Martin Marietta Materials, Inc. Updates 2009 Earnings Expectations

RALEIGH, N.C.--(Business Wire)--
Martin Marietta Materials, Inc. (NYSE:MLM) reported today that it now expects
2009 net earnings to be in a range of $2.70 to $3.30 per diluted share. The
revised earnings range is driven by three primary factors: (i) a weaker and
slower-than-expected recovery of the general United States economy; (ii) a
marked decrease in transportation infrastructure spending resulting from a
decline in state revenues and a longer-than-expected delay in federal stimulus
projects moving to the construction stage; and (iii) an adverse weather-affected
first half of the year.

Stephen P. Zelnak, Jr., Chairman and Chief Executive Officer of Martin Marietta
Materials commented, "As we have consistently indicated, we have expected our
2009 performance to be driven primarily by anticipated economic growth in the
second half of the year. This growth was to be principally fueled by federal
economic stimulus, or the American Recovery and Reinvestment Act, which was
specifically crafted to provide for increased construction and for investment in
the nation's infrastructure.

"Among other things, this stimulus program was designed to address job creation
as well as the underlying demand in infrastructure repair and expansion together
with industrial-related construction activity. While we have seen an increase in
bidding activity for infrastructure projects and awarding of projects to
successful bidders by a significant number of states, we now believe that 25% of
projects will commence later in the year with most of the remainder coming in
2010. The pace at which these projects have moved to the actual construction
stage, to date, is slower than expected even though the majority of the work is
resurfacing. Aside from the federal programs, a number of states are challenged
with their own budgets as revenues decline. This has caused most states to pull
back and defer on state funded projects.

"We have seen resurgence in alternative-energy construction projects, namely
wind farms in Iowa and south Texas, and we are benefiting from the continued
strength of the farm economy through our position in the Midwest. Commercial
construction activity remains weak, primarily in office and retail construction,
and there has been little change in the residential construction markets,
although the indicators point to the beginning of recovery in the second half of
2009.

"We continue to adjust our operating plan in response to the current economic
environment with a strict focus on cost containment and maintaining our strong
financial base. Favorable energy prices have helped mitigate the impact of
declining volumes on the operating leverage of the aggregates business and we
continue to maintain excellent productivity, as measured by tons per worked man
hour. We are carefully controlling headcount as well as the number of hours
worked. We have fully integrated the aggregates quarries that we acquired from
Cemex in June 2009 and are positive about their contribution this year and going
forward.

"Our Specialty Products segment has experienced a decline in dolomitic lime
volume, which is used in both our chemicals products and as a fluxing agent in
steel production. With steel production forecasted to decline in line with
general industrial demand, we do not expect volume growth in dolomitic lime in
2009.

"Based upon our current economic view, our 2009 guidance of net earnings per
diluted share in the range of $2.70 to $3.30, including the effect of the
economic stimulus plan, incorporates the following assumptions: aggregates
volumes to range from down 13% to 18% compared with 2008; the rate of price
increase for the aggregates product line to range from 3.5% to 5% compared with
2008; and Specialty Products segment to contribute $28 million to $30 million in
pretax earnings.

"Although it is too early to provide guidance for 2010, we have begun to frame
our view on the upcoming year. As noted above, we see some of the projects that
we had earlier anticipated to commence in 2009 now beginning next year.
Specifically, we believe there will be a significant increase in infrastructure
related projects as the effects of federal economic stimulus work their way into
the economy. We continue to believe we will see a moderate increase in
aggregates volume to portions of home building and steady growth for chemical
grade aggregates used for flue gas desulfurization and in agricultural lime, as
well as ballast used in the railroad industry. These markets cumulatively
comprised 69% of our 2008 aggregates volumes, and we expect them to increase in
2010. Commercial construction represents the balance of our aggregates volume
and, while we expect a decline in commercial construction volumes in 2010, we do
not have meaningful visibility into these markets at this time. Aggregates
pricing growth in 2010 is expected to trend closer to our 20-year average,"
Zelnak concluded.

RISKS TO EARNINGS EXPECTATIONS

The 2009 estimated earnings range includes management's assessment of the
likelihood of certain risk factors that will affect performance within the
range. The most significant risk to 2009 earnings, whether within or outside
current earnings expectations, will be, as previously noted, the performance of
the United States economy and that performance's effect on construction
activity. Management has estimated its earnings range, assuming a stabilization
of the United States economy in the second half of 2009. Should the second half
2009 stabilization not occur or the economy is worse than currently expected,
earnings could vary significantly.

Risks to the earnings range are primarily volume-related and include a
greater-than-expected drop in demand as a result of the continued decline in
commercial construction, a further decline in residential construction,
continued delays in infrastructure projects, or some combination thereof.
Further, increased highway construction funding pressures as a result of either
federal or state issues can affect profitability. Currently, nearly all states
are experiencing state-level funding pressures driven by lower tax revenues and
an inability to finance approved projects. North Carolina and Texas are among
the states experiencing these pressures and these states disproportionately
affect revenue and profitability. The level of aggregates demand in the
Corporation's end-use markets, production levels and the management of
production costs will affect the operating leverage of the Aggregates business
and, therefore, profitability.

Production costs in the Aggregates business are also sensitive to energy prices,
both directly and indirectly. Diesel and other fuels change production costs
directly through consumption or indirectly in the increased cost of
energy-related consumables, namely steel, explosives, tires and conveyor belts.
Changing diesel costs also affect transportation costs, primarily through fuel
surcharges in our long-haul distribution network. The Corporation's earnings
expectations do not include rapidly increasing diesel costs or sustained periods
of increased diesel fuel cost during 2009 at the level experienced in 2008 and,
in fact, expectations are that reduced diesel costs will contribute $35 million
to $50 million in profitability in 2009. The Corporation experienced favorable
diesel costs in the first quarter 2009, but there is no guarantee that this
level of cost decrease will continue. The availability of transportation in the
Corporation's long-haul network, particularly the availability of barges on the
Mississippi River system and the availability of rail cars and locomotive power
to move trains, affects the Corporation's ability to efficiently transport
material into certain markets, most notably Texas, Florida and the Gulf Coast
region. The Aggregates business is also subject to weather-related risks that
can significantly affect production schedules and profitability. Atlantic Ocean
and Gulf Coast hurricane activity is most acute from June to November and can
cause significant disruption to production activity and increase production
costs. Opportunities to reach the upper end of the earnings range depend on
demand exceeding expectations for the aggregates product line.

Risks to earnings outside of the range include a change in volume beyond current
expectations as a result of economic events outside of the Corporation's
control. In addition to the impact on commercial and residential construction,
the Corporation is exposed to risk in its earnings expectations from tightening
credit markets and the availability of and interest cost related to its debt. If
volumes decline worse than expected, the Corporation is exposed to greater risk
in its earnings, including its debt covenant, as the pressure of operating
leverage increases disproportionately.

Martin Marietta Materials is a leading producer of construction aggregates and a
producer of magnesia-based chemical and dolomitic lime. For more information
about Martin Marietta Materials, refer to our Web site at
www.martinmarietta.com.

Investors are cautioned that all statements in this Press Release that relate to
the future involve risks and uncertainties, and are based on assumptions that
the Corporation believes in good faith are reasonable but which may be
materially different from actual results. Factors that the Corporation currently
believes could cause actual results to differ materially from the
forward-looking statements in this press release include, but are not limited to
business and economic conditions and trends in the markets the Company serves;
the level and timing of federal and state transportation funding; levels of
construction spending in the markets the Company serves; unfavorable weather
conditions; ability to recognize quantifiable savings from internal expansion
projects; ability to successfully integrate acquisitions quickly and in a
cost-effective manner; fuel costs; transportation costs; competition from new or
existing competitors; and other risk factors listed from time to time found in
the Corporation's filings with the Securities and Exchange Commission. The
Corporation assumes no obligation to update any such forward-looking statements.

MLM-G

Martin Marietta Materials, Inc.
Anne H. Lloyd, 919-783-4660
Senior Vice President, Chief Financial Officer and Treasurer
www.martinmarietta.com

Copyright Business Wire 2009