##### Table of Contents



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
    1934For the quarterly period ended
    June 30, 2007o

Transition Report Pursuant to
    Section 13 or 15(d) of the Securities Exchange Act of
    1934For the transition period from
    to    Commission file number 0-14836
     METAL MANAGEMENT,
    INC.
 (Exact Name of Registrant as
    Specified in Its Charter)
     Delaware

94-2835068(State or Other Jurisdiction of
    Incorporation or Organization)

(I.R.S. Employer Identification No.)325 N. LaSalle
    Street, Suite 550, Chicago, IL

60610(Address of Principal Executive
    Offices)

(Zip Code)   (312) 645-0700
      x o
   Rule 12b-2
   Large
    accelerated filer x
    Accelerated
    filer o
    Non-accelerated
    filer o   Rule 12b-2 o x




---



##### 



INDEX
   
 PagePART I:
    FINANCIAL INFORMATIONItem 1.


Financial StatementsConsolidated
    Statements of Operations  three months ended
    June 30, 2007 and 
    2006 (unaudited)


1Consolidated
    Balance Sheets  June 30, 2007 and March 31,
    2007 (unaudited)


2Consolidated
    Statements of Cash Flows  three months ended
    June 30, 2007 and 
    2006 (unaudited)


3Consolidated
    Statement of Stockholders Equity  three months
    ended June 30, 
    2007 (unaudited)


4Notes to
    Consolidated Financial Statements (unaudited)


5Item 2.


Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations


17Item 3.


Quantitative and
    Qualitative Disclosures about Market Risk


24Item 4.


Controls and
    Procedures


24PART II:
    OTHER INFORMATIONItem 1.


Legal
    Proceedings


26Item 1A.


Risk
    Factors


26Item 2.


Unregistered Sales
    of Equity Securities and Use of Proceeds


26Item 6.


Exhibits


27Signatures


28Certification of Daniel W. DienstCertification of Robert C. LarrySection 1350 Certifications




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##### Table of Contents



PART I:
    FINANCIAL INFORMATION  Item 1.
    Financial
    Statements  METAL
    MANAGEMENT, INC.CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited,
    in thousands, except per share amounts)
  Three Months EndedJune 30,


June 30,2007


2006Net sales

$
654,053


$
495,912Operating expenses:Cost of sales (excluding
    depreciation)


583,878



422,921General and administrative expense


25,427



20,872Depreciation and amortization
    expense


8,270



6,847Severance and other charges


0



442Operating income


36,478



44,830Income from joint ventures


717



1,860Interest expense


(1,461
)


(322
)Interest and other income, net


119



431Gain on sale of joint venture
    interest


0



26,362Income before income taxes


35,853



73,161Provision for income taxes


13,114



28,272Net income

$
22,739


$
44,889Earnings per share:Basic

$
0.90


$
1.76Diluted

$
0.89


$
1.70Cash dividends declared per
    share

$
0.075


$
0.075Weighted average common shares
    outstanding:Basic


25,159



25,576Diluted


25,587



26,393    1




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##### Table of Contents



METAL
    MANAGEMENT, INC.CONSOLIDATED BALANCE SHEETS
 (unaudited, in thousands)
  June 30,


March 31,2007


2007ASSETSCurrent assets:Cash and cash equivalents

$
22,231


$
9,354Accounts receivable, net


232,878



227,397Inventories


245,051



191,301Deferred income taxes


5,604



5,544Prepaid expenses and other assets


11,417



12,132Total current assets


517,181



445,728Property and equipment, net


200,180



187,124Goodwill


26,865



14,766Intangible assets, net


25,917



13,267Deferred income taxes, net


10,142



10,437Investments in joint ventures


21,257



20,760Other assets


2,997



3,441Total assets

$
804,539


$
695,523LIABILITIES AND
    STOCKHOLDERS EQUITYCurrent liabilities:Current portion of long-term debt

$
725


$
46Accounts payable


175,252



177,747Income taxes payable


10,625



12,271Other accrued liabilities


26,023



35,482Total current
    liabilities


212,625



225,546Long-term debt, less current
    portion


94,381



160Other liabilities


9,381



4,987Total long-term
    liabilities


103,762



5,147Stockholders equity:Preferred stock


0



0Common stock


274



271Additional paid-in capital


204,796



201,577Accumulated other comprehensive
    loss


(1,982
)


(2,008
)Retained earnings


336,319



315,517Treasury stock, at cost


(51,255
)


(50,527
)Total stockholders
    equity


488,152



464,830Total liabilities and
    stockholders equity

$
804,539


$
695,523    2




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##### Table of Contents



METAL
    MANAGEMENT, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS
 (unaudited, in thousands)
  Three months endedJune 30,


June 30,2007


2006Cash flows from operating
    activities:Net income

$
22,739


$
44,889Adjustments to reconcile net income
    to cash flows from operating 
    activities:Depreciation and amortization


8,270



6,847Deferred income taxes


637



(58
)Income from joint ventures


(717
)


(1,831
)Gain on sale of joint venture
    interest


0



(26,362
)Distribution of earnings from joint
    ventures


30



8,522Stock-based compensation expense


1,742



1,358Excess tax benefits from
    stock-based awards


(1,007
)


(56
)Other


(54
)


906Changes in assets and liabilities,
    net of acquisitions:Accounts receivable


7,213



(46,279
)Inventories


(47,271
)


(59,677
)Other assets


1,288



(4,003
)Accounts payable


(6,025
)


25,971Income taxes payable


7,306



25,241Other liabilities


(15,162
)


(12,188
)Net cash used in operating
    activities


(21,011
)


(36,720
)Cash flows from investing
    activities:Purchases of property and equipment


(12,923
)


(26,516
)Proceeds from sale of property and
    equipment


147



119Acquisitions, net of cash acquired


(42,883
)


(28,156
)Purchases of short-term investments


0



(55,600
)Proceeds from sale of short-term
    investments


0



75,625Proceeds from sale of joint venture
    interest


0



46,005Other


120



(1,900
)Net cash provided by (used in)
    investing activities


(55,539
)


9,577Cash flows from financing
    activities:Issuances of long-term debt


245,377



10,373Repayments of long-term debt


(154,692
)


(11,217
)Issuance of common stock


400



8,117Repurchase of common stock


(728
)


0Excess tax benefits from
    stock-based awards


1,007



56Cash dividends paid to stockholders


(1,937
)


(1,978
)Fees paid to issue long-term debt


0



(608
)Net cash provided by financing
    activities


89,427



4,743Net increase (decrease) in cash and
    cash equivalents


12,877



(22,400
)Cash and cash equivalents at
    beginning of period


9,354



37,717Cash and cash equivalents at end of
    period

$
22,231


$
15,317Supplemental disclosures of cash
    flow information:Cash interest paid

$
1,052


$
198Cash income taxes paid, net of
    refunds

$
6,060


$
3,089    3




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##### Table of Contents



METAL
    MANAGEMENT, INC.CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY
 (unaudited, in thousands)
  AccumulatedAdditional


OtherCommon Stock


Treasury Stock


Paid-In


Comprehensive


RetainedShares


Amount


Shares


Amount


Capital


Loss


Earnings


TotalBalance at March 31,
    2007


27,129


$
271



(1,516
)

$
(50,527
)

$
201,577


$
(2,008
)

$
315,517


$
464,830Net income


0



0



0



0



0



0



22,739



22,739Amortization of pension costs, net
    of tax


0



0



0



0



0



26



0



26Total comprehensive income






























22,765Exercise of stock options and
    warrants


30



1



0



0



254



0



0



255Issuance of restricted stock, net
    of cancellations


214



2



0



0



(2
)


0



0



0Issuance of stock under employee
    stock purchase plan


4



0



0



0



145



0



0



145Tax benefit related to equity
    compensation


0



0



0



0



1,065



0



0



1,065Stock-based compensation expense


0



0



0



0



1,742



0



0



1,742Repurchase of common stock


0



0



(15
)


(728
)


0



0



0



(728
)Cash dividends paid to stockholders


0



0



0



0



0



0



(1,937
)


(1,937
)Other


0



0



0



0



15



0



0



15Balance at June 30,
    2007


27,377


$
274



(1,531
)

$
(51,255
)

$
204,796


$
(1,982
)

$
336,319


$
488,152    4




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##### Table of Contents



METAL
    MANAGEMENT, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 (unaudited)
  NOTE 1 
    Accounting
    Policies  Business
     Basis of
    Presentation
   Form 10-K
  Revenue
    Recognition
    5




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Three Months EndedJune 30,


June 30,2007


2006Ferrous metals

$
406,327


$
295,504Non-ferrous metals


208,911



175,647Brokerage  ferrous


33,215



15,963Brokerage  non-ferrous


1,014



3,667Other


4,586



5,131Net sales

$
654,053


$
495,912   Recently
    Issued Accounting Pronouncements
     NOTE 2 
    Investments
    in Joint Ventures      NOTE 3 
    Earnings
    Per Share   6




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Three months endedJune 30,


June 30,2007


2006Numerator:Net income

$
22,739


$
44,889Denominator:Weighted average common shares
    outstanding, basic


25,159



25,576Incremental common shares
    attributable to dilutive stock options


180



521Incremental common shares
    attributable to unvested restricted stock


248



296Weighted average common shares
    outstanding, diluted


25,587



26,393Basic income per share

$
0.90


$
1.76Diluted income per share

$
0.89


$
1.70     NOTE 4 
    Balance
    Sheet Information  Inventories
   June 30,


March 31,2007


2007Ferrous metals

$
127,025


$
108,553Non-ferrous metals


117,850



82,538Other


176



210$
245,051


$
191,301  7




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Property
    and Equipment
   June 30,


March 31,2007


2007Land and improvements

$
62,557


$
52,646Buildings and improvements


34,697



29,679Operating machinery and equipment


162,836



151,296Automobiles and trucks


17,110



15,720Furniture, office equipment and
    software


6,546



6,408Construction in progress


19,054



27,154302,800



282,903Less  accumulated
    depreciation


(102,620
)


(95,779
)$
200,180


$
187,124   Other
    Accrued Liabilities
   June 30,


March 31,2007


2007Accrued employee compensation and
    benefits

$
9,697


$
25,771Accrued insurance


6,188



5,186Other


10,138



4,525$
26,023


$
35,482   Accrued
    Severance and Other Charges
   NOTE 5 
    Acquisitions   8




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Accounts receivable

$
12,718Inventories


6,479Property and equipment


8,893Other assets


317Amortizable intangible assets


13,200Goodwill


11,987Accounts payable and accrued
    liabilities


(6,549
)Long-term debt


(4,211
)$
42,834     NOTE 6 
    Goodwill
    and Other Intangible Assets    Balance at March 31, 2007

$
14,766Purchase accounting adjustments


112Acquisitions (see Note 5)


11,987Balance at June 30, 2007

$
26,865     June 30, 2007


March 31, 2007Gross





GrossCarrying


Accumulated


Carrying


AccumulatedAmount


Amortization


Amount


AmortizationCustomer lists

$
22,592


$
(1,508
)

$
10,350


$
(804
)Non-compete agreements


5,917



(1,084
)


4,824



(1,103
)$
28,509


$
(2,592
)

$
15,174


$
(1,907
)  9




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Remainder of fiscal 2008

$
2,722Fiscal 2009


3,410Fiscal 2010


3,258Fiscal 2011


3,127Fiscal 2012


2,532Thereafter


10,868   NOTE 7 
    Long-term
    Debt    June 30,


March 31,2007


2007Credit Agreement

$
93,206


$
0Other debt (including capital
    leases) due 2007 to 2010


1,900



20695,106



206Less  current portion
    of long-term debt


(725
)


(46
)$
94,381


$
160   Credit
    Agreement
     Other
    Debt
   NOTE 8 
    Employee
    Benefit Plans   10




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Three Months EndedJune 30,


June 30,2007


2006Service cost

$
43


$
45Interest cost


190



179Expected return on plan assets


(208
)


(199
)Amortization of prior service cost


3



0Amortization of net actuarial loss


40



52Net periodic benefit cost

$
68


$
77     Multi-Employer
    Plans
   Non-Qualified
    Deferred Compensation Plan
     97-14,
  NOTE 9 
    Income
    Taxes   11




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        NOTE 10 
    Commitments
    and Contingencies  Legal
    Proceedings
 and/or
   12




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Environmental
    and Labor Matters
          13




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  MM-Connecticut and/or
  MM-Connecticut
     14




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      MM-Aerospaces and/or and/or
  and/or
   15




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##### Table of Contents



METAL
    MANAGEMENT, INC.
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  NOTE 11 
    Stockholders
    Equity    Stock
    Repurchase Program
   Stock
    Based Compensation
      16




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##### Table of Contents



This
    Form 10-Q
    includes certain statements that may be deemed to be
    forward-looking statements within the meaning of the
    Private Securities Litigation Reform Act of 1995. Statements in
    this
    Form 10-Q
    which address activities, events or developments that Metal
    Management, Inc. (herein, Metal Management, the
    Company, we, us,
    our or other similar terms) expects or anticipates
    will or may occur in the future, including such things as future
    acquisitions (including the amount and nature thereof), business
    strategy, expansion and growth of our business and operations,
    general economic and market conditions and other such matters
    are forward-looking statements. Although we believe the
    expectations expressed in such forward-looking statements are
    based on reasonable assumptions within the bounds of our
    knowledge of our business, a number of factors could cause
    actual results to differ materially from those expressed in any
    forward-looking statements. These and other risks, uncertainties
    and other factors are discussed under Risk Factors
    appearing in our Annual Report on
    Form 10-K
    for the year ended March 31, 2007, as the same may be
    amended from time to time.
  Item 2.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Form 10-K
  Overview
    and Industry
        17




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##### Table of Contents



and/or
  Recent
    Events
     Results
    of Operations
      18




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##### Table of Contents



Consolidated
    Statement of Operations ($ in thousands:)
  Three Months Ended June 30,2007


%


2006


%Sales by commodity:Ferrous metals

$
406,327



62.1
%

$
295,504



59.6
%Non-ferrous metals


208,911



31.9



175,647



35.5Brokerage  ferrous


33,215



5.1



15,963



3.2Brokerage  non-ferrous


1,014



0.2



3,667



0.7Other


4,586



0.7



5,131



1.0Net sales


654,053



100.0
%


495,912



100.0
%Cost of sales (excluding
    depreciation)


583,878



89.3



422,921



85.2General and administrative expense


25,427



3.9



20,872



4.2Depreciation and amortization
    expense


8,270



1.2



6,847



1.4Severance and other charges


0



0.0



442



0.1Operating Income


36,478



5.6



44,830



9.1Income from joint ventures


717



0.1



1,860



0.4Interest expense


(1,461
)


0.2



(322
)


0.1Interest and other income, net


119



0.0



431



0.1Gain on sale of joint venture
    interest


0



0.0



26,362



5.3Pre-tax income


35,853



5.5



73,161



14.8Provision for income taxes


13,114



2.0



28,272



5.7Net income

$
22,739



3.5
%

$
44,889



9.1
%   Sales volume by
    commodity

2007


2006(In thousands):Ferrous metals (tons)


1,274



1,072Non-ferrous metals (lbs.)


119,601



125,621Brokerage  ferrous
    (tons)


109



83Brokerage  non-ferrous
    (lbs.)


969



1,856   Net
    Sales
   Ferrous
    Sales
    19




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##### Table of Contents



Non-ferrous
    Sales
       Brokerage
    Sales
     Other
    Sales
  20




---



##### Table of Contents



Cost
    of Sales (excluding depreciation)
     General
    and Administrative Expense
     Depreciation
    and Amortization Expense
     Severance
    and Other Charges
   Income
    from Joint Ventures
   Interest
    Expense
   Interest
    and Other Income
  21




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##### Table of Contents



Gain
    on Sale of Joint Venture Interest
   Income
    Taxes
   Net
    Income
   Liquidity
    and Capital Resources
      22




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##### Table of Contents



Cash
    Flows
   Three Months EndedJune 30,


June 30,2007


2006Net cash used in operating
    activities

$
(21,011
)

$
(36,720
)Net cash provided by (used in)
    investing activities

$
(55,539
)

$
9,577Net cash provided by financing
    activities

$
89,427


$
4,743   Operating
    Activities
   Investing
    Activities
   Financing
    Activities
   Off-Balance
    Sheet Arrangements, Contractual Obligations and Other
    Commitments
 Off-Balance
    Sheet Arrangements
   Contractual
    Obligations
   Other
    Commitments
  23




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##### Table of Contents



Critical
    Accounting Policies
     Income
    Taxes
   Recent
    Accounting Pronouncements
     Item 3.
    Quantitative
    and Qualitative Disclosures about Market Risk   24




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##### Table of Contents



Item 4.
    Controls
    and Procedures  Evaluation
    of our Disclosure Controls and Procedures.
 Rules 13a-15(e) 15d-15(e)
      CEO and
    CFO Certifications.
   Limitations
    on the Effectiveness of Controls.
  25




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##### Table of Contents



PART II:
    OTHER INFORMATION  Item 1.
    Legal
    Proceedings  and/or
       Item 1A.
    Risk
    Factors.     Item 2.
    Unregistered
    Sales of Equity Securities and Use of Proceeds  Sales of
    Unregistered Common Stock
  26




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##### Table of Contents



Issuer
    Purchases of Equity Securities
     Item 6.
    Exhibits  3
.1

Second Amended and Restated
    Certificate of Incorporation of the Company, as filed with the
    Secretary of State of the State of Delaware on June 29,
    2001 (incorporated by reference to Exhibit 3.1 of the
    Companys Annual Report on
    Form 10-K
    for the year ended March 31, 2001).3
.2

Amended and Restated By-Laws of
    the Company adopted as of April 29, 2003 (incorporated by
    reference to Exhibit 3.2 of the Companys Annual
    Report on
    Form 10-K
    for the year ended March 31, 2003).4
.1

Amended and Restated Credit
    Agreement, dated as of May 9, 2006, among Metal Management,
    Inc. and certain subsidiaries of Metal Management, Inc.
    specified therein, as borrowers, the lenders party thereto and
    LaSalle Bank National Association, in its capacity as agent for
    the lenders (incorporated by reference to Exhibit 4.1 of
    the Companys Current Report on
    Form 8-K
    dated May 9, 2006).4
.2

Amendment No. 1 to the
    Amended and Restated Credit Agreement, dated as of
    October 13, 2006, among Metal Management, Inc. and certain
    subsidiaries of Metal Management, Inc. specified therein, as
    borrowers, the lenders party thereto and LaSalle Bank National
    Association, in its capacity as agent for the lenders
    (incorporated by reference to Exhibit 4.1 of the
    Companys Current Report on
    Form 8-K
    dated October 13, 2006).4
.2

Amendment No. 2 to the
    Amended and Restated Credit Agreement, dated as of
    January 12, 2007, among Metal Management, Inc. and certain
    subsidiaries of Metal Management, Inc. specified therein, the
    lenders (incorporated by reference to Exhibit 4.1 of the
    Companys Current Report on
    Form 8-K
    dated January 12, 2007).4
.3

Amendment No. 3 to the
    Amended and Restated Credit Agreement, dated as of May 21,
    2007, among Metal Management, Inc. and certain subsidiaries of
    Metal Management, Inc. specified therein, as borrowers, the
    lenders party thereto and LaSalle Bank National Association, in
    its capacity as agent for the lenders (incorporated by reference
    to Exhibit 4.5 of the Companys Annual Report on
    Form 10-K
    for the year ended March 31, 2007).31
.1

Certification of Daniel W. Dienst
    pursuant to
    Section 240.13a-14(a)
    and
    Section 240.15d-14(a)
    of the Securities Exchange Act of 1934, as amended, as adopted
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31
.2

Certification of Robert C. Larry
    pursuant to
    Section 240.13a-14(a)
    and
    Section 240.15d-14(a)
    of the Securities Exchange Act of 1934, as amended, as adopted
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32
.1

Certification of Daniel W. Dienst
    and Robert C. Larry pursuant to 18 U.S.C.
    Section 1350, as adopted pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002.  27




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##### Table of Contents



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.



METAL MANAGEMENT, INC. By:
    /s/  Daniel
    W. Dienst  
  By:
    /s/  Robert
    C. Larry  
  By:
    /s/  Amit
    N. Patel  
   28