Dynamic Materials Reports Second Quarter and Year-to-Date Financial Results

BOULDER, CO, Jul 31 (MARKET WIRE) --
Dynamic Materials Corporation (DMC) (NASDAQ: BOOM), the world's leading
provider of explosion-welded clad metal plates, today reported financial
results for its second quarter and six-month fiscal period ended June 30,
2008.

Second quarter sales increased 83% to $63.2 million from $34.5 million in
the second quarter last year and included a $16.5 million contribution
from the recently acquired businesses of Germany-based DYNAenergetics.
Gross margin was 30% versus 35% in the comparable year-ago quarter. The
gross margin decline is largely attributable to a higher proportion of
sales generated in Europe following the DYNAenergetics acquisition. Gross
margin performance at European explosion welding businesses has
historically been lower than in the United States. Additionally,
DYNAenergetics' Oilfield Services business has traditionally delivered
gross margins comparable to those of its explosion-welding counterpart.

Second quarter income from operations increased 16% to $10.1 million from
$8.8 million in the same quarter a year-ago. Net income increased 10% to
$6.2 million, or $0.49 per diluted share, from $5.7 million, or $0.46 per
diluted share, in the comparable year-ago quarter.

Adjusted EBITDA for the second quarter increased 54% to $14.7 million from
$9.6 million in the second quarter last year. Adjusted EBITDA is a
non-GAAP (generally accepted accounting principal) financial measure used
by management to measure operating performance. See additional information
about adjusted EBITDA at the end of this news release.

Explosive Metalworking

Second quarter sales at the company's Explosive Metalworking segment
increased 60% to $53.0 million from $33.1 million in the second quarter
last year. The increase reflects an $8.6 million sales contribution from
the explosive welding business of DYNAenergetics, as well as an $11.3
million, or 34%, increase in sales from DMC's legacy explosion welding
divisions. Operating income increased 8% to $9.8 million from $9.0 million
in last year's second quarter. Adjusted EBITDA increased 31% to $12.5
million from $9.5 million in the comparable year-ago quarter.

Order backlog at the end of the second quarter was $105 million, up from
$102 million reported at the end of this year's first quarter and $85
million recorded at the end of last year's second quarter.

Oilfield Products

DMC's new Oilfield Products segment recorded second quarter sales of $7.9
million and operating income of $616,000. Second quarter adjusted EBITDA
was $1.6 million.

AMK Welding

Second quarter sales at DMC's AMK Welding segment increased 70% to $2.3
million from $1.3 million in the second quarter last year. Operating
income increased to $585,000 from $18,000 in the comparable year-ago
quarter. Adjusted EBITDA advanced to $693,000 from $81,000 in the same
quarter last year.

Management Commentary

Yvon Cariou, president and CEO, said, "Second quarter sales exceeded our
expectations thanks largely to a strong end-of-quarter performance at our
Mt. Braddock, Penn. facility, where our production teams capitalized on
late-quarter metal deliveries to process and ship several orders before
the close of the fiscal period."

"In spite of the challenges resulting from longer delivery lead times on
carbon steel, our backlog and overall business remain strong and we are
enjoying widespread demand for our products," Cariou added. "Our hot list
remains very healthy and includes prospective projects that span the globe
and involve nearly all of our traditional end markets. While it now
appears that order timing and metal supplies will impact our prior
financial forecasts during the second half of the year, we see no signs
that there has been a pullback in overall demand. We therefore remain
encouraged by our prospects for continued long-term growth."

Rick Santa, senior vice president and chief financial officer, said that
although year-to-date bookings have been strong, longer lead times on the
delivery of carbon steel in the United States are expected to result in
sales during the second half of 2008 that will be approximately 5% less
than the first half of the year. Sales in the third quarter are expected
to be up to 20% less than second quarter sales, while fourth quarter sales
are expected to be equal to or above those of the second quarter. Gross
margin in the third quarter is expected to be between 28% and 29% as a
result of lower sales spread over a fixed manufacturing and overhead
expense base. Fourth quarter gross margin is expected to improve to levels
comparable to those in the first and second quarters based upon
anticipated fourth quarter sales that should approximate or exceed those
of the second quarter.

As previously reported, full-year operating income will be impacted by
approximately $7.7 million of amortization expense associated with the
DYNAenergetics acquisition, while pre-tax income will be impacted by
approximately $5.0 million of interest expense. Santa said that recent
refinements to estimates of pre-tax earnings, as well as permanent
differences between book and taxable income for the full-year 2008, have
reduced DMC's expected 2008 blended effective tax rate to a range of 32%
to 33%.

Six-month Results

Sales through six months increased 80% to $121.6 million from $67.5
million in the comparable six-month period of 2007. This year's six-month
sales results included a $31.7 million contribution from DYNAenergetics.
Gross margin was 30% versus 34% in the same period a year ago. Income from
operations increased 20% to $19.5 million from $16.3 million in the
comparable 2007 period. Net income through six months was $11.5 million,
or $0.91 per diluted share, up 9% from net income of $10.5 million, or
$0.86 per diluted share, in the same period last year. Adjusted EBITDA
increased 59% to $28.3 million from $17.7 million in the first six months
of fiscal 2007.

The Explosive Metalworking segment reported six-month sales of $104.6
million, up 62% from sales of $64.6 million in the first half of 2007. The
explosive welding business of DYNAenergetics contributed $19.3 million to
first half 2008 sales. Operating income increased 20% to $19.8 million
from $16.6 million in the prior year's six-month period. Adjusted EBITDA
increased 43% to $24.8 million from $17.3 million in the same period a
year ago.

Six-month sales at DMC's new Oilfield Products segment were $12.4 million.
Operating income for the period was $50,000 and adjusted EBITDA was $2.0
million.

AMK Welding recorded six-month sales of $4.6 million, up 56% from $2.9
million in the comparable year-ago period. Operating income increased 333%
to $1.2 million from $282,000 in the prior-year period. Adjusted EBITDA at
the six-month mark was $1.4 million, an increase of 255% versus $405,000
in the same period a year ago.

Conference call information

Management will hold a conference call to discuss second quarter results
today at 5:00 p.m. Eastern (3:00 p.m. Mountain). Investors are invited to
listen to the call live via the Internet at www.dynamicmaterials.com, or
by dialing into the teleconference at 866-394-8610 (706-758-0876 for
international callers) and entering the passcode 56630645. Participants
should access the website at least 15 minutes early to register and
download any necessary audio software. A replay of the webcast will be
available for 30 days and a telephonic replay will be available through
August 2, 2008, by calling 800-642-1687 (706-645-9291 for international
callers) and entering the passcode 56630645.

Use of Non-GAAP Financial Measures

Non-GAAP results are presented only as a supplement to the financial
statements based on U.S. generally accepted accounting principles (GAAP).
The non-GAAP financial information is provided to enhance the reader's
understanding of DMC's financial performance, but no non-GAAP measure
should be considered in isolation or as a substitute for financial
measures calculated in accordance with GAAP. Reconciliations of the most
directly comparable GAAP measures to non-GAAP measures are provided
within the schedules attached to this release.

EBITDA is defined as net income plus or minus net interest plus taxes,
depreciation and amortization. Adjusted EBITDA excludes from EBITDA
stock-based compensation and, when appropriate, other items that
management does not utilize in assessing DMC's operating performance (as
further described in the attached financial schedules). None of these
non-GAAP financial measures are recognized terms under GAAP and do not
purport to be an alternative to net income as an indicator of operating
performance or any other GAAP measure.

Management uses these non-GAAP measures in its operational and financial
decision-making, believing that it is useful to eliminate certain items in
order to focus on what it deems to be a more reliable indicator of ongoing
operating performance and the company's ability to generate cash flow from
operations. As a result, internal management reports used during monthly
operating reviews feature the adjusted EBITDA. Management also believes
that investors may find non-GAAP financial measures useful for the same
reasons, although investors are cautioned that non-GAAP financial measures
are not a substitute for GAAP disclosures. EBITDA and adjusted EBITDA are
also used by research analysts, investment bankers and lenders to assess
operating performance. For example, a measure similar to EBITDA is
required by the lenders under DMC's credit facility.

Because not all companies use identical calculations, DMC's presentation
of non-GAAP financial measures may not be comparable to other similarly
titled measures of other companies. However, these measures can still be
useful in evaluating the company's performance against its peer companies
because management believes the measures provide users with valuable
insight into key components of GAAP financial disclosures. For example, a
company with greater GAAP net income may not be as appealing to investors
if its net income is more heavily comprised of gains on asset sales.
Likewise, eliminating the effects of interest income and expense
moderates the impact of a company's capital structure on its performance.

All of the items included in the reconciliation from net income to EBITDA
and adjusted EBITDA are either (i) non-cash items (e.g., depreciation,
amortization of purchased intangibles and stock-based compensation) or
(ii) items that management does not consider to be useful in assessing
DMC's operating performance (e.g., income taxes and gain on sale of
assets). In the case of the non-cash items, management believes that
investors can better assess the company's operating performance if the
measures are presented without such items because, unlike cash expenses,
these adjustments do not affect DMC' ability to generate free cash flow
or invest in its business. For example, by adjusting for depreciation and
amortization in computing EBITDA, users can compare operating performance
without regard to different accounting determinations such as useful life.
In the case of the other items, management believes that investors can
better assess operating performance if the measures are presented without
these items because their financial impact does not reflect ongoing
operating performance.

About Dynamic Materials Corporation

Based in Boulder, Colorado, Dynamic Materials Corporation is a leading
international metalworking company. Its products, which are typically used
in industrial capital projects, include explosion-welded clad metal plates
and other metal fabrications for use in a variety of industries, including
oil and gas, petrochemicals, alternative energy, hydrometallurgy, aluminum
production, shipbuilding, power generation, industrial refrigeration and
similar industries. The Company operates three business segments:
Explosive Metalworking, which uses proprietary explosive processes to fuse
different metals and alloys; Oilfield Products, which manufactures,
markets and sells specialized explosive components and systems used to
perforate oil and gas wells; and AMK Welding, which utilizes various
technologies to weld components for use in power-generation turbines, as
well as commercial and military jet engines. For more information, visit
the Company's websites at http://www.dynamicmaterials.com and
http://www.dynaenergetics.de.

Safe Harbor Language

Except for the historical information contained herein, this news release
contains forward-looking statements, including our guidance for 2008
revenue, margins, income, expenses and tax rates, that involve risks and
uncertainties. These risks and uncertainties include, but are not limited
to, the following: our ability to realize sales from our backlog; our
ability to successfully integrate and operate the recently-acquired
DYNAenergetics businesses; our ability to obtain new contracts at
attractive prices; the size and timing of customer orders and shipments;
fluctuations in customer demand; fluctuations in foreign currencies,
changes to customer orders; the cyclicality of our business; competitive
factors; the timely completion of contracts; the timing and size of
expenditures; the timely receipt of government approvals and permits; the
timing and price of metal and other raw material; the adequacy of local
labor supplies at our facilities; current or future limits on
manufacturing capacity at our various operations; the availability and
cost of funds; and general economic conditions, both domestic and
foreign, impacting our business and the business of the end-market users
we serve; as well as the other risks detailed from time to time in the
Company's SEC reports, including the report on Form 10-K for the year
ended December 31, 2007.

DYNAMIC MATERIALS CORPORATION & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2008 AND 2007
(Dollars in Thousands, Except Share Data)
(unaudited)

Three months ended Six months ended
June 30, June 30,
---------------------- ----------------------
2008 2007 2008 2007
---------- ---------- ---------- ----------
NET SALES $ 63,183 $ 34,454 $ 121,576 $ 67,548
COST OF PRODUCTS SOLD 44,134 22,375 84,816 44,618
---------- ---------- ---------- ----------
Gross profit 19,049 12,079 36,760 22,930
---------- ---------- ---------- ----------
COSTS AND EXPENSES:
General and administrative
expenses 3,815 1,854 6,933 3,516
Selling expenses 2,633 1,455 5,474 3,101
Amortization expense of
purchased intangible
assets 2,464 - 4,825 -
---------- ---------- ---------- ----------
Total costs and expenses 8,912 3,309 17,232 6,617
---------- ---------- ---------- ----------
INCOME FROM OPERATIONS 10,137 8,770 19,528 16,313
OTHER INCOME (EXPENSE):
Other income (expense) 189 (13) 41 (20)
Interest expense (1,471) - (2,734) -
Interest income 99 177 323 365
Equity in earnings of
joint ventures 273 - 289 -
---------- ---------- ---------- ----------
INCOME BEFORE INCOME TAXES 9,227 8,934 17,447 16,658
INCOME TAX PROVISION 3,017 3,275 5,989 6,116
---------- ---------- ---------- ----------
NET INCOME $ 6,210 $ 5,659 $ 11,458 $ 10,542
========== ========== ========== ==========
INCOME PER SHARE:
Basic $ 0.50 $ 0.47 $ 0.92 $ 0.88
========== ========== ========== ==========
Diluted $ 0.49 $ 0.46 $ 0.91 $ 0.86
========== ========== ========== ==========
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING:
Basic 12,416,900 12,048,969 12,406,210 12,029,382
========== ========== ========== ==========
Diluted 12,566,726 12,239,256 12,569,983 12,232,569
========== ========== ========== ==========

ANNUAL DIVIDENDS DECLARED
PER COMMON SHARE $ 0.15 $ 0.15 $ 0.15 $ 0.15
========== ========== ========== ==========

DYNAMIC MATERIALS CORPORATION & SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)

June 30, December 31,
2008 2007
ASSETS (unaudited)
------------ ------------

Cash and cash equivalents $ 28,384 $ 9,045
Restricted cash - 371
Accounts receivable, net 38,634 39,833
Inventories 38,864 41,628
Other current assets 4,958 3,853
------------ ------------
Total current assets 110,840 94,730

Property, plant and equipment, net 38,331 35,446
Goodwill, net 49,092 45,862
Purchased intangible assets, net 61,431 61,914
Other long-term assets 3,390 2,947
------------ ------------
Total assets $ 263,084 $ 240,899
============ ============

LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable $ 18,352 $ 22,590
Dividend payable 1,894 -
Accrued income taxes 4,019 1,212
Other current liabilities 11,014 19,394
Lines of credit - current 8,602 7,587
Current portion of long-term debt 7,792 8,035
------------ ------------
Total current liabilities 51,673 58,818

Lines of credit 10,427 -
Long-term debt 62,540 61,530
Deferred tax liabilities 20,075 20,604
Other long-term liabilities 1,592 1,668
Stockholders' equity 116,777 98,279
------------ ------------
Total liabilities and stockholders' equity $ 263,084 $ 240,899
============ ============

DYNAMIC MATERIALS CORPORATION & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2008 AND 2007
(Dollars in Thousands)
(unaudited)

2008 2007
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 11,458 $ 10,542
Adjustments to reconcile net income to net cash
provided by (used in) operating activities -
Depreciation (including capital lease amortization) 2,354 910
Amortization of purchased intangible assets 4,825 -
Amortization of capitalized debt issuance costs 114 -
Stock-based compensation 1,543 519
Provision for deferred income taxes (2,410) (80)
Equity in earnings of joint ventures (289) -
Change in working capital, net (5,782) (14,503)
-------- --------
Net cash provided by (used in) operating
activities 11,813 (2,612)
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment (4,203) (4,977)
Change in other non-current assets 31 (13)
-------- --------
Net cash used in investing
activities (4,172) (4,990)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on lines of credit, net 12,081 -
Payments on long-term debt (985) (385)
Payments on capital lease obligations (216) -
Payment of deferred debt issuance costs (140) -
Net proceeds from issuance of common stock 240 382
Excess tax benefit related to stock options 132 -
Other cash flows from financing activities 33 10
-------- --------
Net cash provided by financing
activities 11,145 7
-------- --------
EFFECTS OF EXCHANGE RATES ON CASH 553 83
-------- --------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 19,339 (7,512)

CASH AND CASH EQUIVALENTS, beginning of the period 9,045 17,886
-------- --------
CASH AND CASH EQUIVALENTS, end of the period $ 28,384 $ 10,374
======== ========

DYNAMIC MATERIALS CORPORATION & SUBSIDIARIES
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASUREMENTS TO MOST
DIRECTLY COMPARABLE GAAP FINANCIAL MEASUREMENTS
(Dollars in thousands)

Three months ended Six months ended
June 30, June 30,
-------------------- --------------------
2008 2007 2008 2007
--------- --------- --------- ---------
(unaudited) (unaudited)
Explosive Metalworking Group $ 52,996 $ 33,119 $ 104,638 $ 64,614
Oilfield Products 7,922 - 12,373 -
AMK Welding 2,265 1,335 4,565 2,934
--------- --------- --------- ---------
Net sales $ 63,183 $ 34,454 $ 121,576 $ 67,548
========= ========= ========= =========

Explosive Metalworking Group $ 9,815 $ 9,047 $ 19,799 $ 16,550
Oilfield Products 616 - 50 -
AMK Welding 585 18 1,222 282
Unallocated Expenses (879) (295) (1,543) (519)
--------- --------- --------- ---------
Income from operations $ 10,137 $ 8,770 $ 19,528 $ 16,313
========= ========= ========= =========

For the three months ended June 30, 2008
----------------------------------------------------
Explosive
Metalworking Oilfield AMK Unallocated
Group Products Welding Expenses Total
------------ -------- -------- ----------- --------
(unaudited)
Income from operations $ 9,815 $ 616 $ 585 $ (879) $ 10,137
Adjustments:
Stock-based compensation - - - 879 879
Depreciation 936 197 108 - 1,241
Amortization of
purchased intangibles 1,724 740 - - 2,464
------------ -------- -------- ----------- --------
Adjusted EBITDA $ 12,475 $ 1,553 $ 693 $ - $ 14,721
============ ======== ======== =========== ========

For the three months ended June 30, 2007
-----------------------------------------
Explosive
Metalworking AMK Unallocated
Group Welding Expenses Total
------------ ------- ----------- -------
(unaudited)
Income from operations $ 9,047 $ 18 $ (295) $ 8,770
Adjustments:
Stock-based compensation - - 295 295
Depreciation 452 63 - 515
------------ ------- ----------- -------
Adjusted EBITDA $ 9,499 $ 81 $ - $ 9,580
============ ======= =========== =======

DYNAMIC MATERIALS CORPORATION & SUBSIDIARIES
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASUREMENTS TO MOST
DIRECTLY COMPARABLE GAAP FINANCIAL MEASUREMENTS
(Dollars in thousands)

For the six months ended June 30, 2008
-------------------------------------------------------
Explosive
Metalworking Oilfield AMK Unallocated
Group Products Welding Expenses Total
------------ --------- --------- ----------- ---------
(unaudited)
Income from
operations $ 19,799 $ 50 $ 1,222 $ (1,543) $ 19,528
Adjustments:
Stock-based
compensation - - - 1,543 1,543
Depreciation 1,668 470 216 - 2,354
Amortization of
purchased
intangibles 3,376 1,449 - - 4,825
------------ --------- --------- ----------- ---------
Adjusted EBITDA $ 24,843 $ 1,969 $ 1,438 $ - $ 28,250
============ ========= ========= =========== =========

For the six months ended June 30, 2007
-------------------------------------------
Explosive
Metalworking AMK Unallocated
Group Welding Expenses Total
------------ -------- ----------- --------
(unaudited)
Income from operations $ 16,550 $ 282 $ (519) $ 16,313
Adjustments:
Stock-based compensation - - 519 519
Depreciation 787 123 - 910
------------ -------- ----------- --------
Adjusted EBITDA $ 17,337 $ 405 $ - $ 17,742
============ ======== =========== ========

Three months ended Six months ended
June 30, June 30,
------------------ ------------------
2008 2007 2008 2007
-------- -------- -------- --------
(unaudited) (unaudited)
Net income $ 6,210 $ 5,659 $ 11,458 $ 10,542
Other (income) expense (189) 13 (41) 20
Interest expense 1,471 - 2,734 -
Interest income (99) (177) (323) (365)
Equity in earnings of joint
ventures (273) - (289) -
Provision for income taxes 3,017 3,275 5,989 6,116
Depreciation 1,241 515 2,354 910
Amortization of purchased
intangible assets 2,464 - 4,825 -
-------- -------- -------- --------
EBITDA 13,842 9,285 26,707 17,223
Stock-based compensation 879 295 1,543 519
-------- -------- -------- --------
Adjusted EBITDA $ 14,721 $ 9,580 $ 28,250 $ 17,742
======== ======== ======== ========

CONTACT:
Pfeiffer High Investor Relations, Inc.
Geoff High
303-393-7044

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