| For the quarter ended June 30, 2009 | Commission file number 1-3919 |
|-------------------------------------|-------------------------------|

| Keystone Consolidated Industries, Inc.                 |
|--------------------------------------------------------|
| (Exact name of Registrant as specified in its charter) |

| Delaware                                                      |   | 37-0364250                       |
|---------------------------------------------------------------|--------|----------------------------------|
| (State or other jurisdiction ofIncorporation or organization) |   | (IRS EmployerIdentification No.) |

| 5430 LBJ Freeway, Suite 1740,Three Lincoln Centre, Dallas, Texas |   | 75240-2697 |
|------------------------------------------------------------------|--------|------------|
| (Address of principal executive offices)                         |   | (Zip Code) |

| Registrant’s telephone number, including area code: | (972) 458-0028 |
|-----------------------------------------------------------|----------------|
|                                                      |           |

|   | * | The registrant has not yet been phased into the interactive data requirements. |
|--------|---|--------------------------------------------------------------------------------|

----

| Part I.     FINANCIAL INFORMATION                                                                                                                               |  Page  |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------|
|                                                                                                                                                                                     |             |
| Item 1.    Financial Statements                                                                                                                                      |             |
|                                                                                                                                                                                     |             |
| Condensed Consolidated Balance Sheets –        December 31, 2008; June 30, 2009 (unaudited)                                                     | 3                |
|                                                                                                                                                                                     |             |
| Condensed Consolidated Statements of Operations (unaudited) -    Three months and six months ended June 30, 2008 and 2009                                            | 5                |
|                                                                                                                                                                                     |             |
| Condensed Consolidated Statements of Cash Flows (unaudited) –    Six months ended June 30, 2008 and 2009                                                       | 6                |
|                                                                                                                                                                                     |             |
| Condensed Consolidated Statement of Stockholders' Equity    and Comprehensive Income (unaudited) -      Six months ended June 30, 2009 | 7                |
|                                                                                                                                                                                     |             |
| Notes to Condensed Consolidated Financial Statements (unaudited)                                                                                                                         | 8                |
|                                                                                                                                                                                     |             |
| Item 2.    Management's Discussion and Analysis of Financial        Condition and Results of Operations                      | 17               |
|                                                                                                                                                                                     |             |
| Item 3.    Quantitative and Qualitative Disclosures About Market Risk                                                                                                | 30               |
|                                                                                                                                                                                     |             |
| Item 4.    Controls and Procedures                                                                                                                                   | 31               |
|                                                                                                                                                                                     |             |
| PART II.   OTHER INFORMATION                                                                                                                                              |             |
|                                                                                                                                                                                     |             |
| Item 1.    Legal Proceedings                                                                                                                                         | 32               |
|                                                                                                                                                                                     |             |
| Item 1A.    Risk Factors                                                                                                                                                  | 32               |
|                                                                                                                                                                                     |             |
| Item 4.    Submission of Matters to a Vote of Security Holders                                                                                                       | 32               |
|                                                                                                                                                                                     |             |
| Item 6.    Exhibits                                                                                                                                                  | 32               |
|                                                                                                                                                                                     |             |
| Items 2, 3 and 5 of Part II are omitted because there is no information to report.                                                                                                       |             |

----

|                                                      |   | December 31, |    |   | June 30,    |   |
|-----------------------------------------------------------|--------|--------------|---------|--------|-------------|--------|
| ASSETS                                                    |   |  2008   |    |   | 2009        |   |
|                                                      |   |         |    |   | (unaudited) |   |
|                                                      |   |         |    |   |        |   |
| Current assets:                                           |   |         |    |   |        |   |
|   Accounts receivable, net                      |   | $            | 26,612  |   |        | $      | 36,404 |   |
|   Inventories                                   |   |         | 70,858  |   |        |   | 51,535 |   |
|   Deferred income taxes                         |   |         | 14,373  |   |        |   | 14,373 |   |
|   Income taxes receivable                       |   |         | -       |   |        |   | 3,487 |   |
|   Prepaid expenses and other                    |   |         | 2,724   |   |        |   |  1,776 |   |
|                                                      |   |         |    |   |        |   |   |   |
|     Total current assets              |   |         | 114,567 |   |        |   | 107,575 |   |
|                                                      |   |         |    |   |        |   |   |   |
| Property, plant and equipment:                            |   |         |    |   |        |   |   |   |
|   Land                                          |   |         | 1,468   |   |        |   | 1,468 |   |
|   Buildings and improvements                    |   |         | 59,598  |   |        |   | 60,092 |   |
|   Machinery and equipment                       |   |         | 317,573 |   |        |   | 324,356 |   |
|   Construction in progress                      |   |         | 9,421   |   |        |   | 5,343 |   |
|                                                      |   |         | 388,060 |   |        |   | 391,259 |   |
|   Less accumulated depreciation                 |   |         | 298,073 |   |        |   | 304,752 |   |
|                                                      |   |         |    |   |        |   |   |   |
|     Net property, plant and equipment |   |         | 89,987  |   |        |   | 86,507 |   |
|                                                      |   |         |    |   |        |   |   |   |
| Other assets:                                             |   |         |    |   |        |   |   |   |
|   Restricted investments                        |   |         | 2,277   |   |        |   | 2,277 |   |
|   Pension asset                                 |   |         | 41,651  |   |        |   | 48,410 |   |
|   Other, net                                    |   |         | 1,251   |   |        |   | 1,133 |   |
|                                                      |   |         |    |   |        |   |   |   |
|     Total other assets                |   |         | 45,179  |   |        |   | 51,820 |   |
|                                                      |   |         |    |   |        |   |   |   |
|                                                      |   |         |    |   |        |   |   |   |
|     Total assets                      |   | $            | 249,733 |   |        | $      | 245,902 |   |
|                                                      |   |         |    |   |        |   |   |   |

----

| LIABILITIES AND STOCKHOLDERS' EQUITY                                     |   | December 31, |         |   | June 30,    |   |
|--------------------------------------------------------------------------|--------|--------------|--------------|--------|-------------|--------|
|                                                                     |   | 2008    |         |   | 2009   |   |
|                                                                     |   |         |         |   | (unaudited) |   |
|                                                                     |   |         |         |   |        |   |
| Current liabilities:                                                     |   |         |         |   |        |   |
|   Notes payable and current maturities of long-term debt  |   | $            |  18,848 |   |        | $      | 32,176 |   |
|   Accounts payable                                             |   |         | 7,776        |   |        |   | 7,036 |   |
|   Accrued OPEB cost                                            |   |         | 1,372        |   |        |   | 1,372 |   |
|   Income taxes payable                                         |   |         | 1,116        |   |        |   | - |   |
|   Other accrued liabilities                                    |   |         | 29,569       |   |        |   | 16,050 |   |
|                                                                     |   |         |         |   |        |   |   |   |
|     Total current liabilities                        |   |         | 58,681       |   |        |   | 56,634 |   |
|                                                                     |   |         |         |   |        |   |   |   |
| Noncurrent liabilities:                                                  |   |         |         |   |        |   |   |   |
|   Long-term debt                                               |   |         | 12,782       |   |        |   | 9,532 |   |
|   Accrued pension cost                                         |   |         | 1,319        |   |        |   | 1,085 |   |
|   Accrued OPEB cost                                            |   |         | 42,560       |   |        |   | 43,279 |   |
|   Deferred income taxes                                        |   |         | 8,284        |   |        |   | 12,752 |   |
|   Other accrued liabilities                                    |   |         | 6,463        |   |        |   | 2,540 |   |
|                                                                     |   |         |         |   |        |   |   |   |
|     Total noncurrent liabilities                     |   |         | 71,408       |   |        |   | 69,188 |   |
|                                                                     |   |         |         |   |        |   |   |   |
|                                                                     |   |         |         |   |        |   |   |   |
| Stockholders' equity:                                                    |   |         |         |   |        |   |   |   |
|   Common stock                                                 |   |         | 125          |   |        |   | 125 |   |
|   Additional paid-in capital                                   |   |         | 100,111      |   |        |   | 100,111 |   |
|   Accumulated other comprehensive loss                         |   |         | (160,415     | )      |        |   | (156,605 | ) |
|   Retained earnings                                            |   |         | 180,619      |   |        |   | 177,245 |   |
|   Treasury stock                                               |   |         | (796         | )      |        |   | (796 | ) |
|                                                                     |   |         |         |   |        |   |   |   |
|     Total stockholders' equity                       |   |         | 119,644      |   |        |   | 120,080 |   |
|                                                                     |   |         |         |   |        |   |   |   |
|     Total liabilities and stockholders’ equity |   | $            | 249,733      |   |        | $      | 245,902 |   |
|                                                                     |   |         |         |   |        |   |   |   |

----

|                                                           |   | Three months ended      June 30,  |         |   | Six months ended  June 30, |   |
|----------------------------------------------------------------|--------|------------------------------------------------------------|--------------|--------|---------------------------------|--------|
|                                                           |   | 2008                                                       |         |   | 2009                            |   |   | 2008  |   |   | 2009 |   |
|                                                           |   | (unaudited)                                                |         |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |
| Net sales                                                      |   | $                                                          | 178,027      |   |                            | $      | 70,511 |   |   | $ | 312,166 |   |   | $ | 130,986 |   |
| Cost of goods sold                                             |   |                                                       | (156,290     | )      |                            |   | (65,272 | ) |   |   | (283,303 | ) |   |   | (127,546 | ) |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
|   Gross margin                                       |   |                                                       | 21,737       |   |                            |   | 5,239 |   |   |   |  28,863 |   |   |   | 3,440 |   |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
| Other operating income (expense):                              |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
|   Selling expense                                    |   |                                                       | (1,892       | )      |                            |   | (1,672 | ) |   |   | (3,763 | ) |   |   | (3,278 | ) |
|   General and administrative expense                 |   |                                                       | (3,990       | )      |                            |   | (803 | ) |   |   | (7,663 | ) |   |   | (3,861 | ) |
|   Defined benefit pension credit (expense)           |   |                                                       | 17,938       |   |                            |   | (1,513 | ) |   |   | 36,934 |   |   |   | (3,028 | ) |
|   Other postretirement benefit credit                |   |                                                       | 2,338        |   |                            |   | 1,260 |   |   |   |  4,536 |   |   |   | 2,520 |   |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
|     Total other operating income (expense) |   |                                                       | 14,394       |   |                            |   | (2,728 | ) |   |   | 30,044 |   |   |   | (7,647 | ) |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
| Operating income (loss)                                        |   |                                                       | 36,131       |   |                            |   | 2,511 |   |   |   | 58,907 |   |   |   | (4,207 | ) |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
| Nonoperating income (expense):                                 |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
|   Interest expense                                   |   |                                                       | (932         | )      |                            |   | (408 | ) |   |   | (2,245 | ) |   |   | (740 | ) |
|   Other income (expense), net                        |   |                                                       | (92          | )      |                            |   | 104 |   |   |   | 298 |   |   |   | 102 |   |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
|     Total nonoperating expense             |   |                                                       | (1,024       | )      |                            |   | (304 | ) |   |   | (1,947 | ) |   |   | (638 | ) |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
|   Income (loss) before income taxes                  |   |                                                       | 35,107       |   |                            |   | 2,207 |   |   |   | 56,960 |   |   |   | (4,845 | ) |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
| Income tax benefit (expense)                                   |   |                                                       | (13,188      | )      |                            |   | (1,207 | ) |   |   | (21,431 | ) |   |   | 1,471 |   |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
|   Net income (loss)                                  |   | $                                                          | 21,919       |   |                            | $      | 1,000 |   |   | $ | 35,529 |   |   | $ | (3,374 | ) |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
| Basic and diluted income (loss) per share                      |   | $                                                          | 1.81         |   |                            | $      | 0.08 |   |   | $ | 3.25 |   |   | $ | (0.28 | ) |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |
| Basic and diluted weighted average shares outstanding     |   |                                                       |  12,102 |   |                            |   | 12,102 |   |   |   |  10,948 |   |   |   | 12,102 |   |
|                                                           |   |                                                       |         |   |                            |   |   |   |   |   |   |   |   |   |   |   |

----

|                                                                          |   | Six months ended   June 30, |    |
|-------------------------------------------------------------------------------|--------|---------------------------------------|---------|
|                                                                          |   | 2008                                  |    |   | 2009 |   |
|                                                                          |   | (unaudited)                           |    |
|                                                                          |   |                                  |    |   |   |   |
| Cash flows from operating activities:                                         |   |                                  |    |   |   |   |
|   Net income (loss)                                                 |   | $                                     | 35,529  |   |   | $ | (3,374 | ) |
|   Depreciation and amortization                                     |   |                                  | 7,892   |   |   |   | 7,249 |   |
|   Deferred income taxes                                             |   |                                  | 20,051  |   |   |   | 2,171 |   |
|   Defined benefit pension expense (credit)                          |   |                                  | (36,934 | ) |   |   | 3,028 |   |
|   OPEB credit                                                       |   |                                  | (4,536  | ) |   |   | (2,520 | ) |
|   OPEB payments                                                     |   |                                  | (1,985  | ) |   |   | (675 | ) |
|   Bad debt expense                                                  |   |                                  | 38      |   |   |   | 2,530 |   |
|   Inventory impairment                                              |   |                                  | -       |   |   |   | 1,495 |   |
|   Other, net                                                        |   |                                  | 489     |   |   |   | 246 |   |
|   Change in assets and liabilities:                                 |   |                                  |    |   |   |   |   |   |
|     Accounts receivable                                   |   |                                  | (28,671 | ) |   |   | (12,332 | ) |
|     Inventories                                           |   |                                  | (2,949  | ) |   |   | 17,828 |   |
|     Accounts payable                                      |   |                                  | 303     |   |   |   | (740 | ) |
|     Accrued environmental costs                           |   |                                  | (262    | ) |   |   | (4,250 | ) |
|     Accrued liabilities                                   |   |                                  | 6,072   |   |   |   | (13,192 | ) |
|     Income taxes                                          |   |                                  | 1,174   |   |   |   | (4,603 | ) |
|     Other, net                                            |   |                                  | 892     |   |   |   | 975 |   |
|                                                                          |   |                                  |    |   |   |   |   |   |
|       Net cash used in operating activities     |   |                                  | (2,897  | ) |   |   | (6,164 | ) |
|                                                                          |   |                                  |    |   |   |   |   |   |
| Cash flows from investing activities:                                         |   |                                  |    |   |   |   |   |   |
|   Capital expenditures                                              |   |                                  | (4,762  | ) |   |   | (3,933 | ) |
|   Restricted investments, net                                       |   |                                  | (15     | ) |   |   | - |   |
|   Other, net                                                        |   |                                  | 360     |   |   |   | 55 |   |
|                                                                          |   |                                  |    |   |   |   |   |   |
|       Net cash used in investing activities     |   |                                  | (4,417  | ) |   |   | (3,878 | ) |
|                                                                          |   |                                  |    |   |   |   |   |   |
| Cash flows from financing activities:                                         |   |                                  |    |   |   |   |   |   |
|   Issuance of common stock                                          |   |                                  | 24,713  |   |   |   | - |   |
|   Revolving credit facility, net                                    |   |                                  | (3,633  | ) |   |   | 22,394 |   |
|   Principal payments on other notes payable and long-term debt |   |                                  | (13,622 | ) |   |   | (12,337 | ) |
|   Deferred financing costs paid                                     |   |                                  | (144    | ) |   |   | (15 | ) |
|                                                                          |   |                                  |    |   |   |   |   |   |
|       Net cash provided by financing activities |   |                                  | 7,314   |   |   |   | 10,042 |   |
|                                                                          |   |                                  |    |   |   |   |   |   |
| Net change in cash and cash equivalents                                       |   |                                  | -       |   |   |   | - |   |
|                                                                          |   |                                  |    |   |   |   |   |   |
| Cash and cash equivalents, beginning of period                                |   |                                  | -       |   |   |   | - |   |
|                                                                          |   |                                  |    |   |   |   |   |   |
| Cash and cash equivalents, end of period                                      |   | $                                     | -       |   |   | $ | - |   |
|                                                                          |   |                                  |    |   |   |   |   |   |
| Supplemental disclosures:  Cash paid for:                           |   |                                  |    |   |   |   |   |   |
|     Interest, net of amount capitalized                   |   | $                                     | 2,173   |   |   | $ | 617 |   |
|     Income taxes, net                                     |   |                                  | 207     |   |   |   | 961 |   |
|                                                                          |   |                                  |    |   |   |   |   |   |

----

|                                                          |   | Common      |   |   | Additionalpaid-in |   |    | Accumulated othercomprehensive income (loss) |   |   | Retained |   |   | Treasury |   |   |   |   |    | Comprehensive |   |
|---------------------------------------------------------------|--------|-------------|--------|--------|-------------------|--------|---------|----------------------------------------------|--------|--------|----------|--------|--------|----------|--------|--------|--------|--------|---------|---------------|--------|
|                                                          |   | stock       |   |   | capital           |   |    | Pensions                                     |   |   | OPEB     |   |   | earnings |   |   | stock  |   |    | Total         |   |   | income (loss) |   |
|                                                          |   | (unaudited) |   |
|                                                          |   |        |   |   |              |   |    |                                         |   |   |     |   |   |     |   |   |   |   |    |          |   |   |   |   |
| Balance – December 31, 2008                             |   | $           | 125    |   |              | $      | 100,111 |                                         |   | $      | (193,258 | )      |   | $        | 32,843 |   |   | $      | 180,619 |          |   | $ | (796 | ) |   | $ | 119,644 |   |   |   |   |
|                                                          |   |        |   |   |              |   |    |                                         |   |   |     |   |   |     |   |   |   |   |    |          |   |   |   |   |   |   |   |   |   |   |   |
| Net loss                                                      |   |        | -      |   |              |   | -       |                                         |   |   | -        |   |   |     | -      |   |   |   | (3,374  | )             |   |   | - |   |   |   | (3,374 | ) |   | $ | (3,374 | ) |
|                                                          |   |        |   |   |              |   |    |                                         |   |   |     |   |   |     |   |   |   |   |    |          |   |   |   |   |   |   |   |   |   |   |   |   |
| Amortization of prior service  cost (credit), net of tax |   |        | -      |   |              |   | -       |                                         |   |   | 384      |   |   |     | (5,046 | )      |   |   | -       |          |   |   | - |   |   |   | (4,662 | ) |   |   | (4,662 | ) |
|                                                          |   |        |   |   |              |   |    |                                         |   |   |     |   |   |     |   |   |   |   |    |          |   |   |   |   |   |   |   |   |   |   |   |   |
| Amortization of actuarial losses, net of tax             |   |        | -      |   |              |   | -       |                                         |   |   | 5,867    |   |   |     | 2,605  |   |   |   | -       |          |   |   | - |   |   |   | 8,472 |   |   |   | 8,472 |   |
|                                                          |   |        |   |   |              |   |    |                                         |   |   |     |   |   |     |   |   |   |   |    |          |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance – June 30, 2009                                 |   | $           | 125    |   |              | $      | 100,111 |                                         |   | $      | (187,007 | )      |   | $        | 30,402 |   |   | $      | 177,245 |          |   | $ | (796 | ) |   | $ | 120,080 |   |   |   |   |   |
|                                                          |   |        |   |   |              |   |    |                                         |   |   |     |   |   |     |   |   |   |   |    |          |   |   |   |   |   |   |   |   |   |   |   |   |
|   Comprehensive income                              |   |        |   |   |              |   |    |                                         |   |   |     |   |   |     |   |   |   |   |    |          |   |   |   |   |   |   |   |   |   | $ | 436 |   |

----

|   | · | Keystone Steel & Wire (“KSW”), located in Peoria, Illinois, operates an electric arc furnace mini-mill and manufactures and sells billets, wire rod, coiled rebar, industrial wire and fabricated wire products to agricultural, industrial, construction, commercial, original equipment manufacturers and retail consumer markets; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Engineered Wire Products, Inc. (“EWP”), located in Upper Sandusky, Ohio, manufactures and sells wire mesh in both roll and sheet form that is utilized in concrete construction products including pipe, pre-cast boxes and applications for use in roadways, buildings and bridges; and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | Keystone-Calumet, Inc. (“Calumet”), located in Chicago Heights, Illinois, manufactures and sells merchant and special bar quality products and special sections in carbon and alloy steel grades for use in agricultural, cold drawn, construction, industrial chain, service centers and transportation applications as well as in the production of a wide variety of products by original equipment manufacturers. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                        |   | Three months ended June 30, |    |   | Six months ended June 30, |   |
|-------------------------------------------------------------|--------|----------------------------------|---------|--------|--------------------------------|--------|
|                                                        |   | 2008                             |    |   | 2009                           |   |   | 2008 |   |   | 2009 |   |
|                                                        |   | (In thousands)                   |    |   | (In thousands)                 |   |
|                                                        |   |                             |    |   |                           |   |   |   |   |   |   |   |
| Net sales:                                                  |   |                             |    |   |                           |   |   |   |   |   |   |   |
|   KSW                                             |   | $                                | 173,129 |   |                           | $      | 67,090 |   |   | $ | 304,169 |   |   | $ | 121,083 |   |
|   EWP                                             |   |                             | 21,127  |   |                           |   | 11,563 |   |   |   | 34,179 |   |   |   | 18,724 |   |
|   Calumet                                         |   |                             | 5,402   |   |                           |   | 2,438 |   |   |   | 8,705 |   |   |   | 4,356 |   |
|   Elimination of intersegment sales          |   |                             | (21,631 | )      |                           |   | (10,580 | ) |   |   | (34,887 | ) |   |   | (13,177 | ) |
|                                                        |   |                             |    |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|      Total net sales               |   | $                                | 178,027 |   |                           | $      | 70,511 |   |   | $ | 312,166 |   |   | $ | 130,986 |   |
|                                                        |   |                             |    |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Operating income (loss):                                    |   |                             |    |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|   KSW                                             |   | $                                | 16,890  |   |                           | $      | 3,765 |   |   | $ | 19,300 |   |   | $ | (685 | ) |
|   EWP                                             |   |                             | 3,188   |   |                           |   | 240 |   |   |   | 4,666 |   |   |   | (86 | ) |
|   Calumet                                         |   |                             | (150    | )      |                           |   | (720 | ) |   |   | (842 | ) |   |   | (3,191 | ) |
|   Pension credit (expense)                        |   |                             | 17,938  |   |                           |   | (1,513 | ) |   |   | 36,934 |   |   |   | (3,028 | ) |
|   OPEB credit                                     |   |                             | 2,338   |   |                           |   | 1,260 |   |   |   | 4,536 |   |   |   | 2,520 |   |
|   Other (1)                                       |   |                             | (4,073  | )      |                           |   | (521 | ) |   |   | (5,687 | ) |   |   | 263 |   |
|                                                        |   |                             |    |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|      Total operating income (loss) |   |                             | 36,131  |   |                           |   | 2,511 |   |   |   | 58,907 |   |   |   | (4,207 | ) |
|                                                        |   |                             |    |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Nonoperating income (expense):                              |   |                             |    |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|   Interest expense                                |   |                             | (932    | )      |                           |   | (408 | ) |   |   | (2,245 | ) |   |   | (740 | ) |
|   Other income (expense), net                     |   |                             | (92     | )      |                           |   | 104 |   |   |   | 298 |   |   |   |  102 |   |
|                                                        |   |                             |    |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|   Income (loss) before income taxes               |   | $                                | 35,107  |   |                           | $      | 2,207 |   |   | $ | 56,960 |   |   | $ | (4,845 | ) |

|   |   | Increase (decrease) in LIFO reserve     |   |
|--------|--------|-----------------------------------------|--------|
|   |   | Three months ended   June 30, |   |   | Six months ended June 30, |   |
|   |   | 2008                                    |   |   | 2009 |   |   | 2008 |   |   | 2009 |   |
|   |   | (In thousands)                          |   |   | (In thousands) |   |
|   |   |                                    |   |   |   |   |
| KSW    |   | $                                       | 4,163  |   |   | $ | (3,320 | ) |   | $ | 4,851 |   |   | $ | (6,737 | ) |
|   |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| EWP    |   |                                    | 1,054  |   |   |   | (2,147 | ) |   |   | 1,294 |   |   |   | (3,217 | ) |
|   |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total  |   | $                                       | 5,217  |   |   | $ | (5,467 | ) |   | $ | 6,145 |   |   | $ | (9,954 | ) |

----

|                                      |   | December 31,     |    |   | June 30, |   |
|-------------------------------------------|--------|------------------|---------|--------|----------|--------|
|                                      |   |  2008  |    |   | 2009     |   |
|                                      |   | (In thousands)   |    |
|                                      |   |             |    |   |     |   |
|   Raw materials                 |   | $                | 9,635   |   |     | $      | 6,848 |   |
|   Work in process               |   |             | 6,657   |   |     |   | 6,018 |   |
|   Billets                       |   |             | 10,191  |   |     |   | 4,873 |   |
|   Wire rod                      |   |             | 24,225  |   |     |   | 11,461 |   |
|   Other finished products       |   |             | 33,646  |   |     |   | 24,584 |   |
|   Supplies                      |   |             | 20,938  |   |     |   | 22,231 |   |
|                                      |   |             |    |   |     |   |   |   |
|     Inventory at FIFO |   |             | 105,292 |   |     |   | 76,015 |   |
|     Less LIFO reserve |   |             | 34,434  |   |     |   | 24,480 |   |
|                                      |   |             |    |   |     |   |   |   |
|       Total |   | $                | 70,858  |   |     | $      | 51,535 |   |
|                                      |   |             |    |   |     |   |   |   |

|                                            |   | December 31,     |   |   | June 30, |   |
|-------------------------------------------------|--------|------------------|--------|--------|----------|--------|
|                                            |   |  2008  |   |   | 2009     |   |
|                                            |   | (In thousands)   |   |
|                                            |   |             |   |   |     |   |
| Wachovia revolving credit facility              |   | $                | 3,264  |   |     | $      | 25,658 |   |
| 8% Notes                                        |   |             | 9,108  |   |     |   | - |   |
| Term loans:                                     |   |             |   |   |     |   |   |   |
|   Wachovia                            |   |             | 10,953 |   |     |   | 8,286 |   |
|   County                              |   |             | 7,441  |   |     |   | 6,882 |   |
| Other                                           |   |             | 864    |   |     |   | 882 |   |
|                                            |   |             |   |   |     |   |   |   |
|     Total debt              |   |             | 31,630 |   |     |   | 41,708 |   |
|     Less current maturities |   |             | 18,848 |   |     |   | 32,176 |   |
|                                            |   |             |   |   |     |   |   |   |
|     Total long-term debt    |   | $                | 12,782 |   |     | $      | 9,532 |   |

----

----

|                                                                                            |   | Six months endedJune 30, 2009 |   |
|-------------------------------------------------------------------------------------------------|--------|-------------------------------|--------|
|                                                                                            |   | (In thousands)                |   |
|                                                                                            |   |                          |   |
| Balance at December 31, 2008                                                                    |   | $                             | 5,125  |   |
| Net reduction in accrued environmental cost credited to general and administrative expense |   |                          | (4,019 | ) |
| Payments                                                                                        |   |                          | (231   | ) |
|                                                                                            |   |                          |   |   |
| Balance at June 30, 2009                                                                        |   | $                             | 875    |   |

----

----

|                                      |   | December 31,     |   |   | June 30, |   |
|-------------------------------------------|--------|------------------|--------|--------|----------|--------|
|                                      |   |  2008  |   |   | 2009     |   |
|                                      |   | (In thousands)   |   |
| Current:                                  |   |             |   |   |     |   |
|   Employee benefits             |   | $                | 19,656 |   |     | $      | 8,405 |   |
|   Self insurance                |   |             | 5,936  |   |     |   | 4,509 |   |
|   Environmental                 |   |             | 455    |   |     |   | 435 |   |
|   Other                         |   |             | 3,522  |   |     |   | 2,701 |   |
|                                      |   |             |   |   |     |   |   |   |
| Total                                     |   | $                | 29,569 |   |     | $      | 16,050 |   |
|                                      |   |             |   |   |     |   |   |   |
| Noncurrent:                               |   |             |   |   |     |   |   |   |
|   Workers compensation payments |   | $                | 1,621  |   |     | $      | 1,912 |   |
|   Environmental                 |   |             | 4,670  |   |     |   | 440 |   |
|   Other                         |   |             | 172    |   |     |   | 188 |   |
|                                      |   |             |   |   |     |   |   |   |
| Total                                     |   | $                | 6,463  |   |     | $      | 2,540 |   |

|                                                         |   | Three months ended June 30, |    |   | Six months ended June 30, |   |
|--------------------------------------------------------------|--------|----------------------------------|---------|--------|--------------------------------|--------|
|                                                         |   | 2008                             |    |   | 2009                           |   |   | 2008 |   |   | 2009 |   |
|                                                         |   | (In thousands)                   |    |
| Service cost                                                 |   | $                                | 861     |   |                           | $      | 813 |   |   | $ | 1,722 |   |   | $ | 1,627 |   |
| Interest cost                                                |   |                             | 5,579   |   |                           |   | 5,410 |   |   |   | 11,157 |   |   |   | 10,820 |   |
| Expected return on plan assets                               |   |                             | (21,989 | )      |                           |   | (9,720 | ) |   |   | (45,035 | ) |   |   | (19,440 | ) |
| Amortization of accumulated other comprehensive income: |   |                             |    |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|     Prior service cost                   |   |                             | 307     |   |                           |   | 308 |   |   |   | 614 |   |   |   | 616 |   |
|     Actuarial losses (gains)             |   |                             | (2,696  | )      |                           |   | 4,702 |   |   |   | (5,392 | ) |   |   | 9,405 |   |
|                                                         |   |                             |    |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Total expense (credit)                                       |   | $                                | (17,938 | )      |                           | $      | 1,513 |   |   | $ | (36,934 | ) |   | $ | 3,028 |   |

----

|                                                         |   | Three months ended June 30, |   |   | Six months ended June 30, |   |
|--------------------------------------------------------------|--------|----------------------------------|--------|--------|--------------------------------|--------|
|                                                         |   | 2008                             |   |   | 2009                           |   |   | 2008 |   |   | 2009 |   |
|                                                         |   | (In thousands)                   |   |
| Service cost                                                 |   | $                                | 53     |   |                           | $      | 24 |   |   | $ | 105 |   |   | $ | 48 |   |
| Interest cost                                                |   |                             | 393    |   |                           |   | 672 |   |   |   | 926 |   |   |   | 1,344 |   |
| Amortization of accumulated other comprehensive income: |   |                             |   |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|     Prior service credit                 |   |                             | (4,412 | )      |                           |   | (4,044 | ) |   |   | (8,823 | ) |   |   | (8,088 | ) |
|     Actuarial losses                     |   |                             | 1,628  |   |                           |   | 2,088 |   |   |   | 3,256 |   |   |   | 4,176 |   |
|                                                         |   |                             |   |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Total credit                                                 |   | $                                | (2,338 | )      |                           | $      | (1,260 | ) |   | $ | (4,536 | ) |   | $ | (2,520 | ) |

|                                                          |   | Six months ended |   |
|---------------------------------------------------------------|--------|------------------|--------|
|                                                          |   | June 30,         |   |
|                                                          |   | 2008             |   |   | 2009 |   |
|                                                          |   | (In thousands)   |   |
|                                                          |   |             |   |
|                                                          |   |             |   |   |   |   |
| Expected income tax expense (benefit), at statutory rate |   | $                | 19,938 |   |   | $ | (1,695 | ) |
| U.S. state income tax expense, net                            |   |             | 1,456  |   |   |   | (17 | ) |
| Other, net                                                    |   |             | 37     |   |   |   | 241 |   |
|                                                          |   |             |   |   |   |   |   |   |
| Income tax expense (benefit)                                  |   | $                | 21,431 |   |   | $ | (1,471 | ) |

|                                           |   |                   |   |   |               |   |
|------------------------------------------------|--------|------------------------|--------|--------|--------------------|--------|
|                                           |   | December 31, 2008 |   |   | June 30, 2009 |   |
|                                           |   | Carrying amount   |   |   | Fairvalue          |   |   | Carrying amount |   |   | Fairvalue |   |
|                                           |   | (In thousands)         |   |
|                                           |   |                   |   |   |               |   |   |   |   |   |   |   |
| Restricted cash equivalents                    |   | $                      | 2,277  |   |               | $      | 2,277 |   |   | $ | 2,277 |   |   | $ | 2,277 |   |
| Accounts receivable, net                       |   |                   | 26,612 |   |               |   | 26,612 |   |   |   | 36,404 |   |   |   | 36,404 |   |
| Accounts payable                               |   |                   | 7,776  |   |               |   | 7,776 |   |   |   | 7,036 |   |   |   | 7,036 |   |
|                                           |   |                   |   |   |               |   |   |   |   |   |   |   |   |   |   |   |
| Long-term debt (excluding capitalized leases): |   |                   |   |   |               |   |   |   |   |   |   |   |   |   |   |   |
|   Variable-rate debt                 |   |                   | 14,217 |   |               |   | 14,217 |   |   |   | 33,944 |   |   |   | 33,944 |   |
|   Fixed-rate debt                    |   |                   | 17,413 |   |               |   | 14,161 |   |   |   | 7,764 |   |   |   | 7,274 |   |
|                                           |   |                   |   |   |               |   |   |   |   |   |   |   |   |   |   |   |

----

----

|   | · | Future supply and demand for our products (including cyclicality thereof), |
|--------|--------|----------------------------------------------------------------------------|

|   | · | Customer inventory levels, |
|--------|--------|----------------------------|

|   | · | Changes in raw material and other operating costs (such as ferrous scrap and energy), |
|--------|--------|---------------------------------------------------------------------------------------|

|   | · | The possibility of labor disruptions, |
|--------|--------|---------------------------------------|

|   | · | General global economic and political conditions, |
|--------|--------|---------------------------------------------------|

|   | · | Competitive products (including low-priced imports) and substitute products, |
|--------|--------|------------------------------------------------------------------------------|

|   | · | Customer and competitor strategies, |
|--------|--------|-------------------------------------|

|   | · | The impact of pricing and production decisions, |
|--------|--------|-------------------------------------------------|

|   | · | Environmental matters (such as those requiring emission and discharge limits for existing and new facilities), |
|--------|--------|----------------------------------------------------------------------------------------------------------------|

|   | · | Government regulations and possible changes thereof, |
|--------|--------|------------------------------------------------------|

|   | · | Significant increases in the cost of providing medical coverage to employees, |
|--------|--------|-------------------------------------------------------------------------------|

|   | · | The ultimate resolution of pending litigation, |
|--------|--------|------------------------------------------------|

|   | · | International trade policies of the United States and certain foreign countries, |
|--------|--------|----------------------------------------------------------------------------------|

|   | · | Operating interruptions (including, but not limited to, labor disputes, fires, explosions, unscheduled or unplanned downtime, supply disruptions and transportation interruptions), |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Our ability to renew or refinance credit facilities, |
|--------|--------|------------------------------------------------------|

|   | · | The ability of our customers to obtain adequate credit, |
|--------|--------|---------------------------------------------------------|

|   | · | Any possible future litigation, and |
|--------|--------|-------------------------------------|

|   | · | Other risks and uncertainties as discussed in this Quarterly Report and the 2008 Annual Report, including, without limitation, the section referenced above. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

|                                                 |   | Three months ended   June 30,  |    |   | Six months ended  June 30,  |   |
|------------------------------------------------------|--------|-----------------------------------------------|---------|--------|---------------------------------------|--------|
|                                                 |   | 2008                                          |    |   | 2009                                  |   |   | 2008 |   |   | 2009 |   |
|                                                 |   | (In thousands)                                |    |   | (In thousands)                        |   |
|                                                 |   |                                          |    |   |                                  |   |   |   |   |   |   |   |
| Operating income (loss) as reported                  |   | $                                             | 36,131  |   |                                  | $      | 2,511 |   |   | $ | 58,907 |   |   | $ | (4,207 | ) |
|   Defined benefit pension expense (credit) |   |                                          | (17,938 | )      |                                  |   | 1,513 |   |   |   | (36,934 | ) |   |   | 3,028 |   |
|   OPEB credit                              |   |                                          | (2,338  | )      |                                  |   | (1,260 | ) |   |   | (4,536 | ) |   |   | (2,520 | ) |
| Operating income (loss) before pension and OPEB      |   | $                                             | 15,855  |   |                                  | $      | 2,764 |   |   | $ | 17,437 |   |   | $ | (3,699 | ) |

|   | · | substantially lower shipment volumes as discussed above; |
|--------|--------|----------------------------------------------------------|

|   | · | lower selling prices as discussed above; |
|--------|--------|------------------------------------------|

|   | · | substantially reduced production volumes as discussed above, which resulted in a much higher percentage of fixed costs included in cost of goods sold; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | increased variable costs of production due to frequent mill changes as customers are managing their inventory by ordering much smaller quantities of our many different products as discussed above; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | increased bad debt expense during the second quarter and first six months of 2009 of $1.6 million and $2.5 million, respectively, primarily due to the Chapter 11 proceedings of one of our customers; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | decreased cost of raw material; |
|--------|--------|---------------------------------|

|   | · | decreased cost of electricity and natural gas; |
|--------|--------|------------------------------------------------|

|   | · | decreased employee incentive compensation accruals during 2009 resulting from poor operating performance; |
|--------|--------|-----------------------------------------------------------------------------------------------------------|

|   | · | decreases in our LIFO reserve and cost of goods sold during the second quarter and first six months of 2009 as compared to increases in our LIFO reserve and cost of goods sold during the second quarter and first six months of 2008 as discussed in Note 2 to our Condensed Consolidated Financial Statements; and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $4.2 million credit to general and administrative expense during 2009 related to the release of accrued environmental costs for certain inactive waste management units as discussed above. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | increased variable costs of production as idle production facilities were difficult to re-start given cold winter temperatures; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $1.5 million impairment charge to reduce certain inventories to net realizable value; and |
|--------|--------|---------------------------------------------------------------------------------------------|

|   | · | decreased workers compensation accruals. |
|--------|--------|------------------------------------------|

----

|                                 |   | Three months ended   June 30,  |   |   | Six months ended   June 30, |   |
|--------------------------------------|--------|-----------------------------------------------|--------|--------|---------------------------------------|--------|
|                                 |   | 2008                                          |   |   | 2009                                  |   |   | 2008 |   |   | 2009 |   |
|                                 |   |                                          |   |   |                                  |   |   |   |   |   |   |   |
| Sales volume (000 tons):             |   |                                          |   |   |                                  |   |   |   |   |   |   |   |
|   Fabricated wire products |   |                                          | 26     |   |                                  |   | 20 |   |   |   | 56 |   |   |   | 40 |   |
|   Industrial wire          |   |                                          | 19     |   |                                  |   | 9 |   |   |   | 36 |   |   |   | 16 |   |
|   Coiled rebar             |   |                                          | 4      |   |                                  |   | 2 |   |   |   | 7 |   |   |   | 2 |   |
|   Wire rod                 |   |                                          | 110    |   |                                  |   | 36 |   |   |   | 216 |   |   |   | 58 |   |
|   Billets                  |   |                                          | 1      |   |                                  |   | 1 |   |   |   | 1 |   |   |   | 1 |   |
|   Wire mesh                |   |                                          | 18     |   |                                  |   | 13 |   |   |   | 32 |   |   |   | 20 |   |
|   Bar                      |   |                                          | 6      |   |                                  |   | 3 |   |   |   | 10 |   |   |   | 5 |   |
|     Total        |   |                                          | 184    |   |                                  |   | 84 |   |   |   | 358 |   |   |   | 142 |   |
|                                 |   |                                          |   |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
|                                 |   |                                          |   |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Average per-ton selling prices:      |   |                                          |   |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
|   Fabricated wire products |   | $                                             | 1,385  |   |                                  | $      | 1,364 |   |   | $ | 1,276 |   |   | $ | 1,410 |   |
|   Industrial wire          |   |                                          | 1,100  |   |                                  |   | 892 |   |   |   | 980 |   |   |   | 967 |   |
|   Coiled rebar             |   |                                          | 859    |   |                                  |   | 522 |   |   |   | 767 |   |   |   | 544 |   |
|   Wire rod                 |   |                                          | 818    |   |                                  |   | 546 |   |   |   | 721 |   |   |   | 592 |   |
|   Billets                  |   |                                          | 565    |   |                                  |   | 170 |   |   |   | 406 |   |   |   | 170 |   |
|   Wire mesh                |   |                                          | 1,154  |   |                                  |   | 910 |   |   |   | 1,062 |   |   |   | 968 |   |
|   Bar                      |   |                                          | 957    |   |                                  |   | 752 |   |   |   | 845 |   |   |   | 812 |   |
|   All products             |   |                                          | 966    |   |                                  |   | 838 |   |   |   | 867 |   |   |   | 920 |   |

|   | · | Keystone Steel & Wire (“KSW”), located in Peoria, Illinois, operates an electric arc furnace mini-mill and manufactures and sells billets, wire rod, coiled rebar, industrial wire and fabricated wire products to agricultural, industrial, construction, commercial, original equipment manufacturers and retail consumer markets; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Engineered Wire Products, Inc. (“EWP”), located in Upper Sandusky, Ohio, manufactures and sells wire mesh in both roll and sheet form that is utilized in concrete construction products including pipe, pre-cast boxes and applications for use in roadways, buildings and bridges; and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Keystone-Calumet, Inc. (“Calumet”), located in Chicago Heights, Illinois, manufactures and sells merchant and special bar quality products and special sections in carbon and alloy steel grades for use in agricultural, cold drawn, construction, industrial chain, service centers and transportation applications as well as in the production of a wide variety of products by original equipment manufacturers. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                   |   | KSW            |         |   | EWP    |   |        | Calumet |   |   | Other(1)   |   |   | Total  |       |
|--------------------------------------------------------|--------|----------------|--------------|--------|--------|--------|-------------|---------|--------|--------|------------|--------|--------|--------|------------|
|                                                   |   | (In thousands) |         |
| Three months ended June 30, 2008:                      |   |
|                                                   |   |           |         |   |   |   |        |    |   |   |       |   |   |   |       |
|  Net sales                                        |   | $              | 173,129      |   |   | $      | 21,127      |    |   | $      | 5,402      |   |   | $      | (21,631    | ) |   | $ | 178,027 |   |
|  Cost of goods sold                               |   |           | (152,531     | )      |   |   | (16,767     | )       |   |   | (5,282     | )      |   |   | 18,290     |   |   |   | (156,290 | ) |
|    Gross margin                         |   |           | 20,598       |   |   |   | 4,360       |    |   |   | 120        |   |   |   | (3,341     | ) |   |   | 21,737 |   |
|                                                   |   |           |         |   |   |   |        |    |   |   |       |   |   |   |       |   |   |   |   |   |
|  Selling and administrative expense          |   |           | (3,708       | )      |   |   | (1,172      | )       |   |   |  (270 | )      |   |   |  (732 | ) |   |   | (5,882 | ) |
|  Operating income (loss) before pension/OPEB |   | $              |  16,890 |   |   | $      |  3,188 |    |   | $      | (150       | )      |   | $      | (4,073     | ) |   | $ |  15,855 |   |
|                                                   |   |           |         |   |   |   |        |    |   |   |       |   |   |   |       |   |   |   |   |   |
| Three months ended June 30, 2009:                      |   |
|                                                   |   |
|  Net sales                                        |   | $              | 67,090       |   |   | $      | 11,563      |    |   | $      | 2,438      |   |   | $      | (10,580    | ) |   | $ | 70,511 |   |
|  Cost of goods sold                               |   |           | (62,601      | )      |   |   | (10,575     | )       |   |   | (3,001     | )      |   |   | 10,905     |   |   |   | (65,272 | ) |
|    Gross margin (loss)                  |   |           | 4,489        |   |   |   | 988         |    |   |   | (563       | )      |   |   | 325        |   |   |   | 5,239 |   |
|                                                   |   |           |         |   |   |   |        |    |   |   |       |   |   |   |       |   |   |   |   |   |
|  Selling and administrative expense          |   |           | (724         | )      |   |   | (748        | )       |   |   | (157       | )      |   |   | (846       | ) |   |   | (2,475 | ) |
|  Operating income (loss) before pension/OPEB |   | $              | 3,765        |   |   | $      | 240         |    |   | $      | (720       | )      |   | $      | (521       | ) |   | $ | 2,764 |   |

| Six months ended June 30, 2008:                        |   |
|--------------------------------------------------------|--------|
|                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Net sales                                        |   | $ | 304,169 |   |   | $ | 34,179 |   |   | $ | 8,705 |   |   | $ | (34,887 | ) |   | $ | 312,166 |   |
|  Cost of goods sold                               |   |   | (277,523 | ) |   |   | (27,531 | ) |   |   | (9,114 | ) |   |   | 30,865 |   |   |   | (283,303 | ) |
|    Gross margin (loss)                  |   |   | 26,646 |   |   |   | 6,648 |   |   |   | (409 | ) |   |   | (4,022 | ) |   |   | 28,863 |   |
|                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Selling and administrative expense          |   |   | (7,346 | ) |   |   | (1,982 | ) |   |   |  (433 | ) |   |   | (1,665 | ) |   |   | (11,426 | ) |
|  Operating income (loss) before pension/OPEB |   | $ |  19,300 |   |   | $ |  4,666 |   |   | $ | (842 | ) |   | $ | (5,687 | ) |   | $ |   17,437 |   |
|                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Six months ended June 30, 2009:                        |   |
|                                                   |   |
|  Net sales                                        |   | $ | 121,083 |   |   | $ | 18,724 |   |   | $ | 4,356 |   |   | $ | (13,177 | ) |   | $ | 130,986 |   |
|  Cost of goods sold                               |   |   | (117,525 | ) |   |   | (17,409 | ) |   |   | (7,330 | ) |   |   | 14,718 |   |   |   | (127,546 | ) |
|    Gross margin (loss)                  |   |   | 3,558 |   |   |   | 1,315 |   |   |   | (2,974 | ) |   |   | 1,541 |   |   |   | 3,440 |   |
|                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Selling and administrative expense          |   |   | (4,243 | ) |   |   | (1,401 | ) |   |   | (217 | ) |   |   | (1,278 | ) |   |   | (7,139 | ) |
|  Operating income (loss) before pension/OPEB |   | $ | (685 | ) |   | $ | (86 | ) |   | $ | (3,191 | ) |   | $ | 263 |   |   | $ | (3,699 | ) |

----

|                                      |   |  Three months ended June 30, |         |
|-------------------------------------------|--------|-----------------------------------|--------------|
|                                      |   | 2008                              |         |   | % ofsales |   |   | 2009 |   |   | % ofsales |   |
|                                      |   | ($ in thousands)                  |         |
|                                      |   |                              |         |   |   |   |   |   |   |   |   |   |
| Net sales                                 |   | $                                 | 173,129      |   |   |   | 100.0 | % |   | $ | 67,090 |   |   |   | 100.0 | % |
| Cost of goods sold                        |   |                              | (152,531     | ) |   |   | (88.1 | ) |   |   | (62,601 | ) |   |   | (93.3 | ) |
|    Gross margin            |   |                              | 20,598       |   |   |   | 11.9 |   |   |   | 4,489 |   |   |   | 6.7 |   |
|                                      |   |                              |         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling and administrative expense        |   |                              | (3,708       | ) |   |   | (2.1 | ) |   |   | (724 | ) |   |   | (1.1 | ) |
| Operating income before pension/OPEB |   | $                                 |  16,890 |   |   |   | 9.8 | % |   | $ | 3,765 |   |   |   | 5.6 | % |

|                                             |   |  Six months ended June 30, |         |
|--------------------------------------------------|--------|---------------------------------|--------------|
|                                             |   | 2008                            |         |   | % ofsales |   |   | 2009 |   |   | % ofsales |   |
|                                             |   | ($ in thousands)                |         |
|                                             |   |                            |         |   |   |   |   |   |   |   |   |   |
| Net sales                                        |   | $                               | 304,169      |   |   |   | 100.0 | % |   | $ | 121,083 |   |   |   | 100.0 | % |
| Cost of goods sold                               |   |                            | (277,523     | ) |   |   | (91.2 | ) |   |   | (117,525 | ) |   |   | (97.1 | ) |
|    Gross margin                   |   |                            | 26,646       |   |   |   | 8.8 |   |   |   | 3,558 |   |   |   | 2.9 |   |
|                                             |   |                            |         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling and administrative expense               |   |                            | (7,346       | ) |   |   | (2.4 | ) |   |   | (4,243 | ) |   |   | (3.5 | ) |
| Operating income (loss) before pension/OPEB |   | $                               |  19,300 |   |   |   | 6.4 | % |   | $ | (685 | ) |   |   | (0.6 | )% |

----

|                                            |   | Three months ended   June 30,  |       |   | Six months ended June 30, |   |
|-------------------------------------------------|--------|-----------------------------------------------|------------|--------|--------------------------------|--------|
|                                            |   | 2008                                          |       |   | 2009                           |   |   | 2008 |   |   | 2009 |   |
|                                            |   |                                          |       |   |                           |   |   |   |   |   |   |   |
| Sales volume (000 tons):                        |   |                                          |       |   |                           |   |   |   |   |   |   |   |
|   Fabricated wire products            |   |                                          | 26         |   |                           |   | 20 |   |   |   | 56 |   |   |   | 40 |   |
|   Industrial wire                     |   |                                          | 19         |   |                           |   | 9 |   |   |   | 36 |   |   |   | 16 |   |
|   Coiled rebar                        |   |                                          | 4          |   |                           |   | 2 |   |   |   | 7 |   |   |   | 2 |   |
|   Wire rod                            |   |                                          | 130        |   |                           |   | 53 |   |   |   | 254 |   |   |   | 78 |   |
|   Billets                             |   |                                          | 8          |   |                           |   | 2 |   |   |   | 14 |   |   |   | 4 |   |
|   Total                               |   |                                          | 187        |   |                           |   | 86 |   |   |   | 367 |   |   |   | 140 |   |
|                                            |   |                                          |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Average per-ton selling prices:                 |   |                                          |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|   Fabricated wire products            |   | $                                             | 1,385      |   |                           | $      | 1,364 |   |   | $ | 1,276 |   |   | $ | 1,410 |   |
|   Industrial wire                     |   |                                          | 1,100      |   |                           |   | 892 |   |   |   | 980 |   |   |   | 967 |   |
|   Coiled rebar                        |   |                                          | 859        |   |                           |   | 522 |   |   |   | 767 |   |   |   | 544 |   |
|   Wire rod                            |   |                                          | 819        |   |                           |   | 563 |   |   |   | 722 |   |   |   | 596 |   |
|   Billets                             |   |                                          | 658        |   |                           |   | 345 |   |   |   | 568 |   |   |   | 423 |   |
|   All products                        |   |                                          | 921        |   |                           |   | 780 |   |   |   | 826 |   |   |   | 867 |   |
|                                            |   |                                          |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Average per-ton ferrous scrap cost         |   | $                                             |  366  |   |                           | $      |   279 |   |   | $ |   320 |   |   | $ |  303 |   |
|                                            |   |                                          |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Average electricity cost per kilowatt hour |   | $                                             |  0.05 |   |                           | $      |  0.03 |   |   | $ |  0.06 |   |   | $ |  0.03 |   |
|                                            |   |                                          |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Kilowatt hours consumed (000 hrs)               |   |                                          | 144,821    |   |                           |   | 89,621 |   |   |   | 277,731 |   |   |   | 131,748 |   |
|                                            |   |                                          |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Average natural gas cost per therm         |   | $                                             |  1.15 |   |                           | $      |   0.37 |   |   | $ |  0.99 |   |   | $ |   0.59 |   |
|                                            |   |                                          |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Natural gas therms consumed (000 therms)   |   |                                          | 5,233      |   |                           |   | 3,267 |   |   |   | 11,815 |   |   |   | 6,665 |   |

|   | · | substantially reduced production volumes as discussed above, which resulted in a much higher percentage of fixed costs included in cost of goods sold; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | increased variable costs of production due to frequent mill changes as customers are managing their inventory by ordering much smaller quantities of our many different product lines as discussed above; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | increased bad debt expense during the second quarter and first six months of 2009 of $1.6 million and $2.5 million, respectively, primarily due to the Chapter 11 proceedings of one of KSW’s customers; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | decreased employee incentive compensation accruals during 2009 as discussed above; |
|--------|--------|------------------------------------------------------------------------------------|

|   | · | decreases in KSW’s LIFO reserve and cost of goods sold during 2009 as discussed in Note 2 to our Condensed Consolidated Financial Statements; and |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $4.2 million credit related to the release of accrued environmental costs as discussed above. |
|--------|--------|-------------------------------------------------------------------------------------------------|

----

|   | · | increased variable costs of production as idle production facilities were difficult to re-start given cold winter temperatures; and |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------|

|   | · | decreased workers compensation accruals. |
|--------|--------|------------------------------------------|

|                                 |   | Three months ended June 30, |    |
|--------------------------------------|--------|-----------------------------|---------|
|                                 |   | 2008                        |    |   | % of sales |   |   | 2009 |   |   | % ofsales |   |
|                                 |   | ($ in thousands)            |    |
|                                 |   |                        |    |   |   |   |   |   |   |   |   |   |
| Net sales                            |   | $                           | 21,127  |   |   |   | 100.0 | % |   | $ | 11,563 |   |   |   | 100.0 | % |
| Cost of goods sold                   |   |                        | (16,767 | ) |   |   | (79.4 | ) |   |   | (10,575 | ) |   |   | (91.5 | ) |
|    Gross margin            |   |                        | 4,360   |   |   |   | 20.6 |   |   |   | 988 |   |   |   | 8.5 |   |
|                                 |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling and administrative expense   |   |                        | (1,172  | ) |   |   | (5.5 | ) |   |   | (748 | ) |   |   | (6.5 | ) |
| Operating income before pension/OPEB |   | $                           | 3,188   |   |   |   | 15.1 | % |   | $ | 240 |   |   |   |  2.0 | % |

|                                        |   | Six months ended June 30, |        |
|---------------------------------------------|--------|---------------------------|-------------|
|                                        |   | 2008                      |        |   | % of sales |   |   | 2009 |   |   | % ofSales |   |
|                                        |   | ($ in thousands)          |        |
|                                        |   |                      |        |   |   |   |   |   |   |   |   |   |
| Net sales                                   |   | $                         | 34,179      |   |   |   | 100.0 | % |   | $ | 18,724 |   |   |   | 100.0 | % |
| Cost of goods sold                          |   |                      | (27,531     | ) |   |   | (80.5 | ) |   |   | (17,409 | ) |   |   | (93.0 | ) |
|    Gross margin                   |   |                      | 6,648       |   |   |   | 19.5 |   |   |   | 1,315 |   |   |   | 7.0 |   |
|                                        |   |                      |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling and administrative expense          |   |                      | (1,982      | ) |   |   | (5.8 | ) |   |   | (1,401 | ) |   |   | (7.5 | ) |
| Operating income (loss) before pension/OPEB |   | $                         |  4,666 |   |   |   | 13.7 | % |   | $ | (86 | ) |   |   | (0.5 | )% |

|                                                        |   | Three months ended   June 30, |        |   | Six months ended June 30, |   |
|-------------------------------------------------------------|--------|-----------------------------------------|-------------|--------|--------------------------------|--------|
|                                                        |   | 2008                                    |        |   | 2009                           |   |   | 2008 |   |   | 2009 |   |
|                                                        |   |                                    |        |   |                           |   |   |   |   |   |   |   |
| Sales volume (000 tons) – Wire mesh              |   |                                    |  18    |   |                           |   |  13 |   |   |   |  32 |   |   |   |  20 |   |
|                                                        |   |                                    |        |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Average per-ton selling prices –  Wire mesh |   | $                                       |  1,154 |   |                           | $      |  910 |   |   | $ |  1,062 |   |   | $ |  968 |   |
|                                                        |   |                                    |        |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Average per-ton wire rod cost                               |   | $                                       | 691         |   |                           | $      | 817 |   |   | $ | 630 |   |   | $ | 813 |   |

----

|   | · | increased variable costs of production due to frequent mill changes as customers are managing their inventory by ordering much smaller quantities of our different products as discussed above; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | significantly higher percentage of fixed costs included in cost of goods sold during the first quarter of 2009 due to substantially reduced production volumes as discussed above; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | decreased employee incentive compensation accruals during 2009 resulting from poor operating performance; and |
|--------|--------|---------------------------------------------------------------------------------------------------------------|

|   | · | decreases in EWP’s LIFO reserve and cost of goods sold during 2009 as discussed in Note 2 to our Condensed Consolidated Financial Statements. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                |   | Three months ended June 30, |   |
|-----------------------------------------------------|--------|-----------------------------|--------|
|                                                |   | 2008                        |   |   | % of sales |   |   | 2009 |   |   | % ofsales |   |
|                                                |   | ($ in thousands)            |   |
|                                                |   |                        |   |   |   |   |   |   |   |   |   |   |
| Net sales                                           |   | $                           | 5,402  |   |   |   | 100.0 | % |   | $ | 2,438 |   |   |   | 100.0 | % |
| Cost of goods sold                                  |   |                        | (5,282 | ) |   |   | (97.8 | ) |   |   | (3,001 | ) |   |   | (123.1 | ) |
|   Gross margin (loss)                     |   |                        | 120    |   |   |   | 2.2 |   |   |   | (563 | ) |   |   | (23.1 | ) |
|                                                |   |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling and administrative expense                  |   |                        | (270   | ) |   |   | (5.0 | ) |   |   | (157 | ) |   |   | (6.4 | ) |
|   Operating loss before pension/OPEB |   | $                           | (150   | ) |   |   | (2.8 | )% |   | $ | (720 | ) |   |   | (29.5 | )% |

|                                                |   | Six months ended June 30, |   |
|-----------------------------------------------------|--------|---------------------------|--------|
|                                                |   | 2008                      |   |   | % of sales |   |   | 2009 |   |   | % ofsales |   |
|                                                |   | ($ in thousands)          |   |
|                                                |   |                      |   |   |   |   |   |   |   |   |   |   |
| Net sales                                           |   | $                         | 8,705  |   |   |   | 100.0 | % |   | $ | 4,356 |   |   |   | 100.0 | % |
| Cost of goods sold                                  |   |                      | (9,114 | ) |   |   | (104.7 | ) |   |   | (7,330 | ) |   |   | (168.3 | ) |
|   Gross margin (loss)                     |   |                      | (409   | ) |   |   | (4.7 | ) |   |   | (2,974 | ) |   |   | (68.3 | ) |
|                                                |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling and administrative expense                  |   |                      | (433   | ) |   |   | (5.0 | ) |   |   | (217 | ) |   |   | (5.0 | ) |
|   Operating loss before pension/OPEB |   | $                         | (842   | ) |   |   |  (9.7 | )% |   | $ | (3,191 | ) |   |   | (73.3 | )% |

|                                      |   | Three months ended  June 30, |   |   | Six months ended  June 30, |   |
|-------------------------------------------|--------|----------------------------------------|--------|--------|--------------------------------------|--------|
|                                      |   | 2008                                   |   |   | 2009                                 |   |   | 2008 |   |   | 2009 |   |
|                                      |   |                                   |   |   |                                 |   |   |   |   |   |   |   |
| Sales volume (000 tons) - Bar        |   |                                   | 6      |   |                                 |   | 3 |   |   |   | 10 |   |   |   | 5 |   |
|                                      |   |                                   |   |   |                                 |   |   |   |   |   |   |   |   |   |   |   |
| Average per-ton selling prices - Bar |   | $                                      | 957    |   |                                 | $      | 752 |   |   | $ | 845 |   |   | $ | 812 |   |
|                                      |   |                                   |   |   |                                 |   |   |   |   |   |   |   |   |   |   |   |
| Average per-ton billet cost               |   | $                                      | 574    |   |                                 | $      | 469 |   |   | $ | 493 |   |   | $ | 489 |   |

----

|   | · | substantially reduced production volumes as discussed above, which resulted in a much higher percentage of fixed costs included in cost of goods sold; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | increased variable costs of production due to frequent mill changes as customers are managing their inventory by ordering much smaller quantities of Calumet’s many different product lines; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | decreased cost of electricity and natural gas; and |
|--------|--------|----------------------------------------------------|

|   | · | decreased employee incentive compensation accruals during 2009 resulting from poor operating performance. |
|--------|--------|-----------------------------------------------------------------------------------------------------------|

|   | · | a $1.5 million impairment charge as Calumet determined it was probable they would not be able to recover the cost of certain inventory items (those produced when scrap prices were substantially higher) in future selling prices; and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | increased variable costs of production as idle production facilities were difficult to re-start given cold winter temperatures. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------|

----

|                            |   | Three months ended   June 30, |   |   | Six months ended  June 30, |   |
|---------------------------------|--------|-----------------------------------------|--------|--------|--------------------------------------|--------|
|                            |   | 2008                                    |   |   | 2009                                 |   |   | 2008 |   |   | 2009 |   |
|                            |   | ($ in thousands)                        |   |
|                            |   |                                    |   |   |                                 |   |   |   |   |   |   |   |
| Interest expense                |   | $                                       | 932    |   |                                 | $      | 408 |   |   | $ | 2,245 |   |   | $ | 740 |   |
|                            |   |                                    |   |   |                                 |   |   |   |   |   |   |   |   |   |   |   |
| Average debt balance            |   |                                    | 71,809 |   |                                 |   | 32,982 |   |   |   | 82,340 |   |   |   | 31,641 |   |
|                            |   |                                    |   |   |                                 |   |   |   |   |   |   |   |   |   |   |   |
| Weighted average interest rates |   |                                    | 4.8    | %      |                                 |   | 4.2 | % |   |   | 5.2 | % |   |   | 3.9 | % |

|   | · | an operating loss before pension/OPEB of $3.7 million during the first six months of 2009 as compared to operating income before pension/OPEB of $17.4 million during the first six months of 2008; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | lower OPEB payments during 2009 of $1.3 million; |
|--------|--------|--------------------------------------------------|

|   | · | lower net cash used as a result of relative changes in our accounts receivable in 2009 of $16.3 million primarily due to lower shipment volumes during the first six months of 2009 as compared to the first six months of 2008; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | higher net cash provided by relative changes in our inventory in 2009 of $20.8 million due to lower levels of inventory as we substantially reduced production levels during the first six months of 2009 as a result of poor product demand; and |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | higher net cash used as a result of relative changes in our accrued liabilities of $19.3 million in 2009 as a result of workers compensation claims settlements during the first quarter of 2009 and 2008 employee incentive compensation paid in the first quarter of 2009 which was significantly higher than 2007 employee incentive compensation paid in the first quarter of 2008. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                             |   | December 31,   |   |   | June 30, |   |
|--------------------------------------------------|--------|----------------|--------|--------|----------|--------|
|                                             |   | 2008           |   |   | 2009     |   |
|                                             |   | (In thousands) |   |
|                                             |   |           |   |   |     |   |
| Working capital                                  |   | $              | 55,886 |   |     | $      | 50,941 |   |
| Outstanding balance of revolving credit facility |   |           | 3,264  |   |     |   | 25,658 |   |
|                                             |   |           |   |   |     |   |   |   |
| Additional borrowing availability                |   |           | 46,500 |   |     |   | 15,990 |   |

----

|   | · | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and dispositions of our assets, |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are made only in accordance with authorizations of our management and directors, and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our Condensed Consolidated Financial Statements. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (a) | We have retained a signed original of any exhibit listed below that contains signatures, and we will provide any such exhibit to the Commission or its staff upon request.  The following exhibit is included herein: |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 31.1 | Certification. |
|--------|------|----------------|

|   | 31.2 | Certification. |
|--------|------|----------------|

|   | 32.1 | Certification. |
|--------|------|----------------|

----

| Date:  August 7, 2009  | By/s/ Bert E. Downing, Jr.                                                                   Bert E. Downing, Jr.Vice President, Chief Financial Officer,Corporate Controller and Treasurer |
|---------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----