Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2026

Martin Marietta Materials, Inc. (the Company or Martin Marietta) is a natural resource-based building materials company. As of March 31, 2026, the Company supplies aggregates (crushed stone, sand and gravel) through its network of approximately 480 quarries, mines and distribution yards in 28 states, Canada and The Bahamas. Martin Marietta also provides other building materials, namely, ready mixed concrete, asphalt and paving services, in vertically-integrated structured markets where the Company also 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.

In connection with closing an asset exchange during the quarter ended March 31, 2026 (see Note 2), 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). The Company has recast all comparative prior-period information presented in the related notes to the financial statements to reflect the updated reportable segments.


BUILDING MATERIALS BUSINESS
Reportable Segments	East Group	West Group
Operating Locations	Alabama, Arkansas, Florida, Georgia, Louisiana, Maryland, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, Nova Scotia and The Bahamas	Arizona, California, Colorado, Indiana, Iowa, Kansas, Kentucky, Minnesota, Missouri, Ohio, Nebraska, Tennessee, Utah, Washington, West Virginia, Wyoming, and British Columbia

Products and Services	Aggregates	Aggregates, Ready Mixed Concrete, Asphalt and Paving Services

The Company also operates a Specialties business (formerly known as the Magnesia Specialties business), which represents a separate reportable segment. The Specialties business produces high-purity natural and synthetic magnesia-based products, including magnesium sulfate, magnesium oxide and magnesium hydroxide, used in 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. Specialties' production facilities are located in Michigan, Ohio, Nevada, North Carolina, Indiana and Pennsylvania.

Basis of Presentation and Use of Estimates

The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and with the instructions to the Quarterly Report on Form 10-Q and in Article 10 of Regulation S-X. The Company has continued to follow the accounting policies set forth in the audited consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. In the opinion of management, the interim consolidated financial information provided herein reflects all adjustments, consisting of normal recurring accruals, necessary for a fair statement of the results of operations, financial position and cash flows for the interim periods. The consolidated results of operations for the three months ended March 31, 2026 are not necessarily indicative of the results expected for other interim periods or the full year. The consolidated balance sheet at December 31, 2025 has been derived from the audited consolidated financial statements at that date but does not include all of the information and notes required by GAAP for complete financial statements. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

The preparation of the Company’s consolidated financial statements requires management to make certain estimates and assumptions about future events. As future events and their effects cannot be fully determined with precision, actual results could differ significantly from estimates. Changes in estimates are reflected in the consolidated financial statements in the period in which the change in estimate occurs.

Consolidated Comprehensive Earnings and Accumulated Other Comprehensive Earnings (Loss)

Consolidated comprehensive earnings consist of consolidated net earnings, adjustments for the funded status of pension and postretirement benefit plans and foreign currency translation adjustments and are presented in the Company’s consolidated statements of earnings and comprehensive earnings.

Consolidated comprehensive earnings attributable to Martin Marietta are as follows:


	Three Months Ended
	March 31,
	2026			2025
	(Dollars in Millions)
Net earnings attributable to Martin Marietta	$	1,513		$	116
Other comprehensive (loss) earnings, net of tax		(7	)		1
Consolidated comprehensive earnings attributable to Martin Marietta	$	1,506		$	117

Accumulated other comprehensive earnings (loss) consists of unrecognized gains and losses related to the funded status of the pension and postretirement benefit plans and foreign currency translation adjustments and is presented on the Company’s consolidated balance sheets.

The components of the changes in accumulated other comprehensive earnings (loss), net of tax, are as follows:


	(Dollars in Millions)
	Pension and Postretirement Benefit Plans			Foreign Currency			Accumulated Other Comprehensive Earnings (Loss)
	Three Months Ended March 31, 2026
Balance at beginning of period	$	62		$	(2	)	$	60
Other comprehensive loss before reclassifications, net of tax		—			(8	)		(8	)
Amounts reclassified from accumulated other comprehensive earnings, net of tax		1			—			1
Other comprehensive earnings (loss), net of tax		1			(8	)		(7	)
Balance at end of period	$	63		$	(10	)	$	53

	Three Months Ended March 31, 2025
Balance at beginning of period	$	(9	)	$	(4	)	$	(13	)
Amounts reclassified from accumulated other comprehensive loss, net of tax		1			—			1
Other comprehensive earnings, net of tax		1			—			1
Balance at end of period	$	(8	)	$	(4	)	$	(12	)

Changes in net noncurrent deferred tax assets related to accumulated other comprehensive earnings (loss) are as follows:


	Pension and Postretirement Benefit Plans
	Three Months Ended
	March 31,
	2026			2025
	(Dollars in Millions)
Balance at beginning of period	$	18		$	41
Tax effect of other comprehensive earnings		(1	)		(1	)
Balance at end of period	$	17		$	40

Reclassifications out of accumulated other comprehensive earnings (loss) are as follows:


	Three Months Ended						Affected line items in the consolidated
	March 31,						statements of earnings
	2026			2025			and comprehensive earnings
	(Dollars in Millions)
Pension and postretirement benefit plans
Amortization of prior service cost	$	2		$	2		Other nonoperating income, net
Tax effect		(1	)		(1	)	Income tax expense
Total	$	1		$	1

Earnings per Common Share

The numerator for basic and diluted earnings per common share is net earnings attributable to Martin Marietta. The denominator for basic earnings per common share is the weighted-average number of common shares outstanding during the period. Diluted earnings per common share is computed assuming that the weighted-average number of common shares is increased by the conversion, using the treasury stock method, of awards to be issued to employees and nonemployee members of the Company’s Board of Directors under certain stock-based compensation arrangements if the conversion is dilutive.

The following table reconciles the denominator for basic and diluted earnings from continuing operations per common share:


	Three Months Ended
	March 31,
	2026		2025
	(In Millions)
Basic weighted-average common shares outstanding		60.3		60.9
Effect of dilutive employee and director awards		0.1		0.1
Diluted weighted-average common shares outstanding		60.4		61.0

New Accounting Pronouncement

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (DISE), which requires public entities to disaggregate any relevant expense caption presented on the face of the income statement within continuing operations into the following required natural expense categories, as applicable: (1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, and (5) depreciation, depletion and amortization recognized as part of oil- and gas-producing activities or other depletion expenses. These disclosures must be made in a tabular format in the footnotes to the financial statements. The new standard does not change the requirements for the presentation of expenses on the face of the statement of earnings. The ASU is effective prospectively for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, and early adoption and retrospective application are permitted. The ASU will impact the Company's expense disclosures beginning with the financial statements included in the 2027 Annual Report on Form 10-K, but will have no impact on its results of operations, cash flows or financial condition.

Reclassifications

Certain reclassifications have been made in the Company's financial statements of the prior year to conform to the current-year presentation. The reclassifications had no impact on the Company’s previously reported results of operations, financial condition or cash flows.

Organization

Basis of Presentation and Use of Estimates

Consolidated Comprehensive Earnings and Accumulated Other Comprehensive Earnings (Loss)

Earnings per Common Share

New Accounting Pronouncement

Reclassifications

MARTIN MARIETTA MATERIALS INC 10-Q