As of
June 30, 2006 and  December  31, 2005,  the total  valuation  allowance on gross
deferred  tax  assets  was  approximately   $16.7  million  and  $18.7  million,
respectively.

Goodwill and Intangible Assets

As of June 30,  2006,  we had goodwill and net  identifiable  intangible  assets
(primarily  the  market  value  of  our  backlog,   customer  relationships  and
trademarks and trade names) of $283.0  million and $15.4 million,  respectively,
in connection with the acquisition of certain  companies.  The  determination of
related  estimated useful lives for identifiable  intangible  assets and whether
those assets are impaired  involves  significant  judgments based upon short and
long-term projections of future performance. These forecasts reflect assumptions
regarding  the  ability  to  successfully  integrate  acquired  companies.  FASB
Statement No. 142,  "Goodwill and Other  Intangible  Assets"  ("Statement  142")
requires goodwill to be tested for impairment, on at least an annual basis (each
October 1), and be written down when impaired, rather than amortized as previous
standards required. Furthermore,  Statement 142 requires identifiable intangible
assets other than goodwill to be amortized  over their useful lives unless these
lives are  determined  to be  indefinite.  Changes  in  strategy  and/or  market
conditions may result in adjustments to recorded  intangible asset balances.  As
of June 30, 2006, no  indicators  of impairment of our goodwill or  identifiable
intangible  assets  resulted from our  impairment  review which was performed in
accordance  with the  provisions  of Statement  142 and FASB  Statement No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets".

<PAGE>

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

We have not used any material derivative financial  instruments during the three
and six months ended June 30, 2006 and 2005, including trading or speculation on
changes  in  interest  rates,  or  commodity  prices  of  materials  used in our
business.

We are exposed to market risk for changes in interest rates for borrowings under
the Revolving Credit  Facility.  Borrowings under that facility bear interest at
variable rates,  and the fair value of borrowings are not affected by changes in
market interest rates. As of June 30, 2006, there were no borrowings outstanding
under the facility. Had there been borrowings, they would bear interest at (1) a
rate which is the prime commercial lending rate announced by Harris Nesbitt from
time to time (8.25% at June 30, 2006) plus 0% to 1.0% based on certain financial
tests or (2) United  States  dollar  LIBOR (at June 30, 2006 the rate was 5.33%)
plus 1.5% to 2.5% based on certain financial tests. Letter of credit fees issued
under this facility range from 0.50% to 2.25% of the respective  face amounts of
the  letters  of credit  issued and are  charged  based on the type of letter of
credit issued and certain financial tests. The Revolving Credit Facility expires
in  October  2010.  There  is no  guarantee  that we will be able to  renew  the
facility at its expiration.

We are also exposed to market risk and its potential  related impact on accounts
receivable or costs and estimated  earnings in excess of billings on uncompleted
contracts.  The amounts  recorded may be at risk if customers'  abilities to pay
these obligations are negatively impacted by economic conditions. We continually
monitor the  creditworthiness of our customers and maintain on-going discussions
with  customers  regarding  contract  status with  respect to change  orders and
billing terms. Therefore, we believe we take appropriate action to manage market
and other risks,  but there is no assurance  that we will be able to  reasonably
identify all risks with respect to collectibility of these assets.  See also the
previous  discussion of Accounts  Receivable under the heading,  "Application of
Critical  Accounting  Policies" in the  Management's  Discussion and Analysis of
Results of Operations and Financial Condition.

Amounts  invested in our foreign  operations are translated into U.S. dollars at
exchange  rates in effect at the end of the period.  The  resulting  translation
adjustments are recorded as accumulated  other  comprehensive  income (loss),  a
component of stockholders' equity, in the condensed consolidated balance sheets.
We believe the exposure to the effects that fluctuating  foreign  currencies may
have on the  consolidated  results of operations is limited  because the foreign
operations   primarily  invoice  customers  and  collect  obligations  in  their
respective  local  currencies.  Additionally,  expenses  associated  with  these
transactions  are  generally  contracted  and  paid  for  in  their  same  local
currencies.

In addition,  we are exposed to market risk of fluctuations in certain commodity
prices of materials such as copper and steel  utilized in both our  construction
and facilities services  operations.  We are also exposed to increases in energy
prices,  particularly  as they relate to  gasoline  prices for our fleet of over
5,000  vehicles.  While we believe we can increase our prices to adjust for some
price increases in  commodities,  there can be no assurance that continued price
increases of commodities, if they were to occur, would be recoverable.

ITEM 4. CONTROLS AND PROCEDURES.

Based on an evaluation of our disclosure controls and procedures (as required by
Rule  13a-15(b) of the  Securities  Exchange  Act of 1934),  our Chairman of the
Board  and our  Chief  Executive  Officer,  Frank  T.  MacInnis,  and our  Chief
Financial  Officer,  Mark A. Pompa, have concluded that our disclosure  controls
and procedures  (as defined in Rule 13a-15(e) of the Securities  Exchange Act of
1934) are effective as of the end of the period covered by this report.

There have not been any changes in our internal control over financial reporting
(as such term is defined in Rules 13a-15(f) and 15(d)-15(f) under the Securities
Exchange  Act of 1934) during the fiscal  quarter  ended June 30, 2006 that have
materially affected,  or are reasonably likely to materially affect our internal
control over financial reporting.

<PAGE>

PART II. - OTHER INFORMATION.

ITEM 1. LEGAL PROCEEDINGS.

Except as indicated below, there have been no new material  developments  during
the quarter  ended June 30, 2006  regarding  legal  proceedings  reported in our
Annual Report on Form 10-K for the year ended  December 31, 2005 (the "2005 Form
10-K") or in our Form 10-Q for the quarter ended March 31, 2006.

We  reported  in our 2005  Form  10-K  that as a result  of a jury  verdict  and
subsequent  ruling  by the  trial  judge in a civil  action  brought  by a joint
venture  (the "JV")  between  our  subsidiary  Poole & Kent  Corporation  and an
unrelated company in the Fairfax,  Virginia Circuit Court in which the JV sought
damages  from the  Upper  Occoquan  Sewage  Authority  ("UOSA")  resulting  from
material  breaches of a  construction  contract  between the JV and UOSA, it was
determined  that the JV is entitled to be paid  approximately  $17.0  million by
UOSA in addition to the amounts already received from UOSA. Both the JV and UOSA
filed  petitions  for an  appeal  of the  decision  with  the  Supreme  Court of
Virginia.  The Supreme Court has denied the appeals of both parties,  as well as
subsequent petitions by both parties requesting the Supreme Court of Virginia to
reconsider  its denial of the  appeals.  The JV has asserted  additional  claims
against UOSA relating to the same project which are also pending in the Fairfax,
Virginia  Circuit  Court and which could result in another  trial between the JV
and UOSA to be held at a date not yet  determined and in which the JV would seek
damages in excess of $18.0 million.


ITEM 1A. RISK FACTORS.

There have been no material changes from the risk factors  previously  disclosed
in our 2005 Form 10-K.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

(a)  The annual meeting of stockholders of EMCOR (the "Annual Meeting") was held
     on June 15, 2006.

(b)  The Board of Directors of EMCOR consists of seven  individuals each of whom
     was nominated at the Annual Meeting for  re-election as a director of EMCOR
     for the ensuing year. Each director was re-elected.

(c)  Set forth  below  are the  names of each  director  elected  at the  Annual
     Meeting,  the number of shares voted for his  re-election and the number of
     votes withheld from his  re-election.  421,609 shares abstained from voting
     for directors. There were no broker non-votes.

Name                                 Votes For                    Votes Withheld
-------------------------------------------------------------------------------

Stephen W. Bershad                   28,286,016                       506,357
David A. B. Brown                    27,505,088                     1,287,285
Larry J. Bump                        28,546,221                       246,152
Albert Fried, Jr.                    28,285,113                       507,260
Richard F. Hamm, Jr.                 28,645,836                       146,737
Frank T. MacInnis                    28,247,939                       544,434
Michael T. Yonker                    28,542,347                       250,026


In  addition,  at the Annual  Meeting,  stockholders  voted  upon a proposal  to
approve  adoption by the Board of Directors of an amendment  (the  "Amendment"),
described in the proxy statement for the Annual  Meeting,  to the Company's 2005
Management Stock Incentive Plan,  26,564,742  shares voted in favor of approval,
1,746,248  voted against  approval,  and 481,383  shares  abstained  from voting
thereon. There were no broker non-votes.

At the Annual Meeting, the stockholders also voted upon a proposal to ratify the
appointment by the Audit  Committee of the Company's Board of Directors of Ernst
& Young LLP,  independent  auditors,  as EMCOR's independent  auditors for 2006;
28,775,358  shares voted in favor of  ratification,  14,738 shares voted against
ratification  and 2,279  shares  abstained  from voting  thereon.  There were no
broker non-votes.

<PAGE>
ITEM 6.  EXHIBITS.
<TABLE>
<CAPTION>

Exhibit                                                                     Incorporated By Reference to or
   No.         Description                                                           Page Number
-----------    --------------------------------------------------------     -------------------------------------------
<S>            <C>                                                          <C>
2(a)           Disclosure Statement and Third Amended Joint Plan of         Exhibit 2(a) to EMCOR's
               Reorganization (the "Plan of Reorganization") proposed       Registration Statement on Form 10 as
               by EMCOR Group, Inc. (formerly JWP INC.) (the  "Company"     Originally filed March 17, 1995 ("Form 10")
               or "EMCOR") and its subsidiary SellCo Corporation
               ("SellCo"), as approved for dissemination by the
               United States Bankruptcy Court, Southern District of
               New York (the "Bankruptcy Court"), on August 22, 1994.

2(b)           Modification to the Plan of Reorganization dated             Exhibit 2(b) to Form 10
               September 29, 1994

2(c)           Second Modification to the Plan of Reorganization            Exhibit 2(c) to Form 10
               dated September 30, 1994

2(d)           Confirmation Order of the Bankruptcy Court dated             Exhibit 2(d) to Form 10
               September 30, 1994 (the "Confirmation Order")
               confirming the Plan of Reorganization, as amended

2(e)           Amendment to the Confirmation Order dated December 8,        Exhibit 2(e) to Form 10
               1994

2(f)           Post-confirmation modification to the Plan of                Exhibit 2(f) to Form 10
               Reorganization entered on December 13, 1994

2(g)           Purchase Agreement dated as of February 11, 2002 by          Exhibit 2.1 to EMCOR's Report on Form
               and among Comfort Systems USA, Inc. and EMCOR-CSI            8-K dated February 14, 2002
               Holding Co.

3(a-1)         Restated Certificate of Incorporation of EMCOR filed         Exhibit 3(a-5) to Form 10
               December 15, 1994

3(a-2)         Amendment dated November 28, 1995 to the Restated            Exhibit 3(a-2)to EMCOR's Annual Report on
               Certificate of Incorporation of EMCOR                        Form 10-K for the year ended December
                                                                            31, 1995 ("1995 Form 10-K")

3(a-3)         Amendment dated February 12, 1998 to the Restated            Exhibit 3(a-3) to EMCOR's Annual Report
               Certificate of Incorporation                                 on Form 10-K for the year ended December
                                                                            31, 1997 ("1997 Form 10-K")

3(a-4)         Amendment dated January 27, 2006 to the Restated             Exhibit 3(a-4) to EMCOR's Annual Report
               Certificate of Incorporation                                 on Form 10-K for the year ended December
                                                                            31, 2005 ( "2005 Form 10-K")

3(b)           Amended and Restated By-Laws                                 Exhibit 3(b) to EMCOR's Annual Report on
                                                                            Form 10-K for the year ended December 31,
                                                                            1998 ("1998 Form 10-K")

3(c)           Rights Agreement dated March 3, 1997 between EMCOR and       Exhibit 1 to EMCOR's Report on Form 8-K
               Bank of New York                                             dated March 3, 1997

4(a)           U.S. $375,000,000 Credit Agreement dated October 14,         Exhibit 4 to EMCOR's Report on Form 8-K
               2005 by and among EMCOR Group, Inc. and certain of its       (Date of Report October 17, 2005)
               subsidiaries and Harris N.A. individually and as Agent
               for the Lenders which are or became parties thereto
               (the "Credit Agreement")

4(b)           Assignment and Acceptance dated October 14, 2005             Exhibit 4(b) to 2005 Form 10-K
               between Harris Nesbitt Financing, Inc. ("HNF") as
               assignor, and Bank of Montreal, as assignee of 100%
               interest of HNF in the Credit Agreement to Bank of
               Montreal
</TABLE>

<PAGE>

ITEM 6.  EXHIBITS. - (continued)
<TABLE>
<CAPTION>

Exhibit                                                                     Incorporated By Reference to or
   No.         Description                                                           Page Number
-----------    --------------------------------------------------------     --------------------------------------
<S>            <C>                                                          <C>
4(c)           Commitment Amount Increase Request dated November 21,        Exhibit 4(c) to 2005 Form 10-K
               2005 between EMCOR and the Northern Trust Company
               effective November 29, 2005 pursuant to Section 1.10
               of the Credit Agreement

4(d)           Commitment Amount Increase Request dated November 21,        Exhibit 4(d) to 2005 Form 10-K
               2005 between EMCOR and Bank of Montreal effective
               November 29, 2005 pursuant to Section 1.10 of the
               Credit Agreement

4(e)           Commitment Amount Increase Request dated November 21,        Exhibit 4(e) to 2005 Form 10-K
               2005 between EMCOR and National City Bank of Indiana
               effective November 29, 2005 pursuant to Section 1.10
               of the Credit Agreement

4(f)           Assignment and Acceptance dated November 29, 2005            Exhibit 4(f) to 2005 Form 10-K
               between Bank of Montreal, as assignee, and Fifth Third
               Bank, as assignee, of 30% interest of Bank of Montreal
               in the Credit Agreement to Fifth Third Bank

4(g)           Assignment and Acceptance dated November 29, 2005            Exhibit 4(g) to 2005 Form 10-K
               between Bank of Montreal, as assignee, and Northern
               Trust Company, as assignee, of 20% interest of Bank of
               Montreal in the Credit Agreement to Bank of Montreal

10(a)          Severance Agreement between EMCOR and Frank T. MacInnis      Exhibit 10.2 to EMCOR's Report on
                                                                            Form 8-K (Date of Report April 25,
                                                                            2005)("April 2005 Form 8-K")


10(b)          Form of Severance Agreement between EMCOR and each of        Exhibit 10.1 to the April 2005 Form
               Sheldon I. Cammaker, Leicle E. Chesser, R. Kevin Matz        8-K
               and Mark A. Pompa

10(c)          Letter Agreement dated October 12, 2004 between              Exhibit 10.1 to EMCOR's Report on
               Anthony Guzzi and EMCOR (the "Guzzi Letter Agreement")       Form 8-K (Date of Report October 12,
                                                                            2004)

10(d)          Form of Confidentiality Agreement                            Exhibit C to Guzzi Letter Agreement

10(e)          Form of Indemnification Agreement between EMCOR and          Exhibit F to Guzzi Letter Agreement
               each of its officers and directors

10(f)          Severance Agreement dated October 25, 2005 between           Exhibit D to the Guzzi Letter
               Anthony Guzzi and EMCOR                                      Agreement

10(g-1)        1994 Management Stock Option Plan ("1994 Option Plan")       Exhibit 10(o) to Form 10

10(g-2)        Amendment to Section 12 of the 1994 Option Plan              Exhibit (g-2) to EMCOR's Annual
                                                                            Report on Form 10-K for the year ended
                                                                            December 31, 2001 ("2001 Form 10-K")

10(g-3)        Amendment to Section 13 of the 1994 Option Plan              Exhibit (g-3) to 2001 Form 10-K

10(h-1)        1995 Non-Employee Directors' Non-Qualified Stock             Exhibit 10(p) to 2001 Form 10-K
               Option Plan ("1995 Option Plan")

10(h-2)        Amendment to Section 10 of the 1995 Option Plan              Exhibit (h-2) to 2001 Form 10-K
</TABLE>

<PAGE>

ITEM 6.  EXHIBITS. - (continued)
<TABLE>
<CAPTION>

Exhibit                                                                     Incorporated By Reference to or
   No.         Description                                                           Page Number
-----------    -------------------------------------------------------      -----------------------------------------
<S>            <C>                                                          <C>
10(i-1)        1997 Non-Employee Directors' Non-Qualified Stock             Exhibit 10(k) to EMCOR's Annual Report on
               Option Plan ("1997 Option Plan")                             Form 10-K for the year ended December 31,
                                                                            1999 ("1999 Form 10-K")

10(i-2)        Amendment to Section 9 of the 1997 Option Plan               Exhibit 10(i-2) to 2001 Form 10-K

10(j)          1997 Stock Plan for Directors                                Exhibit 10(l) to 1999 Form 10-K

10(k-1)        Continuity Agreement dated as of June 22, 1998               Exhibit 10(a) to EMCOR's Quarterly
               between Frank T. MacInnis and EMCOR ("MacInnis               Report on Form 10-Q for the quarter
               Continuity Agreement")                                       ended June 30, 1998 ("June 1998 Form
                                                                            10-Q")

10(k-2)        Amendment dated as of May 4, 1999 to MacInnis                Exhibit 10(h) for the quarter ended
               Continuity Agreement                                         June 30, 1999 (June 1999 Form 10-Q)

10(l-1)        Continuity Agreement dated as of June 22, 1998 between       Exhibit 10(c) to the June 1998 Form 10-Q
               Sheldon I. Cammaker and EMCOR ("Cammaker Continuity
               Agreement")

10(l-2)        Amendment dated as of May 4, 1999 to Cammaker                Exhibit 10(i) to the June 1999 Form 10-Q
               Continuity Agreement

10(m-1)        Continuity Agreement dated as of June 22, 1998 between       Exhibit 10(d) to the June 1998 Form 10-Q
               Leicle E. Chesser and EMCOR ("Chesser Continuity
               Agreement")

10(m-2)        Amendment dated as of May 4, 1999 to Chesser                 Exhibit 10(j) to the June 1999 Form 10-Q
               Continuity Agreement

10(n-1)        Continuity Agreement dated as of June 22, 1998 between       Exhibit 10(f) to the June 1998 Form 10-Q
               R. Kevin Matz and EMCOR ("Matz Continuity Agreement")

10(n-2)        Amendment dated as of May 4, 1999 to Matz Continuity         Exhibit 10(m) to the June 1999 Form 10-Q
               Agreement

10(n-3)        Amendment dated as of January 1, 2002 to Matz                Exhibit 10(o-3) to Form 10-Q for the
               Continuity Agreement                                         quarter ended March 31, 2002 ("March
                                                                            2002 10-Q")

10(o-1)        Continuity Agreement dated as of June 22, 1998 between       Exhibit 10(g) to the June 1998 Form 10-Q
               Mark A. Pompa and EMCOR ("Pompa Continuity Agreement")

10(o-2)        Amendment dated as of May 4, 1999 to Pompa Continuity        Exhibit 10(n) to the June 1999 Form 10-Q
               Agreement

10(o-3)        Amendment dated as of January 1, 2002 to Pompa               Exhibit 10(p-3) to the March 2002 10-Q
               Continuity Agreement

10(p)          Change of Control Agreement dated as of October 25,          Exhibit E to Guzzi Letter Agreement
               2004 between Anthony Guzzi ("Guzzi") and EMCOR

10(q)          Release and Settlement Agreement dated December 22,          Exhibit 10(q) to 1999 Form 10-K
               1999 between Thomas D. Cunningham and EMCOR

10(r)          Separation Agreement and Mutual release dated April 3,       Exhibit 10.1 to EMCOR's Report on Form
               2006 between Leicle E. Chesser and EMCOR                     8-K (Date of Report April 4, 2006)
</TABLE>

<PAGE>

ITEM 6.  EXHIBITS. - (continued)
<TABLE>
<CAPTION>

Exhibit                                                                     Incorporated By Reference to or
   No.          Description                                                          Page Number
------------    -------------------------------------------------------     --------------------------------------
<S>             <C>                                                         <C>
10(s-1)         Executive Stock Bonus Plan, as amended (the "Stock          Exhibit 4.1 to EMCOR's Registration
                Bonus Plan")                                                Statement on Form S-8 (No.
                                                                            333-112940 filed with the Securities
                                                                            and Exchange Commission on February
                                                                            18, 2004 (the "2004 Form S-8")

10(s-2)         Form of Certificate Representing Restrictive Stock          Exhibit 10.1 to EMCOR's Report on
                Units ("RSU's") issued under the Stock Bonus Plan           Form 8-K (Date of Report March 4,
                Manditorily Awarded                                         2005) ("March 4, 2005 Form 8-K")

10(s-3)         Form of Certificate Representing RSU's issued under         Exhibit 10.2 to March 4, 2005 Form
                the Stock Bonus Plan Voluntarily Awarded                    8-K

10(t)           Incentive Plan for Senior Executive Officers of EMCOR       Exhibit 10.3 to March 4, 2005 Form
                Group, Inc. ("Incentive Plan for Senior Executives")        8-K

10(u)           First Amendment to Incentive Plan for Senior                Exhibit 10(t) to 2005 Form 10-K
                Executives

10(v)           EMCOR Group, Inc. Long-Term Incentive Plan                  Exhibit 10 to Form 8-K (Date of
                                                                            Report December 15, 2005)

10(w)           2003 Non-Employee Directors' Stock Option                   Exhibit A to EMCOR's  proxy
                                                                            statement ("2003 Proxy Statement")
                                                                            Plan for its annual meeting held
                                                                            June 12, 2003

10(x-1)         2003 Management Stock Incentive Plan                        Exhibit B to EMCOR's 2003 Proxy
                                                                            Statement

10(x-2)         Amendments to 2003 Management Stock Incentive Plan          Exhibit 10(t-2) to EMCOR's Annual
                                                                            Report on Form 10-K for the year
                                                                            ended December 31, 2003 ("2003 Form
                                                                            10-K")

10(y)           Form of Stock Option Agreement evidencing grant of          Exhibit 10.1 to Form 8-K (Date of
                stock options under the 2003 Management Stock               Report January 5, 2005)
                Incentive Plan

10(z)           Key Executive Incentive Bonus Plan                          Exhibit B to EMCOR's Proxy Statement
                                                                            for its annual meeting held June 16,
                                                                            2005 ("2005 Proxy Statement")

10(a)(a)        2005 Management Stock Incentive Plan                        Exhibit C to EMCOR's 2003 Proxy
                                                                            Statement

10(b)(b)        Amendment to 2005 Management Stock Incentive Plan           Exhibit B to EMCOR's Proxy Statement
                                                                            for its annual meeting held June 15,
                                                                            2006

10(c)(c)        2005 Stock Plan for Directors                               Exhibit C to 2005 Proxy Statement

10(d)(d)        Option Agreement between EMCOR and Frank T. MacInnis        Exhibit 4.4 to 2004 Form S-8
                dated May 5, 1999

10(e)(e)        Form of EMCOR Option Agreement for Messrs. Frank T.         Exhibit 4.5 to 2004 Form S-8
                MacInnis, Jeffrey M. Levy, Sheldon I. Cammaker,
                Leicle E. Chesser, R. Kevin Matz and Mark A. Pompa
                (collectively the "Executive Officers") for options
                granted January 4, 1999, January 3, 2000 and January
                2, 2001

10(f)(f)        Form of EMCOR Option Agreement for Executive Officers       Exhibit 4.6 to 2004 Form S-8
                granted December 14, 2001
</TABLE>

<PAGE>

ITEM 6.  EXHIBITS. - (continued)
<TABLE>
<CAPTION>

Exhibit                                                                     Incorporated By Reference to or
   No.          Description                                                          Page Number
------------    -------------------------------------------------------     --------------------------------------
<S>             <C>                                                         <C>
10(g)(g)        Form of EMCOR Option Agreement for Executive Officers       Exhibit 4.7 to 2004 Form S-8
                granted January 2, 2002, January 2, 2003 and January
                2, 2004

10(h)(h)        Form of EMCOR Option Agreement for Directors granted        Exhibit 4.8 to 2004 Form S-8
                June 19, 2002, October 25, 2002 and February 27, 2003

10(i)(i)       Form of EMCOR Option Agreement for Executive Officers       Exhibit 10(g)(g) to 2005 Form 10-K
                and Guzzi dated January 3, 2005

10(j)(j)        Release and Settlement Agreement dated February 25,         Exhibit 10(a)(a) to EMCOR's Annual
                2004 between Jeffrey M. Levy and EMCOR                      Report on Form 10-K for the year
                                                                            ended December 31, 2004 ("2004 Form
                                                                            10-K")

10(k)(k)        Form of letter agreement between EMCOR and each             Exhibit 10(b)(b) to 2004 Form 10-K
                Executive Officer with respect to acceleration of
                options granted January 2, 2003 and January 2, 2004

11              Computation of Basic EPS and Diluted EPS for the            Note C of the Notes to the Condensed
                three and six months ended June 30, 2006 and 2005           Consolidated Financial Statements

31.1            Certification Pursuant to Section 302 of the                Page ___
                Sarbanes-Oxley Act of 2002 by the Chairman of the
                Board of Directors and Chief Executive Officer *

31.2            Certification Pursuant to Section 302 of the                Page ___
                Sarbanes-Oxley Act of 2002 by the Executive Vice
                President, Chief Financial Officer and Treasurer *

32.1            Certification Pursuant to 18 U.S.C. Section 1350, as        Page ___
                adopted pursuant to Section 906 of the Sarbanes-Oxley
                Act of 2002 by the Chairman of the Board of Directors
                and Chief Executive Officer **


32.2            Certification Pursuant to 18 U.S.C. Section 1350, as        Page ___
                adopted pursuant to Section 906 of the Sarbanes-Oxley
                Act of 2002 by the Executive Vice President,  Chief
                Financial Officer and Treasurer **
</TABLE>

--------------
*    Filed Herewith
**   Furnished Herewith



<PAGE>

                                   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.


Date: July 27, 2006
                                             EMCOR GROUP, INC.
                              -------------------------------------------------
                                                (Registrant)


                                            /s/FRANK T. MACINNIS
                              -------------------------------------------------
                                             Frank T. MacInnis
                                          Chairman of the Board of
                                               Directors and
                                            Chief Executive Officer



                                              /s/MARK A. POMPA
                              -------------------------------------------------
                                               Mark A. Pompa
                                         Executive Vice President,
                                 Chief Financial Officer and Treasurer
                                (Principal Financial and Accounting Officer)

<PAGE>

                                                                   Exhibit 31.1



                                  CERTIFICATION

I, Frank T. MacInnis, Chairman of the Board and Chief Executive Officer of EMCOR
Group, Inc., certify that:

1.   I have reviewed this quarterly report on Form 10-Q of EMCOR Group, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material  fact or omit to state a  material  fact  necessary  to make the
     statements made, in light of the circumstances  under which such statements
     were made,  not  misleading  with  respect  to the  period  covered by this
     report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in  this  report,  fairly  present  in all  material
     respects the financial  condition,  results of operations and cash flows of
     the registrant as of, and for, the periods presented in this report;

4.   The  registrant's  other  certifying  officer(s) and I are  responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-15(e) and 15d-15(e)),  and internal  control over
     financial  reporting  (as  defined  in  Exchange  Act Rules  13a-15(f)  and
     15(d)-15(f)) for the registrant and have:

     a)   Designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;

     b)   Designed such internal  control over  financial  reporting,  or caused
          such internal  control over  financial  reporting to be designed under
          our  supervision,   to  provide  reasonable  assurance  regarding  the
          reliability  of financial  reporting and the  preparation of financial
          statements for external purposes in accordance with generally accepted
          accounting principles;

     c)   Evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluation; and

     d)   Disclosed  in this  report  any  change in the  registrant's  internal
          control over financial reporting that occurred during the registrant's
          most  recent  fiscal  quarter  that  has  materially  affected,  or is
          reasonably  likely to materially  affect,  the  registrant's  internal
          control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed, based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors (or persons performing the equivalent functions):

     a)   All significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  registrant's  ability to
          record, process, summarize and report financial information; and

<PAGE>

     b)   Any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          control over financial reporting.

Date:  July 27, 2006
                                                     /s/FRANK T. MACINNIS
                                             ----------------------------------
                                                        Frank T. MacInnis
                                                     Chairman of the Board of
                                                         Directors and
                                                     Chief Executive Officer


<PAGE>
                                                                   Exhibit 31.2

                                  CERTIFICATION

I,  Mark A.  Pompa,  Executive  Vice  President,  Chief  Financial  Officer  and
Treasurer of EMCOR Group, Inc., certify that:

1.   I have reviewed this quarterly report on Form 10-Q of EMCOR Group, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material  fact or omit to state a  material  fact  necessary  to make the
     statements made, in light of the circumstances  under which such statements
     were made,  not  misleading  with  respect  to the  period  covered by this
     report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in  this  report,  fairly  present  in all  material
     respects the financial  condition,  results of operations and cash flows of
     the registrant as of, and for, the periods presented in this report;

4.   The  registrant's  other  certifying  officer(s) and I are  responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-15(e) and 15d-15(e)),  and internal  control over
     financial  reporting  (as  defined  in  Exchange  Act Rules  13a-15(f)  and
     15(d)-15(f)) for the registrant and have:

     a)   Designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;

     b)   Designed such internal  control over  financial  reporting,  or caused
          such internal  control over  financial  reporting to be designed under
          our  supervision,   to  provide  reasonable  assurance  regarding  the
          reliability  of financial  reporting and the  preparation of financial
          statements for external purposes in accordance with generally accepted
          accounting principles;

     c)   Evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluation; and

     d)   Disclosed  in this  report  any  change in the  registrant's  internal
          control over financial reporting that occurred during the registrant's
          most  recent  fiscal  quarter  that  has  materially  affected,  or is
          reasonably  likely to materially  affect,  the  registrant's  internal
          control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed, based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors (or persons performing the equivalent functions):

     a)   All significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  registrant's  ability to
          record, process, summarize and report financial information; and

<PAGE>

     b)   Any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          control over financial reporting.

Date:  July 27, 2006
                                                 /s/MARK A. POMPA
                                    --------------------------------------------
                                                    Mark A. Pompa
                                              Executive Vice President,
                                       Chief Financial Officer and Treasurer



<PAGE>
                                                                   Exhibit 32.1



                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


     In  connection  with  the  Quarterly  Report  of  EMCOR  Group,  Inc.  (the
"Company")  on Form 10-Q for the period  ended  June 30,  2006 as filed with the
Securities and Exchange  Commission on the date hereof (the "Report"),  I, Frank
T. MacInnis,  Chief Executive  Officer of the Company,  certify,  pursuant to 18
U.S.C.  Section 1350, as adopted  pursuant to Section 906 of the  Sarbanes-Oxley
Act of 2002, that:

1.   The Report fully complies with the  requirements  of Section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

2.   The information  contained in the Report fairly  presents,  in all material
     respects, the financial condition and results of operations of the Company.



Date:    July 27, 2006                            /s/FRANK T. MACINNIS
                                            -----------------------------------
                                                     Frank T. MacInnis
                                                  Chief Executive Officer
<PAGE>
                                                                   Exhibit 32.2




                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


     In  connection  with  the  Quarterly  Report  of  EMCOR  Group,  Inc.  (the
"Company")  on Form 10-Q for the period  ended  June 30,  2006 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, Mark A.
Pompa,  Chief Financial Officer of the Company,  certify,  pursuant to 18 U.S.C.
Section 1350, as adopted  pursuant to Section 906 of the  Sarbanes-Oxley  Act of
2002, that:

1.   The Report fully complies with the  requirements  of Section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

2.   The information  contained in the Report fairly  presents,  in all material
     respects, the financial condition and results of operations of the Company.



Date:    July 27, 2006                              /s/MARK A. POMPA
                                              ----------------------------------
                                                       Mark A. Pompa
                                                  Chief Financial Officer
</TEXT>
</DOCUMENT>
