Selected statements contained in this "Item 2. - Management's Discussion and Analysis of Financial Condition and Results of Operations" constitute "forward-looking statements" as that term is used in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based, in whole or in part, on management's beliefs, estimates, assumptions and currently available information. For a more detailed discussion of what constitutes a forward-looking statement and of some of the factors that could cause actual results to differ materially from such forward-looking statements, please refer to the "Safe Harbor Statement" in the beginning of this Quarterly Report on Form 10-Q, "Part I-Item 1A.-Risk Factors" of our Annual Report on Form 10-K for the fiscal year ended May 31, 2012 and "Part II-Item 1A.-Risk Factors" of this Quarterly Report on Form 10-Q.

Introduction

The following discussion and analysis of market and industry trends, business developments, and the results of operations and financial position of Worthington Industries, Inc., together with its subsidiaries (collectively, "we," "our," "Worthington," or our "Company"), should be read in conjunction with our consolidated financial statements and notes thereto included in "Item
1. - Financial Statements" of this Quarterly Report on Form 10-Q. Our Annual Report on Form 10-K for the fiscal year ended May 31, 2012 includes additional information about us, our operations and our financial position and should be read in conjunction with this Quarterly Report on Form 10-Q.

We are primarily a diversified metals manufacturing company, focused on value-added steel processing and the manufacture of pressure cylinders and custom-engineered cabs. As of November 30, 2012, excluding our joint ventures, we operated 35 manufacturing facilities worldwide, principally in three reportable business segments: Steel Processing, Pressure Cylinders and Engineered Cabs. Our remaining operating segments, which do not meet the applicable aggregation criteria or quantitative thresholds for separate disclosure, are combined and reported in the "Other" category. These include the Steel Packaging, Construction Services and Worthington Energy Innovations operating segments.

During the first quarter of fiscal 2013, we made certain organizational changes impacting the internal reporting and management structure of our former Global Group operating segment. As a result of these organizational changes, management responsibilities and internal reporting were re-aligned into two new operating segments: Construction Services and Worthington Energy Innovations. These organizational changes did not impact the composition of our reportable business segments.

Additionally, we no longer manage our residual metal framing assets in a manner that constitutes an operating segment. Accordingly, the activity related to the wind-down of our former Metal Framing operating segment, consisting primarily of the sale of assets, has been reported in the "Other" category. Segment information reported in previous periods has been restated to conform to the new presentation.

We also held equity positions in 12 joint ventures, which operated 47 manufacturing facilities worldwide, as of November 30, 2012.

Overview

The Company's performance during the second quarter of fiscal 2013 was strong, aided by volume increases in Pressure Cylinders and steady performance in Steel Processing.

Volume trends were mixed in the second quarter. Strong volumes in Pressure Cylinders, which were driven primarily by the impact of acquisitions, led to a 17% increase in net sales. Steel Processing volumes were down 8%, but direct volumes, which carry a higher margin, were up approximately 3% after excluding volumes from the MISA Metals facilities, which were wound down or sold during the past year.

Equity in net income of unconsolidated affiliates ("equity income") during the second quarter was up 15% over prior year driven by higher income at Serviacero, TWB and WAVE. All of our major joint ventures operated at a profit during the quarter and we received $18.2 million in dividends from them.

The Company continues its strategy of optimizing existing operations and pursuing growth opportunities that add to our current businesses. We initiated the diagnostics phase of the Transformation Plan within our Pressure Cylinders operating segment in the first quarter of fiscal 2012, and these efforts are progressing through each facility. Additionally, during the first quarter of fiscal 2013, we initiated the diagnostics phase in our Engineered Cabs operating segment, which contributed $57.8 million and $122.3 million, respectively, in net sales during the three and six months ended November 30, 2012. For additional information regarding the Transformation Plan, refer to "Item 1. - Financial Statements - Notes to Consolidated Financial Statements - NOTE D - Restructuring and Other Expense" of this Quarterly Report on Form 10-Q.

Recent Business Developments

- On September 17, 2012, we acquired 100% of the outstanding common shares of Westerman, Inc. ("Westerman") for cash consideration of $62.7 million and the assumption of $7.3 million of debt, which was repaid at closing. Westerman is a leading manufacturer of tanks and pressure vessels for the oil and gas and nuclear markets as well as hoists for marine applications. The acquired net assets became part of our Pressure Cylinders operating segment upon closing.

Market & Industry Overview

We sell our products and services to a diverse customer base and a broad range of end markets. The breakdown of our net sales by end market for the first six months of fiscal 2013 and fiscal 2012 is illustrated in the following chart:

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The automotive industry is one of the largest consumers of flat-rolled steel, and thus the largest end market for our Steel Processing operating segment. Approximately 58% of the net sales of our Steel Processing operating segment are to the automotive market. North American vehicle production, primarily by Chrysler, Ford and General Motors (the "Detroit Three automakers"), has a considerable impact on the activity within this operating segment. The majority of the net sales of five of our unconsolidated joint ventures are also to the automotive end market.

Approximately 11% of the net sales of our Steel Processing operating segment, 40% of the net sales of our Engineered Cabs operating segment and substantially all of the net sales of our Construction Services operating segment are to the construction market. While the market price of steel significantly impacts these businesses, there are other key indicators that are meaningful in analyzing construction market demand, including U.S. gross domestic product ("GDP"), the Dodge Index of construction contracts, and trends in the relative price of framing lumber and steel. The construction market is also the predominant end market for three of our unconsolidated joint ventures, WAVE, ClarkDietrich and WMSFMCo.

Substantially all of the net sales of our Pressure Cylinders operating segment, and approximately 31% and 58% of the net sales of our Steel Processing and Engineered Cabs operating segments, respectively, are to other markets such as leisure and recreation, industrial gas, HVAC, lawn and garden, agriculture, mining and appliance. Given the many different products that make up these net sales and the wide variety of end markets, it is very difficult to detail the key market indicators that drive this portion of our business. However, we believe that the trend in U.S. GDP growth is a good economic indicator for analyzing these operating segments.

We use the following information to monitor our costs and demand in our major end markets:

                                         Three Months Ended                              Six Months Ended
                                            November 30,                                   November 30,
                                         2012           2011         Inc / (Dec)         2012         2011         Inc / (Dec)
U.S. GDP (% growth year-over-year) 1         1.6 %         0.4 %              1.2 %         1.5 %        1.7 %             (0.2 %)
Hot-Rolled Steel ($ per ton) 2         $     622       $   660      ($         38 )    $    619      $   685      ($         66 )
Detroit Three Auto Build (000's
vehicles) 3                                2,189         1,990                199         4,255        3,890                365
No. America Auto Build (000's
vehicles) 3                                3,639         3,546                 93         7,436        6,718                718
Zinc ($ per pound) 4                   $    0.91       $  0.86       $       0.05      $   0.87      $  0.95      ($       0.08 )
Natural Gas ($ per mcf) 5              $    3.26       $  3.31      ($       0.05 )    $   3.00      $  3.81      ($       0.81 )
On-Highway Diesel Fuel Prices ($ per
gallon) 6                              $    4.07       $  3.89       $       0.18      $   3.95      $  3.90       $       0.05

1 2011 figures based on revised actuals 2 CRU Index; period average 3 CSM Autobase 4 LME Zinc; period average 5 NYMEX Henry Hub Natural Gas; period average 6 Energy Information Administration; period average

U.S. GDP growth rate trends are generally indicative of the strength in demand for our products. A year-over-year increase in U.S. GDP growth rates is indicative of an improving economy, which generally increases demand for our products. Conversely, decreasing U.S. GDP growth rates generally have the opposite effect. Changes in U.S. GDP growth rates can also signal changes in conversion costs related to production and in selling, general and administrative ("SG&A") expense.

The market price of hot-rolled steel is one of the most significant factors impacting our selling prices and operating results. When steel prices fall, we typically have higher-priced material flowing through cost of goods sold, while selling prices compress to what the market will bear, negatively impacting our results. On the other hand, in a rising price environment, our results are generally favorably impacted, as lower-priced material purchased in previous periods flows through cost of goods sold, while our selling prices increase to cover current replacement costs.

The following table presents the average quarterly market price per ton of hot-rolled steel during fiscal 2013 (first and second quarters), fiscal 2012, and fiscal 2011:

(Dollars per ton 1)

                             Fiscal Year                       Increase / (Decrease)
                      2013      2012      2011         2013 vs. 2012            2012 vs. 2011
        1st Quarter   $ 616     $ 709     $ 611     ($  93 )      -13.1 %     $  98         16.0 %
        2nd Quarter   $ 622     $ 660     $ 557     ($  38 )       -5.8 %     $ 103         18.5 %
        3rd Quarter     N/A     $ 718     $ 699        N/A          N/A       $  19          2.7 %
        4th Quarter     N/A     $ 684     $ 851        N/A          N/A      ($ 167 )      -19.6 %
        Annual Avg.     N/A     $ 693     $ 680        N/A          N/A       $  13          1.9 %

1 CRU Hot-Rolled Index Average

No single customer contributed more than 10% of our consolidated net sales during the second quarter of fiscal 2013. While our automotive business is largely driven by the production schedules of the Detroit Three automakers, our customer base is much broader and includes other domestic manufacturers and many of their suppliers. During the second quarter of fiscal 2013, vehicle production for the Detroit Three automakers was up 10% over the comparable period in the prior year. Additionally, North American vehicle production during the second quarter of fiscal 2013 increased 3% over the comparable period in the prior year.

Certain other commodities, such as zinc, natural gas and diesel fuel, represent a significant portion of our cost of goods sold, both directly through our plant operations and indirectly through transportation and freight expense.