Sales for the first quarter of 2009 were $135.4 million, down 40.2% or $90.9 million, compared to the first quarter of 2008. The significant decline in sales is due to the severe global economic recession combined with rapid supply chain inventory adjustments at our customers. Affected key markets included telecommunications and computer (especially consumer electronics applications), data storage, automotive electronics, oil and gas, commercial aerospace, and appliances. This weakness in demand was partially offset by strong sales from the defense and medical markets.

The Company reported a net loss of $8.1 million or $0.40 per share, diluted, for the first quarter of 2009 versus net income of $4.6 million or $0.22 per share, diluted, for the first quarter of 2008. The first quarter net loss includes a net inventory valuation charge of $0.05 per share, severance costs of $0.03 per share due to manpower reductions and a pension benefit in the amount of $0.04 per share resulting from the reduction in workforce.

BALANCE SHEET

The Company?s balance sheet remained strong in the quarter. Despite making the expected pension plan contribution and 2008 incentive payments totaling $20.5 million, debt only increased by $10.9 million to $52.7 million. The Company?s debt, net of cash, to capital ratio was approximately 10% at the end of the quarter and the Company at this time expects the balance sheet to improve through the balance of the year. The Company has a committed revolving line of credit totaling $240.0 million that matures in 2012.

COST REDUCTION INITIATIVES

During the fourth quarter of 2008, as the global economic downturn began to take hold, the Company responded quickly and effectively with a number of initiatives to reduce costs and to assure that the Company?s balance sheet remains strong. The measures implemented included global headcount reductions that reduced total employment by approximately 17%. Initially, the Company also eliminated planned executive and senior management salary increases, implemented a general pay freeze, reduced work hours, suspended the 401(k) match, reduced discretionary spending and supplier costs, and deferred lower priority initiatives.

In addition, the Company subsequently reduced the salaries of senior executives and the annual cash retainer fees of the Board of Directors by 10% and the salaries of other senior managers by 7%. Efforts to reduce working capital and targeted capital spending deferrals have been implemented.

The Company believes that the result of these initiatives is a leaner, more efficient operating structure. The working capital and capital spending reductions are yielding cash benefits. The cost reduction initiatives have had a favorable impact on results to date and are expected to result in more clearly visible benefits in the second quarter. While the scale of these initiatives is sizable, the Company is taking care to not disrupt investment in the pipeline of new products that will help during the difficult macroeconomic environment of 2009 and provide solid growth opportunities for 2010 and beyond.

The annualized impact of the cost reductions is in the range of $45.0 million to $50.0 million. In addition, the Company will consider more cost reductions if the measures already in place are not enough in this down economy and is preparing additional contingency actions to take beyond what is already in place if market conditions do not improve.

BUSINESS SEGMENT REPORTING

Advanced Material Technologies and Services

The Advanced Material Technologies and Services' segment sales for the first quarter of 2009 were $80.1 million, down $43.9 million compared to the first quarter of the prior year. Lower precious metal prices accounted for approximately $11.0 million of the decline in sales. The majority of the sales shortfall was due to the weaker demand in the consumer-driven market segments which include wireless handsets and photonics, data storage and microelectronic packaging. This weakness was offset in part by steady demand and new applications in the medical and defense markets where order entry has remained strong. Although progress continued during the quarter in the re-qualification of ruthenium-based targets for hard drive media applications, the data storage market remained weak as excess inventories are being worked down. Order entry is beginning to improve in wireless and photonics, with indications that the customer base has depleted inventories. In addition, we are beginning to see some improvement in order rates in our Asia business units with increases in some niche semiconductor and chemical material segments.

The operating profit for the first quarter 2009 was $0.7 million versus an operating profit of $5.5 million for the same period last year. The decline in operating profit was due to the significant decline in sales, a lower of cost or market charge of $0.8 million related to ruthenium inventory and severance and other inventory charges totaling $0.9 million.

Specialty Engineered Alloys

Specialty Engineered Alloys' sales for the first quarter were $36.9 million, down $34.4 million compared to the first quarter 2008 sales of $71.3 million. The sales decline was due to the global weakness in the telecommunications and computer, automotive electronics, oil and gas, aerospace and appliance markets. Lower metal prices accounted for $4.1 million of the decline in sales.

Specialty Engineered Alloys had an operating loss of $10.9 million for the first quarter versus operating profit of $0.7 million for the first quarter of 2008. The operating loss was due primarily to the lower sales volume. Cost reduction initiatives including workforce reduction, reduced work hours, wage cut-backs and reduced overhead had a favorable impact in the quarter, lowering the loss. The reduction in workforce was approximately 25% of the segment?s employment. In addition, capital expenditures have been pushed out. The impact of the cost reduction initiatives will be fully realized in the second quarter of 2009.

Order entry rates leveled during the first quarter of 2009. As we move into the second quarter, order entry has improved for handsets and electronic components in Asia.

Beryllium and Beryllium Composites

Beryllium and Beryllium Composites' sales for the first quarter of 2009 were $13.0 million compared to $13.4 million for the first quarter of 2008. Sales for defense were strong in the first quarter offset by weakness in commercial product applications. Order entry for defense and scientific product applications to be shipped later in the year remained strong.

Operating profit for the first quarter was $1.8 million, up $1.6 million versus $0.2 million for the same period of the prior year. The improvement in operating profit despite the slightly lower sales was due to manufacturing efficiencies and a favorable product mix.

Engineered Material Systems

Engineered Material Systems' sales for the first quarter of 2009 were $5.4 million compared to $17.7 million for the same period last year. The significant reduction in sales was caused by the severe economic recession and the effects on consumer spending for electronics and automotive product applications.

The operating loss for the first quarter 2009 was $2.6 million versus an operating profit of $1.4 million for the same period last year. The operating loss was due to the significant decline in sales volume. Engineered Material Systems has implemented several cost reduction initiatives including workforce reductions of 35%, shortened work hours and vendor concessions to reduce overhead expense. Order entry has picked up slightly in the beginning of the second quarter.

OUTLOOK

The Company noted that while it did experience significant widespread weakness and an environment with limited visibility across the majority of its markets in the first quarter, certain of its markets remained strong. These include the medical and defense-related markets.

Recent activity in the Company?s markets suggests that the level of business has bottomed and is improving. The first quarter ended stronger than it began and the level of business to date in the second quarter is stronger than that of the first quarter. While it cannot in this environment be said that anything is for certain, the Company is seeing improvement in its order entry, especially from the consumer electronics-orientated markets, and at this time expects second quarter sales to improve by approximately 15% and thus be in the range of $150.0 million to $160.0 million. Part of the expected second quarter sales increase from the consumer electronics-oriented markets is driven by the reduction of inventory levels in the supply chain during the first quarter. The higher sales volume and additional impact from the cost reduction activities should result in a noticeable improvement in performance in the second quarter. While the Company still expects a loss in the second quarter, the loss should be no more than half the first quarter loss. Assuming this trend continues, the Company expects to generate a profit in the second half of 2009.

It is important to continue to reiterate that the Company?s outlook is subject to significant variability, especially given the current economic environment. Changes in demand levels, metal price changes, metal supply conditions, new product qualification and ramp-up rates, swings in customer inventory levels, changes in the financial health of key customers and other factors can have a significant effect on actual results. The outlook provided above is based on the Company?s best estimates at this time and is subject to significant fluctuations due to these as well as other factors.

CHAIRMAN?S COMMENTS

Richard Hipple, Chairman, President and CEO, stated, ?The global recession has affected the majority of our markets worldwide, especially those that are driven by consumer spending. The Company has responded quickly and effectively. As we address the challenges head on, we are doing more than just cutting costs. We are pressing on with our initiatives to create new revenue streams and extend our market positions. Along with the decisive actions we?ve taken, our strong balance sheet provides the ability to both continue to weather the downturn and take advantage of opportunities, such as acquisitions and business augmentations as they arise.?

CONFERENCE CALL

Brush Engineered Materials will conduct a teleconference in conjunction with today's release. The teleconference begins at 11:00 a.m. Eastern Time, April 30, 2009. The conference call will be available via webcast through the Company?s website at www.beminc.com or through www.InvestorCalendar.com. By phone, please dial (877) 407-0778, callers outside the U.S. can dial (201) 689-8565.

FORWARD-LOOKING STATEMENTS

Portions of the narrative set forth in this document that are not statements of historical or current facts are forward-looking statements. Our actual future performance may materially differ from that contemplated by the forward-looking statements as a result of a variety of factors. These factors include, in addition to those mentioned elsewhere herein:

• The global and domestic economies, including the uncertainties related to the impact of the current global financial crisis;
• The condition of the markets in which we serve, whether defined geographically or by segment, with the major market segments being telecommunications and computer, data storage, aerospace and defense, automotive electronics, industrial components, appliance and medical;
• Changes in product mix and the financial condition of customers;
• Actual sales, operating rates and margins for the second quarter and the year 2009;
• The successful implementation of cost reduction initiatives;
• Our success in developing and introducing new products and new product ramp- up rates, especially in the media market;
• Our success in passing through the costs of raw materials to customers or otherwise mitigating fluctuating prices for those materials, including the impact of fluctuating prices on inventory values;
• Our success in integrating newly acquired businesses;
• Our success in implementing our strategic plans and the timely and successful completion of any capital projects;
• The availability of adequate lines of credit and the associated interest rates;
• Other financial factors, including cost and availability of raw materials (both base and precious metals), tax rates, exchange rates, interest rates, metal financing fees, pension costs and required cash contributions and other employee benefit costs, energy costs, regulatory compliance costs, the cost and availability of insurance, and the impact of the Company?s stock price on the cost of incentive and deferred compensation plans;
• The uncertainties related to the impact of war and terrorist activities;
• Changes in government regulatory requirements and the enactment of new legislation that impacts our obligations and operations;
• The conclusion of pending litigation matters in accordance with our expectation that there will be no material adverse effects; and
• The risk factors set forth in Part I, Item 1A of the Company?s Form 10-K for the year ended December 31, 2008.

Brush Engineered Materials Inc. is headquartered in Mayfield Hts., Ohio. The Company, through its wholly-owned subsidiaries, supplies worldwide markets with beryllium products, alloy products, electronic products, precious metal products, and engineered material systems.

Brush Engineered Materials Inc.
	?	?			?
Digest of Earnings
						?
April 3, 2009
						?
			2009			2008
First Quarter
						?
Net Sales			$135,359,000			$226,347,000
						?
Net (Loss) Income			($8,144,000	)		$4,596,000
						?
Share Earnings - Basic			($0.40	)		$0.23
						?
Average Shares - Basic			20,133,000			20,389,000
						?
Share Earnings - Diluted			($0.40	)		$0.22
						?
Average Shares - Diluted			20,133,000			20,583,000
						?

Consolidated Balance Sheets	?		?
(Unaudited)
				?
		Apr. 3,		Dec. 31,
(Dollars in thousands)	?	2009	?	2008
Assets
Current assets
Cash and cash equivalents		$ 12,917		$ 18,546
Accounts receivable		74,378		89,845
Other receivables		-		1,411
Inventories		149,310		156,718
Prepaid expenses		28,660		23,660
Deferred income taxes		4,316		4,199
Total current assets		269,581		294,379
				?
Other assets		33,419		34,444
Related-party notes receivable		98		98
Long-term deferred income taxes		9,944		9,944
				?
Property, plant and equipment		632,353		635,266
Less allowances for depreciation,
depletion and amortization		430,146		428,012
		202,207		207,254
				?
Goodwill		35,778		35,778
		$ 551,027		$ 581,897
				?
				?
Liabilities and Shareholders' Equity
Current liabilities
Short-term debt		$ 41,177		$ 30,622
Current portion of long-term debt		600		600
Accounts payable		16,693		28,014
Other liabilities and accrued items		31,696		45,131
Unearned revenue		670		113
Total current liabilities		90,836		104,480
				?
Other long-term liabilities		22,290		19,356
Retirement and post-employment benefits		82,191		97,168
Long-term income taxes		3,028		3,028
Deferred income taxes		1,735		163
Long-term debt		10,905		10,605
				?
Shareholders' equity		340,042		347,097
		$ 551,027		$ 581,897
				?
See notes to consolidated financial statements.
				?

Consolidated Statements of Income	?			?
(Unaudited)
					?
		First Quarter Ended
		Apr. 3,			Mar. 28,
(Dollars in thousands except share and per share amounts)	?	2009		?	2008
					?
Net sales		$ 135,359			$ 226,347
Cost of sales		120,757	?		189,389
Gross margin		14,602			36,958
Selling, general and administrative expense		22,544			26,729
Research and development expense		1,695			1,497
Other-net		1,755	?		761
Operating (loss) profit		(11,392	)		7,971
Interest expense - net		326	?		336
Income (loss) before income taxes		(11,718	)		7,635
					?
Income taxes		(3,574	)		3,039
					?
Net (loss) income		$ (8,144	)		$ 4,596
					?
Per share of common stock: basic		$ (0.40	)		$ 0.23
					?
Weighted average number
of common shares outstanding		20,133,000			20,389,000
					?
Per share of common stock: diluted		$ (0.40	)		$ 0.22
					?
Weighted average number
of common shares outstanding		20,133,000			20,583,000
					?
See notes to consolidated financial statements.
					?

Consolidated Statements of Cash Flows	?	?			?
(Unaudited)
			First Quarter Ended
			Apr. 3,			Mar. 28,
(Dollars in thousands)	?	?	2009		?	2008
						?
Net (loss) income			$ (8,144	)		$ 4,596
Adjustments to reconcile net (loss) income to net cash used in
operating activities:
Depreciation, depletion and amortization			7,235			7,032
Amortization of mine costs			559			1,925
Amortization of deferred financing costs in interest expense			104			90
Derivative financial instrument ineffectiveness			-			222
Stock-based compensation expense			590			1,257
Changes in assets and liabilities net of acquired assets
and liabilities:
Decrease (increase) in accounts receivable			13,212			(8,491	)
Decrease (increase) in other receivables			1,411			11,263
Decrease (increase) in inventory			5,485			(5,743	)
Decrease (increase) in prepaid and other current assets			2,065			(2,580	)
Decrease (increase) in deferred income taxes			(22	)		40
Increase (decrease) in accounts payable and accrued expenses			(22,801	)		(12,688	)
Increase (decrease) in unearned revenue			557			(1,781	)
Increase (decrease) in interest and taxes payable			(3,555	)		1,339
Increase (decrease) in long-term liabilities			(13,471	)		1,421
Other - net			2,717	?		(2,781	)
Net cash used in operating activities			(14,058	)		(4,879	)
						?
Cash flows from investing activities:
Payments for purchase of property, plant and equipment			(6,106	)		(7,048	)
Payments for mine development			(264	)		(21	)
Reimbursements for capital equipment under government contracts			2,932			1,800
Payments for purchase of business net of cash received			-			(87,445	)
Proceeds from sale of acquired inventory to consignment			-			24,325
Other investments - net			-	?		66	?
Net cash used in investing activities			(3,438	)		(68,323	)
						?
Cash flows from financing activities:
Proceeds from issuance (repayment) of short-term debt			11,103			14,304
Proceeds from issuance of long-term debt			300			40,000
Issuance of common stock under stock option plans			-			12
Tax benefit from exercise of stock options			-	?		3	?
Net cash provided from financing activities			11,403			54,319
Effects of exchange rate changes			464	?		(577	)
Net change in cash and cash equivalents			(5,629	)		(19,460	)
Cash and cash equivalents at beginning of period			18,546	?		31,730	?
Cash and cash equivalents at end of period			$ 12,917	?		$ 12,270	?
						?
See notes to consolidated financial statements.
						?

Notes to Consolidated Financial Statements										?			?
(Unaudited)							?
?
														?
Note A - Accounting Policies
														?
In management's opinion, the accompanying consolidated financial statements contain all adjustments necessary to present fairly the financial position as of April 3, 2009 and December 31, 2008 and the results of operations for the three month periods ended April 3, 2009 and March 28, 2008. Sales and income before income taxes were reduced in the first quarter 2008 by $2.6 million to correct a billing error that occurred in 2007 that was not material to the 2007 results. All other adjustments were of a normal and recurring nature.
														?
														?
Note B - Inventories
											Apr. 3,			Dec. 31,
(Dollars in thousands)			?	?	?		?	?		?	2009		?	2008
														?
Principally average cost:
Raw materials and supplies											$ 31,788			$ 41,468
Work in process											145,175			139,552
Finished goods											44,922	?		50,579	?
Gross inventories											221,885			231,599
														?
Excess of average cost over LIFO inventory value											72,575	?		74,881	?
Net inventories											$ 149,310	?		$ 156,718	?
														?
Note C - Pensions and Other Post-retirement Benefits
														?
As a result of a significant reduction in force, management determined that there was a curtailment of the domestic defined benefit pension plan in the first quarter 2009 in accordance with Statement No. 88, "Employers' Accounting for Settlements and Curtailments of Defined Benefit Pension Plans and for Termination Benefits".
														?
The plan assets and liabilities were remeasured as of the curtailment date of February 28, 2009. As part of the remeasurement, management reviewed the key assumptions and determined that the discount rate should be increased to 6.80% from the 6.15% rate assumed at December 31, 2008. The revised rate was determined using the same methodology as was employed at year-end 2008. All other key assumptions, including the expected rate of return on assets, remained unchanged from December 31, 2008.
														?
The curtailment reduced the annual expense for 2009 on the domestic plan from a previously estimated $5.3 million to $4.3 million. In addition, the curtailment resulted in the recording of a $1.1 million one-time benefit in the first quarter 2009 as a result of applying the percentage reduction in the estimated future working lifetime of the plan participants against the unrecognized prior service cost benefit. Cost of sales was reduced by $0.8 million and selling, general and administrative expense was reduced by $0.3 million from the recording of the one-time benefit.
														?
The Company made contributions totaling $12.1 million to the defined benefit pension plan in the first quarter 2009 as expected.
														?
The following is a summary of the first quarter 2009 and 2008 net periodic benefit cost for the domestic defined benefit pension plan and the domestic retiree medical plan.
														?
					Pension Benefits						Other Benefits
					First Quarter Ended						First Quarter Ended
					Apr. 3,			Mar. 28,			Apr. 3,			Mar. 28,
(Dollars in thousands)					2009			2008		?	2009			2008
														?
Components of net periodic benefit cost
														?
Service cost					$ 1,115			$ 1,270			$ 72			$ 76
Interest cost					1,993			1,976			482			532
Expected return on plan assets					(2,172	)		(2,180	)		-			-
Amortization of prior service cost					(143	)		(161	)		(9	)		(9	)
Amortization of net loss					434			294			-			-
Curtailment gain					(1,069	)		-	?		-	?		-	?
Net periodic benefit cost					$ 158	?		$ 1,199	?		$ 545	?		$ 599	?
															?

Notes to Consolidated Financial Statements											?			?						?			?
(Unaudited)							?
?
																								?
Note D - Segment Reporting
																								?
Segment information for 2008 has been recast to include Zentrix Technologies Inc. in the Advanced Material Technologies and Services segment. Zentrix's results previously were reported in All Other. Beginning in 2009, Zentrix is being managed by Advanced Material Technologies and Services and is included with that segment's financial results in the Company's internal reporting.
																								?
					Advanced
					Material			Specialty				Beryllium			Engineered
					Technologies			Engineered				and Beryllium			Material						All
(Dollars in thousands)			?	?	and Services		?	Alloys			?	Composites		?	Systems		?	Subtotal		?	Other		?	Total
First Quarter 2009
Revenues from external customers					$ 80,071			$ 36,893				$ 12,990			$ 5,405			$ 135,359			$ -			$ 135,359
																								?
Intersegment revenues					125			805				52			358			1,340			-			1,340
																								?
Operating profit (loss)					705			(10,913	)			1,824			(2,631	)		(11,015	)		(377	)		(11,392	)
																								?
Assets					215,602			213,898				52,698			18,136			500,334			50,693			551,027
																								?
																								?
First Quarter 2008
Revenues from external customers					$ 124,000			$ 71,297				$ 13,364			$ 17,686			$ 226,347			$ -			$ 226,347
																								?
Intersegment revenues					394			2,069				123			335			2,921			-			2,921
																								?
Operating profit					5,472			704				227			1,362			7,765			206			7,971
																								?
Assets					264,637			242,653				40,016			26,718			574,024			29,077			603,101