Inventories, Net

6 Months Ended

Jun. 30, 2015

INVENTORIES, NET

A summary of Inventories, net is as follows:



	June 30, 2015			December 31, 2014
Finished products	$	34,854		$	24,424
In-process	13,862			10,310
Raw materials	23,871			12,346
Fine and fabricated precious metal in various stages of completion	20,432			17,094
	93,019			64,174
LIFO reserve	(92		)	(90		)
Total	$	92,927		$	64,084

Fine and Fabricated Precious Metal Inventory

In order to produce certain of its products, HNH purchases, maintains and utilizes precious metal inventory. HNH records certain precious metal inventory at the lower of LIFO cost or market, with any adjustments recorded through cost of goods sold. Remaining precious metal inventory is accounted for primarily at fair value.

Certain customers and suppliers of HNH choose to do business on a “pool” basis, and furnish precious metal to HNH for return in fabricated form (“customer metal”) or for purchase from or return to the supplier. When the customer metal is returned in fabricated form, the customer is charged a fabrication charge. The value of this customer metal is not included in the Company’s Consolidated Balance Sheets. To the extent HNH is able to utilize customer precious metal in its production process, such customer metals replaces the need for HNH to purchase its own inventory.

As of June 30, 2015, H&H’s customer metal consisted of 148,478 ounces of silver, 538 ounces of gold, and 1,392
ounces of palladium. As of December 31, 2014, H&H’s customer metal consisted of 191,217 ounces of silver, 518 ounces of gold, and 1,392 ounces of palladium.



	June 30, 2015		December 31, 2014
Supplemental inventory information:
Precious metals stated at LIFO cost	$	7,909	$	4,839
Precious metals stated under non-LIFO cost methods, primarily at fair value	12,431		12,165
Market value per ounce:
Silver	15.79		15.75
Gold	1,170.50		1,199.25
Palladium	676.00		798.00