of Operations

                                                     Income and Expense
                                             Items as a Percentage of Net Sales

                                                     Three Months Ended

                                               March 30,             April 1,
                                                  2008                 2007

Net sales                                          100.0 %                100.0  %
Cost of goods sold                                  78.1                   78.7


Production margin                                   21.9                   21.3
Marketing and administrative expenses                9.4                   10.1
Research and development expenses                    2.2                    2.6
Restructuring and other costs                        0.5                      --

Income from operations                               9.8                    8.6

Income from continuing operations                    6.1                    4.8

Income (loss) from discontinued operations           0.1                   (0.7)


Net income                                           6.2 %                  4.1  %

Executive Summary

Consolidated sales for the first quarter of 2008 increased 5% over the prior year to $277.5 million from $265.5 million. Foreign exchange represented the total sales growth of approximately $12.0 million and increased selling prices offset volume declines in our major product lines. Operating income increased 20% to $27.1 million from $22.7 million in the prior year. Income from continuing operations increased 34% to $16.8 million from $12.6 million in the prior year. Net income increased 59% to $17.2 million from $10.8 million in the prior year. First quarter results were positively affected by the benefits derived from the restructuring program initiated in the third quarter of 2007, the favorable effects of foreign currency and an improved performance in the refractory operations in North America. This was partially offset by the continued decline in the residential construction and automotive markets affecting the Processed Minerals product line.

The Company will continue to focus on innovation and new product development and other opportunities for continued growth as follows:

• Increasing our sales of PCC for paper by further penetration of the markets for paper filling at both freesheet and groundwood mills;
• Development of the filler-fiber composite program, to increase the fill-rate for uncoated freesheet paper, which continues to undergo large-scale paper machine trials;
• Further development of the Company's PCC products, filling and coating, for use in the satellite model;
• Development of unique calcium carbonates used in the manufacture of novel biopolymers, an emerging market opportunity;
• Rapid deployment of value-added formulations of refractory materials that not only reduce costs but also improve performance;
• Leverage the Company's expertise in crystal engineering, especially in helping papermakers customize PCC morphologies for specific paper applications;
• Continuing our penetration in emerging markets through our manufacturing facility in China and our 2006 acquisition in Turkey, both within the Refractories segment; and
• Further increasing market penetration in the Refractories segment through development of high-performance products and equipment systems.

However, there can be no assurance that we will achieve success in implementing any one or more of these opportunities.

• Our success depends in part on the performance of the industries we serve, particularly papermaking and steel making. Some of our customers may continue to experience consolidations and shutdowns;
• Consolidations in the paper and steel industries concentrate purchasing power in the hands of fewer customers, increasing pricing pressure on suppliers such as Minerals Technologies Inc.;
• Most of our Paper PCC sales are subject to long-term contracts that may be terminated pursuant to their terms, or may be renewed on terms less favorable to us;
• Our filler-fiber composite technology continues in development through customer trials, but has yet to be proven on a long-term commercial scale;
• We are subject to cost fluctuations on raw materials, including shipping costs, particularly for magnesia and alumina imported from China;
• Our Processed Minerals and Specialty PCC product lines are highly influenced by the domestic building and construction markets; and
• As we expand our operations abroad we face the inherent risks of doing business in many foreign countries, including foreign exchange risk, import and export restrictions, and security concerns.

Results of Operations

Sales


(millions of dollars)                     First    % of                    First      % of
                                         Quarter   Total                  Quarter     Total
             Net Sales                    2008     Sales     Growth        2007       Sales

U.S                                    $   148.5    53.5 %       3  %   $   144.8      54.5 %
International                              129.0    46.5 %       7  %       120.7      45.5 %

       Net sales                       $   277.5   100.0 %       5  %   $   265.5     100.0 %


Paper PCC                              $   137.9    49.7 %       3  %   $   133.6      50.3 %
Specialty PCC                               15.3     5.5 %       2  %        15.0       5.7 %

       PCC Products                    $   153.2    55.2 %       3  %   $   148.6      56.0 %

Talc                                   $     9.2     3.3 %      (2) %   $     9.4       3.5 %
Ground Calcium Carbonate                    18.4     6.6 %       2  %        18.0       6.8 %

       Processed Minerals Products     $    27.6     9.9 %       1  %   $    27.4      10.3 %

       Specialty Minerals Segment      $   180.8    65.1 %       3  %   $   176.0      66.3 %

Refractory Products                    $    79.1    28.5 %      11  %   $    71.5      26.9 %
Metallurgical Products                      17.6     6.4 %      (2) %        18.0       6.8 %

       Refractories Segment            $    96.7    34.9 %       8  %   $    89.5      33.7 %


                      Net sales        $   277.5   100.0 %       5  %   $   265.5     100.0 %

Worldwide net sales in the first quarter of 2008 increased 5% from the previous year to $277.5 million. Foreign exchange had a favorable impact on sales of approximately $12.0 million or 5 percentage points of growth and increased selling prices offset volume declines in our major product lines. Sales in the Specialty Minerals segment, which includes the PCC and Processed Minerals product lines, increased 3% to $180.8 million compared with $176.0 million for the same period in 2007. Sales in the Refractories segment grew 8% over the previous year to $96.7 million.

Worldwide net sales of PCC, which is primarily used in the manufacturing process of the paper industry, increased 3% in the first quarter to $153.2 million from $148.6 million in the prior year. Foreign exchange had a favorable impact on sales of approximately 4 percentage points of growth. Paper PCC sales grew 3% to $137.9 million in the first quarter of 2008 from $133.6 million in the prior year. However, total paper PCC volumes

Net sales of Processed Minerals products increased 1% in the first quarter to $27.6 million from $27.4 million in the first quarter of 2007. This increase was in the GCC product line despite the continued weakness in the residential and commercial construction markets.

Net sales in the Refractories segment in the first quarter of 2008 increased 8% to $96.7 million from $89.5 million in the prior year. Improved demand in North America had a favorable effect on this segment. In addition, foreign exchange had a favorable impact on sales of $5.5 million or approximately 6 percentage points of growth. Sales of refractory products and systems to steel and other industrial applications increased 11 percent to $79.1 million from $71.5 million. Sales of metallurgical products within the Refractories segment decreased 2 percent to $17.6 million as compared with $18.0 million in the same period last year. This decrease was primarily attributable to lower volumes, primarily in Europe.

Net sales in the United States increased 3% to $148.5 million in the first quarter of 2008. International sales in the first quarter of 2008 increased 7% to $129.0 million.

                                 First       First
Operating Costs and Expenses    Quarter     Quarter
(millions of dollars)            2008        2007     Growth

Cost of goods sold            $   216.8   $   209.0       4  %
Marketing and administrative  $    26.0   $    26.9      (3) %
Research and development      $     6.1   $     6.9     (12) %
Restructuring and other costs $     1.4   $      --       *

* Percentage not meaningful

Cost of goods sold was 78.1% of sales compared with 78.7% of sales in the prior year. In the Specialty Minerals segment, production margin increased 5% as compared with 3% sales growth. This segment has been affected by continued weakness in the Processed Minerals product line, higher energy costs, and paper machine and paper mill shutdowns since the first quarter of 2007. These items were more than offset by cost benefits derived from the restructuring program, the favorable impact of foreign exchange and the recovery of raw material costs through price increases. In the Refractories segment, production margin increased 12% as compared with the 8% sales growth. This segment has been negatively affected by higher raw material costs which were partially offset by increased selling prices. The increase in profitability was attributable to an improved performance in refractory products in North America, higher margins in the metallurgical product line and the benefits from the restructuring program.

Marketing and administrative costs decreased 3% in the first quarter to $26.0 million and represented 9.4% of net sales as compared with 10.1% of sales in the prior year.

Research and development expenses decreased 12% to $6.1 million and represented 2.2% of net sales as compared with 2.6% of net sales in the prior year.

The reductions in total expenses were primarily due to the effect of the restructuring program.

Restructuring and other costs during the first quarter relate to additional provisions for severance and other employee benefits and to additional costs associated with facilities that are no longer in operation.

                          First       First
Income from Operations   Quarter     Quarter
(millions of dollars)     2008        2007     Growth


Income from operations $    27.1   $    22.7       20 %

Income from operations for the Specialty Minerals segment increased 15% to $18.4 million and was 10.2% of its net sales. Operating income for this segment was impacted by the aforementioned factors affecting production margin but were offset by lower expense levels than in the prior year. Operating income for the Refractories segment increased 32% to $8.8 million and was 9.2% of its net sales as compared with 7.5% of its net sales in 2007.

                                          First         First
Non-Operating Deductions                 Quarter       Quarter
(millions of dollars)                     2008          2007       Growth

Non-operating income (deductions), net $   (1.5)     $   (2.7)      (44)  %

In the first quarter of 2008, net non-operating deductions decreased 44% to $1.5 million. This decrease was primarily attributable to lower interest expense and higher interest income as a result of lower debt levels and an increase in cash and cash equivalents.

                                 First         First
Provision for Taxes on Income   Quarter       Quarter
(millions of dollars)            2008          2007       Growth


Provision for taxes on income $     7.9     $     6.6         20 %

The effective tax rate decreased to 31.0% in the first quarter of 2008 from 32.8% in the prior year due to a change in the mix of earnings.

                                      First         First
 Income from Continuing Operations   Quarter       Quarter
(millions of dollars)                 2008          2007       Growth

Income from continuing operations  $    16.8     $    12.6         34 %

Income from continuing operations increased 34% to $16.8 million from $12.6 million in the prior year.

                                              First         First
Income (Loss) from Discontinued Operations   Quarter       Quarter
(millions of dollars)                         2008          2007       Growth

Income (loss) from discontinued operations $     0.4     $   (1.8)       *

* Percentage not meaningful

In the first quarter of 2008 the Company recognized income from discontinued operations of $0.4 million as compared with a loss in the prior year of $1.8 million. The loss in the prior year was primarily attributable to the results of operations of SYNSIL®.

                         First         First
Net Income              Quarter       Quarter
(millions of dollars)    2008          2007       Growth

Net income            $    17.2     $    10.8         59 %

Net income increased 59% in the first quarter of 2008 to $17.2 million. Diluted earnings per common share increased 61% to $0.90 per share in the first quarter of 2008 as compared with $0.56 per share in the prior year.

Liquidity and Capital Resources

Cash flows in the first three months of 2008 provided from operations were applied principally to fund working capital, capital expenditures, repay debt and repurchase common shares for treasury. Cash provided from operating

activities amounted to $6.1 million in the first three months of 2008 as compared with $29.3 million for the same period last year. The decrease in cash provided from operations was due to payments related to restructuring costs and an increase in working capital when compared with the prior year. The working capital increase was primarily due to an increase in accounts receivable, raw materials inventories and the effects of foreign exchange. Our days of working capital increased to 75 days in the first quarter of 2008 from 68 days in the fourth quarter of 2007, but decreased 4 days from the prior year's first quarter.

Our accounts receivable increased 15% from December 31, 2007 as compared with a 1% sequential increase in sales over the fourth quarter of 2007. However, sales increased at an accelerated rate during the latter part of the first quarter of 2008 as compared with the same period in the fourth quarter of 2007 due to the cyclical nature of some of our product lines. This, as well as foreign currency, contributed to the increase in accounts receivables. As a result, our days of sales outstanding increased 6 days from year-end levels and one day from the prior year's first quarter.

Our inventory levels also increased from year-end levels as the Company accelerated purchases of higher priced raw materials imported from China. As a result, our days of inventory on hand were 49 days in the first quarter of 2008 as compared to 46 days in the fourth quarter of 2007.

We expect to utilize our cash to support the aforementioned growth strategies.

On October 25, 2005, the Company's Board of Directors authorized the Company's management to repurchase, at its discretion, up to $75 million in additional shares over the next three-year period. As of March 30, 2008, the Company repurchased 1,307,598 shares under this program at an average price of $57.36 per share. This program was completed in February 2008.

On October 24, 2007, the Company's Board of Directors authorized the Company's management to repurchase, at its discretion, up to $75 million of additional shares over the next two-year period. As of March 30, 2008, 214,074 shares have been purchased under this program at an average price of approximately $61.14 per share.

On April 23, 2008, our Board of Directors declared a regular quarterly dividend on our common stock of $0.05 per share. No dividend will be payable unless declared by the Board and unless funds are legally available for payment.

We have $194.0 million in uncommitted short-term bank credit lines, of which $22.5 million was in use at March 30, 2008. We anticipate that capital expenditures for 2008 should be approximately $75 million, principally related to the construction of PCC plants and other opportunities that meet our strategic growth objectives. We expect to meet our other long-term financing requirements from internally generated funds, uncommitted bank credit lines and, where appropriate, project financing of certain satellite plants. The aggregate maturities of long-term debt are as follows: remainder of 2008 - $12.3 million; 2009 - $4.0 million; 2010 - $4.6 million; 2011 - $-- million; 2012 - $8.0 million; thereafter - $84.6 million.

Prospective Information and Factors That May Affect Future Results

The Securities and Exchange Commission encourages companies to disclose forward-looking information so that investors can better understand companies' future prospects and make informed investment decisions. This report may contain forward-looking statements that set out anticipated results based on management's plans and assumptions. Words such as "believes," "expects," "plans," "anticipates," "estimates" and words and terms of similar substance, used in connection with any discussion of future operating or financial performance identify these forward-looking statements.

Although we believe we have been prudent in our plans and assumptions, we cannot guarantee that the outcomes suggested in any forward-looking statement will be realized. Achievement of future results is subject to risks, uncertainties and inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could vary materially from those anticipated, estimated or projected. Investors should bear this in mind as they consider forward-looking statements and should refer to the discussion of certain risks, uncertainties and assumptions entitled "Cautionary Factors That May Affect Future Results" in Exhibit 99 to this report.

In December 2007, the FASB issued Statement of Financial Accounting Standards No. 141 (revised 2007), "Business Combinations" ("Statement No. 141(R)"). Statement No. 141(R) changes the requirements for an acquirer's recognition and measurement of the assets acquired and the liabilities assumed in a business combination. Statement No. 141(R) is effective for annual periods beginning after December 15, 2008 and should be applied prospectively for all business combinations entered into after the date of adoption.

In December 2007, the FASB issued Financial Accounting Standards No. 160, "Noncontrolling Interests in Consolidated Financial Statements - an amendment of ARB No. 51" ("Statement No. 160"). Statement No. 160 requires (i) that noncontrolling (minority) interests be reported as a component of shareholders' equity, (ii) that net income attributable to the parent and to the noncontrolling interest be separately identified in the consolidated statement of operations, (iii) that changes in a parent's ownership interest while the parent retains its controlling interest be accounted for as equity transactions,
(iv) that any retained noncontrolling equity investment upon the deconsolidation of a subsidiary be initially measured at fair value, and (v) that sufficient disclosures are provided that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. Statement No. 160 is effective for annual periods beginning after December 15, 2008 and should be applied prospectively. However, the presentation and disclosure requirements of Statement No. 160 shall be applied retrospectively for all periods presented. The adoption of the provisions of Statement No. 160 is not anticipated to materially impact the Company's consolidated financial position and results of operations.

In February 2008, the FASB issued FSP FAS 157-1, "Application of FASB No. 157 to FASB Statement No. 13 and Other Accounting Pronouncements that Address Fair Value Measurements for Purposes of Lease Classification or Measurement under Statement 13" and FSP FAS 157-2, "Effective Date of FASB Statement No. 157." FSP 157-1 excludes fair measurements for purposes of lease classification or measurement under FASB Statement 13 from the fair value measurement under FASB Statement 157. FSP 157-2 defers the effective date of Statement 157 for non-financial assets and non-financial liabilities to fiscal years beginning after November 15, 2008.

In March 2008, the FASB issued Statement of Financial Accounting Standards No. 161, "Disclosures About Derivative Instruments and Hedging Activities - an amendment of FASB Statement No. 133." This statement requires an entity to provide enhanced disclosures about its derivative and hedging activities. This statement is effective for financial statements for fiscal years beginning after November 15, 2008, with early application encouraged.

Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities.

On an ongoing basis, we evaluate our estimates and assumptions, including those related to revenue recognition, allowance for doubtful accounts, valuation of inventories, valuation of long-lived assets, pension plan assumptions, stock-based compensation assumptions, income taxes, income tax valuation allowances and litigation and environmental liabilities. We base our estimates on historical experience and on other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that can not readily be determined from other sources. There can be no assurance that actual results will not differ from those estimates.