NEWS RELEASE
	Skyline Corporation
	2520 By-Pass Road
	P.O. Box 743
	Elkhart, Indiana 46515-0743
	(574) 294-6521
Subject: SECOND QUARTER REPORT	Approved by:     JAMES R. WEIGAND

ELKHART, INDIANA -— JANUARY 5, 2007

SKYLINE REPORTS RESULTS FOR SECOND QUARTER AND FIRST HALF

          Skyline Corporation’s net earnings for the second quarter of its fiscal 2007 year were $625,000 compared to $4,505,000 for the second quarter of fiscal 2006. On a per share basis, net earnings for the quarter which ended November 30, 2006 were $.07 versus $0.54 for a year ago.

          For the first half of fiscal 2007, net earnings were $2,521,000 compared to $6,849,000 for a year ago. Net earnings per share for the first half of fiscal 2007 were $.30 versus $0.82 for the first half of fiscal 2006. Net earnings per share for the first half of fiscal 2006 included a gain on the sale of vacant land of $0.03.

          Sales for Skyline’s fiscal 2007 second quarter were $94,786,000 compared to $136,487,000 for the second quarter of fiscal 2006. For the first six months of fiscal 2007, sales were $210,592,000 versus $254,833,000 for fiscal 2006.

          For Skyline’s manufactured housing group, sales for the second quarter of fiscal 2007 were $72,618,000 compared to $103,371,000 for the second quarter of fiscal 2006. For the first six months of fiscal 2007, sales by the manufactured housing group were $157,101,000 versus the $195,807,000 recorded for the first six months of fiscal 2006.

          For the recreational vehicle (RV) group, sales amounted to $22,168,000 for fiscal 2007’s second quarter compared to $33,116,000 for the second quarter of fiscal 2006. For the first six months of fiscal 2007, sales by the RV group were $53,491,000 versus $59,026,000 for the same period a year ago.

          As Skyline begins its third quarter, historically the slowest period in its fiscal year, the corporation continues to maintain its traditionally strong balance sheet with no long-term debt and a healthy position in cash and temporary cash investments. This financial strength, along with a seasoned management team, should help the corporation meet the challenges ahead.

**************

Bringing America Home. Bringing America Fun.

SKYLINE CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF EARNINGS

(Dollars in thousands except per share)

	Three Months Ended				Six Months Ended
	November 30,				November 30,
	(Unaudited)				(Unaudited)
	2006		2005		2006		2005
Sales	$	94,786	$	136,487	$	210,592	$	254,833
Earnings before income taxes		1,006		7,401		4,052		11,122
Provision for income taxes		381		2,896		1,531		4,273
Net earnings	$	625	$	4,505	$	2,521	$	6,849
Basic earnings per share	$	.07	$	.54	$	.30	$	.82	(A)
Number of weighted average common shares outstanding		8,391,244		8,391,244		8,391,244		8,391,244

(A) Includes an after-tax gain on sale of vacant land of $.03 per share.

SKYLINE CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

	November 30, (Unaudited)
	2006			2005
ASSETS
Cash and temporary investments	$	134,658		$	155,057
Accounts receivable		18,938			28,590
Inventories		11,966			10,981
Other current assets		10,281			8,285
Total Current Assets		175,843			202,913
Property, Plant and Equipment, net		35,234			34,438
Other Assets		10,268			9,642
	$	221,345		$	246,993
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts payable, trade	$	3,494		$	10,334
Accrued liabilities		26,678			31,187
Income taxes payable		—			1,539
Total Current Liabilities		30,172			43,060
Other Deferred Liabilities		10,702			10,601
Common stock		312			312
Additional paid-in capital		4,928			4,928
Retained earnings		240,975			253,836
Treasury stock, at cost, 2,825,900 shares in 2006 and 2005		(65,744	)		(65,744	)
Total Shareholders’ Equity		180,471			193,332
	$	221,345		$	246,993