Quarterly Report for Quarter Ending June 30, 2026 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

OVERVIEW

Martin Marietta Materials, Inc. (the Company or Martin Marietta) is a natural resource-based building materials company. As of June 30, 2026, the Company supplies aggregates (crushed stone, sand and gravel) through its network of approximately 500 quarries, mines and distribution yards in 29 states, Canada and The Bahamas. Martin Marietta also provides other building materials, namely, asphalt and paving services and ready mixed concrete, in certain vertically-integrated structured markets where the Company has a notable aggregates position.

The Company's heavy-side building materials are used in infrastructure, nonresidential and residential construction projects. Aggregates are also used in agricultural, utility and environmental applications and as railroad ballast. The aggregates and other building materials product lines are reported collectively as the Building Materials business.

On February 23, 2026, the Company completed its previously announced asset exchange with QUIKRETE Holdings, Inc. (QUIKRETE). Under the terms of the transaction, Martin Marietta acquired aggregates operations producing approximately 20 million tons annually in Virginia, Missouri, Kansas and Vancouver, British Columbia, thereby adding to its presence in several attractive growth markets, as well as an asphalt and paving business in Vancouver, British Columbia, along with $450 million in cash. In exchange, QUIKRETE acquired the Company's Midlothian cement plant, related cement distribution terminals, Texas ready mixed concrete assets and certain nonoperating land. The financial results for the Midlothian cement plant, related cement terminals and Texas ready mixed concrete plants are reported as discontinued operations through the divestiture date and for the comparable prior-year quarter and year-to-date period (see Note B to the unaudited consolidated financial statements).

In connection with closing the asset exchange during the quarter ended March 31, 2026, the Company updated its reportable segments. As of March 31, 2026, the Building Materials business includes two reportable segments: East Group (comprised of the East and Southwest divisions) and West Group (comprised of the Central and West divisions). Prior-period comparative information has been recast throughout management's discussion and analysis of financial condition and results of operations to reflect the updated reportable segments.

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RESULTS OF OPERATIONS

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The Building Materials business is significantly affected by weather patterns, precipitation and other weather-related conditions. Production and shipment levels for aggregates, ready mixed concrete and asphalt materials correlate with general construction activity levels, most of which occur in the spring, summer and fall. Thus, production and shipment levels vary by quarter. Excessive rainfall, drought, wildfire and extreme temperatures can adversely affect production, shipments and profitability in all markets served by the Company. Due to the potentially significant impact of weather on the Company's operations, current-period results are not necessarily indicative of expected performance for other interim periods or the full year.

The Company's Specialties business, which represents a separate reportable segment, has manufacturing facilities in Michigan, Ohio, Nevada, North Carolina, Indiana and Pennsylvania. The Specialties business produces high-purity natural and synthetic magnesia-based products, including magnesium sulfate, magnesium oxide and magnesium hydroxide, used in a wide range of environmental, industrial, agricultural, construction, consumer and specialty applications. The Specialties business also produces dolomitic lime, which is sold primarily to external customers for use in steel production and soil stabilization, and is used internally as a raw material input in synthetic magnesia production.

CRITICAL ACCOUNTING POLICIES

The Company outlined its critical accounting policies in its Annual Report on Form 10-K for the year ended December 31, 2025. There were no changes to the Company's critical accounting policies during the six months ended June 30, 2026.

RESULTS OF OPERATIONS

All financial and operating results included in this section are for continuing operations and comparisons are to the prior-year second quarter or prior year-to-date period, unless otherwise noted.

Three Months Ended June 30, 2026

The following tables present revenues and gross profit (loss) for the Company and its reportable segments by product line for the three months ended June 30, 2026 and 2025.

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RESULTS OF OPERATIONS

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The following table displays depreciation, depletion and amortization by product line included in the Costs of revenues line item in the consolidated statements of earnings and comprehensive earnings.

Second-quarter aggregates shipment increases were driven by organic growth, full-quarter contributions from the operations acquired in the QUIKRETE transaction and partial-quarter contributions from the New Frontier Materials (NFM) operations following the May 15, 2026 acquisition. Average selling price per ton (ASP) decreased from the prior-year second quarter, primarily reflecting acquisition mix headwinds. Organic ASP increased despite geographic mix headwinds resulting from continued strong organic shipment momentum in the Central and West Divisions where average selling prices are below the Company's average.

Aggregates gross profit for the quarter ended June 30, 2026 decreased, reflecting the $52 million charge associated with the sale of acquired inventory after its markup to fair market value as part of acquisition accounting, as well as higher depreciation, depletion and amortization expense.

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Other Building Materials revenues increased 12% to $303 million. Gross profit decreased 14% to $34 million due to higher ready mix concrete raw material costs combined with lower organic paving revenues and reduced job margins.

Specialties Business

Specialties achieved second-quarter revenues of $152 million and gross profit increased 39% to $50 million. These results reflect contributions from the July 2025 Premier Magnesia, LLC acquisition and organic pricing gains across all products.

Selling, General and Administrative Expenses (SG&A)

Consolidated SG&A for the second quarter of 2026 was 5.9% of revenues compared with 6.5% in the prior-year quarter as revenue growth outpaced the increase in these expenses.

Net Earnings and Earnings per Diluted Share from Continuing Operations Attributable to Martin Marietta

Net earnings from continuing operations attributable to Martin Marietta were $256 million, or $4.26 per diluted share, in 2026 compared with $292 million, or $4.84 per diluted share, in 2025. Results for 2026 include after-tax charges of $45 million, or $0.74 per diluted share, related to acquisition, divestiture and integration expenses, the impact of selling acquired inventory after markup to fair value as part of acquisition accounting for transactions meeting the Company's threshold for adding back for purposes of Adjusted EBITDA from continuing operations; and an asset and portfolio rationalization charge.

Six Months Ended June 30, 2026

The following tables present revenues and gross profit (loss) for the Company and its reportable segments by product line for the six months ended June 30, 2026 and 2025.

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RESULTS OF OPERATIONS

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The following table displays depreciation, depletion and amortization by product line included in the Costs of revenues line item in the consolidated statements of earnings and comprehensive earnings.

Aggregates shipments increased, driven by organic growth and contributions from acquired operations. Average selling price (ASP) per ton decreased slightly from the prior-year period, reflecting geographic and acquisition mix headwinds.

Aggregates gross profit for the six months ended June 30, 2026 was impacted by the $73 million charge related to the sale of acquired inventory after its markup to fair market value as part of acquisition accounting as well as higher depreciation, depletion and amortization expense, and declined from the prior-year period.

Other Building Materials revenues increased 7% to $420 million, while the business posted gross profit of $18 million, a decrease of 11% reflecting reduced paving job margins and higher ready mix concrete raw material costs.

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Specialties Business

Specialties achieved revenues of $294 million and gross profit increased 28% to $95 million. These results reflect contributions from the July 2025 Premier Magnesia, LLC acquisition and organic pricing gains, partially offset by lower organic shipments and higher energy costs.

Selling, General and Administrative Expenses

Consolidated SG&A for the six months ended June 30 was 7.5% of revenues in 2026 compared with 8.3% in the prior-year period as revenue growth outpaced the increase in these expenses.

Income Taxes

For the six months ended June 30, 2026 and 2025, the effective income tax rates for continuing operations were 23.3% and 20.3%, respectively. The higher 2026 effective income tax rate compared with 2025 was primarily attributable to the revaluation of deferred tax liabilities driven by changes in the state jurisdictional mix of the business following the QUIKRETE transaction.

Net Earnings and Earnings per Diluted Share from Continuing Operations Attributable to Martin Marietta

Net earnings from continuing operations attributable to Martin Marietta were $336 million or $5.56 per diluted share, in 2026 compared with $396 million, or $6.52 per diluted share, in 2025. Results for 2026 include after-tax charges of $82 million, or $1.36 per diluted share, related to acquisition, divestiture and integration expenses and the impact of selling acquired inventory after markup to fair value as part of acquisition accounting for transactions meeting the Company's threshold for adding back for purposes of Adjusted EBITDA from continuing operations; an asset and portfolio rationalization charge; and the revaluation of deferred tax liabilities driven by changes in the state jurisdictional mix of the business following the QUIKRETE transaction.

Discontinued Operations

The Company's Midlothian cement plant, related cement terminals and Texas ready mixed concrete plants were reported as discontinued operations through their February 2026 divestiture date. The collective businesses generated earnings, net of income tax expense, of $1.4 billion in 2026 compared with $48 million in 2025. The 2026 earnings included a $1.4 billion after-tax gain on the divestiture.

Adjusted EBITDA from Continuing Operations

Earnings from continuing operations before interest; income taxes; depreciation, depletion and amortization; earnings/loss from nonconsolidated equity affiliates; acquisition, divestiture and integration expenses; the impact of selling acquired inventory after its markup to fair value as part of acquisition accounting (the Inventory Markup); and an asset and portfolio rationalization charge, or Adjusted EBITDA from continuing operations, is an indicator used by the Company and investors to evaluate the Company's operating performance from period to period. The Company has elected to add back, for purposes of its Adjusted EBITDA from continuing operations calculation, acquisition, divestiture and integration expenses and the Inventory Markup only for transactions with consideration of at least $2.0 billion for the Building Materials business or $200 million for the Specialties business.

Adjusted EBITDA from continuing operations is not defined by accounting principles generally accepted in the United States (GAAP) and, as such, should not be construed as an alternative to net earnings attributable to Martin Marietta, earnings from operations or operating cash flow. Since Adjusted EBITDA from continuing operations excludes some, but not all, items that affect net earnings and may vary among companies, this measure may not be comparable with similarly titled measures of other companies.

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RESULTS OF OPERATIONS

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The following table presents a reconciliation of net earnings from continuing operations attributable to Martin Marietta to Adjusted EBITDA from continuing operations:

LIQUIDITY AND CAPITAL RESOURCES

Cash flow information for the Company is as follows:

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RESULTS OF OPERATIONS

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Cash Provided by Operating Activities

Cash provided by operating activities for the six months ended June 30, 2026 and 2025 was $339 million and $605 million, respectively. Operating cash flow is substantially derived from consolidated net earnings before deducting depreciation, depletion and amortization and the impact of changes in working capital requirements. In the six months ended June 30, 2026, operating cash flow reflects the deduction of the noncash gain on the QUIKRETE transaction from net earnings and the higher income tax payments related to the gain on the QUIKRETE transaction.

The seasonal nature of construction activity impacts the Company's interim operating cash flow when compared with the full year. Full-year 2025 net cash provided by operating activities was $1.8 billion.

Cash Used for Investing Activities

During the six months ended June 30, 2026 and 2025, the Company paid $314 million and $412 million, respectively, for additions to property, plant and equipment.

As part of the QUIKRETE asset exchange, the Company received $450 million in cash, which is included in net cash provided by investing activities for discontinued operations.

Cash Provided by/Used for Financing Activities

The Company can repurchase its common stock through open-market purchases pursuant to authority granted by its Board of Directors or through private transactions at such prices and upon such terms as the Chief Executive Officer deems appropriate. During the first six months of 2026, the Company repurchased 325,455 shares of common stock at an average price of $614.52 for an aggregate cost of $200 million. At June 30, 2026, 10.7 million shares of common stock remain available under the Company's repurchase authorization.

Debt

Line of Credit and Trade Receivable Facility

The Company, through a wholly-owned special-purpose subsidiary, has a trade receivable securitization facility (the Trade Receivable Facility) that matures on September 16, 2026. On May 14, 2026, the Company requested, and lenders consented to, an increase in the Trade Receivable Facility borrowing base from $400 million to $600 million. The Company financed the NFM acquisition (see Note B to the unaudited consolidated financial statements) through cash on hand and short-term borrowings under the Trade Receivable Facility. The Trade Receivable Facility contains a cross-default provision with the Company's other debt agreements. At June 30, 2026, $560 million was outstanding on the Trade Receivable Facility.

The Company has an $800 million five-year senior unsecured revolving facility (the Revolving Facility), which matures in December 2030. At June 30, 2026, $95 million was outstanding under the Revolving Facility. The Revolving Facility requires the Company's ratio of consolidated net debt-to-consolidated EBITDA, as defined, for the trailing-twelve-month period (the Ratio) to not exceed 3.50 times as of the end of any fiscal quarter, provided that the Company may exclude from the Ratio debt incurred in connection with certain acquisitions during the quarter or the three preceding quarters so long as the Ratio calculated without such exclusion does not exceed 4.25 times. On July 10, 2026, the Company amended its Revolving Facility financial covenant provisions to allow for a maximum ratio of (a) 4.75x for the first three quarters after closing the pending Lhoist North America, Inc. (LNA) transaction (see Note B to the unaudited consolidated financial statements); (b) 4.25x for the next succeeding three quarters; and (c) 3.75x thereafter, provided that the Company may exclude from the Ratio debt incurred in connection with certain acquisitions for a period of four quarters so long as the Ratio calculated without such exclusion does not exceed 4.25x.

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RESULTS OF OPERATIONS

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Additionally, if there are no amounts outstanding under the Revolving Facility and the Trade Receivable Facility, consolidated debt, including debt for which the Company is a guarantor, is reduced in an amount equal to the lesser of $500 million or the sum of the Company's unrestricted cash and temporary investments, for purposes of the covenant calculation. The Company was in compliance with the Ratio at June 30, 2026. In the event of a default under the Ratio, the lenders can terminate the Revolving Facility and Trade Receivable Facility and declare any outstanding balances as immediately due.

Cash on hand, along with the Company's projected internal cash flows and availability of financing resources, including its access to debt and equity capital markets, is expected to remain sufficient to provide the capital resources necessary to support anticipated operating needs, cover debt service requirements, meet capital expenditures and discretionary investment needs, fund certain acquisition opportunities that may arise, allow for payment of dividends for the foreseeable future and allow the repurchase of shares of the Company's common stock. At June 30, 2026, the Company had $742 million of unused borrowing capacity under its Revolving Facility and Trade Receivable Facility, subject to complying with the related leverage covenant. Historically, the Company has successfully extended the maturity dates of these credit facilities.

Term Debt

In anticipation of the pending transaction with LNA, on July 15, 2026, the Company secured a three-year senior unsecured term loan commitment in an aggregate principal amount of $1.5 billion, further enhancing its financial flexibility and supporting funding certainty for the transaction. No borrowings are anticipated until closing the transaction.

Debt Ratings

The Company's debt ratings and outlooks as of June 30, 2026 are as follows:

TRENDS AND RISKS

The Company outlined the risks associated with its business in its Annual Report on Form 10-K for the year ended December 31, 2025 and the Form 10-Q for the quarter ended March 31, 2026. Management continues to evaluate its exposure to operating risks on an ongoing basis.

OTHER MATTERS

Statement Regarding Safe Harbor for Forward-Looking Statements

This quarterly report on Form 10-Q contains forward-looking statements under the federal securities laws, including the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties and are based on assumptions that the Company believes are reasonable, but which may differ materially from actual results. These statements reflect the Company's expectations or forecasts of future events. You can identify these statements because they do not relate only to historical or current facts and may use words such as "anticipate," "may," "expect," "should," "believe," "project," "intend," "will," and other words of similar meaning in connection with future events or future operating or financial performance. Any, or all of, management's forward-looking statements herein and in other publications may prove to be incorrect.

The Company's outlook is subject to risks and uncertainties and is based on assumptions that the Company believes are reasonable but which may differ materially from actual results. Factors that the Company currently believes could cause actual results to differ materially from the forward-looking statements in this Form 10-Q include, but are not limited to:

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You should also review the risk factors included herein and other periodic SEC filings. All forward-looking statements should be evaluated with these considerations in mind. Other risks and uncertainties not presently known or currently

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deemed immaterial may also affect the Company's performance or the accuracy of forward-looking statements. The Company undertakes no obligation to update any such forward-looking statements.

Additional Notes

Average selling price per ton (ASP) is calculated by dividing revenues excluding non-inventory and external freight revenues of the relevant product by shipment units.

Organic ASP represents ASP, adjusted to exclude the impact of acquisitions and divestitures completed within the preceding 12 months.

INVESTOR ACCESS TO COMPANY FILINGS

Shareholders may obtain, without charge, a copy of Martin Marietta's Annual Report on Form 10-K, as filed with the Securities and Exchange Commission for the fiscal year ended December 31, 2025, by writing to:

Martin Marietta

Attn: Corporate Secretary

4123 Parklake Avenue

Raleigh, North Carolina 27612

Additionally, Martin Marietta's Annual Report, press releases and filings with the Securities and Exchange Commission, including Forms 10-K, 10-Q, 8-K and 11-K, can generally be accessed via the Company's website. Filings with the Securities and Exchange Commission accessed via the website are available through a link with the Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system. Accordingly, access to such filings is available upon EDGAR placing the related document in its database. Investor relations contact information is as follows:

Telephone: (919) 510-4736

Website address: www.martinmarietta.com

Information included on the Company's website is not incorporated into, or otherwise creates a part of, this report.