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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 September 30, 2007

OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934
|- | -------------------------------------------------------------------------------

For the transition period from  to

Commission file number: 333-117622





WISE METALS GROUP LLC

(Exact name of Registrant as specified in its charter)







|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                       |  | 52-2160047                          
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)

857 Elkridge Road, Suite 600

Linthicum, Maryland 21090

(Address of principal executive offices and zip
code)

(410) 636-6500

(Registrants telephone number, including area code)





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 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   ̈    No  x

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   ̈    Accelerated
filer   ̈    Non-accelerated filer  x

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









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|                              |  |                                                                                                                                |  |   
|----------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------ |  | --
|Part I. FINANCIAL INFORMATION |  |                                                                                                                               
|                              |  |                                                                                                                               
|Item 1.                       |  | Financial Statements                                                                                                           |  | 5 
|                              |  |                                                                                                                               
|                              |  | Condensed Consolidated Balance Sheets at September 30, 2007 and December 31, 2006                                              |  | 5 
|                              |  |                                                                                                                               
|                              |  | Condensed Consolidated Statements of Operations for the three and nine months ended September 30 , 2007 and September 30, 2006 |  | 6 
|                              |  |                                                                                                                               
|                              |  | Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2007 and September 30, 2006            |  | 7 
|                              |  |                                                                                                                               
|                              |  | Notes to Condensed Consolidated Financial Statements                                                                           |  | 8 
|                              |  |                                                                                                                               
|Item 2.                       |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                                          |  | 20
|                              |  |                                                                                                                               
|Item 3.                       |  | Quantitative and Qualitative Disclosures About Market Risk                                                                     |  | 24
|                              |  |                                                                                                                               
|Item 4.                       |  | Controls and Procedures                                                                                                        |  | 25
|                              | 
|Part II. OTHER INFORMATION    |  |                                                                                                                               
|                              |  |                                                                                                                               
|Item 1.                       |  | Legal Proceedings                                                                                                              |  | 26
|                              |  |                                                                                                                               
|Item 1A.                      |  | Risk Factors                                                                                                                   |  | 26
|                              |  |                                                                                                                               
|Item 2.                       |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                                    |  | 26
|                              |  |                                                                                                                               
|Item 3.                       |  | Defaults Upon Senior Securities                                                                                                |  | 26
|                              |  |                                                                                                                               
|Item 4.                       |  | Submission of Matters to a Vote of Security Holders                                                                            |  | 27
|                              |  |                                                                                                                               
|Item 5.                       |  | Other Information                                                                                                              |  | 27
|                              |  |                                                                                                                               
|Item 6.                       |  | Exhibits                                                                                                                       |  | 27
|                              | 
|SIGNATURES                    |  | 28                                                                                                                            

EXPLANATORY NOTE

On December 14, 2007, we reported that we needed to restate our consolidated financial statements to correct certain errors in accounting and financial reporting for the years ended December 31, 2006, 2005
and 2004 and our interim financial statements for the three month periods ending March 31, 2006 and 2007, the three and six month periods ending June 30, 2007 and 2006 and the three and nine month period ended September 30, 2006. The
accompanying restated financial statements for the three and nine month period ended September 30, 2006 incorporate all corrections arising from process of restating the Company's consolidated financial statements. Provided below is a summary
of the impact of such corrections and a reconciliation of the financial results from amounts previously reported to the restated financial statement amounts, as presented in this quarterly report on Form 10-Q. A more detailed explanation of the
adjustments and a detailed reconciliation of the effects that such adjustments had on the annual financial statements from 2004 through 2006, is provided in the Company's restated audited financial statements on amended Form 10-K/A for the fiscal
year ended December 31, 2006, filed on March 4, 2008.



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The restatement relates to the following adjustments for the year ended December 31, 2006 and for the three and nine
month period ended September 30, 2006:



| |  |  | To correct the Companys presentation of the LIFO reserve which improperly stated the LIFO reserve at $69.5 million as of December 31, 2006. The reserve
should have been properly stated at $73.1 million.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The Company incorrectly presented the pension asset, liability and component of other comprehensive income as a net liability within other non-current liabilities
of $0.5 million at December 31, 2006. The Company is correcting the presentation of the pension asset, liability and component of accumulated other comprehensive deficit at their gross amounts in the consolidated balance sheet as of
December 31, 2006.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The Company did not present total comprehensive loss in accordance with Statement of Financial Accounting Standards No. 130 (SFAS 130),
Reporting Comprehensive Income. The Company is restating the presentation of members equity in its consolidated balance sheet as of December 31, 2006 to comply with SFAS 130 and present accumulated other comprehensive deficit
and disclose total comprehensive loss for all periods presented. The correction has no impact on previously reported net loss.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The Company has concluded that its shipping and handling costs which have been previously reported as reductions to revenue should properly be included as cost of
sales under Emerging Issues Task Force No. 00-10 (EITF 00-10). The Company is correcting the classification of these costs to cost of goods sold for the three and nine month periods ended September 30, 2006.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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FORWARD-LOOKING STATEMENTS

Certain of the matters discussed in this report, including, without limitation, matters discussed under Item 2, Managements Discussion and Analysis of Financial Condition and Results of Operations, may constitute
forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Certain of these forward-looking statements can be identified by the use of forward-looking terminology such as
believes, expects, may, will, should, seeks, approximately, intends, plans, estimates, or anticipates or the negative
of these terms or other comparable terminology, or by discussions of strategy, plans or intention. Statements contained in this report that are not historical facts are forward-looking statements. Without limiting the generality of the preceding
statement, all statements in this report concerning or relating to estimated and projected earnings, margins, costs, expenditures, cash flows, growth rates and financial results are forward-looking statements. In addition, through the Companys
senior management, forward-looking statements are made concerning expected future operations, performance and other developments. Such forward-looking statements are necessary estimates reflecting managements best judgment based upon current
information and involve a number of risks and uncertainties. Other factors may affect the accuracy of these forward-looking statements and actual results may differ materially from the results anticipated in these forward-looking statements. While
it is impossible to identify all such factors, factors that could cause actual results to differ materially from those estimated include, but are not limited to, those factors or conditions described under Item 2, Managements
Discussion and Analysis of Financial Condition and Results of Operations.



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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Wise Metals Group LLC

Condensed Consolidated Balance Sheets

(In thousands)



|                                                                                            |  |                   |          |   |                  |   |          |  
|------------------------------------------------------------------------------------------- |  | ----------------- | -------- | - | ---------------- | - | -------- | -
|                                                                                            |  | September 30,2007 |          |   | December 31,2006 |  
|                                                                                            |  | (Unaudited)       |          |   | Restated         |  
|                                                                                            |  |                  
|Assets                                                                                      |  |                   |          |   |                  |   |          |  
|                                                                                            |  |                  
|Current assets:                                                                             |  |                   |          |   |                  |   |          |  
|Cash and cash equivalents                                                                   |  | $                 | 1,138    |   |                  | $ | 2,280    |  
|Broker deposits                                                                             |  |                   | 3,123    |   |                  |   | 7,889    |  
|Accounts receivable, less allowance for doubtful accounts ($269 in 2007 and $1,129 in 2006) |  |                   | 115,191  |   |                  |   | 104,096  |  
|Inventories                                                                                 |  |                   | 109,710  |   |                  |   | 116,902  |  
|Other current assets                                                                        |  |                   | 5,129    |   |                  |   | 9,830    |  
|                                                                                            |  |                   |          |   |                  |   |          |  
|Total current assets                                                                        |  |                   | 234,291  |   |                  |   | 240,997  |  
|Non-current assets:                                                                         |  |                   |          |   |                  |   |          |  
|Property and equipment, net                                                                 |  |                   | 86,974   |   |                  |   | 84,589   |  
|Other assets                                                                                |  |                   | 9,323    |   |                  |   | 8,724    |  
|Other intangible assets                                                                     |  |                   | 326      |   |                  |   | 326      |  
|Goodwill                                                                                    |  |                   | 283      |   |                  |   | 283      |  
|                                                                                            |  |                   |          |   |                  |   |          |  
|Total non-current assets                                                                    |  |                   | 96,906   |   |                  |   | 93,922   |  
|                                                                                            |  |                   |          |   |                  |   |          |  
|Total assets                                                                                |  | $                 | 331,197  |   |                  | $ | 334,919  |  
|                                                                                            |  |                   |          |   |                  |   |          |  
|Liabilities and members deficit                                                            |  |                   |          |   |                  |   |          |  
|                                                                                            |  |                  
|Current liabilities:                                                                        |  |                   |          |   |                  |   |          |  
|Accounts payable                                                                            |  | $                 | 97,496   |   |                  | $ | 71,131   |  
|Current portion of long-term debt                                                           |  |                   | 3,514    |   |                  |   | 1,759    |  
|Borrowings under revolving credit facility                                                  |  |                   | 169,658  |   |                  |   | 177,187  |  
|Accrued expenses, payroll and other                                                         |  |                   | 18,010   |   |                  |   | 24,838   |  
|                                                                                            |  |                   |          |   |                  |   |          |  
|Total current liabilities                                                                   |  |                   | 288,678  |   |                  |   | 274,915  |  
|Non-current liabilities:                                                                    |  |                   |          |   |                  |   |          |  
|Term loans, less current portion                                                            |  |                   | 26,081   |   |                  |   | 15,854   |  
|Senior notes                                                                                |  |                   | 150,000  |   |                  |   | 150,000  |  
|Accrued pension obligation                                                                  |  |                   | 3,101    |   |                  |   | 3,101    |  
|Other liabilities                                                                           |  |                   | 13,858   |   |                  |   | 12,485   |  
|                                                                                            |  |                   |          |   |                  |   |          |  
|Total non-current liabilities                                                               |  |                   | 193,040  |   |                  |   | 181,440  |  
|Commitments and contingencies                                                               |  |                   |         |   |                  |   |         |  
|Members deficit                                                                            |  |                   |          |   |                  |   |          |  
|Members deficit                                                                            |  |                   | (148,230 | ) |                  |   | (119,145 | )
|Accumulated other comprehensive deficit                                                     |  |                   | (2,291   | ) |                  |   | (2,291   | )
|                                                                                            |  |                   |          |   |                  |   |          |  
|Total members deficit                                                                      |  |                   | (150,521 | ) |                  |   | (121,436 | )
|                                                                                            |  |                   |          |   |                  |   |          |  
|Total liabilities and members deficit                                                      |  | $                 | 331,197  |   |                  | $ | 334,919  |  
|                                                                                            |  |                   |          |   |                  |   |          |  

See accompanying notes.



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Wise Metals Group LLC

Condensed Consolidated Statements of Operations

(In thousands)

(Unaudited)



|                                                 |  |                                 |         |   |                                |   |         |      |  |   |          |   |  |   |         |  
|------------------------------------------------ |  | ------------------------------- | ------- | - | ------------------------------ | - | ------- | ---- |  | - | -------- | - |  | - | ------- | -
|                                                 |  | Three months endedSeptember 30, |         |   | Nine months endedSeptember 30, |  
|                                                 |  | 2007                            |         |   | Restated                       |   |         | 2007 |  |   | Restated |  
|                                                 |  |                                 | 2006    |   |                                |   | 2006    |     
|                                                 |  |                                 |         |  
|Net sales                                        |  | $                               | 244,833 |   |                                | $ | 279,297 |      |  | $ | 781,356  |   |  | $ | 791,150 |  
|Cost of sales                                    |  |                                 | 255,500 |   |                                |   | 300,617 |      |  |   | 777,184  |   |  |   | 805,242 |  
|                                                 |  |                                 |         |   |                                |   |         |      |  |   |          |   |  |   |         |  
|Gross margin (deficit)                           |  |                                 | (10,667 | ) |                                |   | (21,320 | )    |  |   | 4,172    |   |  |   | (14,092 | )
|Operating expenses:                              |  |                                 |         |   |                                |   |         |      |  |   |          |   |  |   |         |  
|Selling, general, and administrative             |  |                                 | 2,994   |   |                                |   | 1,998   |      |  |   | 8,476    |   |  |   | 7,877   |  
|                                                 |  |                                 |         |   |                                |   |         |      |  |   |          |   |  |   |         |  
|Operating loss                                   |  |                                 | (13,661 | ) |                                |   | (23,318 | )    |  |   | (4,304   | ) |  |   | (21,969 | )
|Other (expense) income:                          |  |                                 |         |   |                                |   |         |      |  |   |          |   |  |   |         |  
|Interest expense and fees                        |  |                                 | (9,437  | ) |                                |   | (8,635  | )    |  |   | (27,851  | ) |  |   | (24,199 | )
|Unrealized (loss) gain on derivative instruments |  |                                 | (2,613  | ) |                                |   | (21,974 | )    |  |   | 5,070    |   |  |   | (20,719 | )
|                                                 |  |                                 |         |   |                                |   |         |      |  |   |          |   |  |   |         |  
|Net loss                                         |  | $                               | (25,711 | ) |                                | $ | (53,927 | )    |  | $ | (27,085  | ) |  | $ | (66,887 | )
|                                                 |  |                                 |         |   |                                |   |         |      |  |   |          |   |  |   |         |  

See accompanying notes.



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Wise Metals Group LLC

Condensed Consolidated Statements of Cash Flows

(In Thousands)

(Unaudited)



|                                                                                          |  |                                |         |   |      |   |         |  
|----------------------------------------------------------------------------------------- |  | ------------------------------ | ------- | - | ---- | - | ------- | -
|                                                                                          |  | Nine months endedSeptember 30, |        
|                                                                                          |  | 2007                           |         |   | 2006 |  
|                                                                                          |  |                               
|Cash flows from operating activities                                                      |  |                                |         |   |      |   |         |  
|Net loss                                                                                  |  | $                              | (27,085 | ) |      | $ | (66,887 | )
|Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |  |                                |         |   |      |   |         |  
|Depreciation and amortization                                                             |  |                                | 9,810   |   |      |   | 9,375   |  
|Gain on sale of assets                                                                    |  |                                | (371    | ) |      |   |        |  
|Amortization of deferred financing fees                                                   |  |                                | 1,513   |   |      |   | 1,230   |  
|LIFO provision                                                                            |  |                                |        |   |      |   | 25,000  |  
|Unrealized losses (gains) on derivative instruments                                       |  |                                | (5,070  | ) |      |   | 20,719  |  
|Changes in operating assets and liabilities:                                              |  |                                |         |   |      |   |         |  
|Broker deposits                                                                           |  |                                | 4,766   |   |      |   | (10,043 | )
|Accounts receivable                                                                       |  |                                | (11,095 | ) |      |   | (26,031 | )
|Inventories                                                                               |  |                                | 7,192   |   |      |   | (22,412 | )
|Other current assets                                                                      |  |                                | 804     |   |      |   | 560     |  
|Accounts payable                                                                          |  |                                | 26,365  |   |      |   | 23,798  |  
|Accrued expenses, payroll and other                                                       |  |                                | 1,400   |   |      |   | 8       |  
|                                                                                          |  |                                |         |   |      |   |         |  
|Net cash provided by (used in) operating activities                                       |  |                                | 8,229   |   |      |   | (44,683 | )
|Cash flows from investing activities                                                      |  |                                |         |   |      |   |         |  
|Purchase of equipment                                                                     |  |                                | (13,126 | ) |      |   | (8,179  | )
|Proceeds from sale of assets                                                              |  |                                | 1,302   |   |      |   |        |  
|                                                                                          |  |                                |         |   |      |   |         |  
|Net cash used in investing activities                                                     |  |                                | (11,824 | ) |      |   | (8,179  | )
|Cash flows from financing activities                                                      |  |                                |         |   |      |   |         |  
|Net payments on (issuance of) short-term borrowings                                       |  |                                | (7,529  | ) |      |   | 48,968  |  
|Proceeds from sale-financing transaction                                                  |  |                                | 14,950  |   |      |   |        |  
|Payments on long-term obligations                                                         |  |                                | (2,968  | ) |      |   | (161    | )
|Issuance of long-term borrowings                                                          |  |                                |        |   |      |   | 693     |  
|Purchase of members equity                                                               |  |                                | (2,000  | ) |      |   |        |  
|                                                                                          |  |                                |         |   |      |   |         |  
|Net cash provided by financing activities                                                 |  |                                | 2,453   |   |      |   | 49,500  |  
|                                                                                          |  |                                |         |   |      |   |         |  
|Net decrease in cash and cash equivalents                                                 |  |                                | (1,142  | ) |      |   | (3,362  | )
|Cash and cash equivalents at beginning of period                                          |  |                                | 2,280   |   |      |   | 6,456   |  
|                                                                                          |  |                                |         |   |      |   |         |  
|Cash and cash equivalents at end of period                                                |  | $                              | 1,138   |   |      | $ | 3,094   |  
|                                                                                          |  |                                |         |   |      |   |         |  

See accompanying notes.



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Wise Metals Group LLC

Notes to Condensed Consolidated Financial Statements

September 30, 2007

(Unaudited)

(Dollars in thousands)

1.
Organization

Wise Metals Group LLC is a holding company formed for the purpose of managing the operations of Wise Alloys LLC, Wise Recycling LLC and
Listerhill Total Maintenance Company LLC (collectively, the Company). Wise Alloys LLC (Alloys) principally manufactures and sells aluminum can sheet to aluminum can producers and also serves the transportation and building
and construction markets. Wise Recycling LLC (Recycling) is engaged in the recycling and sale of scrap aluminum and other metals. Listerhill Total Maintenance Company LLC (TMC) specializes in providing maintenance, repairs
and fabrication to manufacturing and industrial plants all over the world ranging from small onsite repairs to complete turn-key maintenance.

2.
Restatement

The Company has restated its consolidated financial statements as of December 31, 2006, and the three and nine month periods ended
September 30, 2006 to correct certain errors in accounting and financial reporting. The restated consolidated financial statements included in this Form 10-Q reflect adjustments required as a result of the following errors.

(1)Inventories were overstated by $3.7 million at December 31, 2006. The error resulted from a calculation error in computing the LIFO reserve.

(2) Balance sheet classifications related to pension plan amounts at December 31, 2006 did not comply with certain provisions of Statement of Financial
Accounting Standards No. 87 (SFAS 87), Employers Accounting for Pensions. The pension intangible asset, benefit obligation and component of other comprehensive loss were aggregated and incorrectly classified as a
net liability within other non-current liabilities. The Company has restated the consolidated balance sheet to correctly classify the gross amounts of its pension components as an accrued pension obligation of $3.1 million, an intangible asset of
$326,000 and a component of accumulated other comprehensive deficit of $2.3 million, respectively.

(3) As a result of the pension classification
errors discussed in (2), the Company did not present accumulated other comprehensive deficit and disclose total comprehensive loss in accordance with Statement of Financial Accounting Standards No. 130 (SFAS 130), Reporting
Comprehensive Income. The Company has restated the December 31, 2006 consolidated balance sheet presented herein to report accumulated other comprehensive deficit and has disclosed total comprehensive loss. The correction had no impact on
previously reported Net Income.

(4) The Company improperly classified shipping and handling costs as reductions to revenue in the consolidated
statements of operations for the three and nine month periods ended September 30, 2006. The consolidated statements of operations for the three and nine month periods ended September 30, 2006 have been restated to properly classify these
costs as cost of sales.

The following tables set forth the effects of the restatement on each affected line item in the consolidated balance sheet at
December 31, 2006 and the consolidated statements of operations for each of the three and nine month periods ended September 30, 2006 (amounts in thousands):



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Consolidated Balance Sheets



|                                        |  |                       |          |   |            |   |        |             |  |   |           |   |  |       
|--------------------------------------- |  | --------------------- | -------- | - | ---------- | - | ------ | ----------- |  | - | --------- | - |  | ------
|December 31, 2006                       |  | As PreviouslyReported |          |   | Adjustment |   |        | As Restated |  |   | Reference
|Inventories                             |  | $                     | 120,565  |   |            | $ | (3,663 | )           |  | $ | 116,902   |   |  | (1)   
|Total current assets                    |  |                       | 244,660  |   |            |   | (3,663 | )           |  |   | 240,997   |   |  |       
|Intangible assets                       |  |                       |         |   |            |   | 326    |             |  |   | 326       |   |  | (2)   
|Total non-current assets                |  |                       | 93,596   |   |            |   | 326    |             |  |   | 93,922    |   |  |       
|Total assets                            |  |                       | 338,256  |   |            |   | (3,337 | )           |  |   | 334,919   |   |  |       
|Accrued pension obligation              |  |                       |         |   |            |   | 3,101  |             |  |   | 3,101     |   |  | (2)   
|Other liabilities                       |  |                       | 12,969   |   |            |   | (484   | )           |  |   | 12,485    |   |  | (2)   
|Total non-current liabilities           |  |                       | 178,823  |   |            |   | 2,617  |             |  |   | 181,440   |   |  |       
|Members deficit                        |  |                       | (115,482 | ) |            |   | (3,663 | )           |  |   | (119,145  | ) |  | (1)   
|Accumulated other comprehensive deficit |  |                       |         |   |            |   | (2,291 | )           |  |   | (2,291    | ) |  | (2)(3)
|Total members deficit                  |  |                       | (115,482 | ) |            |   | (5,954 | )           |  |   | (121,436  | ) |  |       
|Total liabilities and members deficit  |  |                       | 338,256  |   |            |   | (3,337 | )           |  |   | 334,919   |   |  |       

Consolidated Statements of Operations



|                                      |  |                       |         |            |   |             |  |           |         |  |    
|------------------------------------- |  | --------------------- | ------- | ---------- | - | ----------- |  | --------- | ------- |  | ---
|Three months ended September 30, 2006 |  | As PreviouslyReported |         | Adjustment |   | As Restated |  | Reference
|Sales                                 |  | $                     | 272,051 |            | $ | 7,246       |  | $         | 279,297 |  | (4)
|Cost of sales                         |  |                       | 293,371 |            |   | 7,246       |  |           | 300,617 |  | (4)
|                                      |  |                       |         |           
|Nine months ended September 30, 2006  |  |                       |         |            |   |             |  |          
|Sales                                 |  |                       | 771,581 |            |   | 19,569      |  |           | 791,150 |  | (4)
|Cost of sales                         |  |                       | 785,673 |            |   | 19,569      |  |           | 805,242 |  | (4)

3. Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements are presented in
accordance with generally accepted accounting principles for interim financial information and with the requirements of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the disclosures normally required by accounting
principles generally accepted in the United States of America for complete financial statements. The condensed consolidated financial statements have been prepared in accordance with the Companys customary accounting practices and, in the
opinion of management, all adjustments necessary to fairly present the financial position, results of operations and cash flows for the reported interim periods have been made and were of a normal recurring nature. Operating results for the three
and nine month periods ended September 30, 2007 are not necessarily indicative of the results that may be expected for the year ending December 31, 2007. For further information, refer to the consolidated financial statements and notes
included in the Companys Annual Report on Form 10-K/A, for the year ended December 31, 2006, filed March 4, 2008. The accompanying condensed consolidated financial statements include the accounts of Wise Metals Group LLC and its
subsidiaries. Intercompany transactions have been eliminated in consolidation.



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Broker Deposits

Broker deposits generally consist of cash on deposit with brokers to support lines of credit associated with the Companys derivative and hedging activity. At September 30, 2007 and December 31, 2006 substantially all broker
deposits were on deposit with brokers associated with derivative and hedging activity as more fully described below.

Derivatives and Hedging Activity

The Company has entered into long-term contracts to supply can sheet to its largest customers. To reduce the risk of changing prices for purchases and
sales of metal, including firm commitments under these supply contracts, the Company uses commodity futures and option contracts. In addition, the Company uses natural gas futures and option contracts.

In June 1998, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 133 (SFAS
No. 133), Accounting for Derivative Instruments and Hedging Activity. The Statement requires companies to recognize all derivative instruments as either assets or liabilities on the balance sheet at fair value. Derivatives that are
not hedges must be adjusted to fair value through the statement of operations. The Company has elected not to designate any of its derivative instruments as hedges under SFAS No. 133.

In determining fair value, the Company uses market quotes for contracts of similar maturity. The market quotes for the aluminum futures and options are adjusted for
premiums/discounts for various product grades, locations, and the closing times for various terminal markets.

A summary of the fair value of the
Companys derivative instruments is as follows:



|                                     |  |                                 |        |   |                                |   |        |  
|------------------------------------ |  | ------------------------------- | ------ | - | ------------------------------ | - | ------ | -
|Description of Derivative Instrument |  | Fair value atSeptember 30, 2007 |        |   | Fair value atDecember 31, 2006 |  
|Aluminum futures and options         |  | $                               | (719   | ) |                                | $ | (2,837 | )
|Natural gas futures and options      |  |                                 | (428   | ) |                                |   | (3,578 | )
|                                     |  |                                 |        |   |                                |   |        |  
|                                     |  | $                               | (1,147 | ) |                                | $ | (6,415 | )
|                                     |  |                                 |        |   |                                |   |        |  

Unrealized gain (loss) amounts recorded were as follows:



|                                     |  |                                |       |      |   |         |  
|------------------------------------ |  | ------------------------------ | ----- | ---- | - | ------- | -
|Description of Derivative Instrument |  | Nine monthsended September 30, |      
|                                     |  | 2007                           |       | 2006 |  
|Aluminum futures and options         |  | $                              | 1,920 |      | $ | (15,404 | )
|Natural gas futures and options      |  |                                | 3,150 |      |   | (5,315  | )
|                                     |  |                                |       |      |   |         |  
|                                     |  | $                              | 5,070 |      | $ | (20,719 | )
|                                     |  |                                |       |      |   |         |  

In connection with the Companys futures activity, the Company maintains lines of credit with brokers to
cover unrealized losses on futures contracts and uses options to manage price exposure with respect to firm commitments to purchase or sell aluminum.



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Inventories

Inventories consisted of the following:



|                                |  |                   |         |   |                  |   |         |  
|------------------------------- |  | ----------------- | ------- | - | ---------------- | - | ------- | -
|                                |  | September 30,2007 |         |   | December 31,2006 |  
|                                |  |                   |         |   | Restated         |  
|Manufacturing inventories:      |  |                   |         |   |                  |   |         |  
|Raw materials                   |  | $                 | 69,750  |   |                  | $ | 66,743  |  
|Work in progress                |  |                   | 55,448  |   |                  |   | 65,832  |  
|Finished goods                  |  |                   | 39,163  |   |                  |   | 39,384  |  
|LIFO reserve                    |  |                   | (73,117 | ) |                  |   | (73,117 | )
|                                |  |                   |         |   |                  |   |         |  
|Total manufacturing inventories |  |                   | 91,244  |   |                  |   | 98,842  |  
|Supplies inventory              |  |                   | 18,466  |   |                  |   | 18,060  |  
|                                |  |                   |         |   |                  |   |         |  
|Total inventories               |  | $                 | 109,710 |   |                  | $ | 116,902 |  
|                                |  |                   |         |   |                  |   |         |  

Manufacturing inventories are stated at the lower of cost or market based on the last-in, first-out (LIFO) method.
An actual valuation of inventory under the LIFO method can be made only at the end of each year based on the inventory levels and costs at that time. Interim LIFO calculations must necessarily be based on managements estimates of expected
year-end inventory levels and costs dependent upon prevailing aluminum costs and other factors which are beyond managements control. Accordingly, managements estimates of the effects of LIFO calculations on inventories and costs of sales
are subject to change prior to the year-end calculation.

Long-Lived Assets

The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is
measured by a comparison of the carrying amount of the assets to the future, undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by
which the carrying amount of the assets exceeds their fair value. Judgments made by us related to the expected useful lives of long-lived assets and the ability to realize any undiscounted cash flows in excess of the carrying amounts of such assets
are affected by factors such as the ongoing maintenance and improvements of the assets, changes in the expected use of the assets, changes in economic conditions, changes in operating performance and anticipated future cash flows.

New Accounting Pronouncements

In December 2007, the FASB issued SFAS
No. 160, Noncontrolling Interest in Consolidated Financial Statements, an amendment of Accounting Research Bulletin No. 51, Consolidated Financial Statements(SFAS 160). SFAS 160 establishes accounting and reporting standards for
ownership interests in subsidiaries held by parties other than the parent, the amount of consolidated net income (loss) attributable to the parent and to the noncontrolling interest, changes in a parents ownership interest and the valuation of
retained noncontrolling equity investments when a subsidiary is deconsolidated. SFAS 160 also establishes reporting requirements that identify and distinguish between the interest of the parent and the interest of the noncontrolling owners. SFAS 160
is effective for fiscal years beginning after December 15, 2008. We are currently evaluating the effect the adoption of SFAS 160 will have on our Consolidated Financial Statements.

In December 2007, the FASB issued SFAS No. 141 (revised 2007), Business Combinations (SFAS 141(R)), which replaces SFAS No. 141, Business Combinations (SFAS
141). SFAS 141(R) retains the underlying concepts of SFAS 141 in that all business combinations are still required to be accounted for at fair value under the acquisition method of accounting but SFAS 141(R) changed the method of applying the
acquisition method in a number of significant aspects. Acquisition costs will generally be expensed as incurred; noncontrolling interests will be valued at fair value at the acquisition date; in-process research and development will be recorded at
fair value as an indefinite-lived intangible asset at the acquisition date; restructuring costs associated with a business combination will generally be expensed subsequent to the



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acquisition date; and changes in deferred tax asset valuation allowances and income tax uncertainties after the acquisition date generally will affect income
tax expense. SFAS 141(R) is effective on a prospective basis for all business combinations for which the acquisition date is on or after the beginning of the first annual period subsequent to December 15, 2008, with the exception of the
accounting for valuation allowances on deferred taxes and acquired tax contingencies. SFAS 141(R) amends SFAS No. 109, Accounting for Income Taxes, such that adjustments made to valuation allowances on deferred taxes and acquired
tax contingencies associated with acquisitions that closed prior to the effective date of SFAS 141(R) would also apply the provisions of SFAS 141(R). Early adoption is not permitted. We are currently evaluating the effects, if any, that SFAS 141(R)
may have on our consolidated financial statements.

In February 2007, the FASB issued SFAS No. 159 (SFAS No. 159), The Fair Value
Option for Financial Assets and Financial Liabilities, which provides companies with an option to report selected financial assets and liabilities at fair value. The new statement establishes presentation and disclosure requirements designed to
facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities and requires companies to provide additional information that will help investors and other users of financial
statements to more easily understand the effect of a companys choice to use fair value on its earnings. The new statement also requires entities to display the fair value of those assets and liabilities for which the company has chosen to use
fair value on the face of the balance sheet. SFAS No. 159 does not eliminate disclosure requirements included in other accounting standards, including requirements for disclosures about fair value measurements included in SFAS No. 157,
Fair Value Measurements, and FASB SFAS No. 107, Disclosures about Fair Value of Financial Instruments. SFAS No. 159 is effective as of the beginning of an entitys first fiscal year beginning after November 15,
2007. Early adoption is permitted as of the beginning of the previous fiscal year provided that the entity makes that choice in the first 120 days of that fiscal year and also elects to apply the provisions of SFAS No. 157. The Company has not
yet determined the impact, if any, of the adoption of FASB Statement No. 159 on our consolidated financial position, results of operations and cash flows.

In September 2006, the FASB issued SFAS No. 158 (SFAS No. 158), Employers Accounting for Defined Benefit and Other Postretirement Plansan amendment of FASB Statements No. 87, 88, 106, and 132R.
SFAS No. 158 requires companies to recognize a net liability or asset and an offsetting adjustment to accumulated other comprehensive income to report the funded status of defined benefit pension and other postretirement benefit plans. SFAS
No. 158 requires prospective application, and the recognition and disclosure requirements are effective for the Companys fiscal year ending December 31, 2007. In addition, SFAS No. 158 requires companies to measure plan assets
and obligations at their year-end balance sheet date. This requirement is effective for the Companys fiscal year ending December 31, 2008. Management is currently evaluating the impact of the adoption of SFAS No. 158 on the
Companys financial statements.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements (SFAS 157), which
defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS 157 is effective for fiscal years beginning after
November 15, 2007, however the FASB has delayed the effective date of SFAS 157 to fiscal years beginning after November 15, 2008 for nonfinancial assets and nonfinancial liabilities, except those items recognized or disclosed at fair value
on an annual or more frequently occurring basis. The Company has not yet determined the impact from adoption of this new accounting pronouncement on the Companys financial position.

Comprehensive Loss

Total Comprehensive Loss for the three months
ended September 30, 2007 and 2006 was $25,711 and $53,927, respectively. Total Comprehensive Loss for the nine months ended September 30, 2007 and 2006 was $27,085 and $66,887, respectively.



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4. Financing Arrangements

Debt consists of the following at:



|                                      |  |                   |          |   |                  |   |          |  
|------------------------------------- |  | ----------------- | -------- | - | ---------------- | - | -------- | -
|                                      |  | September 30,2007 |          |   | December 31,2006 |  
|Revolving and secured credit facility |  | $                 | 169,658  |   |                  | $ | 177,187  |  
|Senior secured 10.25% notes due 2012  |  |                   | 150,000  |   |                  |   | 150,000  |  
|Other notes payable                   |  |                   | 29,595   |   |                  |   | 17,613   |  
|                                      |  |                   |          |   |                  |   |          |  
|                                      |  |                   | 349,253  |   |                  |   | 344,800  |  
|Less current portion                  |  |                   | (173,172 | ) |                  |   | (178,946 | )
|                                      |  |                   |          |   |                  |   |          |  
|                                      |  | $                 | 176,081  |   |                  | $ | 165,854  |  
|                                      |  |                   |          |   |                  |   |          |  

Effective May 5, 2004, the Company issued $150 million of 10.25% senior secured notes due 2012. These notes
are secured by a primary interest in the fixed assets of the Company with the exception of certain Permitted Indebtedness within the indenture agreement. Additionally, they are secured by a secondary interest in the Companys working capital.

Effective March 31, 2006 the Company executed an asset sale agreement with a financial institution that allows the Company to sell certain accounts
receivable up to $17 million on a non-recourse basis. This agreement was due to expire on December 31, 2006. On December 31, 2006 the agreement was renewed and extended to June 15, 2007, and allowed the Company to sell certain
accounts receivable up to $10 million on a non-recourse basis. The agreement was further amended on April 9, 2007 to increase the facility to a total of $20 million and extend the term of the agreement to June 29, 2007. Under the terms of
the agreement, the Company agreed to sell on an ongoing basis and without recourse, a designated customers accounts receivable. The Company has not renewed the agreement which had been extended to June 29, 2007 and therefore as of
September 30, 2007, the Company had no sales of accounts receivable under this agreement. At September 30, 2007, the Company also has $1.7 million of outstanding letters of credit with a financial institution. Substantially all the assets
of the Company are pledged as collateral for its financing arrangements.

Effective July 31, 2007, the Company completed an amendment to its revolving
credit facility that reset certain covenant levels. Pursuant to the amendment, as of and subsequent to July 31, 2007, the Company must either meet the minimum Adjusted EBITDA levels (which represents EBITDA, defined as net income (loss) before
income taxes, interest expense and fees, net, and depreciation and amortization, adjusted to exclude early extinguishment of debt, income from affiliate, nonrecurring charges, severance charges and credits, LIFO adjustments, cumulative effect of
change in accounting principle and mark-to-market adjustment for contracts under SFAS No. 133) or the Adjusted Excess Availability as defined within the credit agreement must be equal to or greater than $20,000 for each of the ten
(10) consecutive days immediately preceding the last day of the month.

Subsequent to September 30, 2007, the Company reached agreement with the
Retirement Systems of Alabama (RSA) in which the RSA agreed to purchase $75 million of cumulative-convertible 10% PIK preferred membership interests of the Company. The preferred interest is convertible into 25 percent of the common interest of the
Company. The Company has the right to call the preferred membership interest after seven years at the cost of the greater of the investment plus any accrued PIK dividends or the fair market value of the preferred interest on an as converted basis.

5. Pension and Post-Retirement Benefits

The
Companys pension and other post retirement benefit plans are more fully disclosed in Note 7 of the Notes to Consolidated Financial Statements included in Item 8 of the Companys Annual Report on Form 10-K/A, for the year ended
December 31, 2006, filed on March 4, 2008. Effective April 1, 1999, the Company established a defined benefit pension plan that covers essentially all union employees. The plan provides certain levels of benefits based on years of service
and wage levels, but does not provide benefits for any prior service. In addition, defined contribution plans for both union and nonunion employees were established.



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In 2003 the Company agreed to defined contributions, for certain union employees, to multi-employer union pension plans.
This was done in exchange for freezing service time and the pension factor in the aforementioned defined benefit plan as of the first quarter of 2004 and eliminating post-retirement benefits for affected employees.

The Company also established post-retirement benefit plans for all hourly and salaried employees effective April 1, 1999. The union employees who become eligible to
retire under the defined benefit plan, and are not a part of the unions that have elected the multi-employer option, will retain health benefits and certain other benefits for life. Salaried employees who retire after age 60 with a combined 10 years
service with Wise Alloys LLC and the previous owner of the Wise Alloys facilities will be eligible for medical benefits until age 65.

The Companys
funding policy for these plans is to contribute negotiated amounts to the multi-employer funds and amounts necessary to meet minimum funding requirements of the Employee Retirement Income Security Act for the defined benefit plans but not to exceed
the maximum deductible amount allowed by the Internal Revenue Code. The Company contributed $1,644 to the multi-employer plans during 2006. Contributions to the defined benefit plan are expected to be $2,710 during 2007.

The 2007 and 2006 amounts shown below reflect the defined benefit pension and other postretirement benefit expense for the three and nine month periods ended
September 30 for each year:





|                                   |  |                                 |      |   |                                |   |      |                  |  |   |                               |   |  |      |     |   |      |   |       |      |  |   |       |   |  |   |       |   |  |   |       |  
|---------------------------------- |  | ------------------------------- | ---- | - | ------------------------------ | - | ---- | ---------------- |  | - | ----------------------------- | - |  | ---- | --- | - | ---- | - | ----- | ---- |  | - | ----- | - |  | - | ----- | - |  | - | ----- | -
|                                   |  | Three months ended September 30 |      |   | Nine months ended September 30 |  
|                                   |  | Pension Benefits                |      |   | Other PostRetirement Benefits  |   |      | Pension Benefits |  |   | Other PostRetirement Benefits |  
|                                   |  | 2007                            |      |   | 2006                           |   |      | 2007             |  |   | 2006                          |   |  | 2007 |     |   | 2006 |   |       | 2007 |  |   | 2006  |  
|Service cost                       |  | $                               | 344  |   |                                | $ | 325  |                  |  | $ | 356                           |   |  | $    | 385 |   |      | $ | 1,033 |      |  | $ | 975   |   |  | $ | 1,067 |   |  | $ | 1,156 |  
|Interest cost                      |  |                                 | 281  |   |                                |   | 237  |                  |  |   | 142                           |   |  |      | 115 |   |      |   | 843   |      |  |   | 711   |   |  |   | 425   |   |  |   | 344   |  
|Expected return on plan assets     |  |                                 | (273 | ) |                                |   | (175 | )                |  |   |                              |   |  |      |    |   |      |   | (820  | )    |  |   | (524  | ) |  |   |      |   |  |   |      |  
|Amortization of prior service cost |  |                                 | 9    |   |                                |   | 9    |                  |  |   |                              |   |  |      |    |   |      |   | 27    |      |  |   | 27    |   |  |   |      |   |  |   |      |  
|Net loss (gain) recognition        |  |                                 | 11   |   |                                |   | 7    |                  |  |   | (29                           | ) |  |      | (31 | ) |      |   | 33    |      |  |   | 20    |   |  |   | (88   | ) |  |   | (92   | )
|                                   |  |                                 |      |   |                                |   |      |                  |  |   |                               |   |  |      |     |   |      |   |       |      |  |   |       |   |  |   |       |   |  |   |       |  
|Net periodic benefit cost          |  | $                               | 372  |   |                                | $ | 403  |                  |  | $ | 469                           |   |  | $    | 469 |   |      | $ | 1,116 |      |  | $ | 1,209 |   |  | $ | 1,404 |   |  | $ | 1,408 |  
|                                   |  |                                 |      |   |                                |   |      |                  |  |   |                               |   |  |      |     |   |      |   |       |      |  |   |       |   |  |   |       |   |  |   |       |  



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Subsequent to September 30, 2007 the Company reached agreement with the labor unions at the Alloys facility
resulting in a new 5-year contract beginning November 1, 2007. As part of the agreement the unions pension benefits will now be provided through multi-employer funds administered through the Steelworkers Pension Trust, the Central Pension
Fund and the Tri-State Carpenters Fund. The Wise defined benefit pension will be frozen as of the date of the new contract and the Company will reverse a previously recorded liability approximating $11 million relating to other post retirement
benefits.

6. Commitments and Contingencies

The
Company is a defendant in an action brought by Merrill Lynch, Pierce, Fenner & Smith Incorporated pending in the New York Supreme Court, County of New York. In this action, Merrill Lynch seeks $0.9 million for out-of-pocket costs and
expenses allegedly incurred pursuant to a letter agreement between Wise Metals and Merrill Lynch dated January 31, 2002, in which Merrill Lynch alleges that Wise Metals agreed to reimburse Merrill Lynch for such costs and expenses. Wise Metals
has hired counsel and is vigorously contesting this lawsuit and believes it has meritorious defenses. Wise Metals has filed an answer to the complaint denying the material allegations and alleging several affirmative defenses and counterclaims which
exceed in amount the sum sought by Merrill Lynch. Merrill Lynch moved to dismiss the Wise Metals counterclaims and by an order dated December 30, 2004, the Court granted this motion, dismissed the counterclaims and permitted Wise Metals
to replead two of the counterclaims. Wise Metals appealed, which resulted in a reversal reinstating the dismissed counterclaims. Merrill Lynch has replied to the counterclaims. The action is proceeding and is presently in the discovery stages. The
Company believes that it is not currently possible to estimate the ultimate outcome of this litigation. As a result, no expense for any potential adverse outcome of this matter has been recorded in the consolidated financial statements.

The Company was a defendant in an action brought by a former executive seeking compensatory damages previously pending in Delaware State Court. The plaintiff alleged
that certain transactions between Wise Metals Group members violated the Companys Limited Liability Company Agreement because other members were not afforded the opportunity to participate on equal terms, breach of fiduciary duty and
conversion of a portion of the plaintiffs equity interest in the Company. On June 25, 2007, the parties reached a settlement whereby in exchange for $2 million, the plaintiff would surrender his equity interest in the Company, forgo any
claim for a $1 million severance that plaintiff alleges would otherwise come due on his 62nd birthday and provide the Company with a general release of any existing or potential claims. This settlement was approved by the court and the action was
dismissed on June 25, 2007 and the Company paid the settlement during the quarter ended September 30, 2007.

On August 11, 2006 the Company
filed a lawsuit against Crown Cork and Seal (USA) (Crown), Inc. in state court in Alabama (Alabama Action) for breach of contract and seeking a declaratory judgment on our beverage can sheet and food sheet contracts. The
lawsuit alleges damages because of breaches by Crown of the beverage can sheet contract, and asks the court to interpret certain pricing provisions of the food contract. On January 26, 2007, Crown entered a counterclaim asserting breach of
contract and seeking declaratory judgments on our beverage can sheet and food container contracts.

On September 8, 2006, Crown filed a lawsuit
against the Company in state court in Pennsylvania (Pennsylvania Action) for breach of contract and seeking declaratory judgments on our beverage can sheet and food container contracts. The Pennsylvania Action has been stayed upon the
Companys motion pending resolution of the Alabama Action.

The Company intends to vigorously contest the Pennsylvania Action and the counterclaim in
the Alabama Action and at this time is unable to determine the reasonably likely outcome of both the Companys and Crowns claims. In the opinion of management, amounts accrued for exposures relating to the aforementioned contingencies,
and other legal proceedings are adequate and, accordingly, the ultimate resolution of these matters is not expected to have a material adverse effect on the Companys consolidated financial statements.



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The Company is a party to certain claims and litigation associated with employment related matters for which management
believes that the ultimate resolution will not have a material adverse impact on the Companys financial position.

Future environmental regulations,
including those under the Clean Air Act and Clean Water Act, or more aggressive enforcement of existing regulations, may result in stricter compliance requirements for the Company and for the aluminum industry in general.

In connection with our acquisition of the Listerhill facility in 1999, a consultant performed a soil and groundwater investigation (Phase II Report) to
identify any environmental issues at the various plants that comprise the Listerhill facility. That Phase II Report identified certain on-site environmental areas of concern that may potentially require investigation or remediation and provided a
then-present value estimate of approximately $18 million to address them. Pursuant to the Listerhill facility purchase agreement, the prior owner of the Listerhill facility, Reynolds, now Alcoa, is required to perform the work necessary and to
indemnify the Company against the environmental matters required by applicable law to be addressed that are identified in the Phase II Report and any other such environmental liabilities attributable to Reynolds that were identified on or before
March 31, 2004 subject to certain limitations. Alcoa disagrees with the cost estimates contained in the Phase II Report and has stated that it estimates that the environmental issues identified in the Phase II Report will cost less than $18
million to remediate. Although Alcoa has conducted some on-site environmental investigations and sampling and has submitted reports to the Alabama Department of Environmental Management (ADEM) regarding most of the on-site areas of
concern, it has not yet commenced cleanup activities with respect to many of the areas of concern.

The Company is also party to an Environmental
Cooperation Agreement (ECA), with Alcoa, which is Reynolds successor. The ECA addresses, among other things, the use of a surface water ditch system by both us and Alcoa, the use of process water retention ponds on Alcoas
property and certain surface drainage easements across our property. The ECA expires in December 2009, with automatic two year renewal periods unless either party elects to terminate, in which event the ECA will terminate one year following such
election. Under the ECA, each party defends and indemnifies the other against claims arising from its own violations of any applicable environmental laws, its handling, use, or disposal of hazardous materials at the Listerhill facility, a breach of
any warranties, representations or covenants in the agreement, or damage or loss to property and injury to or death of any persons.

In November 2006 the
Company received notice from the Environmental Protection Agency (EPA) regarding certain violations of the Clean Air Act. The Company disputes some of the alleged violations and has initiated actions to come into compliance with the
relevant requirements. The EPA has indicated its intent to resolve the violations through a judicial consent-decree, including the payment of civil penalties by the Company. Discussions with the EPA are ongoing. The ultimate outcome cannot be
reasonably estimated at this time and thus no expense has been recorded in the Companys consolidated financial statements.

The Company is subject to
certain monthly purchase commitments for raw materials. The amount of inventory under this commitment not yet received was $24,808 and $15,382 as of September 30, 2007 and December 31, 2006, respectively.

7. Business Segment Information

A reportable segment is a component
of an enterprise in which the operating results are regularly reviewed by the enterprises chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete
financial information is available. The Company has two reportable segments under FASB SFAS No. 131 (SFAS No. 131), Disclosures about Segments of an Enterprise and Related Information: Alloys and Recycling.



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Wise Alloys: Alloys principally manufactures and sells aluminum can sheet to aluminum can producers and also
serves the transportation, building, and construction markets. Beverage can stock is aluminum sheet specifically designed and engineered for use in the production of aluminum beverage cans and represents the Companys primary product. Can stock
customers include Ball Corporation, Crown Holdings, Inc. and Rexam PLC, the three largest beverage can manufacturers in the world. In addition, Alloys produces food can stock and semi-fabricated aluminum sheet for building and construction,
transportation and other markets.

Wise Recycling: Recycling is engaged in the recycling and sale of scrap aluminum and other non-ferrous metals for
use by Alloys as well as for sale to third parties. Recycling provides the Company with an effective, profitable infrastructure to obtain a portion of Alloys scrap requirements. Recycling has developed a collection process that utilizes both
direct acquisitions from scrap dealers and industrial accounts, as well as off-the-street from the actual consumer. Furthermore, Recycling collects other forms of non-ferrous scrap, primarily non-UBC aluminum, copper and brass, for sale
in the merchant market. The Company is currently expanding the business of Recycling to include warehousing operations in order to provide regional shipping centers for our scrap collection and to enhance the ability to provide a vendor managed
inventory program for Alloys customers.

Substantially all revenues and assets are attributed to or are located in the United States. The Company evaluates
segment performance based on profit or loss from operations excluding corporate general and administrative expenses, LIFO adjustments, and derivative gains or losses included in cost of sales. The accounting policies of the segments are the same as
those described in the significant accounting policies.

We have concluded that TMC is not a reportable segment because it is not significant to our
consolidated operations and represents less than 10% of our revenues and its absolute profit or loss represents less than 10% of our absolute profit or loss in each of the past three years ended December 31, 2006, 2005 and 2004 and for the nine
months ended September 30, 2007. Additionally, TMCs assets were less than 10% of the combined assets of our operating segments as of December 31, 2006 and 2005 and as of September 30, 2007. Financial information about TMC is
included in the Other caption in the tables below.

The following table sets forth information on the Companys reportable segments:



|                                                 |  |                    |         |   |                   |   |         |                   |  |   |                   |   |  |   |         |  
|------------------------------------------------ |  | ------------------ | ------- | - | ----------------- | - | ------- | ----------------- |  | - | ----------------- | - |  | - | ------- | -
|                                                 |  | Three Months Ended |         |   | Nine Months Ended |  
|                                                 |  | September 30,2007  |         |   | September 30,2006 |   |         | September 30,2007 |  |   | September 30,2006 |  
|                                                 |  |                    |         |   | Restated          |   |         |                   |  |   | Restated          |  
|Net Sales                                        |  |                    |         |   |                   |   |         |                   |  |   |                   |   |  |   |         |  
|Alloys                                           |  | $                  | 208,314 |   |                   | $ | 240,286 |                   |  | $ | 670,328           |   |  | $ | 688,769 |  
|Recycling  (Note 1)                             |  |                    | 36,175  |   |                   |   | 38,932  |                   |  |   | 109,480           |   |  |   | 101,544 |  
|Other                                            |  |                    | 344     |   |                   |   | 79      |                   |  |   | 1,548             |   |  |   | 837     |  
|                                                 |  |                    |         |   |                   |   |         |                   |  |   |                   |   |  |   |         |  
|Net sales                                        |  | $                  | 244,833 |   |                   | $ | 279,297 |                   |  | $ | 781,356           |   |  | $ | 791,150 |  
|                                                 |  |                    |         |   |                   |   |         |                   |  |   |                   |   |  |   |         |  
|Segment (loss) profit                            |  |                    |         |   |                   |   |         |                   |  |   |                   |   |  |   |         |  
|Alloys                                           |  | $                  | (13,693 | ) |                   | $ | (17,594 | )                 |  | $ | (2,610            | ) |  | $ | (34,343 | )
|Recycling  (Note 1)                             |  |                    | 1,778   |   |                   |   | 3,452   |                   |  |   | 7,025             |   |  |   | 10,791  |  
|                                                 |  |                    |         |   |                   |   |         |                   |  |   |                   |   |  |   |         |  
|Segment (loss) profit                            |  |                    | (11,915 | ) |                   |   | (14,142 | )                 |  |   | 4,415             |   |  |   | (23,552 | )
|LIFO adjustments                                 |  |                    |        |   |                   |   | (25,000 | )                 |  |   |                  |   |  |   | (25,000 | )
|Unrealized (loss) gain on derivative instruments |  |                    | (2,613  | ) |                   |   | (21,974 | )                 |  |   | 5,070             |   |  |   | (20,719 | )
|Corporate and other undistributed expenses, net  |  |                    | (11,183 | ) |                   |   | 7,190   |                   |  |   | (36,570           | ) |  |   | 2,384   |  
|                                                 |  |                    |         |   |                   |   |         |                   |  |   |                   |   |  |   |         |  
|Net loss                                         |  | $                  | (25,711 | ) |                   | $ | (53,927 | )                 |  | $ | (27,085           | ) |  | $ | (66,887 | )
|                                                 |  |                    |         |   |                   |   |         |                   |  |   |                   |   |  |   |         |  



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Note 1: The Company has eliminated all intercompany sales and cost of sales associated with transfers of recycled
aluminum from Recycling to Alloys. Recycling transfers aluminum to Alloys at market value and recognizes profit only when the sale to the end consumer is completed. Recycling transferred aluminum to Alloys with a cost of $27,751 and $19,553 for the
three month periods ended September 30, 2007 and 2006, respectively , $89,686 and $62,543 for the nine month periods ended September 30, 2007 and 2006, respectively.



|                              |  |                   |         |                  |   |        
|----------------------------- |  | ----------------- | ------- | ---------------- | - | -------
|                              |  | As of            
|                              |  | September 30,2007 |         | December 31,2006
|                              |  |                   |         | Restated        
|Total Assets                  |  |                   |         |                  |   |        
|Alloys (Note 1)              |  | $                 | 283,726 |                  | $ | 294,417
|Recycling                     |  |                   | 45,433  |                  |   | 31,409 
|Corporate and other (Note 1) |  |                   | 2,038   |                  |   | 9,093  
|                              |  |                   |         |                  |   |        
|Total assets                  |  | $                 | 331,197 |                  | $ | 334,919
|                              |  |                   |         |                  |   |        

Note 1: The Company has reclassified certain assets reported in previous periods as Corporate and other assets to
Alloys. These assets were valued at $24,157 as of September 30, 2007.



|                                    |  |                                 |       |                                |   |       |  |      |       |  |   |      
|----------------------------------- |  | ------------------------------- | ----- | ------------------------------ | - | ----- |  | ---- | ----- |  | - | -----
|                                    |  | Three months endedSeptember 30, |       | Nine months endedSeptember 30,
|                                    |  | 2007                            |       | 2006                           |   | 2007  |  | 2006
|Depreciation and Amortization       |  |                                 |       |                                |   |       |  |      |       |  |   |      
|Alloys                              |  | $                               | 3,082 |                                | $ | 2,971 |  | $    | 9,287 |  | $ | 8,825
|Recycling                           |  |                                 | 171   |                                |   | 141   |  |      | 513   |  |   | 424  
|Corporate and other                 |  |                                 | 6     |                                |   | 42    |  |      | 10    |  |   | 126  
|                                    |  |                                 |       |                                |   |       |  |      |       |  |   |      
|Total depreciation and amortization |  | $                               | 3,259 |                                | $ | 3,154 |  | $    | 9,810 |  | $ | 9,375
|                                    |  |                                 |       |                                |   |       |  |      |       |  |   |      



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|                           |  |                                |        |      |   |      
|-------------------------- |  | ------------------------------ | ------ | ---- | - | -----
|                           |  | Nine months endedSeptember 30,
|                           |  | 2007                           |        | 2006
|Capital Expenditures       |  |                                |        |      |   |      
|Alloys                     |  | $                              | 12,722 |      | $ | 7,465
|Recycling                  |  |                                | 320    |      |   | 714  
|Corporate and other        |  |                                | 84     |      |   |     
|                           |  |                                |        |      |   |      
|Total capital expenditures |  | $                              | 13,126 |      | $ | 8,179
|                           |  |                                |        |      |   |      



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##### Table of Contents

ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

We are the third largest producer of aluminum beverage can sheet in the world and one of the largest aluminum scrap recyclers in the
United States based on The Aluminum Association, Inc., a trade association for producers of primary aluminum and semi-fabricated aluminum products and recyclers. Beverage can sheet is aluminum sheet specifically designed and engineered for the
production of aluminum beverage cans. Our customers include Ball, Crown, and Rexam. These customers produce aluminum cans for the largest brewers and carbonated soft drink makers in North America. In addition, we provide food container stock and
semi-fabricated aluminum sheet for the transportation and other common alloy markets. In 2006, we supplied an estimated 14% of the North American market for aluminum beverage can sheet as measured by volume and we own one of only five beverage can
sheet facilities in North America, providing valuable capacity to a consolidated industry. We further estimate that our market share for 2007 will remain consistent, while also increasing our market presence in the common alloy markets.

Unlike some of our principal competitors, we do not manufacture aluminum from bauxite. Instead, we process aluminum scrap and prime aluminum
manufactured by third parties. As a result, we do not have the capital requirements and high fixed costs associated with the production of prime aluminum. Historically, prices of our aluminum can sheet and other products have been directly
correlated to the prices of our metal costs due to the standard industry practice of passing through metal costs to customers, subject to the impacts of metal ceiling or price caps. The Company expects to have no impact from metal
ceilings in 2007.

Restatement

As
discussed in Note 2 to the consolidated financial statements on Form 10Q for the quarter ended September 30, 2007, the Company restated its financial statements as of December 31, 2006 and the three and nine month periods ended
September 30, 2006 to:



| | 1. | Correct the presentation of the LIFO reserve as of December 31, 2006;
| | -- | ---------------------------------------------------------------------



| | 2. | Properly present its pension benefit obligation amounts as of December 31, 2006 in accordance with SFAS 87;
| | -- | -----------------------------------------------------------------------------------------------------------



| | 3. | Correct the presentation of members equity at December 31, 2006 to comply with SFAS 130; and
| | -- | ---------------------------------------------------------------------------------------------



| | 4. | Correct the classification of shipping and handling fees for the three and nine month periods ended September 30, 2006 in accordance with EITF 00-10.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------

Quarterly Information

Our quarterly revenues tend
to fluctuate period to period based in large part on changes in aluminum prices. These changes generally do not affect our cash flow because we seek to match our hedging positions to our contractually-obligated sales agreements. We also pass
aluminum cost increases to customers through an indexed pricing mechanism and/or by fixing the cost of metal through forward contracts on the London Metals Exchange (LME). Our net income may also fluctuate period to period based on the
mark to market adjustments for derivatives we hold to hedge aluminum and natural gas. Because we do not designate our forward contracts as hedges under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activity, we are
required to recognize the non-cash mark to market adjustment in our current earnings and these adjustments may be material.

Critical Accounting
Policies

We have prepared our financial statements in conformity with accounting principles generally accepted in the United States.
These statements include some amounts that are based on informed judgments and estimates of management. Our critical accounting policies are discussed in Item 7, Managements Discussion and Analysis of Financial Condition and Results
of Operations  Critical Accounting Policies in our Annual Report on Form 10-K/A, for the year ended December 31, 2006, filed March 3 2008. Since the date of our 2006 Form 10-K/A, there have been no changes to our critical accounting
policies or the methodologies and assumptions applied under them.



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Operating Results

Three months ended September 30, 2007 and 2006

Sales.Consolidated sales decreased from
$279.3 million in the three months ended September 30, 2006, to $244.8 million in the comparable period in 2007, a decrease of $34.5 million or 12%. The decrease was a result of lower shipments decreasing from 203.8 million pounds in the
three months ended September 30, 2006 to 174.6 million pounds in the third quarter of 2007, a decrease of 14%.

Wise Alloys sales
decreased from $240.3 million in the three months ended September 30, 2006 to $208.3 million in the comparable period in 2007, a decrease of $32.0 million or 13%. Third quarter shipments were lower due mostly to can sheet customers reducing
inventory quantities from year-end levels combined with the effect of slightly lower contractual volumes which resulted from negotiations to improve pricing. Shipment volumes decreased from 171.5 million pounds in the three months ended
September 30, 2006 to 132.3 million pounds in the third quarter of 2007, a decrease of 39.2 million pounds or 23%. Offsetting the decrease in shipment volumes were price increases that were effective on January 1, 2007.

Wise Recycling sales to third parties decreased from $38.9 million in the three months ended September 30, 2006 to $36.2 million in
the comparable period in 2007, a decrease of $2.7 million or 7%. Shipments by Wise Recycling to third parties increased approximately 31% for the third quarter of 2007 over the third quarter of 2006 due to higher recycling activity and an increased
presence in the ferrous market. Average sales price decreased from $1.14 per pound in the third quarter of 2006 to $0.88 per pound in the third quarter of 2007 due mostly to the increased presence of ferrous metal in the sales mix which has a
significantly lower price per pound than other product categories.

Cost of Sales. Consolidated cost of sales decreased from $300.6
million in the three months ended September 30, 2006, to $255.5 million in the three months ended September 30, 2007, a decrease of $45.1 million or 15%. The decrease in consolidated cost of sales was primarily due to the decrease in
shipments.

Wise Alloys cost of sales decreased from $257.7 million in the three months ended September 30, 2006 to $221.8 million in
the three months ended September 30, 2007, a decrease of $35.9 million or 14%. Metal costs, representing 85% of Alloys cost of sales in the third quarter of 2006 and 71% in the third quarter of 2007, decreased from $214.6 million in the third
quarter of 2006 to $157.3 million in the third quarter of 2007, a decrease of $57.3 million or 27%. The decrease is attributable to the 23% decrease in Alloys shipments and a 5% decrease in metal prices. This also included a 16% decrease in natural
gas cost from $8.64 per mmBTUs for the three months ended September 30, 2006 to $7.22 per mmBTUs for the comparable period in 2007.

Wise Recycling cost of sales associated with third party sales decreased from $35.0 million in the three months ended September 30, 2006 to $34.3 million in the three months ended September 30, 2007, a
decrease of 2%. The decrease can be attributed to decreased costs per pound due to the increased level of lower costing ferrous metal at Recycling partially offset by the increased volumes of both ferrous and non-ferrous metal.

Selling, General and Administrative. Selling, general and administrative expense increased from $2.0 million in the third quarter of 2006 to $3.0
million in the third quarter of 2007.

Interest Expense and Fees. Interest expense and fees increased from $8.6 million in the third
quarter of 2006 to $9.4 million in the third quarter of 2007 due to higher outstanding amounts on our line of credit in addition to additional interest paid under the Companys financing agreement. The increase was due to higher working capital
needs caused by higher metal prices.



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Mark-to-Market for Contracts under SFAS No. 133.This expense represents the non-cash gain we
recognized from changes in the value of our derivative financial instruments. The unrealized gains and losses were primarily a result of forward contracts entered into to hedge the cost of natural gas and aluminum. The fair value decrease during the
third quarter of 2006 was $22.0 million compared to a decrease of $2.6 million during the third quarter of 2007.

Nine months ended
September 30, 2007 and 2006

Sales.Consolidated sales decreased from $791.2 million in the nine months ended
September 30, 2006, to $781.4 million in the comparable period in 2007, a decrease of $9.8 million or 1%. The decrease was primarily a result of lower shipments which decreased from 581.1 million pounds in the first nine months of 2006 to
545.2 million pounds in 2007 offset partially by increased pricing.

Wise Alloys sales decreased from $688.8 million in the nine
months ended September 30, 2006 to $670.3 million in the comparable period in 2007, a decrease of $18.5 million or 3%. The first nine months shipments were lower due mostly to can sheet customers reducing inventory quantities from year-end
levels combined with the effect of slightly lower contractual volumes which resulted from negotiations to improve pricing. Shipment volumes decreased from 492.1 million pounds in the nine months ended September 30, 2006 to
423.5 million pounds in the first nine months of 2007, a decrease of 68.6 million pounds or 14%. Partially offsetting the decrease in shipment volumes were price increases that were effective on January 1, 2007.

Wise Recycling sales to third parties increased from $101.5 million in the nine months ended September 30, 2006 to $109.5 million in the comparable
period in 2007, an increase of $8.0 million or 8%.

Shipments by Wise Recycling to third parties increased approximately 37% for the first
nine months of 2007 over the first nine months of 2006 due to higher recycling activity and an increased presence in the ferrous market. Average sales price decreased from $1.09 per pound in the first nine months of 2006 to $0.93 per pound in the
first nine months of 2007 due mostly to the increased presence of ferrous metal in the sales mix which has a significantly lower price per pound than other product categories.

Cost of Sales. Consolidated cost of sales decreased from $805.2 million in the nine months ended September 30, 2006, to $777.2 million in the
nine months ended September 30, 2007, a decrease of $28.0 million.

Wise Alloys cost of sales decreased from $722.7 million in the
nine months ended September 30, 2006 to $672.4 million in the nine months ended September 30, 2007, a decrease of $50.3 million or 7%. Metal costs, representing 76% of Alloys cost of sales in the first nine months of 2006 and 71% in the
first nine months of 2007, decreased from $547.9 million in 2006 to $479.5 million in 2007, a decrease of $68.4 million or 12%. The decrease is attributable to the 14% decrease in Alloys shipments and also includes a 17% decrease in natural
gas cost from $10.03 per mmBTUs for the nine months ended September 30, 2006 to $8.28 per mmBTUs for the comparable period in 2007 and is partially offset by higher metal prices.

Wise Recycling cost of sales associated with third party sales increased from $89.6 million in the nine months ended September 30, 2006 to $101.4
million in the nine months ended September 30, 2007, an increase of 13%. The increase can be attributed to the increased volumes at Recycling.

Selling, General and Administrative. Selling, general and administrative expense increased from $7.9 million in the first nine months of 2006 to $8.5 million in the first nine months of 2007.

Interest Expense and Fees. Interest expense and fees increased from $24.2 million in the first nine months of 2006 to $27.9 million in the first
nine months of 2007 due to higher outstanding amounts on our line of credit in addition to additional interest paid under the Companys financing agreement. The increase was due to higher working capital needs caused by higher metal prices.

Mark-to-Market for Contracts under SFAS No. 133.This income or loss represents the non-cash gain we recognized from changes
in the value of our derivative financial instruments. The unrealized gains were primarily a result of forward contracts entered into to hedge the cost of natural gas and aluminum. The fair value decrease during the first nine months of 2006 was
$20.7 million compared to an increase of $5.1 million during the first nine months of 2007.



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Liquidity and Capital Resources

The following discusses material changes in our liquidity and capital resources in the nine months ended September 30, 2007.

As of September 30, 2007, the outstanding balance on our revolving line of credit facility was $169.7 million. In addition, we had approximately $1.7 million of outstanding letters of credit against our $207.5
million revolving credit line. Our senior credit agreement and indenture agreement contain restrictive covenants. These covenants may constrain our activities and limit our operational and financial flexibility. The failure to comply with these
covenants could result in an event of default, which, if not cured or waived, could have a material adverse effect on our business, financial condition, and results of operations. The termination date on the facility is May 5, 2009. The
facility is considered short term due to the use of a lockbox as well as material adverse effect language within the agreement. The terms of the credit facility permit us to enter into various forms of additional financing with varying amounts. See
Note 5 of the Notes to the Condensed Consolidated Financial Statements above for further discussion. Furthermore, we frequently offer cash discounts for early payment against receivables from our major can sheet customers which can also decrease
outstanding debt and increase overall liquidity.

Our liquidity has been directly impacted by aluminum prices which have increased steadily
and dramatically since 2002. Average aluminum prices in 2002 were 65.4 cents per pound and have risen over 87% to average $1.22 per pound in 2006 and risen still further to average $1.26 per pound for the nine months ended September 30, 2007.
These price increases have impacted and are continuing to impact our working capital requirements resulting in higher outstanding debt supported by higher levels of receivables and inventory. Our net liquidity is determined based on a standard
borrowing base formula which accounts for the collateral value of inventory and receivables on a basis approximating the lower of current cost (on a first-in-first-out, or FIFO basis) or fair market value. This borrowing base is then compared to the
outstanding loan balance including outstanding letters of credit to determine a net amount available for additional borrowings. Our liquidity could also be hampered if we incurred significant unexpected increases in necessary capital expenditures.
Significant increases in volumes could also impact our liquidity. See Item 1A, Risk Factors in our annual report on Form 10-K/A, for the year ended December 31, 2006, filed on March 4, 2008, for certain circumstances that could
adversely affect our liquidity. Decreased sales or lower margins could have a material adverse effect on our liquidity. While the metal price ceilings materially impacted sales in 2004, 2005 and 2006, the Company expects to have no impact from metal
price ceilings in 2007.

If we do not comply with these or other covenants and restrictions contained in our senior secured credit
facility, the indenture and other agreements governing our indebtedness, we could be in default under those agreements, and the debt under those instruments, together with accrued interest, could then be declared immediately due and payable. If we
default under our senior secured credit facility, the lenders could cause all of our outstanding debt obligations under our senior secured credit facility to become due and payable, require us to apply all of our cash to repay the indebtedness or
prevent us from making debt service payments on any other indebtedness we owe. In addition, any default under our senior secured credit facility or agreements governing our other indebtedness could lead to an acceleration of debt under other debt
instruments that contain cross-acceleration or cross-default provisions. If the indebtedness under our senior secured credit facility and indenture is accelerated, we may have to seek other sources of financing or otherwise may not have sufficient
assets to repay amounts due under our senior secured credit facility, our senior secured notes or under other debt securities then outstanding. Our ability to comply with these provisions of our senior secured credit facility, the indenture and
other agreements governing our other indebtedness may be affected by changes in economic or business conditions or other events beyond our control.

Subsequent to September 30, 2007, the Company reached agreement with the Retirement Systems of Alabama (RSA) in which the RSA agreed to purchase $75 million of cumulative-convertible 10% PIK preferred membership interests of the
Company. The preferred interest is convertible into 25 percent of the



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##### Table of Contents

common interest of the Company. The Company has the right to call the preferred membership interest after seven years at the cost of the greater of the
investment plus any accrued PIK dividends or the fair market value of the preferred interest on an as converted basis.

Subsequent to
September 30, 2007 the Company reached agreement with the labor unions at the Alloys facility resulting in a new 5-year contract beginning November 1, 2007. As part of the agreement the unions pension benefits will now be provided
through multi-employer funds administered through the Steelworkers Pension Trust, the Central Pension Fund and the Tri-State Carpenters Fund. The Wise defined benefit pension will be frozen as of the date of the new contract.

Nine months ended September 30, 2007 and 2006.

Operating Activities. During the nine months ended September 30, 2007, net cash provided by operating activities was $8.6 million, compared to net cash used of $44.7 million during the nine months ended
September 30, 2006. Fluctuations in cash used in and provided by operating activities are subject to changing working capital requirements especially for accounts receivable and inventory. During the nine months ended September 30, 2006,
accounts receivable increased from $73.3 million at December 31, 2005, to $99.4 million at September 30, 2006, representing an increase of $26.1 million due mostly to higher metal prices. In the nine months ended September 30, 2007,
receivables increased from $104.1 million at December 31, 2006, to $115.2 million at September 30, 2007, an increase of $11.1 million due to higher metal prices.

Effective June 30, 2006 the Company executed an asset sale agreement with a financial institution that allows the Company to sell certain accounts
receivable up to $17 million on a non-recourse basis. This agreement was due to expire on December 31, 2006. On December 31, 2006 the agreement was renewed and extended to June 29, 2007, and allowed the Company to sell certain
accounts receivable up to $10 million on a non-recourse basis. The agreement was further amended on April 9, 2007 to increase the facility to a total of $20 million and extend the term of the agreement to June 29, 2007. The Company has not
renewed the agreement which had been extended to June 29, 2007 and therefore as of September 30, 2007, the Company had no sales of accounts receivable under this agreement.

Investing Activities. In the nine months ended September 30, 2007, our capital expenditures were $12.2 million, compared to $8.2 million
during the same period in 2006. Both nine month periods included some significant projects leading to relatively higher expenditures. Projects in the first nine months of 2006 included expansion of one of our recycling facilities and a major project
to upgrade one of our furnaces. Projects in the first nine months of 2007 included a significant furnace rebuild. The Company is continuing the next step in a program to further diversify industry product offerings by adding increased width to its
aluminum can-stock capabilities. The results of this phase will extend the width of Wise Alloys can stock from 60 inches to 72 inches by the end of 2008. This project will allow Wise Alloys can-sheet product to become also available to
beverage-can producers that use 14 and 15 out extended-width cupping presses in their manufacturing process.

Financing
Activities. Net cash provided by financing activities was $2.5 million in the nine months ended September 30, 2007, compared to $49.5 million in the first nine months of 2006. Net cash provided by financing activities was related to
increased borrowings under the revolving line of credit to fund increased working capital needs due to an increase in inventories in 2007 and primarily due to higher aluminum prices in 2006 and capital expenditures.

In 2006 the Company executed a sale-financing agreement on certain pieces of production equipment with The Employees Retirement System of Alabama
in the amount of $29.9 million. The agreement executed on November 13, 2006 provided the Company with an initial funding of $14.95 million followed by an additional $14.95 million which the Company drew down on January 3, 2007. The
agreement qualifies as a capital lease and has a three-year term with a fixed interest rate of 10.7%.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

See Item 7A of the Companys
Annual Report on Form 10-K on Form 10-K/A, for the year ended December 31, 2006, filed on February, 29, 2008.



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ITEM 4. CONTROLS AND PROCEDURES

(a) Disclosure Controls and Procedures

As stated in Note 2 to the consolidated financial statements in Form 10-K/A for the year ended December 31, 2006 , we have restated our financial
statements for the years ended December 31, 2006, 2005 and 2004 and related disclosures. We have also restated our interim financial statements for the three months ended March 31, 2007 and 2006 and the six months ended June 30, 2007 and 2006.

As of September 30, 2007, our management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), has
conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Securities Exchange Act Rule 13a-15(e), as amended). Based on the evaluation, our CEO and CFO concluded that our disclosure controls and procedures
as of September 30, 2007 were not effective because of a material weakness in internal control over financial reporting described below. The CEO and CFOs original conclusions regarding the effectiveness of their disclosure controls and
procedures as well as the identification of a material weakness in those controls and procedures was not affected by this restatement.

A
material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will
not be prevented or detected on a timely basis.

As previously disclosed in Item 9A of our 2006 Annual Report on Form 10-K/A, we
identified the following material weakness as of December 31, 2006, which also existed as of September 30, 2007:

The Company has
not maintained sufficient staff with appropriate training in US GAAP and SEC financial rules and regulations. This deficiency has led to material misstatements and the restatement of the Companys financial statements.

(b) Status of Plan for Remediation of Material Weakness

The Company has evaluated its resource requirements to ensure the timely and effective review and management of its financial reporting. The Company has formed a Finance Committee consisting of various financial and
accounting personnel to regularly review the effectiveness of internal control over reporting and is evaluating staffing requirements and implementing training programs to ensure the preparation of financial statements in accordance with GAAP. It
has also added and is continuing to add additional financial staff, and has reviewed and updated scheduling and planning protocols in place to ensure continued timely compliance with SEC reporting deadlines. The formation of a Finance Committee, the
addition of financial staff and the updating of protocols will ensure that misstatements similar to those addressed by this restatement will not occur in the future.

Despite making progress during the first three quarters of 2007, the remedial action described above is ongoing and is not yet complete. Therefore, the material weakness identified in the Companys Annual Report
on Form 10-K/A for the year ended December 31, 2006 has not been remediated as of September 30, 2007.

We are continuing to
perform the systems and process evaluation testing of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, in order to allow management to report on the internal control over financial reporting
which will be required for the fiscal year ending December 31, 2007. Furthermore, the Company has begun to execute a plan to engage an external consulting firm to assist in a review of its internal control over financial reporting and to
develop a plan to test those controls over financial reporting and assist management in any required remediation activity.

(c) Changes in
Internal Control Over Financial Reporting

There was no change in the Company's internal control over financial reporting that occurred
during the third fiscal quarter ended September 30, 2007, nor as a result of this restatement that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting



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PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are a defendant from time to time in various legal actions arising in the
normal course of business, the outcomes of which, in the opinion of management, neither individually nor in the aggregate are likely to result in a material adverse effect on our business, results of operations or financial condition. The following
describes material developments in the third quarter of 2007 with respect to those proceedings reported in Amendment No. 1 to our Annual Report on Form 10-K/A, filed on March 4, 2008, for the year ended December 31, 2006.

The Company was a defendant in an action brought by a former executive seeking compensatory damages previously pending in Delaware State Court. The
plaintiff alleged that certain transactions between Wise Metals Group members violated the Companys Limited Liability Company Agreement because other members were not afforded the opportunity to participate on equal terms, breach of fiduciary
duty and conversion of a portion of the plaintiffs equity interest in the Company. On June 25, 2007 the parties reached a settlement whereby in exchange for $2 million, the plaintiff would surrender his equity interest in the Company,
forgo any claim for a $1 million severance that plaintiff alleges would otherwise come due on his 62nd birthday and provide the Company with a general release of any existing or potential claims. This settlement was approved by the court and the
action was dismissed on June 25, 2007 and the Company paid the settlement during the quarter ended September 30, 2007.

On
August 11, 2006 the Company filed a lawsuit against Crown Cork and Seal (USA) (Crown), Inc. in state court in Alabama (Alabama Action) for breach of contract and seeking a declaratory judgment on our beverage can sheet
and food sheet contracts. The lawsuit alleges damages because of breaches by Crown of the beverage can sheet contract, and asks the court to interpret certain pricing provisions of the food contract. On January 26, 2007, Crown entered a
counterclaim asserting breach of contract and seeking declaratory judgments on our beverage can sheet and food container contracts.

On
September 8, 2006, Crown filed a lawsuit against the Company in state court in Pennsylvania (Pennsylvania Action) for breach of contract and seeking declaratory judgments on our beverage can sheet and food container contracts. The
Pennsylvania Action has been stayed upon the Companys motion pending resolution of the Alabama Action.

The Company intends to
vigorously contest the Pennsylvania Action and the counterclaim in the Alabama Action and at this time is unable to determine the reasonably likely outcome of both the Companys and Crowns claims. In the opinion of management, amounts
accrued for exposures relating to the aforementioned contingencies, and other legal proceedings are adequate and, accordingly, the ultimate resolution of these matters is not expected to have a material adverse effect on the Companys
consolidated financial statements.

ITEM 1A. RISK FACTORS

There were no material changes from the risk factors as previously disclosed in our
Annual Report on Form 10-K/A, for the year ended December 31, 2006, filed on March 4, 2008.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Reference is made to Current Report
Form 8-K filed October 4, 2007 with respect to the purchase of $75 million of Preferred Membership Interest in the Company by RSA. Exemption from registration is claimed under Section 4(2) of the Securities Act as this transaction did not
involve a public offering.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.



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

On October 5, 2007, Members of the
Company constituting a Majority in Interest (as defined in the Second Amended and Restated Limited Liability Company Agreement of the Company dated May 24, 2004) resolved in writing that, in connection with the purchase of $75 million of
Preferred Membership Interest in the Company by RSA, the Company shall execute and deliver: (1) the Preferred Membership Interest Purchase Agreement dated October 4, 2007; (2) the Registration Rights Agreement dated October 5,
2007; (3) the Third Amended and Restated Limited Liability Agreement of the Company dated October 5, 2007.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS



|      |  |                                                                                                                                                                                             
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.2   |  | Third Amended and Restated Limited Liability Agreement of the Company dated October 5, 2007.                                                                                                
|      | 
|10.45 |  | Amendment No. 11 to Amended and Restated Loan Agreement, dated July 31, 2007, by and among the Issuers, the Guarantors, and Wachovia Corporation (formerly Congress Financial) as
Agent.    
|      | 
|10.46 |  | Preferred Membership Interest Purchase Agreement dated October 4, 2007 by and among the Company, the Teachers Retirement System of Alabama and the Employees Retirement System of
Alabama.
|      | 
|10.47 |  | Registration Rights Agreement dated October 5, 2007 by and among the Company, the Teachers Retirement System of Alabama and the Employees Retirement System of
Alabama.                   
|      | 
|31.1  |  | Certification of Chief Executive Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.                                                                                    
|      | 
|31.2  |  | Certification of Chief Financial Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.                                                                                    
|      | 
|32.1  |  | Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                         
|      | 
|32.2  |  | Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                         



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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.



|                     |  |  |  |                                     
|-------------------- |  |  |  | ------------------------------------
|                     |  |  |  | WISE METALS GROUP LLC               
|                     |  | 
|Dated: March 4, 2008 |  |  |  | /s/ David DAddario                 
|                     |  |  |  | David DAddario                     
|                     |  |  |  | Chairman and Chief Executive Officer
|                     |  | 
|                     |  |  |  | /s/ Kenneth Stastny                 
|                     |  |  |  | Kenneth Stastny                     
|                     |  |  |  | Chief Financial Officer             



28