Statements we make in the following discussion which express a belief, expectation or intention, as well as those that are not historical fact, are forward-looking statements that are subject to various risks, uncertainties and assumptions. Our actual results, performance or achievements, or industry results, could differ materially from those we express in the following discussion as a result of a variety of factors, including the risks and uncertainties we have referred to under the headings "Risk Factors" in Item 1A of Part I in the 2007 Form 10-K, and "-Risks and Uncertainties" below, except as required by applicable law. For a discussion of our commitment not discussed below, related-party transactions, and our critical accounting policies, see "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Item 7 in the 2007 Form 10-K. We assume no obligation to update our forward-looking statements, except as required by applicable law.

Our Business

We operate our business in two business segments: ready-mixed concrete and concrete-related products; and precast concrete products.

Ready-Mixed Concrete and Concrete-Related Products. Our ready-mixed concrete and concrete-related products segment is engaged primarily in the production, sale and delivery of ready-mixed concrete to our customers' job sites. To a lesser extent, this segment is engaged in the mining and sale of aggregates, and the resale of building materials, primarily to our ready-mixed concrete customers. We provide these products and services from our operations in north and west Texas, northern California, New Jersey, New York, Washington, D.C., Michigan and Oklahoma.

Precast Concrete Products. Our precast concrete products segment engages principally in the production, distribution and sale of precast concrete products from its eight plants located in California, Arizona and Pennsylvania. From these facilities, we produce precast concrete structures such as utility vaults, manholes and other wastewater management products, specialty engineered structures, curb-inlets, catch basins, retaining and other wall systems, custom designed architectural products and other precast concrete products.

Our Markets

The markets for our products are generally local, and our operating results are subject to fluctuations in the level and mix of construction activity that occur in our markets. The level of activity affects the demand for our products, while the product mix of activity among the various segments of the construction industry affects both our relative competitive strengths and our operating margins. Commercial and industrial projects generally provide more opportunities to sell value-added products which are designed to meet the high-performance requirements of these types of projects.

Our customers are generally involved in the construction industry, which is a cyclical business and is subject to general and more localized economic conditions. In addition, our business is impacted by seasonal variations in weather conditions which vary by regional market. Accordingly, demand for our products and services during the winter months is typically lower than other months of the year because of inclement weather. Also, sustained periods of inclement weather and other weather conditions could postpone or delay projects in our markets during other times of the year.

For the first six months of 2008, our average sales price trends varied by region in our ready-mixed concrete markets. We experienced pricing improvements in our northern California and our north and west Texas markets, and pricing declines in our New Jersey and Washington, D.C. markets, as compared to the first half of 2007. Our Michigan market's average selling price was essentially flat. Sustaining or improving our operating margins in the future will depend on market conditions, including the impact of continued softening in the residential sector, our customers' access to credit and strength in the commercial and public works end-use markets of our operations.

Ready-mixed concrete sales volume generally declined beginning in 2006 and has continued to decline in the first half of 2008, as compared to the first half of 2007. This decline reflects a sustained downward trend in residential construction activity and commercial projects in many of our markets. We expect the overall construction downturn, in both residential and commercial end-use markets, to continue in the remainder of 2008, resulting in ready-mixed concrete sales volumes being down on a same-plant-sales basis in 2008 in most of our markets as compared to 2007. We expect ready-mixed concrete volumes related to public works construction to be higher in 2008, as compared to 2007.

Demand for our products in our precast concrete products segment decreased in the first half of 2008, as compared to the first half of 2007. This decline is reflective of the decline in residential construction starts in our northern California and Phoenix, Arizona markets, where our precast business has been heavily weighted toward products used in new residential construction projects. We are in the process of refocusing our product lines and streamlining our operations in these markets to better serve existing demand and penetrate additional end-use markets.

Cement and Other Raw Materials

We obtain most of the raw materials necessary to manufacture ready-mixed concrete and precast concrete products on a daily basis. These materials include cement, other cementitious materials (generally, fly ash and blast furnace slag) and aggregates (stone, gravel and sand), in addition to certain chemical admixtures. With the exception of chemical admixtures, each plant typically maintains an inventory level of these materials sufficient to satisfy its operating needs for a few days. Typically, cement, other cementitious materials and aggregates represents the highest cost materials used in manufacturing a cubic yard of ready-mixed concrete. In each of our markets, we purchase each of these materials from several suppliers. Admixtures are generally purchased from suppliers under national purchasing agreements.

We negotiate cement and aggregate pricing with suppliers both on a company-wide basis and at the local market level to obtain the most competitive pricing available for cement and aggregates. We anticipate that the residential construction downturn that began in the second half of 2006 will continue through the remainder of 2008 and, therefore, commercial construction and other building segments will comprise a larger percentage of overall product demand. Generally, due to tightness of supply, cement and aggregates costs have increased significantly over the last several years. However, due to the slowdown in residential housing starts and increased U.S. cement capacity, we have not experienced and do not expect to experience cement shortages during 2008. Announced cement price increases for January 1, 2008 have been delayed, or withdrawn, in many of our markets and increases realized, if any, by our cement suppliers, are expected to be significantly lower than in 2007. We expect 2008 aggregates pricing to increase moderately over 2007 levels. Today, in most of our markets, we believe there is an adequate supply of aggregates. Should demand for aggregates increase significantly, we could experience escalating prices or shortages of aggregates. We are experiencing higher diesel fuel surcharges from our cement and aggregate suppliers, including third-party freighters, due to the rising costs of diesel fuel.

Acquisitions

Since our inception in 1999, our growth strategy has contemplated acquisitions. The rate and extent to which appropriate further acquisition opportunities are available, and the extent to which acquired businesses are integrated and anticipated synergies and cost savings are achieved, can affect our operations and results. Our recent acquisitions are discussed briefly below.

Ready-Mixed Concrete and Concrete-Related Products Segment

West Texas Acquisition. In June 2008, we acquired nine ready-mixed concrete plants, together with related real property, rolling stock and working capital, in our west Texas market for approximately $13.5 million.

New York Acquisition. In January 2008, we acquired a single plant ready-mixed concrete operation in Staten Island, New York. The purchase price was approximately $1.8 million in cash.

West Texas Acquisition. In June 2007, we acquired two ready-mixed concrete plants, including real property and certain raw material inventories, in our west Texas market for approximately $3.6 million.

Superior Materials Joint Venture. In April 2007, we formed a joint venture (Superior Materials Holdings, LLC) with the Edw. C. Levy Co., which operates in Michigan. Under the contribution agreement, we contributed substantially all of our ready-mixed concrete and concrete-related products assets, except our quarry assets and working capital, in Michigan, in exchange for a 60% ownership interest, while the Edw. C. Levy Co. contributed all of its Michigan ready-mixed concrete and related concrete products assets, its 24,000-ton cement terminal and $1.0 million for a 40% ownership interest. The 60%-owned Michigan subsidiary currently owns and operates 22 ready-mixed concrete plants, a 24,000-ton cement terminal and approximately 250 ready-mixed concrete trucks.

Precast Concrete Products Segment

Architectural Precast, LLC ("API"). In October 2007, we acquired the operating assets, including working capital and real property, of API, a leading designer and manufacturer of premium quality architectural and structural precast concrete products serving the Mid-Atlantic region, for approximately $14.5 million plus a $1.5 million contingency payment based on the future earnings of API.

Divestitures

In the fourth quarter of 2007, we began to implement our strategy of exiting markets that do not meet our performance and return criteria or fit our long-term strategic objectives. We sold our Knoxville, Tennessee and Wyoming, Delaware operations in November 2007 for $16.5 million, plus certain adjustments for working capital. In addition, we sold our Memphis, Tennessee operations for $7.2 million, plus the payment for certain inventory-on-hand at closing on January 31, 2008 (See Note 3 to our condensed consolidated financial statements included in this report). These operations have been aggregated and presented in our accompanying condensed consolidated financial statements as "discontinued operations."

Risks and Uncertainties

Numerous factors could affect our future operating results, including those discussed under the heading "Risk Factors" in Item 1A of Part I of the 2007 Form 10-K and the following factors:

Internal Computer Network and Applications. We rely on our network infrastructure, enterprise applications and internal technology systems for our operational, support and sales activities. The hardware and software systems related to such activities are subject to damage from earthquakes, floods, fires, power loss, telecommunication failures and other similar events. They are also subject to computer viruses, physical or electronic vandalism or other similar disruptions that could cause system interruptions, delays and loss of critical data and could prevent us from fulfilling our customers' orders. We have developed disaster recovery plans and backup systems to reduce the potentially adverse effects of such events. Any event that causes failures or interruption in our hardware or software systems could result in disruption in our business operations, loss of revenues or damage to our reputation.

During the second half of 2007, we began a process to select a new enterprise resource planning solution to provide for enhanced control, business efficiency and effectiveness, more timely and consistent reporting of both operational and financial data, and provide a platform to more adequately support our long-term growth plans. In the fourth quarter, a plan of implementation was approved which anticipates a phased implementation across our regions during the course of 2008 and into early 2009. The plan of implementation is on schedule.

Accounting Rules and Regulations. We prepare our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP"). A change in these policies can have a significant effect on our reported results and may even retroactively affect previously reported transactions. Our accounting policies that recently have been or may be affected by changes in the accounting rules are as follows:

• accounting for income taxes; and

• accounting for business combinations and related goodwill.

Tax Liabilities. We are subject to federal, state and local income taxes, applicable to corporations generally, as well as nonincome-based taxes. Significant judgment is required in determining our provision for income taxes and other tax liabilities. In the ordinary course of business, we make calculations in which the ultimate tax determination is uncertain. We are also, from time to time, under audit by state and local tax authorities. Although we can provide no assurance that the final determination of our tax liabilities will not differ from what our historical income tax provisions and accruals reflect, we believe our tax estimates are reasonable.

Critical Accounting Policies

We have outlined our critical accounting policies in Item 7 of Part II of the 2007 Form 10-K. Our critical accounting policies involve the use of estimates in the recording of allowance for doubtful accounts, realization of goodwill, accruals for self-insurance, accruals for income taxes and the valuation and useful lives of property, plant and equipment. During the six months ended June 30, 2008, we made no changes in the application of our critical accounting policies presented in the 2007 Form 10-K. See Note 1 to our consolidated financial statements included in Item 8 of Part II of the 2007 Form 10-K for a discussion of these accounting policies. See Note 13 to the condensed consolidated financial statements in Part I of this report for a discussion of recent accounting pronouncements and accounting changes.

Results of Operations

The following table sets forth selected historical statements of operations
information (in thousands, except for selling prices) and that information as a
percentage of sales for the periods indicated.
                                 Three Months Ended June 30,                      Six Months Ended June 30,
                                2008                    2007                    2008                     2007
                                         (unaudited)                                     (unaudited)
Sales:
Ready-mixed concrete
and concrete-related
products                 $ 192,964      93.7 %   $ 195,130      93.1 %   $ 341,790      92.8 %    $ 338,104      92.1 %
Precast concrete
products                    17,353       8.4        18,129       8.7        33,914       9.2         35,944       9.8
Inter-segment sales         (4,270 )    (2.1 )      (3,751 )    (1.8 )      (7,550 )    (2.0 )       (7,046 )    (1.9 )
Total sales              $ 206,047     100.0     $ 209,508     100.0     $ 368,154     100.0      $ 367,002     100.0

Cost of goods sold
before depreciation,
depletion and
amortization:
Ready-mixed concrete
and concrete-related
products                 $ 157,320      76.4     $ 155,590      74.3     $ 286,361      77.8      $ 277,978      75.7
Precast concrete
products                    13,090       6.3        12,919       6.2        25,340       6.9         27,037       7.4
Selling, general and
administrative
expenses                    17,642       8.6        15,926       7.6        35,773       9.7         32,619       8.9
Depreciation,
depletion and
amortization                 7,035       3.4         7,304       3.4        13,913       3.8         13,942       3.8
Income from operations      10,960       5.3        17,769       8.5         6,767       1.8         15,426       4.2
Interest expense, net        6,668       3.2         7,188       3.4        13,374       3.6         14,055       3.8
Other income, net              428       0.2         1,907       0.9         1,050       0.3          2,384       0.6
Minority interest in
consolidated
subsidiary                    (785 )    (0.4 )         359       0.2        (2,829 )    (0.8 )          359       0.1
Income (loss) before
income
taxes                        5,505       2.7        12,129       5.8        (2,728 )    (0.7 )        3,396       0.9
Income tax provision
(benefit)                    2,202       1.1         5,085       2.4          (902 )    (0.2 )        1,576       0.4
Income (loss) from
continuing operations        3,303       1.6         7,044       3.4        (1,826 )    (0.5 )        1,820       0.5
Loss from discontinued
operations, net of
tax                              -       0.0          (220 )    (0.1 )        (149 )     0.0           (725 )    (0.2 )
Net income (loss)        $   3,303       1.6 %   $   6,824       3.3 %   $  (1,975 )    (0.5 )%   $   1,095       0.3 %

Ready-mixed Concrete
Data:
Average selling price
per cubic yard           $   93.83               $   91.16               $   94.60                $   90.98
Sales volume in cubic
yards                        1,786                   1,868                   3,157                    3,262

Precast Concrete Data:
Average selling price
per cubic yard of
concrete used in
production1              $  512.96               $  600.23               $  692.91                $  576.89
Ready-mixed concrete
used in production in
cubic yards                     32                      30                      49                       62

1 Compared to the three and six month ended June 30, 2007, average selling price per cubic yard of
concrete used in production was $630.10 on a same-plant-sales basis. Sales

Ready-mixed concrete and concrete-related products. Sales of our ready-mixed concrete and concrete-related products from continuing operations were $193.0 million for the three months ended June 30, 2008, down $2.2 million, or 1.1%, compared to the corresponding period in 2007. Our ready-mixed sales volumes for the second quarter of 2008 totaled approximately 1.79 million cubic yards, down 4.4% from the 1.87 million cubic yards of ready-mixed concrete we sold in the second quarter of 2007. The decline reflects the continued downturn in construction activity in many of our markets. On a same-plant-sales basis, ready-mixed concrete sales volumes were down 5.3% in the second quarter of 2008, as compared to the second quarter of 2007. Offsetting the effects of lower sales volumes was the approximate 2.9% rise in the average sales price per cubic yard of ready-mixed concrete during the second quarter of 2008, as compared to the second quarter of 2007.

For the six months ending June 30, 2008, sales were $341.8 million, an increase of $3.7 million, or 1.1%, over the same period in 2007. The increase in the six months ending June 30, 2008 was primarily related to a 4.0% increase in the average selling price of ready-mixed concrete, partially offset by a 3.2% decrease in ready-mixed concrete sales volumes in the six months ended June 30, 2008, as compared to the same period in 2007.

Precast concrete products. Sales in our precast concrete products segment were $17.4 million for the three months ended June 30, 2008, a decrease of $0.8 million, or 4.3%, from the corresponding period in 2007. Excluding sales associated with acquired operations, on a same-plant-sales basis, our second quarter 2008 precast concrete products sales were down approximately 24.8% from the second quarter of 2007, a result of the continued downturn in residential construction in our northern California and Phoenix, Arizona markets. Sales for the six months ended June 30, 2008 were down by $2.0 million, or 5.6%, to $33.9 million, as compared to the same period of last year. Excluding sales associated with acquired operations, on a same-plant-sales basis, precast concrete products sales in the first six months of 2008 were down approximately 28.6% from the corresponding period last year. The decline was attributable primarily to the downturn in residential construction in our Phoenix, Arizona and northern California markets.

Cost of goods sold before depreciation, depletion and amortization.

Ready-mixed concrete and concrete-related products. The increase in cost of goods sold, before depreciation, depletion and amortization, of $1.7 million, or 1.1%, to $157.3 million for the three months ended June 30, 2008 was primarily associated with higher aggregates costs and increased diesel fuel costs, as compared to the three months ended June 30, 2007. As a percentage of ready-mixed concrete and concrete-related products sales, cost of goods sold before depreciation, depletion and amortization increased from 79.7% for the three months ended June 30, 2007, to 81.5% for the three months ended June 30, 2008. The increase in cost of goods sold as a percentage of ready-mixed concrete and concrete-related products sales was primarily attributable to higher aggregates and increased diesel fuel costs, partially offset by higher average selling prices, as compared to the second quarter of 2007. Cost of goods sold before depreciation, depletion and amortization in the six months ended June 30, 2008 increased $8.4 million, or 3.0%, to $286.4 million on lower sales volumes, primarily due to higher aggregates costs and increased diesel fuel costs. Cost of goods sold before depreciation, depletion and amortization was favorably impacted in the first quarter of 2007 by the $1.4 million workers' compensation settlement gain. Cost of goods sold before depreciation, depletion and amortization in the first quarter of 2008 was negatively impacted by a $1.3 million expense related to a multi-employer plan funding deficiency accrual at one of our locations. As a percentage of ready-mixed concrete and concrete-related products sales, these costs increased from 82.2% to 83.8% for the six months ended June 30, 2008, as compared to the same period in 2007. The increase in cost of goods sold as a percentage of revenue was primarily attributable to increased aggregates costs and diesel fuel costs rising faster than price increases for our ready-mixed concrete and concrete-related products.

Precast concrete products. The cost of goods sold before depreciation, depletion and amortization in our precast concrete products segment increased $0.2 million, or 1.3%, for the three months ended June 30, 2008, as compared to the corresponding period in 2007. This increase reflected increased cost of goods sold associated with our Architectural Precast business in 2008, which we did not own in the second quarter of 2007, partially offset by the reduced costs of goods sold primarily related to volume reductions in our northern California and Phoenix, Arizona precast markets. As a percentage of precast concrete products sales, cost of goods sold before depreciation, depletion and amortization increased in the three months ended June 30, 2008, as compared to the corresponding period in 2007, from 71.3% to 75.4%. The increase in cost of goods sold as a percentage of precast concrete product sales for the three months ended June 30, 2008 reflected lower average selling prices associated with product mix changes, lower sales volumes and the comparative impact of certain fixed costs in both periods. Cost of goods sold before depreciation, depletion and amortization for the six months ended June 30, 2008 declined $1.7 million, or 6.3%, on lower sales volumes in our northern California and Phoenix, Arizona markets, partially offset by API volumes not reflected in the six- month period ended June 30, 2007. As a percentage of precast product sales, cost of goods sold declined slightly from 75.2% to 74.7%.

Selling, general and administrative expenses. Selling, general and administrative expenses for the three months ended June 30, 2008 were $17.6 million, or 10.7% higher than in the corresponding 2007 period. For the six months ended June 30, 2008, selling, general and administrative expenses rose by $3.2 million, or 9.7%, when compared to the corresponding period in 2007. These expenses increased comparatively in both periods, respectively, and are due primarily to an increase in incentive compensation accruals and professional fees. Selling, general and administrative expenses as a percentage of sales increased to 8.6% and 9.7% in the three- and six-month periods ended June 30, 2008, as compared to 7.6% and 8.9% in the three- and six-month periods ended June 30, 2007.

Depreciation, depletion and amortization. Depreciation, depletion and amortization expense decreased $0.3 million, or 3.7%, for the three months ended June 30, 2008, as compared to the corresponding period in 2007. For the six months ended June 30, 2008, depreciation, depletion and amortization expense was $13.9 million, which was unchanged from the six months ended June 30, 2007.

Interest expense, net. Interest expense, net, decreased $0.5 million, or 7.2%, to $6.7 million for the three months ended June 30, 2008, as compared to the corresponding period of 2007. Net interest expense decreased $0.7 million to $13.4 million in the six months ended June 30, 2008, as compared to the six months ended June 30, 2007, primarily due to lower borrowings under our credit facility.

Other income, net. Other income, net, decreased $1.5 million for the quarter ended June 30, 2008, and $1.3 million for the six months ended June 30, 2008, as compared to the corresponding periods in the prior year, and was primarily attributable to a contractual settlement reached in 2007 with a former owner of an acquired business.

Minority interest in consolidated subsidiary. Minority interest of ($0.8) million and $(2.8) million recorded in the three months and six months ended June 30, 2008, respectively, related to the allocable share of net loss from our Michigan joint venture to our minority partner. The Michigan joint venture was formed on April 1, 2007, and accordingly, no minority interest was recorded for the three-months ended March 31, 2007.

Income tax provision (benefit). We recorded an income tax expense from continuing operations of $2.2 million for the three months ended June 30, 2008, as compared to $5.1 million for the corresponding period in 2007. The decrease in the income tax expense for the period ended June 30, 2008 resulted primarily from lower pre-tax income. We recorded an income tax benefit of $0.9 million for the six months ended June 30, 2008, as compared to an income tax provision of $1.6 million for the corresponding period in 2007. That decrease was also a result of lower pre-tax income. At the end of each interim reporting period, we estimate the effective income tax rate expected to be applicable for the full year. We use this estimate in providing for income taxes on a year-to-date basis, and it may change in subsequent interim periods. Our estimated annualized effective tax rate was 40.0% and 41.9% for the three months ended June 30, 2008 and 2007, respectively. Our estimated annualized effective tax rate was 33.1% and 46.4% for the six months ended June 30, 2008 and 2007, respectively. The effective income tax rates for the 2008 and 2007 periods are higher (or income tax benefits lower) than the federal statutory rate, due primarily to state income taxes and additional tax provisions for uncertain tax benefits as required by FIN 48. We expect our effective tax rate for 2008 will be approximately 40.0% to 43.0%.

Liquidity and Capital Resources

Our primary short-term liquidity needs consist of financing seasonal increases in working capital requirements, purchasing property and equipment and paying . . .