For Immediate Release

Ferro Reports 2011 Third-Quarter Results

CLEVELAND, Ohio – October 26, 2011 – Ferro Corporation (NYSE: FOE, the “Company”) today announced net sales of $546 million for the three-month period ended September 30, 2011, an increase of 3 percent from net sales of $529 million in the third quarter of 2010. Net income improved to $18 million, or $0.21 per diluted share, compared with a net loss of $2 million, or $0.04 per diluted share, in the prior-year quarter. Adjusted net income, excluding charges, was $20 million, or $0.23 per diluted share, compared with $25 million, or $0.29 per diluted share, in the third quarter of 2010.

2011 Third-Quarter Results

“The strength of our business is reflected by the fact that we recorded over $35 million in operating profit, and adjusted earnings per diluted share of $0.23 for the third quarter. This was achieved despite market conditions that drove a reduction of over 50 percent in sales of our solar paste products,” said Chairman, President and Chief Executive Officer James F. Kirsch. “We expect weaker fourth-quarter sales for a number of our products as global economic activity slows. However, the successful restructuring of our manufacturing operations and our improved balance sheet position us well to withstand this period of reduced customer demand. We continue to believe in the long-term growth opportunities for Ferro in the solar, electronic materials, and specialty glass and pigments markets. Our investments in these areas are resulting in new product introductions and customer qualifications that we expect will lead to higher sales and profits when market conditions improve.”

Net sales for the three months ended September 30, 2011, were $546 million, an increase of 3 percent over net sales of $529 million in the third quarter of 2010. Sales increased in all segments except Electronic Materials. Reduced customer demand for conductive pastes used in solar cell applications resulted in a sales decline for these pastes of more than 50 percent compared with the prior-year quarter. Demand for conductive pastes remains weak due to low end-market demand and excess inventory of completed solar power modules, particularly in the European solar market. Sales of precious metals increased $9 million compared with the prior-year quarter as higher silver prices were only partially offset by reduced metals sales volume. Changes in foreign currency exchange rates increased sales by approximately $17 million compared with the 2010 third quarter. A portion of the reduction in sales volume occurred because the Company no longer manufactures certain products due to portfolio changes resulting from 2010 restructuring actions and business sales.

Gross profit was $104 million, or 19.1 percent of net sales, during the 2011 third quarter, compared with $120 million, or 22.8 percent of net sales, during the third quarter of 2010. Excluding charges, gross profit was 23.5 percent of sales excluding precious metals in the 2011 third quarter, compared with 27.7 percent in the prior-year quarter. The primary driver of the decline in gross profit dollars was the reduced sales volume of conductive pastes sold to manufacturers of solar cells. These conductive pastes are among the Company’s highest margin products. During the 2011 third quarter, gross profit was reduced by charges of $0.7 million, primarily related to residual costs at closed manufacturing sites involved in restructuring actions. In the third quarter of 2010, gross profit was also reduced by charges of $0.7 million due to charges for accelerated depreciation, severance costs and other costs associated with manufacturing rationalization activities.

Selling, general and administrative (“SG&A”) expenses declined to $68 million during the 2011 third quarter from $75 million in the prior-year quarter. SG&A expenses were 12.4 percent of net sales during the quarter, down from 14.2 percent of net sales in the third quarter of 2010. The SG&A expenses for the quarter were lower primarily as a result of reduced special charges, lower pension and incentive compensation expense, and control of discretionary spending. Partially offsetting the decline in SG&A expenses were $1.6 million in costs related to an initiative to streamline and standardize business processes and improve management information systems tools. Changes in foreign currency exchange rates also increased SG&A spending compared with the prior-year quarter. SG&A expenses in the 2011 third quarter included charges of $0.8 million that were primarily due to expenses at sites that were closed during manufacturing rationalization actions. During the third quarter of 2010, SG&A expenses included charges of $5.5 million, primarily related to manufacturing rationalization activities and employee severance expenses.

Restructuring and impairment charges declined to $0.9 million in the third quarter of 2011, down from $9.6 million in the prior-year quarter. The decline reflects the substantial reduction in restructuring activities as the Company completes the final actions related to its multi-year manufacturing rationalization initiatives that began in 2006.

Interest expense declined to $7.0 million in the 2011 third quarter, down by $3.5 million from the third quarter of 2010. The decline was due to the combined effects of lower average interest rates on borrowings, a decline in the average borrowing throughout the quarter and reduced amortization of debt issuance costs. In addition, during the 2010 third quarter, interest expense included a $0.8 million noncash write-off of unamortized fees related to a repayment of term loans.

A charge of $19.3 million for losses on extinguishment of debt was recorded during the 2010 third quarter related to debt refinancing. This charge did not recur in the 2011 third quarter.

Net income was $18.2 million, or $0.21 per diluted share, during the 2011 third quarter compared with a net loss of $2.4 million, or $0.04 per diluted share, during the third quarter of 2010. Adjusted net income, excluding charges, was $19.7 million, or $0.23 per diluted share during the 2011 third quarter, compared with adjusted net income of $25.3 million, or $0.29 per diluted share during the prior-year quarter.

Cash flow from operations was $3.4 million during the third quarter compared with $32.9 million during the third quarter of 2010, excluding $55.8 million from the return of deposits for precious metal leases. During the 2011 third quarter, working capital requirements increased due to lower accounts payable balances. The lower accounts payable level was driven by reduced purchases of raw materials. Partially offsetting this increase in working capital were reduced accounts receivables and inventory balances. The Company expects cash flow from operations to improve in the 2011 fourth quarter as raw material costs begin to decline and production activities are reduced in line with lower expected sales levels.

2011 Outlook

The Company currently expects net sales to grow between 2 and 5 percent in 2011, compared with 2010, to between $2.15 billion and $2.20 billion. Previously, the Company had forecasted 2011 sales to be between $2.30 billion and $2.35 billion. The reduced sales forecast is primarily due to lower sales expectations for electronic materials products, including conductive pastes, metal powders and surface finishing products. Weakening economic conditions, particularly in Europe and the United States, also reduced sales forecasts for a number of product lines, particularly those used in building and construction applications. In addition, the Company has updated its foreign currency exchange rate assumptions for the final three months of the year to be consistent with current exchange rates.

The Company expects sales of conductive pastes to decline by 25 to 35 percent in the 2011 fourth quarter compared with the sales recorded in the third quarter, based on current order patterns and declines in customer production plans. Previously, the Company had expected demand for conductive pastes to begin to recover during the last three months of 2011. In addition, sales of other electronic materials, including metal powders and surface finishing materials, also are expected to decline by 20 to 25 percent in the fourth quarter because of reduced demand from consumer electronics and semiconductor-related applications.

Because of weakening global economic conditions and rapidly changing customer order patterns, it is difficult to forecast future financial results at this time. Therefore, the Company’s earnings per share guidance encompasses a wide range.

Adjusted earnings per share for 2011, excluding special charges, are expected to be $0.70 to $0.80, down from the Company’s previous guidance of $1.08 to $1.18 per share. The primary drivers of the lower earnings outlook are reduced sales expectations for electronic materials products and weakening economic conditions in Europe and the United States.

Non-GAAP Measures

Adjusted earnings per share is equal to income (loss) before taxes, plus restructuring and impairment charges, charges related to debt refinancing and other special charges, adjusted for a normalized tax rate that is consistent with the Company’s expected future effective tax rate excluding discrete items, and divided by the average number of common shares outstanding. The Company’s expected future effective tax rate is lower than the U.S. statutory rate because of expected earnings in foreign jurisdictions with lower tax rates.

Adjusted earnings per share is a financial measure not required by, or presented in accordance with, accounting principles generally accepted in the United States (U.S. GAAP). The measure is presented here because it provides additional information in a manner that is commonly used by investors and reported by third-party analysts. The amount and timing of restructuring, impairment and other special charges in future periods are difficult to forecast due to cost-reduction projects currently underway within the Company and the uncertainty of factors that determine future charges, which make a detailed reconciliation to the most directly comparable U.S. GAAP measures impractical.

Conference Call

The Company will host a conference call to discuss its 2011 third-quarter financial results, its outlook for general business conditions and its current outlook for 2011 on Thursday, October 27, 2011, at 10:00 a.m. Eastern time. To participate in the call, dial 800-750-5845 if calling from the United States or Canada, or dial 212-231-2929 if calling from outside North America. 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 October 27 through noon Eastern time on November 3. To access the replay, dial 800-633-8284 if calling from the United States or Canada, or dial 402-977-9140 if calling from outside North America. Use the program ID #21542543 to access the audio replay.

The conference call also will be broadcast live over the Internet and will be available for replay through December 31, 2011. 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 Mayfield Heights, Ohio, the Company has approximately 5,000 employees globally and reported 2010 sales of $2.1 billion.

Cautionary Note on Forward-Looking Statements

Certain statements in this 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. 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:

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 our 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. Additional information regarding these risks can be found in our Annual Report on Form 10-K for the period ended December 31, 2010.

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INVESTOR CONTACT:
David Longfellow
Director, Investor Relations, Ferro Corporation
Phone: 216-875-5488
E-mail: david.longfellow@ferro.com

MEDIA CONTACT:
Mary Abood
Director, Corporate Communications, Ferro Corporation
Phone: 216-875-5401
E-mail: mary.abood@ferro.com

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Condensed Consolidated Statements of Income (Unaudited)

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Ferro Corporation and Subsidiaries
Segment Net Sales and Segment Income (Unaudited)

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Ferro Corporation and Subsidiaries
Condensed Consolidated Balance Sheets

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Ferro Corporation and Subsidiaries
Consolidated Statements of Cash Flows (Unaudited)

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Ferro Corporation and Subsidiaries
Supplemental Information

Reconciliation of Adjusted Earnings to Reported Earnings
for the Three Months Ended September 30 (Unaudited)

¹ 2011 tax rate of 32%, consistent with the Company’s expectation for future effective tax rates, excluding discrete items. The Company’s expected future effective tax rate is lower than the U.S. statutory rate because of expected earnings in foreign jurisdictions with lower tax rates.

² 2010 tax rate of 36%, consistent with the Company’s 2010 expectation for normalized effective tax rates, excluding discrete items.

It should be noted that adjusted earnings is a financial measure not required by, or presented in accordance with, accounting principles generally accepted in the United States (U.S. GAAP). The adjusted earnings presented here exclude certain special charges including restructuring charges and asset impairments, charges related to debt refinancing, and other charges that are not related to production of products for sale. We believe this data provides investors with additional information on the underlying operations of the business and enables period-to-period comparability of financial performance. In addition, these measures are used in the calculation of certain incentive compensation programs for selected employees.

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Ferro Corporation and Subsidiaries
Supplemental Information

Reconciliation of Adjusted Earnings to Reported Earnings
for the Nine Months Ended September 30 (Unaudited)

¹ 2011 tax rate of 32%, consistent with the Company’s expectation for future effective tax rates, excluding discrete items. The Company’s expected future effective tax rate is lower than the U.S. statutory rate because of expected earnings in foreign jurisdictions with lower tax rates.

² 2010 tax rate of 36%, consistent with the Company’s 2010 expectation for normalized effective tax rates, excluding discrete items.

It should be noted that adjusted earnings is a financial measure not required by, or presented in accordance with, accounting principles generally accepted in the United States (U.S. GAAP). The adjusted earnings presented here exclude certain special charges including restructuring charges and asset impairments, charges related to debt refinancing, and other charges that are not related to production of products for sale. We believe this data provides investors with additional information on the underlying operations of the business and enables period-to-period comparability of financial performance. In addition, these measures are used in the calculation of certain incentive compensation programs for selected employees.

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Ferro Corporation and Subsidiaries
Supplemental Information

Segment Net Sales Excluding Precious Metals and
Reconciliation of Sales Excluding Precious Metals to Net Sales (Unaudited)

It should be noted that segment sales excluding precious metals is a financial measure not required by, or presented in accordance with, accounting principles generally accepted in the United States (U.S. GAAP). The sales are presented here to exclude the impact of volatile precious metal raw material costs. The precious metal raw material costs are generally passed through directly to customers with minimal margin. We believe this data provides investors with additional information on the underlying operations of the business and enables period-to-period comparability of financial performance. In addition, these measures are used in the calculation of certain incentive compensation programs for selected employees.

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