##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File Number: 001-33658
 Horsehead Holding Corp.
  
 Delaware
    
    20-0447377(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)4955 Steubenville Pike, Suite 405
Pittsburgh, Pennsylvania 15205
    
    (724) 774-1020(Address of Principal Executive Offices, including Zip Code)
    
    (Registrants Telephone Number, Including Area Code)
 
 þ o
 o o
  Large
accelerated Filer oAccelerated filer þNon-accelerated filer o(Do not check if a smaller reporting company)
Smaller reporting company o o þ




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##### 



TABLE OF CONTENTS
  
 PART I
    
    Financial Information
    
    
    1Item 1.
    

Financial Statements
    
    
    1Consolidated Balance Sheets as of June 30, 2009 (Unaudited) and December 31, 2008
    
    
    1Consolidated Statements of Operations (Unaudited) for the three and six months ended
June 30, 2009 and 2008
    
    
    2Consolidated Statement of Stockholders Equity (Unaudited) for the six months ended
June 30, 2009
    
    
    3Consolidated Statements of Cash Flows (Unaudited) for the six months ended June 30,
2009 and June 30, 2008
    
    
    4Notes to Consolidated Financial Statements (Unaudited) June 30, 2009
    
    
    5Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    14Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    26Item 4.
    
    Controls and Procedures
    
    
    26PART II
    

Other
InformationItem 1.
    
    Legal Proceedings
    
    
    28Item 1A
    
    Risk Factors.
    
    
    28Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    28Item 3
    
    Defaults Upon Senior Securities
    
    
    28Item 4
    
    Submission of Matters to a Vote of Security Holders
    
    
    28Item 5.
    
    Other Information
    
    
    28Item 6.
    
    Exhibits
    
    
    28
  CAUTIONARY STATEMENT FOR PURPOSES OF THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995
   i




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ii




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PART IFINANCIAL INFORMATION
 
 Item 1. Financial Statements.
 
 CONSOLIDATED BALANCE SHEETS   (Amounts in thousands, except per share amounts)
 June 30,
    
    
    December 31,2009
    
    
    2008(Unaudited)ASSETSCurrent assetsCash and cash equivalents
    
    $
    78,798
    
    
    $
    122,768Accounts receivable, net of allowance of $980 and $750, respectively
    
    
    23,874
    
    
    
    30,446Inventories
    
    
    29,752
    
    
    
    47,209Prepaid expenses and other current assets
    
    
    16,672
    
    
    
    15,842Deferred income taxes
    
    
    5,253
    
    
    
    4,925Total current assets
    
    
    154,349
    
    
    
    221,190Property, plant and equipment, net
    
    
    151,675
    
    
    
    136,141Other assetsIntangible assets net of amortization of $49
    
    
    11,655
    
    
    
    Restricted cash
    
    
    5,925
    
    
    
    Deferred financing costs, net of amortization of $1,633 and $1,200, respectively
    
    
    566
    
    
    
    999Deposits and other
    
    
    148
    
    
    
    148Total other assets
    
    
    18,294
    
    
    
    1,147Total assets
    
    $
    324,318
    
    
    $
    358,478LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilitiesCurrent maturities of long-term debt
    
    $
    63
    
    
    $
    62Accounts payable
    
    
    18,410
    
    
    
    35,285Accrued expenses
    
    
    18,017
    
    
    
    24,931Total current liabilities
    
    
    36,490
    
    
    
    60,278Long-term debt, less current maturities
    
    
    282
    
    
    
    58Other long-term liabilities
    
    
    18,222
    
    
    
    10,257Deferred income taxes
    
    
    1,326
    
    
    
    1,326Commitments and contingenciesStockholders equityCommon stock, par value $0.01 per share; 100,000 shares authorized; 35,272 and
35,253 shares issued and outstanding in 2009 and 2008, respectively
    
    
    353
    
    
    
    352Preferred stock, par value $0.01 per share; 10,000 shares authorized; no shares
issued or outstanding
    
    
    
    
    
    
    Additional paid-in capital
    
    
    130,747
    
    
    
    129,741Retained earnings
    
    
    132,359
    
    
    
    156,466Total Horsehead Holding Corp. stockholders equity
    
    
    263,459
    
    
    
    286,559Non-controlling interest
    
    
    4,539
    
    
    
    Total stockholders equity
    
    
    267,998
    
    
    
    286,559Total liabilities and stockholders equity
    
    $
    324,318
    
    
    $
    358,478
 The accompanying notes to financial statements are an integral part of these statements.
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CONSOLIDATED STATEMENTS OF OPERATIONS    (Amounts in thousands except per share amounts)
 Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Net sales of zinc material and other goods
    
    $
    40,962
    
    
    $
    116,676
    
    
    $
    73,024
    
    
    $
    217,545EAF dust service fees
    
    
    6,650
    
    
    
    13,847
    
    
    
    14,396
    
    
    
    27,426Net sales
    
    
    47,612
    
    
    
    130,523
    
    
    
    87,420
    
    
    
    244,971Cost of sales of zinc material and other
goods (excluding depreciation)
    
    
    50,829
    
    
    
    96,298
    
    
    
    103,737
    
    
    
    185,921Cost of EAF dust services
    
    
    3,093
    
    
    
    3,862
    
    
    
    5,580
    
    
    
    7,009Cost of sales (excluding depreciation)
    
    
    53,922
    
    
    
    100,160
    
    
    
    109,317
    
    
    
    192,930Depreciation
    
    
    3,653
    
    
    
    2,946
    
    
    
    7,213
    
    
    
    5,827Selling, general and administrative expenses
    
    
    4,043
    
    
    
    5,137
    
    
    
    7,746
    
    
    
    8,782Total costs and expenses
    
    
    61,618
    
    
    
    108,243
    
    
    
    124,276
    
    
    
    207,539Income (loss) from operations
    
    
    (14,006
    )
    
    
    22,280
    
    
    
    (36,856
    )
    
    
    37,432Other income (expense)Interest expense
    
    
    (607
    )
    
    
    (380
    )
    
    
    (954
    )
    
    
    (729
    )Interest and other income
    
    
    117
    
    
    
    491
    
    
    
    283
    
    
    
    1,149(490
    )
    
    
    111
    
    
    
    (671
    )
    
    
    420Income (loss) before income taxes
    
    
    (14,496
    )
    
    
    22,391
    
    
    
    (37,527
    )
    
    
    37,852Income tax provision (benefit)
    
    
    (5,198
    )
    
    
    8,524
    
    
    
    (13,420
    )
    
    
    14,115NET INCOME (LOSS)
    
    $
    (9,298
    )
    
    $
    13,867
    
    
    $
    (24,107
    )
    
    $
    23,737Earnings (losses) per common share:Basic
    
    $
    (0.26
    )
    
    $
    0.40
    
    
    $
    (0.68
    )
    
    $
    0.68Diluted
    
    $
    (0.26
    )
    
    $
    0.39
    
    
    $
    (0.68
    )
    
    $
    0.67Weighted average shares outstanding:Basic
    
    
    35,264
    
    
    
    35,062
    
    
    
    35,259
    
    
    
    34,941Diluted
    
    
    35,264
    
    
    
    35,280
    
    
    
    35,259
    
    
    
    35,222
 The accompanying notes to financial statements are an integral part of these statements.
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CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY    (Amounts in thousands)
 Additional
    
    
    
    
    
    
    Non-Common Stock
    
    
    Paid-In
    
    
    Retained
    
    
    controllingShares
    
    
    Amount
    
    
    Capital
    
    
    Earnings
    
    
    Interest
    
    
    TotalBalance at January 1, 2009
    
    
    35,253
    
    
    $
    352
    
    
    $
    129,741
    
    
    $
    156,466
    
    
    $
    
    
    
    $
    286,559Restricted stock vesting
    
    
    19
    
    
    
    1
    
    
    
    (1
    )
    
    
    
    
    
    
    
    
    
    
    Stock compensation expense
    
    
    
    
    
    
    
    
    
    
    1,064
    
    
    
    
    
    
    
    
    
    
    
    1,064Tax liability of stock vesting
    
    
    
    
    
    
    
    
    
    
    (57
    )
    
    
    
    
    
    
    
    
    
    
    (57
    )Net (loss)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (24,107
    )
    
    
    
    
    
    
    (24,107
    )Investment by non-controlling
interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,539
    
    
    
    4,539Balance at June 30, 2009
    
    
    35,272
    
    
    $
    353
    
    
    $
    130,747
    
    
    $
    132,359
    
    
    $
    4,539
    
    
    $
    267,998
 The accompanying notes to financial statements are an integral part of these statements
 3




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CONSOLIDATED STATEMENTS OF CASH FLOWS    (Amounts in thousands)
 2009
    
    
    2008Cash Flows from Operating Activities:Net income (loss)
    
    $
    ($24,107
    )
    
    $
    23,737Adjustments to reconcile net income to net cash (used in) provided by operating activities:Depreciation and amortization
    
    
    7,698
    
    
    
    6,160Deferred income tax (benefit)
    
    
    (328
    )
    
    
    (224
    )Losses (gains) on derivative financial instruments
    
    
    6,106
    
    
    
    (15,886
    )Non-cash compensation expense
    
    
    1,064
    
    
    
    854Changes in operating assets and liabilities:Decrease in accounts receivable
    
    
    6,572
    
    
    
    252Decrease in inventories
    
    
    17,457
    
    
    
    10,605(Increase) in prepaid expenses and other current assets
    
    
    (10,895
    )
    
    
    (14,365
    )(Increase) in other assets
    
    
    
    
    
    
    (1
    )(Decrease) in accounts payable
    
    
    (16,875
    )
    
    
    (3,285
    )(Decrease) increase in accrued expenses net of tax effect of share based compensation
    
    
    (4,689
    )
    
    
    1,150Increase (decrease) in other long-term liabilities
    
    
    943
    
    
    
    (1,065
    )Net cash (used in) provided by operating activities
    
    
    (17,054
    )
    
    
    7,932Cash Flows from Investing Activities:Purchase of property, plant and equipment
    
    
    (22,698
    )
    
    
    (17,869
    )Increase in restricted cash
    
    
    (5,925
    )
    
    
    Purchase of intangible assets
    
    
    (3,000
    )
    
    
    Net cash (used in) investing activities
    
    
    (31,623
    )
    
    
    (17,869
    )Cash Flows from Financing Activities:Proceeds from exercise of options
    
    
    
    
    
    
    944Proceeds from non-controlling interest equity holders
    
    
    4,539
    
    
    
    Tax (liability) benefit of share based compensation
    
    
    (57
    )
    
    
    1,835Proceeds from issuance of loans payable
    
    
    255
    
    
    
    Payments on notes payable and long-term debt
    
    
    (30
    )
    
    
    (30
    )Net cash provided by financing activities
    
    
    4,707
    
    
    
    2,749Net (Decrease) In Cash And Cash Equivalents
    
    
    (43,970
    )
    
    
    (7,188
    )Cash and cash equivalents at beginning of period
    
    
    122,768
    
    
    
    76,169Cash and cash equivalents at end of period
    
    $
    78,798
    
    
    $
    68,981
 The accompanying notes to financial statements are an integral part of these statements.
 4




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NOTE ABASIS OF PRESENTATION
   NOTE BRECENTLY ISSUED ACCOUNTING STANDARDS
     5




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NOTE CACQUISITION OF BUSINESS
  Customer contracts
    
    $
    10,915Non-compete agreement
    
    
    789Total assets purchased
    
    
    11,704Purchase price
    
    $
    11,704
 NOTE DNEW MARKETS TAX CREDIT PROGRAM FINANCING
  NOTE ECASH AND CASH EQUIVALENTS
  June 30,
    
    December 31,2009
    
    2008Cash in bank
    
    $
    38,801
    
    
    $
    82,789Certificates of deposit
    
    
    20,000
    
    
    
    Commercial paper
    
    
    19,997
    
    
    
    39,979$
    78,798
    
    
    $
    122,768
  6




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NOTE FINVENTORIES
  June 30,
    
    
    December 31,2009
    
    
    2008Raw materials
    
    $
    6,616
    
    
    $
    15,885Work-in-process
    
    
    2,121
    
    
    
    4,394Finished goods
    
    
    9,413
    
    
    
    13,969Supplies and spare parts
    
    
    11,602
    
    
    
    12,961$
    29,752
    
    
    $
    47,209
  NOTE GPREPAID EXPENSES AND OTHER CURRENT ASSETS
  June 30,
    
    
    December 31,2009
    
    
    2008Refundable income taxes
    
    $
    11,804
    
    
    $
    Prepaid hedge contracts
    
    
    2,536
    
    
    
    12,601Other
    
    
    2,332
    
    
    
    3,241$
    16,672
    
    
    $
    15,842
 NOTE HPROPERTY, PLANT AND EQUIPMENT
  June 30,
    
    
    December 31,2009
    
    
    2008Land and land improvements
    
    $
    8,494
    
    
    $
    8,494Buildings and building improvements
    
    
    23,395
    
    
    
    23,228Machinery and equipment
    
    
    117,806
    
    
    
    113,444Construction in progress
    
    
    53,047
    
    
    
    34,878
 7




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June 30,
    
    
    December 31,2009
    
    
    2008202,742
    
    
    
    180,044Less accumulated depreciation
    
    
    (51,067
    )
    
    
    (43,903
    )$
    151,675
    
    
    $
    136,141
 NOTE IINTANGIBLE ASSETS
  June 30,
    
    
    December 31,2009
    
    
    2008Customer contracts
    
    $
    10,915
    
    
    $
    Non-compete agreement
    
    
    789
    
    
    
    11,704
    
    
    
    Less accumulated amortization
    
    
    (49
    )
    
    
    $
    11,655
    
    
    $
    
  NOTE JNOTES PAYABLE AND LONG-TERM DEBT
     8




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NOTE KACCRUED EXPENSES
  June 30,
    
    
    December 31,2009
    
    
    2008Employee related costs
    
    $
    5,053
    
    
    $
    9,915EAF dust processing reserve
    
    
    3,376
    
    
    
    1,334Accrued hedge contracts
    
    
    27
    
    
    
    3,986Insurance claim liabilities
    
    
    2,800
    
    
    
    2,800Other
    
    
    6,761
    
    
    
    6,896$
    18,017
    
    
    $
    24,931
 NOTE LOTHER LONG-TERM LIABILITIES
  June 30,
    
    
    December 31,2009
    
    
    2008Environmental obligations
    
    $
    2,032
    
    
    $
    2,047Insurance claim liabilities
    
    
    7,511
    
    
    
    6,964Asset retirement obligations
    
    
    1,297
    
    
    
    1,246Deferred asset purchase price obligations
    
    
    7,022
    
    
    
    Other
    
    
    360
    
    
    
    $
    18,222
    
    
    $
    10,257
 Deferred asset purchase price obligations
  NOTE MINCOME TAXES
   NOTE NSTOCK-BASED COMPENSATION
 9




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NOTE OACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
  10




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Three months ended June 30,
    
    Six months ended June 30,2009
    
    2008
    
    2009
    
    2008Gains (losses) included in net sales:Put options
    
    
    ($1,784
    )
    
    $
    13,700
    
    
    
    ($6,430
    )
    
    $
    13,921Swaps
    
    
    858
    
    
    
    4,462
    
    
    
    885
    
    
    
    2,839($926
    )
    
    $
    18,162
    
    
    
    ($5,545
    )
    
    
    $16,760
  Fair Value Measurements Using Significant Other Observable Inputs (Level 2)
 June 30, 2009
    
    
    December 31, 2008Put options and swaps included in Prepaid expenses and other assets
    
    $
    2,536
    
    
    $
    12,601Swaps included in Accrued expenses
    
    $
    27
    
    
    $
    3,987
 11




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NOTE PCONTINGENCIES
   NOTE QEARNINGS PER SHARE
   12




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Three months ended June 30,
    
    
    Six months ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Basic earnings (loss) per share:Net income (loss)
    
    $
    (9,298
    )
    
    $
    13,867
    
    
    $
    (24,107
    )
    
    $
    23,737Weighted average shares outstanding  basic
    
    
    35,264
    
    
    
    35,062
    
    
    
    35,259
    
    
    
    34,941Basic earnings (loss) per share
    
    $
    (0.26
    )
    
    $
    0.40
    
    
    $
    (0.68
    )
    
    $
    0.68Diluted earnings (loss) per share:Net income (loss)
    
    $
    (9,298
    )
    
    $
    13,867
    
    
    $
    (24,107
    )
    
    $
    23,737Weighted average shares outstanding 
diluted
    
    
    35,264
    
    
    
    35,280
    
    
    
    35,259
    
    
    
    35,222Diluted earnings (loss) per share
    
    $
    (0.26
    )
    
    $
    0.39
    
    
    $
    (0.68
    )
    
    $
    0.67Reconciliation of average shares
outstanding  basic to average shares
outstanding  diluted:Weighted average shares outstanding  basic
    
    
    35,264
    
    
    
    35,062
    
    
    
    35,259
    
    
    
    34,941Effect of dilutive securities:Options
    
    
    
    
    
    
    208
    
    
    
    
    
    
    
    276Restricted stock units
    
    
    
    
    
    
    10
    
    
    
    
    
    
    
    5Weighted average shares outstanding 
diluted
    
    
    35,264
    
    
    
    35,280
    
    
    
    35,259
    
    
    
    35,222
  NOTE RCOMMITMENTS
  Years Ending December 31,
 Amounts2009
    
    $
    1,8612010
    
    
    3,3202011
    
    
    2,6682012
    
    
    1,4672013
    
    
    1,115Thereafter
    
    
    1,477$
    11,908
 
 13




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations.
 General
  Overview
 Our History
   Economic Conditions and Outlook
  Factors Affecting Our Operating Results
 Market Price for Zinc
  14




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Demand for Zinc-Based Products
  Production/EAF Dust Processed
    
    Shipments/EAF Dust Receipts
    
    Revenue/TonSix
MonthsEnded June 30,
    
    Year EndedDecember31,
    
    Six MonthsEnded June 30,
    
    Year EndedDecember31,
    
    Six MonthsEnded June 30,
    
    Year EndedDecember31,2009
    
    2008
    
    2008
    
    2007
    
    2009
    
    2008
    
    2008
    
    2007
    
    2009
    
    2008
    
    2008
    
    2007(Tons, in thousands)
    
    
    
    
    
    
    
    
    
    (Tons, in thousands)
    
    
    
    
    
    
    
    
    
    (In U.S. dollars)Product:Zinc Products
    
    
    48
    
    
    
    74
    
    
    
    137
    
    
    
    140
    
    
    
    56
    
    
    
    84
    
    
    
    154
    
    
    
    153
    
    
    $
    1,285
    
    
    $
    2,197
    
    
    $
    1,932
    
    
    $
    3,104EAF Dust
    
    
    175
    
    
    
    269
    
    
    
    519
    
    
    
    492
    
    
    
    166
    
    
    
    284
    
    
    
    507
    
    
    
    458
    
    
    $
    88
    
    
    $
    97
    
    
    $
    97
    
    
    $
    99
 Cost of Sales (excluding depreciation)
  Selling, General and Administrative Expenses
 Trends Affecting Our Business
  
    
    LME price of zinc;
    
    changes in cost of energy and fuels;
 15




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##### Table of Contents




    
    gain and loss of customers;
    
    pricing pressures from competitors, including new entrants into the EAF dust
recycling market;
    
    increases and decreases in the use of zinc products;
    
    expansions into new products and expansion of our capacity, which requires us to
incur costs prior to generating revenues;
    
    expenditures required to comply with environmental and other operational
regulations;
    
    access to credit by our customers; and
    
    our operational efficiency improvement programs.
      Summary of Critical Accounting Policies and Estimates
  16




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Inventories
   Financial Instruments
      Impairment
  Recently Issued Accounting Pronouncements
  17




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##### Table of Contents



Results of Operations
  Three months ended June 30,
    
    Six months ended June 30,2009
    
    2008
    
    2009
    
    2008Net sales
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of sales (excluding depreciation)
    
    
    113.2
    
    
    
    76.7
    
    
    
    125.0
    
    
    
    78.7Depreciation
    
    
    7.7
    
    
    
    2.3
    
    
    
    8.3
    
    
    
    2.4Selling, general and administrative expenses
    
    
    8.5
    
    
    
    3.9
    
    
    
    8.8
    
    
    
    3.6Income (loss) from operations
    
    
    (29.4
    )
    
    
    17.1
    
    
    
    (42.1
    )
    
    
    15.3Interest expense
    
    
    1.2
    
    
    
    0.3
    
    
    
    1.1
    
    
    
    0.3Interest and other income
    
    
    0.2
    
    
    
    0.3
    
    
    
    0.3
    
    
    
    0.5Income (loss) before income taxes
    
    
    (30.4
    )
    
    
    17.1
    
    
    
    (42.9
    )
    
    
    15.5Income tax provision (benefit)
    
    
    (10.9
    )
    
    
    6.5
    
    
    
    (15.3
    )
    
    
    5.8Net income (loss)
    
    
    (19.5
    )%
    
    
    10.6
    %
    
    
    (27.6
    )%
    
    
    9.7
    %
  18




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##### Table of Contents



Put Options2008
    
    2009
    
    Swaps
    
    TotalFair value December 31, 2007
    
    
    9,871
    
    
    
    
    
    
    
    (757
    )
    
    
    9,114Purchases
    
    
    
    
    
    
    7,008
    
    
    
    
    
    
    
    7,008Settlements of closed positions
    
    
    
    
    
    
    
    
    
    
    566
    
    
    
    566Gain (loss) on settlements of
closed positions
    
    
    (3,322
    )
    
    
    
    
    
    
    (182
    )
    
    
    (3,504
    )Mark to market adjustment on
open positions
    
    
    2,612
    
    
    
    932
    
    
    
    (1,441
    )
    
    
    2,103Fair value March 31, 2008
    
    
    9,161
    
    
    
    7,940
    
    
    
    (1,814
    )
    
    
    15,287Purchases
    
    
    
    
    
    
    7,208
    
    
    
    
    
    
    
    7,208Settlements of closed positions
    
    
    (2,267
    )
    
    
    
    
    
    
    827
    
    
    
    (1,440
    )Gain (loss) on settlements of
closed positions
    
    
    736
    
    
    
    
    
    
    
    (60
    )
    
    
    676Mark to market adjustment on
open positions
    
    
    5,730
    
    
    
    7,233
    
    
    
    4,522
    
    
    
    17,485Fair value June 30, 2008
    
    
    13,360
    
    
    
    22,381
    
    
    
    3,475
    
    
    
    39,216Purchases
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Settlements of closed positions
    
    
    (8,866
    )
    
    
    
    
    
    
    175
    
    
    
    (8,691
    )Gain (loss) on settlements of
closed positions
    
    
    2,601
    
    
    
    
    
    
    
    (358
    )
    
    
    2,243Mark to market adjustment on
open positions
    
    
    3,926
    
    
    
    11,553
    
    
    
    (655
    )
    
    
    14,824Fair value September 30, 2008
    
    
    11,021
    
    
    
    33,934
    
    
    
    2,637
    
    
    
    47,592Sales
    
    
    
    
    
    
    (33,934
    )
    
    
    
    
    
    
    (33,934
    )Purchases
    
    
    
    
    
    
    10,472
    
    
    
    
    
    
    
    10,472Settlements of closed positions
    
    
    (20,806
    )
    
    
    
    
    
    
    907
    
    
    
    (19,899
    )Gain (loss) on settlements of
closed positions
    
    
    9,785
    
    
    
    
    
    
    
    (1,086
    )
    
    
    8,699Mark to market adjustment on
open positions
    
    
    
    
    
    
    (3,626
    )
    
    
    (690
    )
    
    
    (4,316
    )Fair value December 31, 2008
    
    
    
    
    
    
    6,846
    
    
    
    1,768
    
    
    
    8,614Settlements of closed positions
    
    
    
    
    
    
    
    
    
    
    356
    
    
    
    356Gain (loss) on settlements of
closed positions
    
    
    
    
    
    
    (744
    )
    
    
    (256
    )
    
    
    (1,000
    )Mark to market adjustment on
open positions
    
    
    
    
    
    
    (3,903
    )
    
    
    284
    
    
    
    (3,619
    )Fair value March 31, 2009
    
    
    
    
    
    
    2,199
    
    
    
    2,152
    
    
    
    4,351Settlements of closed positions
    
    
    
    
    
    
    
    
    
    
    (916
    )
    
    
    (916
    )Gain (loss) on settlements of
closed positions
    
    
    
    
    
    
    (217
    )
    
    
    411
    
    
    
    194Mark to market adjustment on
open positions
    
    
    
    
    
    
    (1,566
    )
    
    
    446
    
    
    
    (1,120
    )Fair value June 30, 2009
    
    $
    
    
    
    $
    416
    
    
    $
    2,093
    
    
    $
    2,509
  2007
    
    2008
    
    2009Fiscal quarter ended
    
    Fiscal quarter ended
    
    Fiscal quarter endedAverage LME zinc price
    
    December 31
    
    March 31
    
    June 30
    
    December 31
    
    March 31
    
    June 30Three months ended
    
    $
    1.19
    
    
    $
    1.10
    
    
    $
    0.96
    
    
    $
    0.54
    
    
    $
    0.53
    
    
    $
    0.67Year-to-date
    
    $
    1.47
    
    
    $
    1.10
    
    
    $
    1.03
    
    
    $
    0.85
    
    
    $
    0.53
    
    
    $
    0.60
 Three Months Ended June 30, 2009 Compared with Three Months Ended June 30, 2008
 Net sales.
 19




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##### Table of Contents



Cost of sales (excluding depreciation).
  20




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##### Table of Contents



Depreciation
 Selling, general and administrative expenses.
 Interest expense.
 Interest and other income
 Income tax (benefit) provision.
 Net income (loss).
 Six Months Ended June 30, 2009 Compared with Six Months Ended June 30, 2008
 Net sales.
 21




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##### Table of Contents



Cost of sales (excluding depreciation).
  22




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##### Table of Contents



Depreciation
 Selling, general and administrative expenses.
 Interest expense.
 Interest and other income.
 Income tax (benefit) provision.
 Net income.
 Liquidity and Capital Resources
  June 30, 2009
  23




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##### Table of Contents



Cash Flows from Operating Activities
  24




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##### Table of Contents



Cash Flows from Investing Activities
   Cash Flows from Financing Activities
  Off-Balance Sheet Arrangements
  Available Information
  25




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk.
   Interest Rate Risk
  Commodity Price Risk
    
 Item 4. Controls and Procedures.
  26




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##### Table of Contents



Changes in Internal Control over Financial Reporting
  27




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##### Table of Contents



PART IIOTHER INFORMATION
 
 Item 1. Legal Proceedings.
  
 Item 1A. Risk Factors.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
 Change in Securities.
 a. Recent Sales of Unregistered Securities:
  
 Item 3. Defaults Upon Senior Securities.
  
 Item 4. Submission of Matters to a Vote of Security Holders.
  Name
    
    Number of Votes For
    
    Number of Votes WithheldT. Grant John
    
    
    30,287,832
    
    
    
    1,034,719Bryan D. Rosenberger
    
    
    30,282,639
    
    
    
    1,039,912
 
 Item 5. Other Information.
  
 Item 6. Exhibits.
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##### Table of Contents



Exhibit No.
    
    Description31.1
    
    Certification by James M. Hensler, Chief Executive Officer,
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of Robert D. Scherich, Chief Financial Officer,
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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##### Table of Contents



SIGNATURES
  HORSEHEAD HOLDING CORP./s/ James M. HenslerBy:                         James M. HenslerIts:              President and Chief Executive Officer  SIGNATURE
    
    TITLE
    
    DATE/s/ James M. Hensler

James M. Hensler
    
    Principal Executive Officer
    
    August 10, 2009/s/ Robert D. Scherich

Robert D. Scherich
    
    Principal Financial and
Accounting Officer
    
    August 10, 2009
 30