| For      the quarter ended September 30,      2009 | Commission      file number 1-5467 |
|----------------------------------------------------|------------------------------------|

| VALHI,      INC.                                           |
|------------------------------------------------------------|
| (Exact      name of Registrant as specified in itscharter) |

| Delaware                                                                |   | 87-0110150                                 |
|-------------------------------------------------------------------------|--------|--------------------------------------------|
| (State      or other jurisdiction ofincorporation      or organization) |   | (IRS      EmployerIdentification      No.) |

| 5430      LBJ Freeway, Suite 1700, Dallas,    Texas  75240-2697                  |
|--------------------------------------------------------------------------------------------|
| (Address      of principal executive offices)     (Zip      Code) |

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

----

|                                                                                                                                                                                                                                      | Pagenumber    |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------|
| Part      I.                  FINANCIAL      INFORMATION                                                                                        |          |
|                                                                                                                                                                                                                                      |          |
| Item      1.                   Financial      Statements.                                                                                  |          |
|                                                                                                                                                                                                                                      |          |
| Condensed Consolidated Balance      Sheets – December 31, 2008 and      September 30, 2009 (unaudited)                                                                                                                         |  3       |
|                                                                                                                                                                                                                                      |          |
| Condensed Consolidated      Statements of Operations (unaudited)  – Three and Nine months ended      September 30, 2008 and 2009                                                                                               |  5       |
|                                                                                                                                                                                                                                      |          |
| Condensed Consolidated      Statements of Cash Flows (unaudited) –Nine months ended      September 30, 2008 and 2009                                                                                                           |  6       |
|                                                                                                                                                                                                                                      |          |
| Condensed Consolidated      Statement of Equity and Comprehensive      Income (Loss) –  Nine months ended  September 30, 2009      (unaudited)                                                             |   8 |
|                                                                                                                                                                                                                                      |          |
| Notes to Condensed Consolidated      Financial Statements (unaudited)                                                                                                                                                                |  9       |
|                                                                                                                                                                                                                                      |          |
| Item      2.                   Management’s      Discussion and Analysis of Financial Condition and Results of      Operations. |  33      |
|                                                                                                                                                                                                                                      |          |
| Item      3.                   Quantitative      and Qualitative Disclosures About Market Risk                                        | 55            |
|                                                                                                                                                                                                                                      |          |
| Item      4.                   Controls      and Procedures                                                                                | 55            |
|                                                                                                                                                                                                                                      |          |
| Part      II.                      OTHER      INFORMATION                                                                   |          |
|                                                                                                                                                                                                                                      |          |
| Item      1.                   Legal      Proceedings.                                                                                     | 57            |
|                                                                                                                                                                                                                                      |          |
| Item      1A.                Risk      Factors.                                                                                                           | 58            |
|                                                                                                                                                                                                                                      |          |
| Item      6.                         Exhibits.                                                                                             | 58            |
|                                                                                                                                                                                                                                      |          |

----

|               ASSETS |   | December      31, 2008 |    |   | September      30, 2009   |   |
|--------------------------------------------------------------------------------------------|--------|-----------------------------|---------|--------|-------------------------------------|--------|
|                                                                                       |   |                        |    |   | (unaudited)                         |   |
|                                                                                       |   |                        |    |   |                                |   |
| Current assets:                                                                       |   |                        |    |   |                                |   |
|   Cash and cash equivalents                                       |   | $                           | 37.0    |   |                                | $      | 69.5 |   |
|   Restricted cash equivalents                                          |   |                        | 9.4     |   |                                |   | 8.3 |   |
|   Marketable securities                                                     |   |                        | 8.8     |   |                                |   | 6.1 |   |
|   Accounts and other receivables, net                        |   |                        | 205.2   |   |                                |   | 241.5 |   |
|   Inventories, net                                                          |   |                        | 408.5   |   |                                |   | 274.1 |   |
|   Prepaid expenses and      other                                      |   |                        | 15.4    |   |                                |   | 23.1 |   |
|   Deferred income taxes                                                |   |                        | 12.1    |   |                                |   | 12.3 |   |
|                                                                                       |   |                        |    |   |                                |   |   |   |
|       Total current assets                         |   |                        | 696.4   |   |                                |   | 634.9 |   |
|                                                                                       |   |                        |    |   |                                |   |   |   |
| Other assets:                                                                         |   |                        |    |   |                                |   |   |   |
|   Marketable      securities                                                     |   |                        | 272.0   |   |                                |   | 275.1 |   |
|   Investment in affiliates                                             |   |                        | 124.0   |   |                                |   | 121.8 |   |
|   Goodwill                                                                       |   |                        | 396.8   |   |                                |   | 396.9 |   |
|   Other intangible assets                                              |   |                        | 2.0     |   |                                |   | 1.6 |   |
|   Deferred income taxes                                                |   |                        | 166.4   |   |                                |   | 198.5 |   |
|   Other assets                                                              |   |                        | 90.8    |   |                                |   | 100.0 |   |
|                                                                                       |   |                        |    |   |                                |   |   |   |
|       Total other assets                           |   |                        | 1,052.0 |   |                                |   | 1,093.9 |   |
|                                                                                       |   |                        |    |   |                                |   |   |   |
| Property and equipment:                                                          |   |                        |    |   |                                |   |   |   |
|   Land                                                                           |   |                        | 46.4    |   |                                |   | 53.4 |   |
|   Buildings                                                                      |   |                        | 268.5   |   |                                |   | 291.8 |   |
|   Equipment                                                                      |   |                        | 1,025.3 |   |                                |   | 1,137.6 |   |
|   Mining properties                                                         |   |                        | 30.3    |   |                                |   | 67.2 |   |
|   Construction in progress                                             |   |                        | 58.2    |   |                                |   | 53.0 |   |
|                                                                                       |   |                        | 1,428.7 |   |                                |   | 1,603.0 |   |
|   Less accumulated depreciation                                        |   |                        | 787.7   |   |                                |   | 914.8 |   |
|                                                                                       |   |                        |    |   |                                |   |   |   |
|       Net property and equipment              |   |                        | 641.0   |   |                                |   | 688.2 |   |
|                                                                                       |   |                        |    |   |                                |   |   |   |
|       Total assets                                      |   | $                           | 2,389.4 |   |                                | $      | 2,417.0 |   |

----

|    LIABILITIES AND      EQUITY                                       |   | December      31, 2008 |    |   | September      30, 2009 |   |
|-------------------------------------------------------------------------------------|--------|-----------------------------|---------|--------|------------------------------|--------|
|                                                                                |   |                        |    |   | (unaudited)                  |   |
|                                                                                |   |                        |    |   |                         |   |
| Current liabilities:                                                           |   |                        |    |   |                         |   |
|   Current maturities of long-term debt                |   | $                           | 9.4     |   |                         | $      | 69.4 |   |
|   Accounts payable      and accrued liabilities                      |   |                        | 275.2   |   |                         |   | 288.4 |   |
|   Income taxes                                                       |   |                        | 4.9     |   |                         |   | 4.2 |   |
|   Deferred income taxes                                         |   |                        | 4.7     |   |                         |   | 4.9 |   |
|                                                                                |   |                        |    |   |                         |   |   |   |
|       Total current liabilities             |   |                        | 294.2   |   |                         |   | 366.9 |   |
|                                                                                |   |                        |    |   |                         |   |   |   |
| Noncurrent liabilities:                                                        |   |                        |    |   |                         |   |   |   |
|   Long-term debt                                                     |   |                        | 911.0   |   |                         |   | 919.9 |   |
|   Deferred income taxes                                         |   |                        | 346.6   |   |                         |   | 354.8 |   |
|   Accrued pension costs                                         |   |                        | 146.1   |   |                         |   | 143.2 |   |
|   Accrued postretirement      benefits costs                         |   |                        | 29.3    |   |                         |   | 29.5 |   |
|   Accrued environmental costs                                   |   |                        | 41.3    |   |                         |   | 37.6 |   |
|   Other liabilities                                                  |   |                        | 78.8    |   |                         |   | 71.3 |   |
|                                                                                |   |                        |    |   |                         |   |   |   |
|       Total noncurrent liabilities          |   |                        | 1,553.1 |   |                         |   | 1,556.3 |   |
|                                                                                |   |                        |    |   |                         |   |   |   |
| Equity:                                                                             |   |                        |    |   |                         |   |   |   |
|   Preferred stock                                                    |   |                        | 667.3   |   |                         |   | 667.3 |   |
|   Common stock                                                       |   |                        | 1.2     |   |                         |   | 1.2 |   |
|   Additional paid-in capital                                    |   |                        | -       |   |                         |   | - |   |
|   Accumulated      deficit                                                |   |                        | (109.8  | )      |                         |   | (174.2 | ) |
|   Accumulated other comprehensive loss                     |   |                        | (51.0   | )      |                         |   | (30.4 | ) |
|   Treasury stock                                                     |   |                        | (38.9   | )      |                         |   | (38.9 | ) |
|                                                                                |   |                        |    |   |                         |   |   |   |
|       Total Valhi      stockholders' equity |   |                        | 468.8   |   |                         |   | 425.0 |   |
|                                                                                |   |                        |    |   |                         |   |   |   |
| Noncontrolling interest      in subsidiaries                                   |   |                        | 73.3    |   |                         |   | 68.8 |   |
|                                                                                |   |                        |    |   |                         |   |   |   |
|       Total equity                               |   |                        | 542.1   |   |                         |   | 493.8 |   |
|                                                                                |   |                        |    |   |                         |   |   |   |
|       Total liabilities      and equity     |   | $                           | 2,389.4 |   |                         | $      | 2,417.0 |   |
|                                                                                |   |                        |    |   |                         |   |   |   |

----

|                                                                                                                 |   | Three      months ended |        |   | Nine      months ended |   |
|----------------------------------------------------------------------------------------------------------------------|--------|-------------------------|-------------|--------|------------------------|--------|
|                                                                                                                 |   | September 30,           |        |   | September 30,          |   |
|                                                                                                                 |   | 2008                    |        |   | 2009                   |   |   | 2008 |   |   | 2009 |   |
|                                                                                                                 |   | (unaudited)             |        |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |
| Revenues      and other income:                                                                                      |   |                    |        |   |                   |   |   |   |   |   |   |   |
|   Net      sales                                                                                           |   | $                       | 390.2       |   |                   | $      | 341.6 |   |   | $ | 1,200.3 |   |   | $ | 931.0 |   |
|   Other      income, net                                                                                   |   |                    | 10.8        |   |                   |   | 10.9 |   |   |   | 28.3 |   |   |   | 61.9 |   |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|     Total      revenues and other income                                                         |   |                    | 401.0       |   |                   |   | 352.5 |   |   |   | 1,228.6 |   |   |   | 992.9 |   |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Costs      and expenses:                                                                                             |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|   Cost      of sales                                                                                       |   |                    | 332.2       |   |                   |   | 281.5 |   |   |   | 1,012.3 |   |   |   | 850.1 |   |
|   Selling,      general and administrative                                                                 |   |                    | 58.6        |   |                   |   | 58.1 |   |   |   | 182.6 |   |   |   | 163.4 |   |
|   Goodwill      impairment                                                                                 |   |                    | 10.1        |   |                   |   | - |   |   |   | 10.1 |   |   |   | - |   |
|   Assets      held for sale write-down                                                                     |   |                    | -           |   |                   |   | - |   |   |   | - |   |   |   | .7 |   |
|   Interest                                                                                                 |   |                    | 17.7        |   |                   |   | 17.2 |   |   |   | 52.8 |   |   |   | 49.9 |   |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|       Total      costs and expenses                                                    |   |                    | 418.6       |   |                   |   | 356.8 |   |   |   | 1,257.8 |   |   |   | 1,064.1 |   |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|     Loss      before income taxes                                                                |   |                    | (17.6       | )      |                   |   | (4.3 | ) |   |   | (29.2 | ) |   |   | (71.2 | ) |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Provision      for income taxes (benefit)                                                                            |   |                    | 7.9         |   |                   |   | (13.7 | ) |   |   | 1.0 |   |   |   | (36.6 | ) |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|     Net      income (loss)                                                                       |   |                    | (25.5       | )      |                   |   | 9.4 |   |   |   | (30.2 | ) |   |   | (34.6 | ) |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Noncontrolling      interest in net income (loss) of      subsidiaries                                          |   |                    | (2.3        | )      |                   |   |  1.0 |   |   |   | (.9 | ) |   |   | (4.0 | ) |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|     Net      income (loss) attributable to Valhi           stockholders |   | $                       | (23.2       | )      |                   | $      | 8.4 |   |   | $ | (29.3 | ) |   | $ | (30.6 | ) |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Amounts      attributable to Valhi stockholders:                                                                     |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Basic      and diluted net income (loss) per share                                                                   |   | $                       | (.20        | )      |                   | $      | .07 |   |   | $ | (.25 | ) |   | $ | (.27 | ) |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Cash      dividends per share                                                                                        |   | $                       | .10         |   |                   | $      | .10 |   |   | $ | .30 |   |   | $ | .30 |   |
|                                                                                                                 |   |                    |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Basic      and diluted weighted average shares outstanding                                                      |   |                    |  114.4 |   |                   |   |  114.3 |   |   |   |  114.4 |   |   |   |  114.3 |   |

----

|                                                                                                                 |   | Nine      months ended September 30, |   |
|----------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|--------|
|                                                                                                                 |   | 2008                                      |   |   | 2009 |   |
|                                                                                                                 |   | (unaudited)                               |   |
|                                                                                                                 |   |                                      |   |   |   |   |
| Cash flows from operating activities:                                                            |   |                                      |   |   |   |   |
|   Net loss                                                                                            |   | $                                         | (30.2  | ) |   | $ | (34.6 | ) |
|   Depreciation and amortization                                                                  |   |                                      | 51.4   |   |   |   | 45.7 |   |
|   Gain      on sale of business                                                                            |   |                                      | -      |   |   |   | (6.3 | ) |
|   Gain      on litigation settlement                                                                       |   |                                      | -      |   |   |   | (11.1 | ) |
|   Goodwill      impairment                                                                                 |   |                                      | 10.1   |   |   |   | - |   |
|   Assets      held for sale write-down                                                                     |   |                                      | -      |   |   |   | .7 |   |
|   Benefit plan expense greater      (less) than cash funding   requirements: |   |                                      |   |   |   |   |   |   |
|     Defined      benefit pension expense                                                         |   |                                      | (9.4   | ) |   |   | (1.3 | ) |
|     Other      postretirement benefit expense                                                    |   |                                      | .4     |   |   |   | .1 |   |
|   Deferred income taxes                                                                          |   |                                      | (24.4  | ) |   |   | (27.3 | ) |
|   Net distributions from Ti02      manufacturing joint venture                              |   |                                      | 4.9    |   |   |   | 1.5 |   |
|   Other, net                                                                                          |   |                                      | 4.1    |   |   |   | 3.2 |   |
|   Change in assets and liabilities:                                                    |   |                                      |   |   |   |   |   |   |
|     Accounts and other receivables, net                                      |   |                                      | (40.6  | ) |   |   | (25.1 | ) |
|     Inventories, net                                                                        |   |                                      | 1.6    |   |   |   | 142.7 |   |
|     Accounts payable and accrued liabilities                                 |   |                                      | 20.5   |   |   |   | 1.1 |   |
|     Accounts with affiliates                                                           |   |                                      | 19.4   |   |   |   | (9.1 | ) |
|     Income taxes                                                                            |   |                                      | (1.4   | ) |   |   | (.5 | ) |
|     Other, net                                                                              |   |                                      | (5.5   | ) |   |   | (18.7 | ) |
|                                                                                                                 |   |                                      |   |   |   |   |   |   |
|         Net cash provided      by operating activities             |   |                                      | .9     |   |   |   | 61.0 |   |
|                                                                                                                 |   |                                      |   |   |   |   |   |   |
| Cash flows from investing activities:                                                            |   |                                      |   |   |   |   |   |   |
|   Capital expenditures                                                                                |   |                                      | (64.7  | ) |   |   | (48.9 | ) |
|   Capitalized      permit costs                                                                            |   |                                      | (11.3  | ) |   |   | (7.5 | ) |
|   Purchase      of:                                                                                        |   |                                      |   |   |   |   |   |   |
|     CompX common stock                                                                 |   |                                      | (1.0   | ) |   |   | - |   |
|     Marketable securities                                                                   |   |                                      | (3.8   | ) |   |   | (4.9 | ) |
|   Proceeds      from:                                                                                      |   |                                      |   |   |   |   |   |   |
|     Disposal of marketable      securities                                             |   |                                      | 5.9    |   |   |   | 6.6 |   |
|     Sale      of business                                                                        |   |                                      | -      |   |   |   | 6.7 |   |
|     Real      estate-related litigation settlement                                               |   |                                      | -      |   |   |   | 11.8 |   |
|   Change in restricted cash equivalents, net                                      |   |                                      | (3.8   | ) |   |   | 1.0 |   |
|   Other, net                                                                                          |   |                                      | 1.8    |   |   |   | .4 |   |
|                                                                                                                 |   |                                      |   |   |   |   |   |   |
|         Net cash used in investing activities       |   |                                      | (76.9  | ) |   |   | (34.8 | ) |
|                                                                                                                 |   |                                      |   |   |   |   |   |   |

----

|                                                                                                   |   | Nine      months ended September 30, |   |
|--------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|--------|
|                                                                                                   |   | 2008                                      |   |   | 2009 |   |
|                                                                                                   |   | (unaudited)                               |   |
|                                                                                                   |   |                                      |   |   |   |   |
| Cash      flows from financing activities:                                                             |   |                                      |   |   |   |   |
|   Indebtedness:                                                                              |   |                                      |   |   |   |   |
|     Borrowings                                                                     |   | $                                         | 335.4  |   |   | $ | 353.4 |   |
|     Principal payments                                                        |   |                                      | (298.4 | ) |   |   | (313.6 | ) |
|     Deferred      financing costs paid                                             |   |                                      | (1.3   | ) |   |   | (.7 | ) |
|   Purchases      of Kronos common stock                                                      |   |                                      | -      |   |   |   | (.1 | ) |
|   Valhi      cash dividends paid                                                        |   |                                      | (34.1  | ) |   |   | (34.1 | ) |
|   Distributions to noncontrolling      interest in subsidiaries                    |   |                                      | (5.5   | ) |   |   | (3.7 | ) |
|   Issuance      of common stock and other                                                    |   |                                      | -      |   |   |   | .1 |   |
|                                                                                                   |   |                                      |   |   |   |   |   |   |
|       Net cash provided      by (used in) financing activities |   |                                      | (3.9   | ) |   |   | 1.3 |   |
|                                                                                                   |   |                                      |   |   |   |   |   |   |
| Cash and cash equivalents – net change from:                  |   |                                      |   |   |   |   |   |   |
|   Operating, investing and financing activities                          |   |                                      | (79.9  | ) |   |   | 27.5 |   |
|   Currency translation                                                                  |   |                                      | (.2    | ) |   |   | 5.0 |   |
| Cash and cash      equivalents at beginning of period                    |   |                                      | 138.3  |   |   |   | 37.0 |   |
|                                                                                                   |   |                                      |   |   |   |   |   |   |
| Cash and cash      equivalents at end of period                          |   | $                                         | 58.2   |   |   | $ | 69.5 |   |
|                                                                                                   |   |                                      |   |   |   |   |   |   |
|                                                                                                   |   |                                      |   |   |   |   |   |   |
| Supplemental disclosures:                                                                         |   |                                      |   |   |   |   |   |   |
|   Cash paid for:                                                                   |   |                                      |   |   |   |   |   |   |
|     Interest, net of amounts capitalized                       |   | $                                         | 42.9   |   |   | $ | 40.2 |   |
|     Income taxes, net                                                    |   |                                      | .9     |   |   |   | 3.4 |   |
|   Accrual      for capital expenditures                                                      |   |                                      | 4.7    |   |   |   | 9.4 |   |
|   Accrual      for capitalized permit costs                                                  |   |                                      | .8     |   |   |   | 1.3 |   |
|                                                                                                   |   |                                      |   |   |   |   |   |   |
| Noncash      investing activities -                                                                    |   |                                      |   |   |   |   |   |   |
| Note      receivable from sale of business                                                             |   |                                      | -      |   |   |   | .8 |   |

----

|                                                                 |   | Valhi      Stockholders’ Equity |    |   |   |   |    |       |   |   |        |   |
|----------------------------------------------------------------------|--------|---------------------------------------|---------|--------|--------|--------|---------|------------|--------|--------|-------------|--------|
|                                                                 |   |                                  |    |   |   |   |    |       |   |   |        |   |   | Accumulated |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                 |   |                                  |    |   |   |   |    | Additional |   |   |        |   |   | other |   |   |   |   |   | Non- |   |   |   |   |   |   |   |
|                                                                 |   | Preferred                             |    |   | Common |   |    | paid-in    |   |   | Accumulated |   |   | comprehensive |   |   | Treasury |   |   | controlling |   |   | Total |   |   | Comprehensive |   |
|                                                                 |   | stock                                 |    |   | stock  |   |    | capital    |   |   | deficit     |   |   | loss |   |   | stock |   |   | interest |   |   | equity |   |   | income (loss) |   |
|                                                                 |   | (unaudited)                           |    |
|                                                                 |   |                                  |    |   |   |   |    |       |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance      at December 31, 2008                                    |   | $                                     | 667.3   |   |   | $      | 1.2     |       |   | $      | -           |   |   | $ | (109.8 | ) |   | $ | (51.0 | ) |   | $ | (38.9 | ) |   | $ | 73.3 |   |   | $ | 542.1 |   |   |   |   |
|                                                                 |   |                                  |    |   |   |   |    |       |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      loss                                                        |   |                                  | -       |   |   |   | -       |       |   |   | -           |   |   |   | (30.6 | ) |   |   | - |   |   |   | - |   |   |   | (4.0 | ) |   |   | (34.6 | ) |   | $ | (34.6 | ) |
|                                                                 |   |                                  |    |   |   |   |    |       |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other      comprehensive income, net                                 |   |                                  | -       |   |   |   | -       |       |   |   | -           |   |   |   | - |   |   |   | 20.6 |   |   |   | - |   |   |   | 3.5 |   |   |   | 24.1 |   |   |   | 24.1 |   |
|                                                                 |   |                                  |    |   |   |   |    |       |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Equity      transactions with noncontrolling      interest, net |   |                                  |  - |   |   |   |  - |       |   |   |  .3    |   |   |   |  - |   |   |   |  - |   |   |   |  - |   |   |   | (.3 | ) |   |   |  - |   |   |   |  - |   |
|                                                                 |   |                                  |    |   |   |   |    |       |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash      dividends                                                  |   |                                  | -       |   |   |   | -       |       |   |   | (.3         | )      |   |   | (33.8 | ) |   |   | - |   |   |   | - |   |   |   | (3.7 | ) |   |   | (37.8 | ) |   |   | - |   |
|                                                                 |   |                                  |    |   |   |   |    |       |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance      at September 30, 2009                                   |   | $                                     | 667.3   |   |   | $      | 1.2     |       |   | $      | -           |   |   | $ | (174.2 | ) |   | $ | (30.4 | ) |   | $ | (38.9 | ) |   | $ | 68.8 |   |   | $ | 493.8 |   |   |   |   |   |
|                                                                 |   |                                  |    |   |   |   |    |       |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive      loss                                              |   |                                  |    |   |   |   |    |       |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | $ | (10.5 | ) |
|                                                                 |   |                                  |    |   |   |   |    |       |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                 |   |                                  |    |   |   |   |    |       |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

----

|   Businesssegment  |   |         Entity        |   | %      controlled at September 30,    2009  |
|-----------------------------------|--------|--------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------|
|                              |   |                                                                                             |   |                                                  |
| Chemicals                         |   | Kronos                                                                                           |   |  95%                                             |
| Component      products           |   | CompX                                                                                            |   |  87%                                             |
| Waste      management             |   | WCS                                                                                              |   |  100%                                            |

|                                                                                         |   | Three      months ended September 30, |   |   | Nine      months ended September 30, |   |
|----------------------------------------------------------------------------------------------|--------|--------------------------------------------|--------|--------|-------------------------------------------|--------|
|                                                                                         |   | 2008                                       |   |   | 2009                                      |   |   | 2008 |   |   | 2009 |   |
|                                                                                         |   | (In      millions)                         |   |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |
| Net sales:                                                                              |   |                                       |   |   |                                      |   |   |   |   |   |   |   |
|   Chemicals                                                                        |   | $                                          | 345.6  |   |                                      | $      | 310.1 |   |   | $ | 1,070.0 |   |   | $ | 840.2 |   |
|   Component products                                                          |   |                                       | 43.9   |   |                                      |   | 29.4 |   |   |   | 128.1 |   |   |   | 87.1 |   |
|   Waste management                                                            |   |                                       | .7     |   |                                      |   | 2.1 |   |   |   | 2.2 |   |   |   | 3.7 |   |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|     Total net sales                                            |   | $                                          | 390.2  |   |                                      | $      | 341.6 |   |   | $ | 1,200.3 |   |   | $ | 931.0 |   |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
| Cost of sales:                                                                     |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|   Chemicals                                                                        |   | $                                          | 295.9  |   |                                      | $      | 251.2 |   |   | $ | 905.2 |   |   | $ | 764.0 |   |
|   Component products                                                          |   |                                       | 32.7   |   |                                      |   | 22.4 |   |   |   | 96.5 |   |   |   | 69.1 |   |
|   Waste management                                                            |   |                                       | 3.6    |   |                                      |   | 7.9 |   |   |   | 10.6 |   |   |   | 17.0 |   |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|     Total cost of sales                                   |   | $                                          | 332.2  |   |                                      | $      | 281.5 |   |   | $ | 1,012.3 |   |   | $ | 850.1 |   |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
| Gross margin:                                                                           |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|   Chemicals                                                                        |   | $                                          | 49.7   |   |                                      | $      | 58.9 |   |   | $ | 164.8 |   |   | $ | 76.2 |   |
|   Component products                                                          |   |                                       | 11.2   |   |                                      |   | 7.0 |   |   |   | 31.6 |   |   |   | 18.0 |   |
|   Waste management                                                            |   |                                       | (2.9   | )      |                                      |   | (5.8 | ) |   |   | (8.4 | ) |   |   | (13.3 | ) |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|     Total gross margin                                         |   | $                                          | 58.0   |   |                                      | $      | 60.1 |   |   | $ | 188.0 |   |   | $ | 80.9 |   |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
| Operating income (loss):                                                           |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|   Chemicals                                                                        |   | $                                          | 8.8    |   |                                      | $      | 22.3 |   |   | $ | 30.6 |   |   | $ | (23.2 | ) |
|   Component products                                                          |   |                                       | (5.2   | )      |                                      |   | (.1 | ) |   |   | 2.3 |   |   |   | (2.0 | ) |
|   Waste management                                                            |   |                                       | (5.7   | )      |                                      |   | (9.0 | ) |   |   | (15.6 | ) |   |   | (22.2 | ) |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|     Total operating income     (loss) |   |                                       | (2.1   | )      |                                      |   |  13.2 |   |   |   |  17.3 |   |   |   | (47.4 | ) |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
| Equity      in losses of investee                                                            |   |                                       | (.2    | )      |                                      |   | (.1 | ) |   |   | (.8 | ) |   |   | (.8 | ) |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
| General corporate items:                                                           |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|   Securities      earnings                                                         |   |                                       | 6.6    |   |                                      |   | 7.0 |   |   |   | 24.2 |   |   |   | 20.0 |   |
|   Insurance recoveries                                                        |   |                                       | .7     |   |                                      |   | 1.4 |   |   |   | 2.4 |   |   |   | 4.1 |   |
|   Gain      on litigation settlements                                              |   |                                       | -      |   |                                      |   | - |   |   |   | - |   |   |   | 23.0 |   |
|   Gain      on sale of business                                                    |   |                                       | -      |   |                                      |   | - |   |   |   | - |   |   |   | 6.3 |   |
|   General expenses, net                                                  |   |                                       | (4.9   | )      |                                      |   | (8.6 | ) |   |   | (19.5 | ) |   |   | (26.5 | ) |
| Interest expense                                                                        |   |                                       | (17.7  | )      |                                      |   | (17.2 | ) |   |   | (52.8 | ) |   |   | (49.9 | ) |
|                                                                                         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|     Loss      before income taxes                              |   | $                                          | (17.6  | )      |                                      | $      | (4.3 | ) |   | $ | (29.2 | ) |   | $ | (71.2 | ) |

----

|                                          |   | December      31, 2008 |   |   | September      30, 2009   |   |
|-----------------------------------------------|--------|-----------------------------|--------|--------|-------------------------------------|--------|
|                                          |   | (In      millions)          |   |
|                                          |   |                        |   |   |                                |   |
| Accounts      receivable                      |   | $                           | 194.9  |   |                                | $      | 237.0 |   |
| Refundable      income taxes                  |   |                        | 1.6    |   |                                |   | .6 |   |
| Receivable      from affiliates:              |   |                        |   |   |                                |   |   |   |
|   Contran      – income taxes |   |                        | -      |   |                                |   | 3.8 |   |
|   Other                             |   |                        | .1     |   |                                |   | - |   |
| Other      receivables                        |   |                        | 11.3   |   |                                |   | 3.3 |   |
| Allowance      for doubtful accounts          |   |                        | (2.7   | )      |                                |   | (3.2 | ) |
|                                          |   |                        |   |   |                                |   |   |   |
|       Total     |   | $                           | 205.2  |   |                                | $      | 241.5 |   |

|                                                                    |   | December      31, 2008 |   |   | September      30, 2009   |   |
|-------------------------------------------------------------------------|--------|-----------------------------|--------|--------|-------------------------------------|--------|
|                                                                    |   | (In      millions)          |   |
|                                                                    |   |                        |   |   |                                |   |
| Raw materials:                                                     |   |                        |   |   |                                |   |
|   Chemicals                                                   |   | $                           | 67.1   |   |                                | $      | 44.3 |   |
|   Component products                                     |   |                        | 7.5    |   |                                |   | 5.5 |   |
|                                                                    |   |                        |   |   |                                |   |   |   |
|       Total raw materials       |   |                        | 74.6   |   |                                |   | 49.8 |   |
|                                                                    |   |                        |   |   |                                |   |   |   |
| Work      in process:                                                   |   |                        |   |   |                                |   |   |   |
|   Chemicals                                                   |   |                        | 19.8   |   |                                |   | 18.9 |   |
|   Component products                                     |   |                        | 8.2    |   |                                |   | 6.6 |   |
|                                                                    |   |                        |   |   |                                |   |   |   |
|       Total in-process products |   |                        | 28.0   |   |                                |   | 25.5 |   |
|                                                                    |   |                        |   |   |                                |   |   |   |
| Finished products:                                                 |   |                        |   |   |                                |   |   |   |
|   Chemicals                                                   |   |                        | 243.8  |   |                                |   | 134.8 |   |
|   Component products                                     |   |                        | 6.9    |   |                                |   | 5.2 |   |
|                                                                    |   |                        |   |   |                                |   |   |   |
|       Total finished products   |   |                        | 250.7  |   |                                |   | 140.0 |   |
|                                                                    |   |                        |   |   |                                |   |   |   |
| Supplies (primarily chemicals)                                |   |                        | 55.2   |   |                                |   | 58.8 |   |
|                                                                    |   |                        |   |   |                                |   |   |   |
|       Total                          |   | $                           | 408.5  |   |                                | $      | 274.1 |   |

----

|                                                                            |   | December      31, 2008   |   |   | September      30, 2009 |   |
|---------------------------------------------------------------------------------|--------|------------------------------------|--------|--------|------------------------------|--------|
|                                                                            |   | (In      millions)                 |   |
|                                                                            |   |                               |   |   |                         |   |
| Marketable      securities:                                                     |   |                               |   |   |                         |   |
|   The      Amalgamated Sugar Company LLC                              |   | $                                  | 250.0  |   |                         | $      | 250.0 |   |
|   Titanium      Metals Corporation (“TIMET”)              |   |                               | 20.1   |   |                         |   | 21.8 |   |
|   Other                                                          |   |                               | 1.9    |   |                         |   | 3.3 |   |
|                                                                            |   |                               |   |   |                         |   |   |   |
|       Total                                       |   | $                                  | 272.0  |   |                         | $      | 275.1 |   |
|                                                                            |   |                               |   |   |                         |   |   |   |
|                                                                            |   |                               |   |   |                         |   |   |   |
| Investment      in affiliates:                                                  |   |                               |   |   |                         |   |   |   |
|   TiO2 manufacturing joint venture                     |   | $                                  | 105.6  |   |                         | $      | 104.1 |   |
|   Other                                                          |   |                               | 18.4   |   |                         |   | 17.7 |   |
|                                                                            |   |                               |   |   |                         |   |   |   |
|       Total                                       |   | $                                  | 124.0  |   |                         | $      | 121.8 |   |
|                                                                            |   |                               |   |   |                         |   |   |   |
| Other assets:                                                              |   |                               |   |   |                         |   |   |   |
|   Waste disposal site operating permits, net |   | $                                  | 43.7   |   |                         | $      | 52.0 |   |
|   NL      note receivable                                             |   |                               | 15.0   |   |                         |   | 15.0 |   |
|   IBNR      receivables                                               |   |                               | 7.5    |   |                         |   | 8.0 |   |
|   Deferred financing costs                                  |   |                               | 7.1    |   |                         |   | 6.6 |   |
|   Other                                                               |   |                               | 17.5   |   |                         |   | 18.4 |   |
|                                                                            |   |                               |   |   |                         |   |   |   |
|       Total                                       |   | $                                  | 90.8   |   |                         | $      | 100.0 |   |

----

----

|                                                           |   |                        |   |   |                         |   |
|----------------------------------------------------------------|--------|-----------------------------|--------|--------|------------------------------|--------|
|                                                           |   | December      31, 2008 |   |   | September      30, 2009 |   |
|                                                           |   | (In      millions)          |   |
|                                                           |   |                        |   |   |                         |   |
| Current:                                                       |   |                        |   |   |                         |   |
|   Accounts      payable                              |   | $                           | 121.0  |   |                         | $      | 98.0 |   |
|   Employee benefits                             |   |                        | 33.6   |   |                         |   | 36.8 |   |
|   Payable      to affiliates:                        |   |                        |   |   |                         |   |   |   |
|     Louisiana      Pigment Company, L.P.   |   |                        | 14.3   |   |                         |   | 10.4 |   |
|     Contran      – trade items       |   |                        | 9.7    |   |                         |   | 12.5 |   |
|     Contran      – income taxes, net |   |                        | 1.3    |   |                         |   | - |   |
|     TIMET                                  |   |                        | .5     |   |                         |   |  .2 |   |
|   Accrued      sales discounts and rebates           |   |                        | 14.9   |   |                         |   | 18.2 |   |
|   Environmental costs                           |   |                        | 11.6   |   |                         |   | 11.5 |   |
|   Deferred income                               |   |                        | 8.4    |   |                         |   | 19.4 |   |
|   Interest                                           |   |                        | 7.9    |   |                         |   | 17.7 |   |
|   Reserve      for uncertain tax positions           |   |                        | .2     |   |                         |   | .3 |   |
|   Other                                              |   |                        | 51.8   |   |                         |   | 63.4 |   |
|                                                           |   |                        |   |   |                         |   |   |   |
|       Total                      |   | $                           | 275.2  |   |                         | $      | 288.4 |   |
|                                                           |   |                        |   |   |                         |   |   |   |
| Noncurrent:                                                    |   |                        |   |   |                         |   |   |   |
|   Reserve      for uncertain tax positions           |   | $                           | 50.4   |   |                         | $      | 43.1 |   |
|   Insurance claims and expenses       |   |                        | 13.5   |   |                         |   | 13.0 |   |
|   Employee benefits                             |   |                        | 9.1    |   |                         |   | 9.0 |   |
|   Other                                              |   |                        | 5.8    |   |                         |   | 6.2 |   |
|                                                           |   |                        |   |   |                         |   |   |   |
|       Total                      |   | $                           | 78.8   |   |                         | $      | 71.3 |   |

|                                                                                                   |   | December      31, 2008 |        |   | September      30, 2009   |   |
|--------------------------------------------------------------------------------------------------------|--------|-----------------------------|-------------|--------|-------------------------------------|--------|
|                                                                                                   |   | (In      millions)          |        |
|                                                                                                   |   |                        |        |   |                                |   |
| Valhi:                                                                                                 |   |                        |        |   |                                |   |
|   Snake      River Sugar Company                                                             |   | $                           | 250.0       |   |                                | $      | 250.0 |   |
|   Revolving      bank credit facility                                                        |   |                        | 7.3         |   |                                |   | - |   |
|   Contran      credit facility                                                               |   |                        | -           |   |                                |   | 37.3 |   |
|   Promissory      note payable to Contran                                                    |   |                        | -           |   |                                |   | 30.0 |   |
|       Total      Valhi debt                                              |   |                        | 257.3       |   |                                |   | 317.3 |   |
|                                                                                                   |   |                        |        |   |                                |   |   |   |
| Subsidiary      debt:                                                                                  |   |                        |        |   |                                |   |   |   |
|   Kronos International:    6.5% Senior Secured Notes |   |                        |  560.0 |   |                                |   |  582.2 |   |
|   European      bank credit facility                                                         |   |                        | 42.2        |   |                                |   | 26.3 |   |
| CompX      promissory note payable to TIMET                                                            |   |                        | 43.0        |   |                                |   | 42.2 |   |
|   Kronos U.S. bank credit facility                                       |   |                        | 13.7        |   |                                |   | 13.8 |   |
|   Other                                                                                      |   |                        | 4.2         |   |                                |   | 7.5 |   |
|                                                                                                   |   |                        |        |   |                                |   |   |   |
|       Total subsidiary debt                                    |   |                        | 663.1       |   |                                |   | 672.0 |   |
|                                                                                                   |   |                        |        |   |                                |   |   |   |
|       Total debt                                                    |   |                        | 920.4       |   |                                |   | 989.3 |   |
|                                                                                                   |   |                        |        |   |                                |   |   |   |
|       Less current maturities                                  |   |                        | 9.4         |   |                                |   | 69.4 |   |
|                                                                                                   |   |                        |        |   |                                |   |   |   |
|       Total long-term debt                                     |   | $                           | 911.0       |   |                                | $      | 919.9 |   |

----

----

----

|                                                                       |   | Three      months ended September 30, |     |   | Nine      months ended September 30, |   |
|----------------------------------------------------------------------------|--------|--------------------------------------------|----------|--------|-------------------------------------------|--------|
|                                                                       |   | 2008                                       |     |   | 2009                                      |   |   | 2008 |   |   | 2009 |   |
|                                                                       |   | (In      millions)                         |     |
|                                                                       |   |                                       |     |   |                                      |   |   |   |   |   |   |   |
| Service cost                                                     |   | $                                          | 1.7      |   |                                      | $      | 2.0 |   |   | $ | 5.2 |   |   | $ | 5.6 |   |
| Interest cost                                                    |   |                                       | 7.4      |   |                                      |   | 7.1 |   |   |   | 22.4 |   |   |   | 20.5 |   |
| Expected return on plan assets                         |   |                                       | (8.1     | )      |                                      |   | (5.6 | ) |   |   | (24.3 | ) |   |   | (16.3 | ) |
| Amortization of prior service cost                     |   |                                       | .2       |   |                                      |   | .3 |   |   |   | .7 |   |   |   | .9 |   |
| Amortization of net transition   obligations |   |                                       |  .2 |   |                                      |   |  .1 |   |   |   |  .4 |   |   |   |  .3 |   |
| Recognized actuarial losses                                      |   |                                       | 1.3      |   |                                      |   | 1.9 |   |   |   | 3.6 |   |   |   | 5.6 |   |
|                                                                       |   |                                       |     |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|       Total                                  |   | $                                          | 2.7      |   |                                      | $      | 5.8 |   |   | $ | 8.0 |   |   | $ | 16.6 |   |

|                                      |   | Three      months ended September 30, |   |   | Nine      months ended September 30, |   |
|-------------------------------------------|--------|--------------------------------------------|--------|--------|-------------------------------------------|--------|
|                                      |   | 2008                                       |   |   | 2009                                      |   |   | 2008 |   |   | 2009 |   |
|                                      |   | (In      millions)                         |   |
|                                      |   |                                       |   |   |                                      |   |   |   |   |   |   |   |
| Service      cost                         |   | $                                          | -      |   |                                      | $      | .1 |   |   | $ | .2 |   |   | $ | .2 |   |
| Interest      cost                        |   |                                       | .6     |   |                                      |   | .5 |   |   |   | 1.7 |   |   |   | 1.5 |   |
| Amortization      of prior service credit |   |                                       | (.1    | )      |                                      |   | (.1 | ) |   |   | (.3 | ) |   |   | (.3 | ) |
| Recognized      actuarial losses (gains)  |   |                                       | .1     |   |                                      |   | (.1 | ) |   |   | .2 |   |   |   | (.2 | ) |
|                                      |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |
|       Total |   | $                                          | .6     |   |                                      | $      | .4 |   |   | $ | 1.8 |   |   | $ | 1.2 |   |

|                                                                    |   | Nine      months ended September 30, |   |
|-------------------------------------------------------------------------|--------|-------------------------------------------|--------|
|                                                                    |   | 2008                                      |   |   | 2009 |   |
|                                                                    |   | (In      millions)                        |   |
|                                                                    |   |                                      |   |   |   |   |
| Securities      earnings:                                               |   |                                      |   |   |   |   |
|   Dividends and interest                            |   | $                                         | 25.0   |   |   | $ | 19.6 |   |
|   Securities transactions, net                      |   |                                      | (.8    | ) |   |   | .4 |   |
|                                                                    |   |                                      |   |   |   |   |   |   |
|       Total securities earnings |   |                                      | 24.2   |   |   |   | 20.0 |   |
|                                                                    |   |                                      |   |   |   |   |   |   |
| Equity      in losses of investee                                       |   |                                      | (.8    | ) |   |   | (.8 | ) |
| Currency transactions, net                                    |   |                                      | (.2    | ) |   |   | 9.0 |   |
| Insurance recoveries                                               |   |                                      | 2.4    |   |   |   | 4.1 |   |
| Gain      on litigation settlements                                     |   |                                      | -      |   |   |   | 23.0 |   |
| Gain      on sale of business                                           |   |                                      | -      |   |   |   | 6.3 |   |
| Other, net                                                         |   |                                      | 2.7    |   |   |   | .3 |   |
|                                                                    |   |                                      |   |   |   |   |   |   |
|       Total                          |   | $                                         | 28.3   |   |   | $ | 61.9 |   |

----

|                                                                                       |   | Nine      months ended September 30,  |      |
|--------------------------------------------------------------------------------------------|--------|-------------------------------------------------|-----------|
|                                                                                       |   | 2008                                            |      |   | 2009 |   |
|                                                                                       |   | (In      millions)                              |      |
|                                                                                       |   |                                            |      |   |   |   |
| Expected      tax benefit, at U.S. federal statutory income      tax rate of 35% |   | $                                               | (10.2     | ) |   | $ | (24.9 | ) |
| Incremental      U.S. tax and rate differences on equity      in earnings             |   |                                            |  2.9 |   |   |   | (7.7 | ) |
| Non-U.S.      tax rates                                                                    |   |                                            |  .4  |   |   |   | 1.9 |   |
| Nondeductible      expenses                                                                |   |                                            |  1.5 |   |   |   | 2.2 |   |
| German      tax attribute adjustment                                                       |   |                                            | (7.2      | ) |   |   | - |   |
| Change      in reserve for uncertain tax positions                                         |   |                                            | 8.7       |   |   |   | (7.1 | ) |
| No      income tax benefit on goodwill impairment                                          |   |                                            | 3.5       |   |   |   | - |   |
| U.S.      state income taxes, net                                                          |   |                                            | 1.1       |   |   |   | .1 |   |
| Other,      net                                                                            |   |                                            | .3        |   |   |   | (1.1 | ) |
|                                                                                       |   |                                            |      |   |   |   |   |   |
|      Income      tax provision (benefit)                          |   | $                                               | 1.0       |   |   | $ | (36.6 | ) |

----

|                                          |   | December      31, 2008 |   |   | September      30, 2009  |   |
|-----------------------------------------------|--------|-----------------------------|--------|--------|------------------------------------|--------|
|                                          |   | (In      millions)          |   |
|                                          |   |                        |   |   |                               |   |
| Noncontrolling      interest in subsidiaries: |   |                        |   |   |                               |   |
|   NL Industries                |   | $                           | 45.8   |   |                               | $      | 43.1 |   |
|   Kronos Worldwide             |   |                        | 15.6   |   |                               |   | 14.5 |   |
|   CompX International          |   |                        | 11.9   |   |                               |   | 11.2 |   |
|                                          |   |                        |   |   |                               |   |   |   |
|       Total     |   | $                           | 73.3   |   |                               | $      | 68.8 |   |

|                                                                    |   | Nine      months ended September 30, |   |
|-------------------------------------------------------------------------|--------|-------------------------------------------|--------|
|                                                                    |   | 2008                                      |   |   | 2009 |   |
|                                                                    |   | (In      millions)                        |   |
|                                                                    |   |                                      |   |   |   |   |
| Noncontrolling      interest in net income (loss) of subsidiaries: |   |                                      |   |   |   |   |
|   NL Industries                                          |   | $                                         | (.5    | ) |   | $ | (1.8 | ) |
|   Kronos Worldwide                                       |   |                                      | .1     |   |   |   | (2.0 | ) |
|   CompX International                                    |   |                                      | (.5    | ) |   |   | (.2 | ) |
|                                                                    |   |                                      |   |   |   |   |   |   |
|       Total                               |   | $                                         | (.9    | ) |   | $ | (4.0 | ) |

|                                                                                                          |   | Nine      months ended September    30, 2009 |            |
|---------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------|-----------------|
|                                                                                                          |   | (In      millions)                                     |            |
|                                                                                                          |   |                                                   |            |
| Net      loss attributable to Valhi stockholders                                                              |   | $                                                      | (30.6           | ) |
|                                                                                                          |   |                                                   |            |   |
| Transfers      (to) from noncontrolling interest:                                                             |   |                                                   |            |   |
| Increase      in additional paid-in capital for purchase of 14,000 shares of Kronos      common stock         |   |                                                   |    .2 |   |
| Issuance      of subsidiary stock                                                                             |   |                                                   | .1              |   |
|                                                                                                          |   |                                                   |            |   |
| Net      transfers (to) from noncontrolling interest                                                          |   |                                                   |  .3        |   |
|                                                                                                          |   |                                                   |            |   |
| Net      loss attributable to Valhi stockholders and change from noncontrolling      interest in subsidiaries |   | $                                                      | (30.3           | ) |

----

|   | · | we      have never settled any of thesecases; |
|--------|--------|-----------------------------------------------|

|   | · | no      final, non-appealable adverse verdicts have ever been entered against us;      and |
|--------|--------|--------------------------------------------------------------------------------------------|

|   | · | we      have never ultimately been found liable with respect to any such      litigation matters. |
|--------|--------|---------------------------------------------------------------------------------------------------|

----

|   | · | complexity      and differing interpretations of governmental  regulations; |
|--------|--------|-----------------------------------------------------------------------------|

|   | · | number      of PRPs and their ability or willingness to fund such allocation of      costs; |
|--------|--------|---------------------------------------------------------------------------------------------|

|   | · | financial      capabilities of the PRPs and the allocation of costs among      them; |
|--------|--------|--------------------------------------------------------------------------------------|

|   | · | solvency      of other PRPs; |
|--------|--------|------------------------------|

|   | · | multiplicity      of possible solutions; |
|--------|--------|------------------------------------------|

|   | · | number      of years of investigatory, remedial and monitoring activity required;      and |
|--------|--------|--------------------------------------------------------------------------------------------|

|   | · | number      of years between former operations and notice of the claim and lack of      information and documents about the former  operations. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

----

|                                                                                                                                                      |   | Amount             |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|
|                                                                                                                                                      |   | (In      millions) |   |
|                                                                                                                                                      |   |               |   |
| Balance      at the beginning of the period                                                                                                               |   | $                  | 52.9   |   |
| Additions      charged to expense, net                                                                                                                    |   |               | 2.7    |   |
| Currency      changes                                                                                                                                     |   |               | .1     |   |
| Payments,      net                                                                                                                                        |   |               | (6.6   | ) |
|                                                                                                                                                      |   |               |   |   |
|       Balance      at the end of the period                                                                                 |   | $                  | 49.1   |   |
|                                                                                                                                                      |   |               |   |   |
| Amounts recognized in the Condensed      Consolidated Balance Sheet at the end of the period: |   |               |   |   |
|   Current liability                                                                                                                        |   | $                  | 37.6   |   |
|   Noncurrent liability                                                                                                                     |   |               | 11.5   |   |
|                                                                                                                                                      |   |               |   |   |
|       Total                                                                                                                 |   | $                  | 49.1   |   |

----

----

|   | · | to      recover response and remediation costs incurred at the    site; |
|--------|--------|-------------------------------------------------------------------------|

|   | · | a      declaration of the parties’ liability for response and remediation costs      incurred at the site; |
|--------|--------|------------------------------------------------------------------------------------------------------------------|

|   | · | a      declaration of the parties’ liability for response and remediation costs      to be incurred in the future at the site;and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a      declaration regarding the obligation of Tremont to indemnify Halliburton      and DII for costs and expenses attributable to the  site. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

| ·   | facts      concerning historical operations, |
|--------------------|----------------------------------------------|

| ·   | the      rate of new claims, |
|--------------------|------------------------------|

| ·   | the      number of claims from which we have been dismissed  and |
|--------------------|------------------------------------------------------------------|

| ·   | our      prior experience in the defense of these  matters, |
|--------------------|-------------------------------------------------------------|

----

|                                        |   | Fair Value Measurements |   |
|---------------------------------------------|--------|-------------------------|--------|
|                                        |   | Total                   |   |   | Quoted      Prices in Active Markets (Level      1) |   |   | Significant      Other Observable Inputs (Level      2) |   |   | Significant      Unobservable Inputs (Level      3) |   |
|                                        |   | (In      millions)      |   |
|                                        |   |                    |   |   |   |   |   |   |   |   |   |   |
| December      31, 2008:                     |   |                    |   |   |   |   |   |   |   |   |   |   |
|   Marketable      securities:     |   |                    |   |   |   |   |   |   |   |   |   |   |
|     Current             |   | $                       | 8.8    |   |   | $ | - |   |   | $ | 8.8 |   |   | $ | - |   |
|     Noncurrent          |   |                    | 272.0  |   |   |   | 21.6 |   |   |   | .4 |   |   |   | 250.0 |   |
|                                        |   |                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Currency      forward contracts |   |                    | (1.6   | ) |   |   | (1.6 | ) |   |   | - |   |   |   | - |   |
|                                        |   |                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| September      30, 2009:                    |   |                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Marketable      securities:     |   |                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Current             |   | $                       | 6.1    |   |   |   | - |   |   |   | 6.1 |   |   |   | - |   |
|     Noncurrent          |   |                    | 275.1  |   |   |   | 25.1 |   |   |   | - |   |   |   | 250.0 |   |
|                                        |   |                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Currency      forward contracts |   |                    | 2.7    |   |   |   | 2.7 |   |   |   | - |   |   |   | - |   |

----

| ·   | an      aggregate of $7.5 million for an equivalent value of Canadian dollars at      exchange rates ranging from Cdn. $1.25 to Cdn. $1.26 per U.S.      dollar.  These contracts with U.S. Bank mature from October 2009      through December 2009 at a rate of $2.5 million per month, subject to      early redemption provisions at our option.  At September 30, 2009,      the actual exchange rate was Cdn. $1.10 per U.S.  dollar. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | an      aggregate euro 21.4 million for an equivalent value of Norwegian kroner at      exchange rates ranging from kroner 8.70 to kroner 9.22 per euro.       These contracts with DnB Nor Bank ASA mature from October 2009 through      September 2010 at a rate of euro .1 million to euro 1.8 million per month,      subject to early redemption provisions at our option.  At      September 30, 2009, the actual exchange rate was kroner 8.46 per euro. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                             |   |                        |   |   |                         |   |
|------------------------------------------------------------------|--------|-----------------------------|--------|--------|------------------------------|--------|
|                                                             |   | December      31, 2008 |   |   | September      30, 2009 |   |
|                                                             |   | Carrying amount        |   |   | Fairvalue                    |   |   | Carrying amount |   |   | Fairvalue |   |
|                                                             |   | (In      millions)          |   |
|                                                             |   |                        |   |   |                         |   |   |   |   |   |   |   |
| Cash,      cash equivalents and restricted cash equivalents |   | $                           | 46.4   |   |                         | $      | 46.4 |   |   | $ | 78.2 |   |   | $ | 78.2 |   |
| Promissory      note receivable                                  |   |                        | 15.0   |   |                         |   | 15.0 |   |   |   | 15.0 |   |   |   | 15.0 |   |
|                                                             |   |                        |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |
| Long-term      debt (excluding capitalized leases):              |   |                        |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |
|   Publicly-traded      fixed rate debt -               |   |                        |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |
|     KII      Senior Secured Notes            |   | $                           | 560.0  |   |                         | $      | 129.4 |   |   | $ | 582.2 |   |   | $ | 370.0 |   |
|   Snake      River Sugar Company fixed rate loans      |   |                        | 250.0  |   |                         |   | 250.0 |   |   |   | 250.0 |   |   |   | 250.0 |   |
|   CompX      variable rate promissory note             |   |                        | 43.0   |   |                         |   | 43.0 |   |   |   | 42.2 |   |   |   | 42.2 |   |
|   Variable      rate debt to Contran                   |   |                        | -      |   |                         |   | - |   |   |   | 67.3 |   |   |   | 67.3 |   |
|   Variable      rate bank credit facilities            |   |                        | 63.2   |   |                         |   | 63.2 |   |   |   | 40.1 |   |   |   | 40.1 |   |
|   Other      fixed-rate debt                           |   |                        | .9     |   |                         |   | .9 |   |   |   | .6 |   |   |   | .6 |   |
|                                                             |   |                        |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |
| Noncontrolling      interest in:                                 |   |                        |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |
|   NL      common stock                                 |   | $                           | 45.8   |   |                         | $      | 110.0 |   |   | $ | 43.1 |   |   | $ | 55.1 |   |
|   Kronos      common stock                             |   |                        | 15.6   |   |                         |   | 27.6 |   |   |   | 14.5 |   |   |   | 24.4 |   |
|   CompX      common stock                              |   |                        | 11.9   |   |                         |   | 8.5 |   |   |   | 11.2 |   |   |   | 11.7 |   |
|                                                             |   |                        |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |
| Valhi      stockholders' equity                                  |   | $                           | 468.8  |   |                         | $      | 1,223.4 |   |   | $ | 425.0 |   |   | $ | 1,385.8 |   |

----

----

----

|   | • | Chemicals – Our      chemicals segment is operated through our majority ownership of      Kronos.  Kronos is a leading global producer and marketer of      value-added titanium dioxide pigment products (“TiO2”).  TiO2 is      used for a variety of manufacturing applications, including plastics,      paints, paper and other industrialproducts. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | Component Products – We      operate in the component products industry through our majority ownership      of CompX.  CompX is a leading global manufacturer of security      products, precision ball bearing slides and ergonomic computer support      systems used in the office furniture, transportation, tool storage and a      variety of other industries.  CompX is also a leading      manufacturer of stainless steel exhaust systems, gauges and throttle      controls for the performance marineindustry. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | Waste Management – WCS      is our wholly-owned subsidiary which owns and operates a West Texas      facility for the processing, treatment, storage and disposal of hazardous,      toxic and certain types of low-level radioactive waste.  WCS      obtained a byproduct disposal license in 2008 and began disposal      operations in October 2009.  In January 2009 WCS received a      low-level radioactive waste disposal permit, and construction of the      low-level radioactive waste facility is currently expected to begin in      early 2010, following the completion of some pre-construction licensing      and administrative matters, and is expected to be operational in the      fourth quarter of 2010. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | Future      supply and demand for our products; |
|--------|--------|-------------------------------------------------|

|   | · | The      cyclicality of certain of our businesses (such as Kronos’ TiO2      operations); |
|--------|--------|-------------------------------------------------------------------------------------------------|

|   | · | Customer      inventory levels (such as the extent to which Kronos’ customers may, from      time to time, accelerate purchases of TiO2 in      advance of anticipated price increases or defer purchases of TiO2in      advance of anticipated pricedecreases; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Changes      in our raw material and other operating costs (such as energy      costs); |
|--------|--------|-----------------------------------------------------------------------------------------|

|   | · | General      global economic and political conditions (such as changes in the level of      gross domestic product in various regions of the world and the impact of      such changes on demand for, among other things, TiO2); |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Competitive      products and substitute products; |
|--------|--------|----------------------------------------------------|

|   | · | Possible      disruption of our business or increases in the cost of doing business      resulting from terrorist activities or global  conflicts; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Customer      and competitor strategies; |
|--------|--------|------------------------------------------|

|   | · | The      impact of pricing and productiondecisions; |
|--------|--------|-----------------------------------------------------|

|   | · | Competitive      technology positions; |
|--------|--------|----------------------------------------|

|   | · | The      introduction of trade barriers; |
|--------|--------|------------------------------------------|

|   | · | Restructuring      transactions involving us and ouraffiliates; |
|--------|--------|-----------------------------------------------------------------|

|   | · | Potential      consolidation or solvency of ourcompetitors; |
|--------|--------|-------------------------------------------------------------|

|   | · | Demand      for high performance marinecomponents; |
|--------|--------|----------------------------------------------------|

|   | · | The      ability of our subsidiaries to pay us dividends (such as Kronos’      suspension of its dividend in2009); |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------|

|   | · | Uncertainties      associated with new productdevelopment; |
|--------|--------|------------------------------------------------------------|

|   | · | Fluctuations      in currency exchange rates (such as changes in the exchange rate between      the U.S. dollar and each of the euro, the Norwegian krone, the Canadian      dollar and the New Taiwan dollar); |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Operating      interruptions (including, but not limited to, labor disputes, leaks,      natural disasters, fires, explosions, unscheduled or unplanned downtime      and transportation interruptions); |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | The      timing and amounts of insurancerecoveries; |
|--------|--------|-----------------------------------------------------|

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

|   | · | Our      ability to maintain sufficientliquidity; |
|--------|--------|---------------------------------------------------|

|   | · | The      ultimate outcome of income tax audits, tax settlement initiatives or other      tax matters; |
|--------|--------|-------------------------------------------------------------------------------------------------------|

|   | · | The      ultimate ability to utilize income tax attributes or changes in income tax      rates related to such attributes, the benefit of which has been recognized      under the more likely than not recognition criteria (such as Kronos’      ability to utilize its German net operating loss      carryforwards); |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Environmental      matters (such as those requiring compliance with emission and discharge      standards for existing and new facilities, or new developments regarding      environmental remediation at sites related to our former      operations); |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Government      laws and regulations and possible changes therein (such as changes in      government regulations which might impose various obligations on present      and former manufacturers of lead pigment and lead-based paint, including      NL, with respect to asserted health concerns associated with the use of      such products); |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | The      ultimate resolution of pending litigation (such as NL's lead pigment      litigation, environmental and other litigation and CompX’s patent      litigation); |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Our      ability to comply with covenants contained in our revolving bank credit      facilities; and |
|--------|--------|-------------------------------------------------------------------------------------------------------|

|   | · | Possible      future litigation. |
|--------|--------|----------------------------------|

----

|   |          · | higher      operating income from our Chemicals Segment in  2009; |
|--------|--------------------------------|-------------------------------------------------------------------|

|   |          · | a      goodwill impairment recognized by our Company Products Segment in      2008; |
|--------|--------------------------------|-------------------------------------------------------------------------------------|

| ·   | lower      operating income from our Component Products (exclusive of the impact of      the goodwill impairment charge recognized in 2008) and Waste Management      Segments in 2009; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |          · | an      income tax charge recognized in 2008 due to a net increase in our reserve      for uncertain tax positions; and |
|--------|--------------------------------|-------------------------------------------------------------------------------------------------------------------------|

| ·   | an      income tax benefit recognized in 2009 due to a net decrease in our reserve      for uncertain tax positions. |
|--------------------|----------------------------------------------------------------------------------------------------------------------|

----

|   | · | lower      operating income from each of our Chemicals, Component Products and Waste      Management Segments in 2009; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------|

|   | · | a      gain from a litigation settlements in2009; |
|--------|--------|---------------------------------------------------|

|   | · | a      gain from a sale of a business in2009; |
|--------|--------|-----------------------------------------------|

|   | · | a      goodwill impairment recognized by our Component Products Segment in      2008; |
|--------|--------|---------------------------------------------------------------------------------------|

|   | · | an      asset held for sale write-down recognized by our Component Products      Segment in 2009; |
|--------|--------|---------------------------------------------------------------------------------------------------|

| ·   | interest      income related to an escrow fund recognized by NL in  2008; |
|--------------------|---------------------------------------------------------------------------|

| ·   | an      income tax charge recognized in 2008 due to a net increase in our reserve      for uncertain tax positions; |
|--------------------|---------------------------------------------------------------------------------------------------------------------|

|   | · | an      income tax benefit recognized by our Chemicals Segment in 2008;      and |
|--------|--------|----------------------------------------------------------------------------------|

| ·   | an      income tax benefit recognized in 2009 due to a net decrease in our reserve      for uncertain tax positions. |
|--------------------|----------------------------------------------------------------------------------------------------------------------|

| ·   | a      gain of $.07 per diluted share as a result of a litigation      settlement; |
|--------------------|------------------------------------------------------------------------------------|

| ·   | a      gain of $.04 per diluted share gain from the sale of a business      ; |
|--------------------|-------------------------------------------------------------------------------|

| ·   | a      gain of $.05 per diluted share as a result of the second close of a      litigation settlement; |
|--------------------|--------------------------------------------------------------------------------------------------------|

| ·   | income      of $.02 per diluted share related to certain insurance recoveries we      recognized; and |
|--------------------|-------------------------------------------------------------------------------------------------------|

| ·   | income      of $.06 per diluted share, related to a net decrease in our reserve for      uncertain tax positions. |
|--------------------|-------------------------------------------------------------------------------------------------------------------|

|   | · | income      of $.04 per diluted share  related to the adjustment of certain      German income tax attributes within our Chemicals  Segment; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | interest      income of $.02 per diluted share related to certain escrow funds of      NL; |
|--------|--------|--------------------------------------------------------------------------------------------|

|   | · | income      of $.01 per diluted share related to certain insurance recoveries we      recognized; |
|--------|--------|---------------------------------------------------------------------------------------------------|

|   | · | a      charge of $.06 per diluted share related to goodwill impairment recognized      on the marine products reporting unit of our Component Products Segment;      and |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a      charge of $.07 per diluted share due to a net increase in our reserve for      uncertain tax positions. |
|--------|--------|----------------------------------------------------------------------------------------------------------------|

|   | · | lower      expected operating income from our Chemicals Segment.   In      late 2008, as a result of the sharp decline in global demand, our      Chemicals Segment experienced a build up in inventory levels. In order to      decrease inventory levels and improve liquidity, we implemented production      curtailments during the first half of 2009.  In addition,      throughout all of 2009 we have implemented cost controls and reduced our      capital spending.  Through these actions we have successfully      reduced our Chemicals Segment’s inventory and increased our liquidity,      although the resulting curtailments led to an operating loss in the first      six months of 2009 due to the large amount of unabsorbed fixed production      costs we charged to expense as incurred during the first half of      2009; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | lower      expected operating income from our Component Products Segment;      and |
|--------|--------|------------------------------------------------------------------------------------|

|   | · | recording      a lower gain from litigationsettlements. |
|--------|--------|---------------------------------------------------------|

----

|   | · | TiO2      sales and production volumes; |
|--------|--------|-----------------------------------------|

|   | · | TiO2      selling prices; |
|--------|--------|---------------------------|

|   | · | Currency      exchange rates (particularly the exchange rate for the U.S. dollar      relative to the euro, Norwegian krone and the Canadian dollar);      and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Manufacturing      costs, particularly raw materials, maintenance and energy-related      expenses. |
|--------|--------|-----------------------------------------------------------------------------------------------------|

----

|                                      |   | Three      months ended September 30, |   |   | Nine      months ended September 30, |   |
|-------------------------------------------|--------|--------------------------------------------|--------|--------|-------------------------------------------|--------|
|                                      |   | 2008                                       |   |   | 2009                                      |   |   | % Change |   |   | 2008 |   |   | 2009 |   |   | % Change |   |
|                                      |   | (Dollars      in millions)                 |   |
|                                      |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      sales                            |   | $                                          | 345.6  |   |                                      | $      | 310.1 |   |   |   | (10 | )% |   | $ | 1,070.0 |   |   | $ | 840.2 |   |   |   | (21 | )% |
| Cost      of sales                        |   |                                       | 295.9  |   |                                      |   | 251.2 |   |   |   | (15 | ) |   |   | 905.2 |   |   |   | 764.0 |   |   |   | (16 | ) |
|                                      |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross      margin                         |   | $                                          | 49.7   |   |                                      | $      | 58.9 |   |   |   | 18 |   |   | $ | 164.8 |   |   | $ | 76.2 |   |   |   | (54 | ) |
|                                      |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating      income (loss)              |   | $                                          | 8.8    |   |                                      | $      | 22.3 |   |   |   |   |   |   | $ | 30.6 |   |   | $ | (23.2 | ) |   |   |   |   |
|                                      |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Percent      of net sales:                |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Cost      of sales            |   |                                       | 86     | %      |                                      |   | 81 | % |   |   |   |   |   |   | 85 | % |   |   | 91 | % |   |   |   |   |
|   Gross      margin             |   |                                       | 14     |   |                                      |   | 19 |   |   |   |   |   |   |   | 15 |   |   |   | 9 |   |   |   |   |   |
|   Operating      income         |   |                                       | 3      |   |                                      |   | 7 |   |   |   |   |   |   |   | 3 |   |   |   | (3 | ) |   |   |   |   |
|                                      |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Ti02      operating statistics:           |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Sales      volumes*           |   |                                       | 121    |   |                                      |   | 124 |   |   |   | 3 | % |   |   | 389 |   |   |   | 335 |   |   |   | (14 | )% |
|   Production      volumes*      |   |                                       | 126    |   |                                      |   | 129 |   |   |   | 3 |   |   |   | 390 |   |   |   | 280 |   |   |   | (28 | ) |
|                                      |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Percent      change in net sales:         |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Ti02      product pricing     |   |                                       |   |   |                                      |   |   |   |   |   | (5 | )% |   |   |   |   |   |   |   |   |   |   | - | % |
|   Ti02      sales volumes       |   |                                       |   |   |                                      |   |   |   |   |   | 3 |   |   |   |   |   |   |   |   |   |   |   | (14 | ) |
|   Ti02      product mix         |   |                                       |   |   |                                      |   |   |   |   |   | (3 | ) |   |   |   |   |   |   |   |   |   |   | (2 | ) |
| Changes      in currency exchange rates   |   |                                       |   |   |                                      |   |   | (5 | )% |   |   |   |   |   |   |   |   |   |   | (5 | ) |
|                                      |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       Total |   |                                       |   |   |                                      |   |   |   |   |   | (10 | )% |   |   |   |   |   |   |   |   |   |   | (21 | )% |

----

|                                     |   | Three      months endedSeptember      30, 2009 vs. 2008 |   |   | Nine      months endedSeptember      30, 2009 vs. 2008 |   |
|------------------------------------------|--------|--------------------------------------------------------------|--------|--------|-------------------------------------------------------------|--------|
|                                     |   | Increase (decrease) in    millions                           |   |
|                                     |   |                                                         |   |   |                                                        |   |
| Impact      on:                          |   |                                                         |   |   |                                                        |   |
|   Net      sales               |   | $                                                            | (17    | )      |                                                        | $      | (56 | ) |
|   Operating      income (loss) |   |                                                         | 2      |   |                                                        |   | 50 |   |

----

----

|                              |   | Three      months ended September 30, |   |   | Nine      months ended September 30, |   |
|-----------------------------------|--------|--------------------------------------------|--------|--------|-------------------------------------------|--------|
|                              |   | 2008                                       |   |   | 2009                                      |   |   | % Change |   |   | 2008 |   |   | 2009 |   |   | % Change |   |
|                              |   | (Dollars      in millions)                 |   |
|                              |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      sales                    |   | $                                          | 43.9   |   |                                      | $      | 29.4 |   |   |   | (33 | )% |   | $ | 128.1 |   |   | $ | 87.1 |   |   |   | (32 | )% |
| Cost      of sales                |   |                                       | 32.7   |   |                                      |   | 22.4 |   |   |   | (31 | ) |   |   | 96.5 |   |   |   | 69.1 |   |   |   | (28 | ) |
|                              |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross      margin                 |   | $                                          | 11.2   |   |                                      | $      | 7.0 |   |   |   | (38 | ) |   | $ | 31.6 |   |   | $ | 18.0 |   |   |   | (43 | ) |
|                              |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating      income (loss)      |   | $                                          | (5.2   | )      |                                      |   | (.1 | ) |   |   |   |   |   | $ | 2.3 |   |   | $ | (2.0 | ) |   |   |   |   |
|                              |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Percent      of net sales:        |   |                                       |   |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Cost      of sales    |   |                                       | 74     | %      |                                      |   | 76 | % |   |   |   |   |   |   | 75 | % |   |   | 79 | % |   |   |   |   |
|   Gross      margin     |   |                                       | 26     |   |                                      |   | 24 |   |   |   |   |   |   |   | 25 |   |   |   | 21 |   |   |   |   |   |
|   Operating      income |   |                                       | (12    | )      |                                      |   | (1 | ) |   |   |   |   |   |   | 2 |   |   |   | (2 | ) |   |   |   |   |

----

|                              |   | Three      months endedSeptember      30, 2009 vs. 2008 |   |   | Nine      months endedSeptember      30, 2009 Vs. 2008 |   |
|-----------------------------------|--------|--------------------------------------------------------------|--------|--------|-------------------------------------------------------------|--------|
|                              |   | Increase (decrease) in    millions                           |   |
|                              |   |                                                         |   |   |                                                        |   |
| Impact      on:                   |   |                                                         |   |   |                                                        |   |
|   Net      sales        |   | $                                                            | (.2    | )      |                                                        | $      | (1.1 | ) |
|   Operating      income |   |                                                         | -      |   |                                                        |   | 1.3 |   |

----

|                |   | Three      months ended |   |   | Nine      months ended |   |
|---------------------|--------|-------------------------|--------|--------|------------------------|--------|
|                |   | September 30,           |   |   | September 30,          |   |
|                |   | 2008                    |   |   | 2009                   |   |   | 2008 |   |   | 2009 |   |
|                |   | (In      millions)      |   |
|                |   |                    |   |   |                   |   |   |   |   |   |   |   |
| Net      sales      |   | $                       | .7     |   |                   | $      | 2.1 |   |   | $ | 2.2 |   |   | $ | 3.7 |   |
| Cost      of sales  |   |                    | 3.6    |   |                   |   | 7.9 |   |   |   | 10.6 |   |   |   | 17.0 |   |
|                |   |                    |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Gross      margin   |   | $                       | (2.9   | )      |                   | $      | (5.8 | ) |   | $ | (8.4 | ) |   | $ | (13.3 | ) |
|                |   |                    |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Operating      loss |   | $                       | (5.7   | )      |                   | $      | (9.0 | ) |   | $ | (15.6 | ) |   | $ | (22.2 | ) |

----

----

| ·   | litigation      and related costs at NL of $2.1 million in the third quarter of 2009      compared to $2.2 million in the same period in 2008 and $7.4 million in      the first nine months of 2009 compared to $10.8 million in the same period      in 2008 and |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | environmental      expenses of $1.5 million in the third quarter of 2009, compared to $.1      million in the same period of 2008 and $1.8 million in the first nine      months of 2009 compared to $.1 million in the same period of      2008. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|   | · | lower      consolidated operating income in 2009 of $64.7 million, due to the      operating losses at all of our segments in2009; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------|

|   | · | lower      cash paid for interest in 2009 of $2.7 million primarily due to favorable      changes in currency exchange rates; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------|

|   | · | proceeds      from a litigation settlement of $11.8 million received in January      2009; |
|--------|--------|--------------------------------------------------------------------------------------------|

|   | · | lower      general corporate dividend and interest income in 2009 of $5.4 million      principally due to $4.3 million of interest received from certain escrow      funds of NL in 2008; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | lower      net distributions from our TiO2      joint venture in 2009 of $3.4 million;and |
|--------|--------|-------------------------------------------------------------------------------------------|

|   | · | Changes      in receivables, inventories, payables and accrued liabilities in 2009      provided $105.0 million of net cash, an improvement of $126.8 million      compared to 2008, primarily due to decreases in Kronos’ inventory      levels. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Kronos’      average days sales outstanding (“DSO”) remained the same from December 31,      2008 to September 30, 2009; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Kronos’      average days sales in inventory (“DSI”) decreased from December 31, 2008      to September 30, 2009 as our TiO2      sales volumes exceeded our TiO2      production volumes in the first nine months of  2009; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | CompX’s      average DSO increased from December 31, 2008 to September 30, 2009 in      absolute terms, however, CompX reduced accounts receivable by $2.9 million      in the first nine months of 2009 as compared to December 31, 2008;      and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | CompX’s      average DSI remained flat from December 31, 2008 to September 30,      2009 in absolute terms, however, CompX reduced inventory by $5.1 million      in the first nine months of 2009. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                     | December      31, | September 30, | December      31,  | September 30, |
|------------------------------------------|-------------------|--------------------|--------------------|--------------------|
|                                     | 2007              | 2008               | 2008               | 2009               |
|                                     |              |               |               |               |
| Kronos:                                  |              |               |               |               |
|   Days      sales outstanding  | 63      days      | 66      days       |  64      days | 64      days       |
|   Days      sales in inventory | 59      days      | 55      days       | 113      days      | 48      days       |
|                                     |              |               |               |               |
| CompX:                                   |              |               |               |               |
|   Days      sales outstanding  | 44      days      | 44      days       | 41      days       | 43      days       |
|   Days      sales in inventory | 63      days      | 71      days       | 70      days       | 70      days       |

|                                                  |   | Nine      months ended September 30, |   |
|-------------------------------------------------------|--------|-------------------------------------------|--------|
|                                                  |   | 2008                                      |   |   | 2009 |   |
|                                                  |   | (In      millions)                        |   |
|                                                  |   |                                      |   |   |   |   |
| Cash      provided by (used in) operating activities: |   |                                      |   |   |   |   |
|   Kronos                                    |   | $                                         | 13.6   |   |   | $ | 63.5 |   |
|   CompX                                     |   |                                      | 10.6   |   |   |   | 10.7 |   |
|   Waste Control Specialists       |   |                                      | (7.6   | ) |   |   | (9.8 | ) |
|   NL Parent                            |   |                                      | 5.0    |   |   |   | (4.2 | ) |
|   Tremont                                   |   |                                      | (.8    | ) |   |   | 8.8 |   |
|   Valhi      exclusive of subsidiaries      |   |                                      | 35.3   |   |   |   | 21.5 |   |
|   Other                                     |   |                                      | (1.1   | ) |   |   | .6 |   |
|   Eliminations                              |   |                                      | (54.1  | ) |   |   | (30.1 | ) |
|                                                  |   |                                      |   |   |   |   |   |   |
|       Total        |   | $                                         | .9     |   |   | $ | 61.0 |   |

|   | · | $29.8      million in our Waste ManagementSegment; |
|--------|--------|----------------------------------------------------|

|   | · | $17.3      million in our Chemicals Segment;and |
|--------|--------|-------------------------------------------------|

|   | · | $1.8      million in our Component ProductsSegment. |
|--------|--------|-----------------------------------------------------|

|   | · | purchased      Kronos common stock for $.1million; |
|--------|--------|----------------------------------------------------|

|   | · | purchased      other marketable securities of $4.9 million;and |
|--------|--------|----------------------------------------------------------------|

|   | · | sold      other marketable securities for proceeds of $6.6  million. |
|--------|--------|----------------------------------------------------------------------|

----

|   | · | KII’s      euro 400 million aggregate principal amount of its 6.5% Senior Secured      Notes ($582.2 million) due in 2013; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------|

|   | · | our      $250 million loan from Snake River Sugar Company due in    2027; |
|--------|--------|---------------------------------------------------------------------------|

|   | · | KII's      European revolving credit facility ($26.3 million outstanding) due in      2011; |
|--------|--------|---------------------------------------------------------------------------------------------|

|   | · | CompX’s      promissory note payable to TIMET ($42.2 million outstanding) which is due      in 2014; |
|--------|--------|------------------------------------------------------------------------------------------------------------|

|   | · | Kronos’      U.S. revolving credit facility ($13.8 million outstanding) due in      2011; |
|--------|--------|-------------------------------------------------------------------------------------------------|

|   | · | Valhi’s      revolving credit facility with Contran ($37.3 million outstanding) due in      2012; |
|--------|--------|---------------------------------------------------------------------------------------------------------|

|   | · | A      wholly-owned subsidiary of Valhi's promissory demand notes payable to      Contran ($30 million outstanding) due December 31, 2010;    and |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | approximately      $7.5 million of other indebtedness. |
|--------|--------|--------------------------------------------------------|

----

----

|   | · | $83.5(1)      million under Kronos’ various U.S. and non-U.S. credit facilities;      and |
|--------|--------|-------------------------------------------------------------------------------------------------|

|   | · | $32.7      million under Valhi’s Contran creditfacility. |
|--------|--------|----------------------------------------------------------------|

| (1) | Based      on euro 51 million ($74.5 million at September 30, 2009) maximum borrowing      availability which, under the Amendment, we are currently limited to until      we are in compliance with certain specified financial covenants and, in      any event, no earlier then March 31,2010. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                                      |   |               |   |
|-------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|
|                                                                                                                                      |   | Amount             |   |
|                                                                                                                                      |   | (In      millions) |   |
|                                                                                                                                      |   |               |   |
|   Kronos                                                                                                                        |   | $                  | 41.5   |   |
|   NL Parent                                                                                                                |   |               | 27.7   |   |
|   CompX                                                                                                                         |   |               | 18.2   |   |
|   Tremont                                                                                                                       |   |               | 9.4    |   |
|   Valhi      exclusive of its subsidiaries                                                                                      |   |               | 10.8   |   |
|   Waste Control Specialists                                                                                           |   |               | 1.8    |   |
|                                                                                                                                      |   |               |   |   |
|   Total cash      and cash equivalents restricted cash   and marketable securities |   | $                  | 109.4  |   |

----

----

|   | · | certain      income tax examinations which are underway in various U.S. and non-U.S.      jurisdictions; |
|--------|--------|----------------------------------------------------------------------------------------------------------|

|   | · | certain      environmental remediation matters involving NL, Tremont and      Valhi; |
|--------|--------|--------------------------------------------------------------------------------------|

|   | · | certain      litigation related to NL’s former involvement in the manufacture of lead      pigment and lead-based paint; and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------|

|   | · | certain      other litigation to which we are aparty. |
|--------|--------|-------------------------------------------------------|

----

----

|   | · | 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. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|   | Item      No. |   | Exhibit      Index |
|--------|---------------|--------|--------------------|
|   |          |   |               |
|   | 31.1          |   | Certification      |
|   |          |   |               |
|   | 31.2          |   | Certification      |
|   |          |   |               |
|   | 32.1          |   | Certification      |

----

|                                                                                                                |   |           VALHI,      INC.          (Registrant) |
|---------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                |   |                                                                                                                                                 |
|                                                                                                                |   |                                                                                                                                                 |
|                                                                                                                |   |                                                                                                                                                 |
| Date        November 4,      2009             |   | /s/ Bobby D.      O’Brien                                           |
|                                                                                                                |   | Bobby      D. O’Brien(Vice      President and Chief Financial      Officer)                                                               |
|                                                                                                                |   |                                                                                                                                                 |
| Date        November 4,      2009             |   | /s/ Gregory M.      Swalwell                                                             |
|                                                                                                                |   | Gregory      M. Swalwell(Vice      President and Controller, Principal      Accounting Officer)                                                 |
|                                                                                                                |   |                                                                                                                                                 |

----