Industrial Services of America, Inc. Reports Second Quarter 2009 Results

LOUISVILLE, Ky.--(Business Wire)--
Industrial Services of America, Inc. (NASDAQ: IDSA), a company that buys,
processes and markets ferrous and non-ferrous metals and other recyclable
commodities for domestic users and export markets and offers programs and
equipment to help businesses manage wastes, today reported financial results for
the second quarter ending June, 30 2009.

For the second quarter ending June 30, 2009, net income was $922,210 ($.26 per
basic and diluted share), compared with $1,662,632 ($.46 per basic and diluted
share) in the second quarter ending June 30, 2008. Total revenues for the
quarter were $39.1M compared to $34.5M in 2008.

For the first six months ending June 30, 2009, net income was $1,576,273 ($.44
per basic and diluted share), compared with $2,749,183 ($.76 per basic and
diluted share) in the first six months ending June 30, 2008. Total revenues for
the first six months were $63.4M compared to $60.6M in 2008.

In an environment where many businesses have continued to suffer, ISA delivered
another solid financial performance in the second quarter of 2009. "As the
economy and asset markets stabilized throughout the quarter, we saw improved
commodity pricing and a solid pick-up in domestic consumer demand for scrap
metals," said Harry Kletter, ISA`s Chairman and Chief Executive Officer.
Throughout the second quarter of 2009, ISA continued making important and
strategic investments in its operational capabilities. ISA completed its
shredder installations, fully integrated its stainless steel and alloys business
into its recycling division and expanded its banking facilities. "Our fully
operational and integrated recycling operations give us a great competitive
footprint in our markets."

For the second quarter of fiscal 2009

* Total revenues were $39.1 million, compared with $34.5 million in 2008.
* Income before income taxes was $1,537,017 compared with $2,848,714 in 2008.
* Earnings before interest, taxes, depreciation and amortization (EBITDA) for
2009 were $2,365,976, compared with EBITDA of $3,505,381 for 2008. (See attached
reconciliation.)
* Net income was $922,210 (basic and diluted earnings of $0.26 per share),
compared with net income of $1,662,632 (basic and diluted earnings of $0.46 per
share) in 2008. Basic and diluted weighted average shares outstanding were
3,651,896 in 2009 and 3,596,368 in 2008.

For the first six months of fiscal 2009

* Total revenues were $63.4 million, compared with $60.6 million in 2008.
* Income before income taxes was $2,627,122 compared with $4,659,632 in 2008.
* Earnings before interest, taxes, depreciation and amortization (EBITDA) for
2009 were $4,208,212, compared with EBITDA of $5,929,201 for 2008. (See attached
reconciliation.)
* Net income was $1,576,273 (basic and diluted earnings of $0.44 per share),
compared with net income of $2,749,183 (basic and diluted earnings of $0.76 per
share) in 2008. Basic and diluted weighted average shares outstanding were
3,613,806 in 2009 and 3,607,120 in 2008.

ISA also recently announced that it has entered into an agreement to acquire two
parcels of property adjacent to its facilities in Louisville, Kentucky from the
Harry Kletter Family Partnership LLC. The transactions have been approved by the
Audit Committee and the Board of Directors of the company. Mr. Harry Kletter,
the Chairman of the Board and Chief Executive Officer of the Company, took no
part in the Board`s deliberations or decision due to his interest in the
transaction. This transaction is scheduled to close in early September of 2009.
This deal represents another step in ISA`s long-term strategy to acquire key
real property assets.

The Company`s 2009 SEC filings are available for review at the Securities and
Exchange Commission web site at
http://www.sec.gov/edgar/searchedgar/companysearch.html.

About ISA

Headquartered in Louisville, Kentucky, Industrial Services of America, Inc., is
a publicly traded company whose core business is buying, processing and
marketing scrap metals and recyclable materials for domestic users and export
markets. Additionally, the company offers commercial, industrial and business
customers a variety of programs and equipment to efficiently manage waste. More
information about ISA is available at www.isa-inc.com.

This news release contains forward-looking statements that involve risks and
uncertainties that could cause actual results to differ from predicted results.
Specific risks include fluctuations in the price of recycled materials, varying
demand for waste managing systems, equipment and services, competitive pressures
in the waste managing systems and equipment, competitive pressures in the waste
managing business and the loss of customers. Further information on factors that
could affect the Company's results is detailed in the Company's filings with the
Securities and Exchange Commission. The Company undertakes no obligation to
publicly release the results of any revisions to the forward-looking statements.

Key words: recycling, scrap, ferrous, non-ferrous materials, waste management,
international markets, global markets.

INDUSTRIAL SERVICES OF AMERICA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 2009 AND 2008
(UNAUDITED)

2009 2008

Revenue from services $ 1,522,134 $ 4,011,256
Revenue from product sales 37,602,180 30,499,829
Total Revenue 39,124,314 34,511,085

Cost of goods sold for services 1,153,059 4,284,501
Cost of goods sold for product sales 33,820,184 24,536,188
Total Cost of goods sold 34,973,243 28,820,689

Selling, general and administrative expense 2,439,883 2,876,234

Income before other income (expense) 1,711,188 2,814,162

Other income (expense)
Interest expense (213,161 ) (135,003 )
Interest income 6,917 20,563
Gain on sale of assets 7,222 21,623
Other income 24,851 127,369
174,171 ) 34,552

Income before income taxes 1,537,017 2,848,714

Income tax provision 614,807 1,186,082

Net income $ 922,210 $ 1,662,632

Basic earnings per share $ 0.26 $ 0.46

Diluted earnings per share $ 0.26 $ 0.46

Weighted shares outstanding:
Basic 3,651,896 3,596,368

Diluted 3,651,896 3,596,368

INDUSTRIAL SERVICES OF AMERICA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2009 AND 2008
(UNAUDITED)

2009 2008

Revenue from services $ 4,167,702 $ 8,883,798
Revenue from product sales 59,206,535 51,710,682
Total Revenue 63,374,237 60,594,480

Cost of goods sold for services 3,415,987 8,267,428
Cost of goods sold for product sales 51,822,374 42,448,736
Total Cost of goods sold 55,238,361 50,716,164

Selling, general and administrative expense 5,149,544 5,179,259

Income before other income (expense) 2,986,332 4,699,057

Other income (expense)
Interest expense (351,666 ) (228,569 )
Interest income 22,160 43,997
Gain on sale of assets 10,972 16,481
Other income (expense) (40,676 ) 128,666
(359,210 ) (39,425 )

Income before income taxes 2,627,122 4,659,632

Income tax provision 1,050,849 1,910,449

Net income $ 1,576,273 $ 2,749,183

Basic earnings per share $ 0.44 $ 0.76

Diluted earnings per share $ 0.44 $ 0.76

Weighted shares outstanding:
Basic 3,613,806 3,607,120

Diluted 3,613,806 3,607,120

Industrial Services of America, Inc.

Supplemental Financial Information

Reconciliation of EBITDA (1):

Three months ending June 30, Six Months ending June 30,
2009 2008 2009 2008
Net Income 922,210 1,662,632 1,576,273 2,749,183
Interest expense 213,161 135,003 351,666 228,569
Income taxes 614,807 1,186,082 1,050,849 1,910,449
Depreciation 615,798 521,664 1,229,425 1,041,000
Amortization - - - -
EBITDA (1) 2,365,976 3,505,381 4,208,212 5,929,201

(1) EBITDA is calculated by the Company as net income before interest expense, income tax expense, depreciation and amortization. The Company uses EBITDA as a key performance measure of results of operations for purposes of evaluating performance internally. This non-GAAP measurement is not intended to replace the presentation of our financial results in accordance with GAAP. Rather, we believe the EBITDA calculation provides additional information to investors and debt holders due to the fact that tax
credits, tax rates and other tax related items vary by company. Additionally, years of service for fixed assets and amortizable assets are based on company judgment. Finally, companies have several ways of raising capital which can affect interest expense. We believe the presentation of EBITDA provides a meaningful measure of performance exclusive of these unique items.

Industrial Services of America, Inc., Louisville
Harry Kletter or Alan Schroering, 502-366-3452
hklet@isa-inc.com or aschroering@isa-inc.com
http://www.isa-inc.com/

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