ALJ Announces 1st Quarter Earnings

For the three months ended December 31, 2007, ALJ (Pink Sheets: ALJJ) posted net income of $4,965,246 as compared to a net loss of $395,420 for the three months ended December 31, 2006. ALJ is the parent company of KES Acquisition Company dba Kentucky Electric Steel, the owner and operator of a steel mini-mill near Ashland, Kentucky producing both merchant bar quality flats (MBQ Bar Flats), and special bar quality steel flats (SBQ Bar Flats).

ALJ Regional Holdings, Inc.

( in thousands except per share )

2007

2006

3 months Ended Dec. 31

Net Sales

$

37,432

$

35,399

Net Income

4,965

(395

)

Per share

0.12

(0.01

)

According to John Scheel, ALJ’s Chief Executive Officer, “The fairly dramatic improvement in ALJ’s net income has three root causes: a near-doubling of operating profit due to strong performance at KES, a twenty percent (20%) decrease in interest payments resulting from last year’s debt restructuring and the elimination of liabilities related to long-standing discontinued operations. Absent the latter, net income would have been about $2 million.”

Full financial reports are available at www.pinksheets.com