Net sales of $650 million, up 17% from second quarter of 2007

Total segment income up 36% to $54.8 million, compared with 2007

second quarter

Diluted earnings of 21 cents per share, up from 10 cents per share in

second quarter of 2007

CLEVELAND–(EMWNews)–Ferro Corporation (NYSE: FOE) (the “Company”)

today announced sales of $650.4 million for the quarter ended June 30,

2008, up 17 percent from sales of $553.7 million in the second quarter

of 2007.

Income from continuing operations for the 2008 second quarter was $9.4

million, or $0.21 per diluted share, compared with $4.6 million, or

$0.10 per diluted share, in the second quarter of 2007. Income from

continuing operations increased as a result of the combined effects of

higher gross profit driven by increased net sales, lower selling,

general and administrative expenses and reduced interest expense,

partially offset by higher restructuring charges. Income from continuing

operations for the second quarter of 2008 included net pre-tax expenses

of $13.8 million primarily related to restructuring charges, asset

write-offs, and corporate development activities. In the second quarter

of 2007, income from continuing operations included net pre-tax expenses

of $10.0 million primarily related to litigation settlements and

manufacturing rationalization costs.

“The Ferro team delivered outstanding

performance in the quarter, from sales to net income,”

said Chairman, President and Chief Executive Officer James F. Kirsch. “Our

improved results came in spite of slowing economic growth and

unprecedented cost increases for a number of raw materials. Our efforts

to improve business operations and restructure manufacturing assets are

generating results, and we are making sustainable progress toward our

long-term profitability goals.”

Price increases and changes in foreign exchange were the most

significant drivers of sales growth during the quarter. Price increases

during the quarter include higher precious metal costs which are passed

through to customers as higher product prices. Changes in foreign

currency exchange rates accounted for approximately 40 percent of the

sales increase. Higher sales volumes also contributed to the sales

increase, particularly in Electronic Materials and Color and Glass

Performance Materials. Sales volumes declined in Polymer Additives and

Specialty Plastics.

In the 2008 second quarter, sales growth was strongest in the Electronic

Materials segment, driven by conductive pastes used by solar cell

manufacturers, particularly in Asia. Increased precious metal costs,

which are passed through to customers, also contributed to the sales

increase. Sales growth was also strong in Performance Coatings and Color

and Glass Performance Materials, driven by sales growth in Europe, the

Middle East and North Africa. Sales in Polymer Additives grew, primarily

as a result of higher product pricing. Sales in Specialty Plastics

declined as a result of lower demand from customers in the U.S.

automotive, housing and appliance markets. This lower demand was not

fully offset by higher average selling prices.

Gross profit percentage was 19.0 percent of sales for the second quarter

of 2008, compared with 19.4 percent of sales in the second quarter of

2007. Gross profit for the 2008 second quarter was reduced by $1.4

million primarily as a result of asset write-offs and costs related to

manufacturing rationalization activities. During the second quarter of

2007, gross profit was negatively impacted by an interruption of

manufacturing activities at Ferro’s South

Plainfield, New Jersey, facility and by manufacturing rationalization

costs of $1.9 million. Higher raw material costs, primarily the cost of

precious metals that are passed through to customers, contributed to the

lower gross profit percentage for the 2008 second quarter.

Selling, general and administrative (SG&A) expense was $81.2 million in

the second quarter of 2008, or 12.5 percent of sales. Included in the

2008 second quarter SG&A expense were charges totaling $2.4 million,

primarily related to corporate development activities, asset write-offs

and employee severance expenses. SG&A expense in the second quarter of

2007 was $84.4 million, or 15.2 percent of sales, including charges of

$7.8 million primarily related to increased reserves for litigation

settlements.

Total segment income for the 2008 second quarter was $54.8 million

compared with $40.4 million in the second quarter of 2007. The increase

in total segment income reflected improved performance across a number

of segments. Segment income increased in Electronic Materials as a

result of higher sales, improved product mix and benefits from

prior-period restructuring activities. In addition, the Electronic

Materials results in the second quarter of 2007 included the costs of a

temporary manufacturing interruption at the Company’s

South Plainfield, New Jersey, facility. Income increased in Performance

Coatings and Color and Glass Performance Materials as a result of

successful value pricing and improved sales volume, partially offset by

higher raw material costs. Increased income in the Polymer Additives

segment was driven by product price improvements that offset raw

material cost increases and improved product mix. Segment income

declined in Specialty Plastics as a result of lower manufacturing volume

and higher raw material costs that were not fully offset by value

pricing initiatives and cost control actions. Segment income declined in

Other Businesses as a result of lower pharmaceutical product sales and

an increased proportion of lower-margin industrial solvent sales in the

quarter, as well as higher raw material and manufacturing costs.

Restructuring charges were $9.0 million for the 2008 second quarter, an

increase from $0.3 million in the prior-year period. The increased

charges were primarily the result of restructuring initiatives in Europe

and Brazil in the Performance Coatings and Color and Glass Performance

Materials segments. Ferro also recorded restructuring charges in the

second quarter in the Performance Coatings, Color and Glass Performance

Materials, Polymer Additives and Specialty Plastics segments as a result

of continuing costs from restructuring programs initiated in late 2007

and the first half of 2008.

Interest expense for the 2008 second quarter was $13.2 million, compared

with $14.3 million in the year-ago period. The lower interest expense

was the result of lower interest rates on the Company’s

variable-rate borrowings and term loans, partially offset by higher

borrowing levels.

Miscellaneous expense increased in the second quarter of 2008, primarily

as a result of a $1.0 million increase in a provision for an

environmental contingency in Latin America related to a previously

closed manufacturing property.

The Company’s tax rate for the second quarter

of 2008 increased to 46.1% of pre-tax income from 37.9% in the 2007

second quarter. The 2008 second quarter effective tax rate increased as

a result of a change in the mix of income by country, loss of a tax

holiday and a decrease in the U.S. tax cost on foreign dividends. The

effective tax rate was also impacted by an unfavorable tax decision in

Brazil and favorable adjustments to prior-year accruals that increased

tax expense in the 2008 second quarter by $1.6 million, in aggregate.

Total debt on June 30, 2008 was $571.0 million, an increase of $44.9

million from the end of 2007. The Company had net proceeds of $75.0

million from its U.S. accounts receivable securitization program as of

the end of the 2008 second quarter, compared with $54.6 million at the

end of 2007. The Company also had $41.2 million in net proceeds from

similar programs outside the U.S. at the end of the quarter, compared

with $42.1 million at the end of 2007. The increase in total debt was

driven by increased working capital requirements resulting from higher

sales, and foreign currency exchange rate changes.

Outlook

The Company expects sales to increase in the 2008 third quarter from the

$551 million recorded in the third quarter of 2007. Consistent with

historical seasonality, sales are forecast to decline sequentially from

the second quarter of 2008. Sales for the third quarter, ending

September 30, 2008, are expected to be in the range of $600 million to

$625 million.

The sales estimates for the third quarter are consistent with the Company’s

outlook for worldwide economic activity, and its current view of the

potential for increased commodity prices, higher energy costs and

volatility in credit markets to affect customers’

demand for products.

Net income per share in the third quarter is expected to be in the range

of 8 to 13 cents per share, including approximately 20 cents per share

for charges related primarily to the Company’s

manufacturing rationalization activities. Net income per share in the

third quarter of 2007 was 12 cents per share, including charges of

approximately 11 cents per share.

Conference Call

The Company will host a conference call to discuss its 2008

second-quarter financial results, third-quarter earnings estimates, and

general business outlook on Wednesday, August 6, 2008, at 10:00 a.m.

Eastern time. If you wish to participate in the call, dial 888-323-2711

if calling from the United States or Canada, or dial 210-234-0008 if

calling from outside North America. When prompted, refer to the pass

code, FOE, and the conference leader, David Longfellow. Please call

approximately 10 minutes before the conference call is scheduled to

begin.

An audio replay of the call will be available from noon Eastern time on

August 6 through 9 p.m. Eastern time on August 13. To access the replay,

dial 866-510-4832 if calling from the United States or Canada, or dial

203-369-1941 if calling from outside North America.

The conference call also will be broadcast live over the Internet and

will be available for replay through the end of the third quarter. The

live broadcast and replay can be accessed through the Investor

Information portion of the Company’s Web site

at www.ferro.com. A podcast of the

conference call will also be available on the Company’s

Web site.

About Ferro Corporation

Ferro Corporation (http://www.ferro.com)

is a leading global supplier of technology-based performance materials

for manufacturers. Ferro materials enhance the performance of products

in a variety of end markets, including electronics, solar energy,

telecommunications, pharmaceuticals, building and renovation,

appliances, automotive, household furnishings, and industrial products.

Headquartered in Cleveland, Ohio, the Company has approximately 6,300

employees globally and reported 2007 sales of $2.2 billion.

Cautionary Note on Forward-Looking Statements

Certain statements in this Ferro press release may constitute “forward-looking

statements” within the meaning of Federal

securities laws. These statements are subject to a variety of

uncertainties, unknown risks and other factors concerning the Company’s

operations and business environment, which are difficult to predict and

often beyond the control of the Company. Important factors that could

cause actual results to differ materially from those suggested by these

forward-looking statements, and that could adversely affect the Company’s

future financial performance, include the following:

• We depend on reliable sources of raw materials, including energy,

  petroleum-based materials, and other supplies, at a reasonable cost,

  but availability of such materials and supplies could be interrupted

  and/or the prices charged for them could escalate.

• The markets in which we participate are highly competitive and subject

  to intense price competition.

• We are striving to improve operating margins through sales growth,

  price increases, productivity gains, and improved purchasing

  techniques, and restructuring activities, but we may not be successful

  in achieving the desired improvements.

• Our products are sold into industries where demand is unpredictable,

  cyclical or heavily influenced by consumer spending.

• The global scope of our operations exposes us to risks related to

  currency conversion rates and changing economic, social and political

  conditions around the world.

• We have a growing presence in the Asia-Pacific region where it can be

  difficult for a U.S.-based company to compete lawfully with local

  competitors.

• Regulatory authorities in the U.S., European Union and elsewhere are

  taking a much more aggressive approach to regulating hazardous

  materials and those regulations could affect our sales and operating

  profits.

• Our operations are subject to operating hazards and, as a result, to

  stringent environmental, health and safety regulations and compliance

  with those regulations could require us to make significant

  investments.

• We depend on external financial resources and any interruption in

  access to capital markets or borrowings could adversely affect our

  financial condition.

• Interest rates on some of our external borrowings are variable, and

  our borrowing costs could be affected adversely by interest rate

  increases.

• Many of our assets are encumbered by liens that have been granted to

  lenders, and those liens affect our flexibility in making timely

  dispositions of property and businesses.

• We are subject to a number of restrictive covenants in our credit

  facilities, and those covenants could affect our flexibility in

  funding strategic initiatives.

• We have significant deferred tax assets, and our ability to utilize

  these assets will depend on our future performance.

• We are a defendant in several lawsuits that could have an adverse

  effect on our financial condition and/or financial performance, unless

  they are successfully resolved.

• Our businesses depend on a continuous stream of new products, and

  failure to introduce new products could affect our sales and

  profitability.

• We are subject to stringent labor and employment laws in certain

  jurisdictions in which we operate and party to various collective

  bargaining arrangements, and our relationship with our employees could

  deteriorate, which could adversely impact our operations.

• Employee benefit costs, especially post-retirement costs, constitute a

  significant element of our annual expenses, and funding these costs

  could adversely affect our financial condition.

• Our restructuring initiatives may not provide sufficient cost savings

  to justify their expense.

• We are exposed to intangible asset risk.

• We have in the past identified material weaknesses in our internal

  controls, and the identification of any material weaknesses in the

  future could affect our ability to ensure timely and reliable

  financial reports.

• We are exposed to risks associated with acts of God, terrorists and

  others, as well as fires, explosions, wars, riots, accidents,

  embargoes, natural disasters, strikes and other work stoppages,

  quarantines and other governmental actions, and other events or

  circumstances that are beyond our control.

Additional information regarding these risk factors can be found in the

Company’s Quarterly Report on Form 10-Q for

the period ended June 30, 2008 and other filings with the SEC.

The risks and uncertainties identified above are not the only risks the

Company faces. Additional risks and uncertainties not presently known to

the Company or that it currently believes to be immaterial also may

adversely affect the Company. Should any known or unknown risks and

uncertainties develop into actual events, these developments could have

material adverse effects on the Company’s

business, financial condition and results of operations.

This release contains time-sensitive information that reflects management’s

best analysis only as of the date of this release. The Company does not

undertake any obligation to publicly update or revise any

forward-looking statements to reflect future events, information or

circumstances that arise after the date of this release.

Ferro Corporation and Consolidated Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
(Dollars in thousands, except per share amounts)		Three Months Ended June 30,						Six Months Ended June 30,
		2008			2007			2008			2007
Net sales		$650,396			$553,658			$1,257,652			$1,083,363
Cost of sales		527,012			446,131			1,020,949			869,056
Gross profit		123,384			107,527			236,703			214,307
Selling, general and administrative expenses		81,191			84,386			159,848			163,143
Restructuring charges		9,031			332			13,238			1,863
Other expense (income):
Interest expense		13,214			14,286			27,243			31,732
Interest earned		(142	)		(189	)		(271	)		(1,154	)
Foreign currency transactions, net		650			423			(891	)		934
Loss (gain) on sale of business
Miscellaneous (income) expense, net		2,082			883			3,932			(386	)
Income before income taxes		17,358			7,406			33,604			18,175
Income tax expense		8,002			2,808			15,083			7,342
Income from continuing operations		9,356			4,598			18,521			10,833
(Gain) Loss from discontinued operations, net of tax		(9	)		58			16			214
Net income		9,365			4,540			18,505			10,619
Dividends on preferred stock		223			259			450			545
Net income available to common shareholders		$9,142			$4,281			$18,055			$10,074
Per common share data:
Basic earnings
From Continuing Operations		$0.21			$0.10			$0.42			$0.24
From Discontinued Operations		0.00			0.00			0.00			0.00
		$0.21			$0.10			$0.42			$0.24
Diluted earnings
From continuing operations		$0.21			$0.10			$0.42			$0.24
From discontinued operations		0.00			0.00			0.00			0.00
		$0.21			$0.10			$0.42			$0.24
Cash dividends declared		$0.145			$0.145			$0.290			$0.290
Shares outstanding:
Basic		43,250,802			42,905,728			43,205,521			42,806,837
Diluted		43,327,093			42,967,331			43,282,754			42,867,651
End of Period		43,719,321			43,435,614			43,719,321			43,435,614

Ferro Corporation and Consolidated Subsidiaries
Segment Net Sales and Segment Income (Unaudited)
(Dollars in thousands)		Three Months Ended June 30,				Six Months Ended June 30,
		2008		2007		2008		207
Segment Net Ferro Corporation INVESTOR CONTACT: David Longfellow, Director, Investor Relations Phone: 216-875-7155 E-mail: [email protected] or MEDIA CONTACT: Mary Abood, Director, Corporate Communications Phone: 216-875-6202 E-mail: [email protected] Major Newsire & Press Release Distribution with Basic Starting at only $19 and Complete OTCBB / Financial Distribution only $89 Get Unlimited Organic Website Traffic to your Website  TheNFG.com now offers Organic Lead Generation & Traffic Solutions