Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2012

Basis of Presentation

Basis of Presentation

The accompanying unaudited consolidated financial statements of Martin Marietta Materials, Inc. (the “Corporation”) have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to the Quarterly Report on Form 10-Q and to Article 10 of Regulation S-X. The Corporation has continued to follow the accounting policies set forth in the audited consolidated financial statements and related notes thereto included in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2011, filed with the Securities and Exchange Commission on February 29, 2012. In the opinion of management, the interim financial information provided herein reflects all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the results of operations, financial position and cash flows for the interim periods. The results of operations for the quarter and six months ended June 30, 2012 are not indicative of the results expected for other interim periods or the full year. The balance sheet at December 31, 2011 has been derived from the audited financial statements at that date but does not include all of the information and notes required by generally accepted accounting principles for complete financial statements. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2011.

Warranties

Warranties

The Corporation’s construction contracts contain warranty provisions covering defects in equipment, materials, design or workmanship that generally run from six months to two years after the customer accepts the contract. Because of the nature of its projects, including contract owner inspections of the work both during construction and prior to acceptance, the Corporation has not experienced material warranty costs for these warranties and therefore does not believe an accrual for these costs is necessary.

Consolidated Comprehensive Earnings/Loss and Accumulated Other Comprehensive Loss

Consolidated Comprehensive Earnings/Loss and Accumulated Other Comprehensive Loss

Consolidated comprehensive earnings/loss for the Corporation consist of consolidated net earnings or loss; adjustments for the funded status of pension and postretirement benefit plans; foreign currency translation adjustments; and the amortization of the value of terminated forward starting interest rate swap agreements into interest expense.

Effective January 1, 2012, as required by recent accounting guidance, the Corporation changed its presentation of consolidated comprehensive earnings/loss. The Corporation no longer reports total consolidated comprehensive earnings/loss and related components of other comprehensive earnings/loss in its consolidated statement of total equity. Rather, the Corporation presents total consolidated comprehensive earnings/loss in its consolidated statements of earnings and comprehensive earnings for interim periods and in separate but consecutive consolidated statements of comprehensive earnings for annual periods. Prior-year information has been recast to conform to this presentation approach.

Comprehensive earnings attributable to Martin Marietta Materials Inc. consist of the following:

	Three Months Ended June  30,				Six Months Ended June  30,
	2012		2011		2012		2011
		(Dollars in Thousands)
Net earnings attributable to Martin     Marietta Materials Inc.	$	36,751	$	35,799	$	18	$	18,385
Other comprehensive earnings, net of tax		1,351		5,246		3,250		4,341
Consolidated comprehensive     earnings attributable to Martin     Marietta Materials Inc.	$	38,102	$	41,045	$	3,268	$	22,726

Changes in accumulated other comprehensive loss, net of tax, are as follows:

	Three Months Ended June 30, 2012
		(Dollars in Thousands)
	Pension and Postretirement Benefit Plans			Foreign Currency			Unamortized Value of Terminated Forward Starting Interest Rate Swap			Accumulated Other Comprehensive Loss
Balance at beginning of period	$	(82,656	)	$	5,275		$	(4,610	)	$	(81,991	)
Other comprehensive earnings (loss), net of tax		1,249			(53	)		155			1,351
Balance at end of period	$	(81,407	)	$	5,222		$	(4,455	)	$	(80,640	)

	Six Months Ended June 30, 2012
	(Dollars in Thousands)
		Pension and Postretirement Benefit Plans			Foreign Currency		Unamortized Value of Terminated Forward Starting Interest Rate Swap			Accumulated Other Comprehensive Loss
Balance at beginning of period	$	(84,204	)	$	5,076	$	(4,762	)	$	(83,890	)
Other comprehensive earnings, net of tax		2,797			146		307			3,250
Balance at end of period	$	(81,407	)	$	5,222	$	(4,455	)	$	(80,640	)

Changes in net noncurrent deferred tax assets recorded in accumulated other comprehensive loss are as follows:

	Three Months Ended June 30, 2012
		(Dollars in Thousands)
		Pension and Postretirement Benefit Plans			Unamortized Value of Terminated Forward Starting Interest Rate Swap			Net Noncurrent Deferred Tax Assets
Balance at beginning of period	$	54,148		$	3,017		$	57,165
Tax effect of other comprehensive earnings		(820	)		(102	)		(922	)
Balance at end of period	$	53,328		$	2,915		$	56,243

	Six Months Ended June 30, 2012
		(Dollars in Thousands)
		Pension and Postretirement Benefit Plans			Unamortized Value of Terminated Forward Starting Interest Rate Swap			Net Noncurrent Deferred Tax Assets
Balance at beginning of period	$	55,161		$	3,116		$	58,277
Tax effect of other comprehensive earnings		(1,833	)		(201	)		(2,034	)
Balance at end of period	$	53,328		$	2,915		$	56,243

Comprehensive earnings attributable to noncontrolling interests consist of net earnings and adjustments for the funding

status of pension and postretirement benefit plans as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
	(Dollars in Thousands)
Net earnings (loss) attributable to     noncontrolling interests	$	1,057	$	55	$	116	$	(227	)
Other comprehensive earnings, net of tax		3		1		6		2
Consolidated comprehensive earnings (loss) attributable to noncontrolling interests	$	1,060	$	56	$	122	$	(225	)

Earnings (Loss) per Common Share

Earnings (Loss) per Common Share

The numerator for basic and diluted earnings (loss) per common share is net earnings (loss) attributable to Martin Marietta Materials, Inc., reduced by dividends and undistributed earnings attributable to the Corporation’s unvested restricted stock awards and incentive stock awards. The denominator for basic earnings (loss) per common share is the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per common share are 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 Corporation’s Board of Directors under certain stock-based compensation arrangements if the conversion is dilutive. For the three months ended June 30, 2012 and 2011 and the six months ended June 30, 2011, the diluted per-share computations reflect a change in the number of common shares outstanding to include the number of additional shares that would have been outstanding if the potentially dilutive common shares had been issued. For the six months ended June 30, 2012, all such awards were antidilutive given the net loss available to common shareholders attributable to Martin Marietta Materials, Inc.

The following table reconciles the numerator and denominator for basic and diluted earnings (loss) per common share:

		Three Months Ended June 30,					Six Months Ended June 30,
		2012		2011			2012			2011
		(In Thousands)
Net earnings from continuing operations attributable to Martin Marietta Materials, Inc.	$	36,435	$	36,751		$	296		$	20,793
Less: Distributed and undistributed earnings attributable to unvested awards		232		298			242			313
Basic and diluted net earnings available to common shareholders from continuing operations attributable to Martin Marietta Materials, Inc.		36,203		36,453			54			20,480
Basic and diluted net earnings (loss) available to common shareholders from discontinued operations		316		(952	)		(278	)		(2,408	)
Basic and diluted net earnings (loss) available to common shareholders attributable to Martin Marietta Materials, Inc.	$	36,519	$	35,501		$	(224	)	$	18,072
Basic weighted-average common shares outstanding		45,781		45,628			45,757			45,606
Effect of dilutive employee and director awards		124		166			—			168
Diluted weighted-average common shares outstanding		45,905		45,794			45,757			45,774