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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

FORM 10-Q

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 1, 2004

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 001-15885

BRUSH ENGINEERED MATERIALS INC.

216-486-4200

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes x  No o

      Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).     Yes x  No o

      As of October 29, 2004 there were 19,197,447 shares of Common Stock, no par value, outstanding.

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PART I FINANCIAL INFORMATION

BRUSH ENGINEERED MATERIALS INC. AND SUBSIDIARIES

       The consolidated financial statements of Brush Engineered Materials Inc. and its subsidiaries for the quarter ended October 1, 2004 are as follows:

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Consolidated Statements of Income
(Unaudited)

See notes to consolidated financial statements.

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Consolidated Balance Sheets
(Unaudited)

See notes to consolidated financial statements.

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Consolidated Statements of Cash Flows
(Unaudited)

See notes to consolidated financial statements.

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Notes to Consolidated Financial Statements

(Unaudited)

      In management’s opinion, the accompanying consolidated financial statements contain all adjustments necessary to present fairly the financial position as of October 1, 2004 and December 31, 2003 and the results of operations for the three and nine month periods ended October 1, 2004 and September 26, 2003. All of the adjustments were of a normal and recurring nature. Certain items in the prior year have been reclassified to conform to the 2004 consolidated financial statement presentation.

      The reconciliation between net income (loss) and comprehensive income (loss) for the three and nine month periods ended October 1, 2004 and September 26, 2003 is as follows:

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Note E — Income Taxes

      A tax provision or benefit was not applied against the income or loss before income taxes in the third quarter and the first nine months of 2004 and 2003 for certain domestic and foreign taxes as a result of the deferred tax valuation allowance recorded in 2003 and previous periods in accordance with SFAS 109, “Accounting for Income Taxes” due to the uncertainty regarding full utilization of the Company’s deferred income taxes. The valuation allowance was reduced offsetting a portion of the net tax expense in both the third quarter and first nine months of 2004, while the valuation allowance was increased in the third quarter and first nine months of 2003 offsetting the net tax benefit in those periods. The Company intends to maintain the valuation allowance until additional realization events occur, including the generation of future sustainable taxable income, that would support reversal of all or a portion of the allowance. The tax expense was $0.3 million in the third quarter 2004 and $0.2 million in the third quarter 2003 while the year-to-date tax expense was $0.5 million in 2004 and $0.6 million in 2003. The expense in each period represents taxes from various state and local jurisdictions and foreign taxes from Japan and Singapore only.

      The remaining tax valuation allowance available to be reversed against future income was approximately $15.3 million at the end of the third quarter 2004.

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Note F — Pensions and Other Post-retirement Benefits