<SUBMISSION>
<ACCESSION-NUMBER>0000792987-01-500015
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>1
<PERIOD>20010331
<FILING-DATE>20010514
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>ASTEC INDUSTRIES INC
<CIK>0000792987
<ASSIGNED-SIC>3531
<IRS-NUMBER>620873631
<STATE-OF-INCORPORATION>TN
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>000-14714
<FILM-NUMBER>1633327
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>4101 JEROME AVE
<CITY>CHATTANOOGA
<STATE>TN
<ZIP>37407
<PHONE>4238674210
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>PO BOX 72787
<STREET2>4101 JEROME AVE
<CITY>CHATTANOOGA
<STATE>TN
<ZIP>37407
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>a10q2.htm
<TEXT>

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<B><FONT SIZE=2><P ALIGN="CENTER">SECURITIES &amp; EXCHANGE COMMISSION <BR>
Washington, D. C. 20549 <BR>
FORM 10-Q</P>
</B><P ALIGN="CENTER">(Mark One) </P>
<P>[ X ] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934. For the quarterly period ended March 31, 2001. </P>
<P>[ ] Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934. For the Transition period from ____ to ____. </P>
<P>Commission File Number <U>0-14714 </P>
<P><BR>
Astec Industries, Inc. <BR>
</U>(Exact Name of Registrant as Specified in its Charter) <BR>
<BR>
<U>Tennessee </U>&#9;&#9;&#9;&#9;<U> 62-0873631 <BR>
</U>(State or other jurisdiction of (I.R.S. Employer Identification No.) <BR>
incorporation or organization) </P>
<U><P>4101 Jerome Avenue, Chattanooga, Tennessee </U>&#9;&#9;&#9;&#9;<U>37407 <BR>
</U>(Address of Principal Executive Offices) (Zip Code) </P>
<U><P>(423) 867-4210</U> <BR>
(Registrant's Telephone Number, Including Area Code)</P>
<P>&#9; </P>
<P ALIGN="JUSTIFY">&#9;Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. </P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=638>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE=2>YES <U>X_____</U></FONT></TD>
<TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="25%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">NO ________</FONT></TD>
<TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
</TABLE>

<FONT SIZE=2><P>&#9;</P>
<P>Indicate the number of shares outstanding of each of the registrant's classes of stock as of the latest practicable date.</P></FONT>
<TABLE CELLSPACING=0 BORDER=0 WIDTH=638>
<TR><TD WIDTH="50%" VALIGN="BOTTOM" HEIGHT=20>
<P><U><FONT SIZE=2>Class</U></FONT></TD>
<TD WIDTH="50%" VALIGN="BOTTOM" HEIGHT=20>
<U><FONT SIZE=2><P>Outstanding at May 10 , 2001</U></FONT></TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="BOTTOM" HEIGHT=20>
<FONT SIZE=2><P>Common Stock, par value $0.20&#9;</FONT></TD>
<TD WIDTH="50%" VALIGN="BOTTOM" HEIGHT=20>
<FONT SIZE=2><P>19,335,568</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">ASTEC INDUSTRIES, INC. </P>
<P ALIGN="CENTER">INDEX </P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=638>
<TR><TD VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">&#9;&#9;&#9;&#9;&#9;&#9;&#9;&#9;&#9;<U>Page Number </U></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P>PART I - Financial Information </U></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P>Item 1. &#9;Financial Statements</U></FONT></TD>
</TR>
<TR><TD WIDTH="84%" VALIGN="TOP">
<FONT SIZE=2><P>Consolidated Balance Sheets as of March 31, 2001 and December 31, 2000&#9;</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P>1</FONT></TD>
</TR>
<TR><TD WIDTH="84%" VALIGN="TOP">
<FONT SIZE=2><P>Consolidated Statements of Income for the Three Months Ended March 31, 2001 and 2000&#9;</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P>2</FONT></TD>
</TR>
<TR><TD WIDTH="84%" VALIGN="TOP">
<FONT SIZE=2><P>Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2001 and 2000</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P>3</FONT></TD>
</TR>
<TR><TD WIDTH="84%" VALIGN="TOP">
<FONT SIZE=2><P>Notes to Unaudited Consolidated Financial Statements </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P>4</FONT></TD>
</TR>
<TR><TD WIDTH="84%" VALIGN="TOP">
<U><FONT SIZE=2><P>Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P>6</FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P>PART II - Other Information</U></FONT></TD>
</TR>
<TR><TD WIDTH="84%" VALIGN="TOP">
<U><FONT SIZE=2><P>Item 1. Legal Proceedings</U>&#9;</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P>8</FONT></TD>
</TR>
<TR><TD WIDTH="84%" VALIGN="TOP">
<U><FONT SIZE=2><P>Item 5. Other Items</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P>8</FONT></TD>
</TR>
<TR><TD WIDTH="84%" VALIGN="TOP">
<U><FONT SIZE=2><P>Item 6. Exhibits and Reports on Form 8-K</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P>9</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P><BR>
&nbsp;<BR>
</FONT><B>PART I - FINANCIAL INFORMATION<BR>
<U><FONT SIZE=2>Item 1. Financial Statements</P></B></U></FONT>
<TABLE BORDER CELLSPACING=1 BORDERCOLOR="#000000" WIDTH=584>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=16>
<P ALIGN="CENTER"><B><FONT SIZE=2>Astec Industries, Inc. and Subsidiaries</B></FONT></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=16>
<B><FONT SIZE=2><P ALIGN="CENTER">Consolidated Balance Sheets </B></FONT></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=14>
<FONT SIZE=2><P ALIGN="CENTER">(In thousands)</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="CENTER">Account Description</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="CENTER">March 31,<BR>
2001<BR>
(Unaudited)</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="CENTER">December 31,<BR>
2000<BR>
(Note 1)</FONT></TD>
</TR>
<TR><TD WIDTH="101%" VALIGN="BOTTOM" COLSPAN=3 HEIGHT=24>
<B><FONT SIZE=2><P>ASSETS</B></FONT></TD>
</TR>
<TR><TD WIDTH="101%" VALIGN="BOTTOM" COLSPAN=3 HEIGHT=24>
<B><FONT SIZE=2><P>Current Assets</B></FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Cash and cash equivalents</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">$ 3,170</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">$ 7,053</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Receivables - net</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">109,130</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">83,159</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Inventories</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">126,539</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">126,308</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Prepaid expenses and other </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">13,969</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">15,473</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Total current assets</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">252,808</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">231,993</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Property and equipment - net</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">124,840</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">126,928</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Goodwill</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">36,516</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">37,208</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Other assets</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">7,861</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">6,177</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Total assets</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">$422,025</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">$402,306</FONT></TD>
</TR>
<TR><TD WIDTH="101%" VALIGN="BOTTOM" COLSPAN=3 HEIGHT=24>
<B><FONT SIZE=2><P>LIABILITIES AND SHAREHOLDERS' EQUITY</B></FONT></TD>
</TR>
<TR><TD WIDTH="101%" VALIGN="BOTTOM" COLSPAN=3 HEIGHT=24>
<B><FONT SIZE=2><P>Current Liabilities</B></FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Notes payable</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">$ 1,633 </FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">$ 1,445</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Current maturities of long-term debt</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">556</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">542</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Accounts payable - trade</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">39,903</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">35,585</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Other accrued liabilities</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">39,748</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">38,686</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Total current liabilities</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">81,840</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">76,258</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Long-term debt, less current maturities</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">127,780</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">118,511</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Other non-current liabilities</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">13,403</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">12,466</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Minority interest in investment</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">472</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">448</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Total shareholders' equity</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">198,530</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">194,623</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P>Total liabilities and shareholders' equity</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">$422,025</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=24>
<FONT SIZE=2><P ALIGN="RIGHT">$402,306</FONT></TD>
</TR>
</TABLE>

<FONT FACE="MS Sans Serif" SIZE=2><P>&nbsp;</P>
<P>&nbsp;</P></FONT>
<TABLE BORDER CELLSPACING=1 WIDTH=578>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=8>
<P ALIGN="CENTER"><B><FONT SIZE=2>Astec Industries, Inc. and Subsidiaries</B></FONT></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=12>
<B><FONT SIZE=2><P ALIGN="CENTER">Consolidated Statements of Income</B></FONT></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=12>
<B><FONT SIZE=2><P ALIGN="CENTER">(In thousands)</B></FONT></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=12>
<B><FONT SIZE=2><P ALIGN="CENTER">(Unaudited)</B></FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12><P></P></TD>
<TD WIDTH="40%" VALIGN="BOTTOM" COLSPAN=2 HEIGHT=12>
<FONT SIZE=2><P ALIGN="CENTER">Three months ended</FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12><P></P></TD>
<TD WIDTH="40%" VALIGN="BOTTOM" COLSPAN=2 HEIGHT=12>
<FONT SIZE=2><P ALIGN="CENTER">March 31,</FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12><P></P></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="CENTER">2001</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="CENTER">2000</FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Net sales</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">$ 143,310 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">$ 140,872 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Cost of sales</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">111,987 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">107,114 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Gross profit</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">31,323 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">33,758 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Selling, general and administrative expenses</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">20,960 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">18,255 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Income from operations</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">10,363 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">15,503 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Interest expense</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">2,339 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">2,186 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Other income, net of expense</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">644 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">802 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Income before income taxes</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">8,668 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">14,119 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Income taxes</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">3,337 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">5,492 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Minority interest in earnings</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">28 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Net income</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">$ 5,303 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">$ 8,627 </FONT></TD>
</TR>
<TR><TD WIDTH="101%" VALIGN="BOTTOM" COLSPAN=3 HEIGHT=12>
<FONT SIZE=2><P>Earnings per common share</FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Basic</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">$ 0.27 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">$ 0.45 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Diluted</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">$ 0.27 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">$ 0.44 </FONT></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=12>
<FONT SIZE=2><P>Weighted average common shares outstanding</FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Basic</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">19,324,234 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">19,140,293 </FONT></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P>Diluted</FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">19,600,539 </FONT></TD>
<TD WIDTH="20%" VALIGN="BOTTOM" HEIGHT=12>
<FONT SIZE=2><P ALIGN="RIGHT">19,828,565 </FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P>&nbsp;</P>
<P>&nbsp;</P></FONT>
<TABLE BORDER CELLSPACING=1 WIDTH=578>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=6>
<P ALIGN="CENTER"><B><FONT SIZE=2>Astec Industries, Inc. and Subsidiaries</B></FONT></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=16>
<B><FONT SIZE=2><P ALIGN="CENTER">Consolidated Statements of Cash Flows</B></FONT></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=14>
<FONT SIZE=2><P ALIGN="CENTER">(In thousands)</FONT></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=3 HEIGHT=14>
<FONT SIZE=2><P ALIGN="CENTER">(Unaudited)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="37%" VALIGN="BOTTOM" COLSPAN=2 HEIGHT=17>
<FONT SIZE=2><P ALIGN="CENTER">Three months ended March 31,</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times New Roman Bold,Times New Roman" SIZE=2><P ALIGN="CENTER">2001</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="CENTER">2000</FONT></TD>
</TR>
<TR><TD WIDTH="101%" VALIGN="BOTTOM" COLSPAN=3 HEIGHT=17>
<B><FONT SIZE=2><P>Cash flows from operating activities:</B></FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Net income </FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">$ 5,303</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">$ 8,627 </FONT></TD>
</TR>
<TR><TD WIDTH="101%" VALIGN="BOTTOM" COLSPAN=3 HEIGHT=21>
<B><FONT SIZE=2><P>Adjustments to reconcile net income to net cash provided by operating activities:</B></FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Depreciation and amortization</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">4,110</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">3,445</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Provision for doubtful accounts</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">109</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">92</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Provision for inventory reserve</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">361</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">802</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Provision for warranty reserve</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">823</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">990</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>(Gain) on sale of fixed assets</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(3)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(3)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>(Gain) on sale of lease portfolio</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(474)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(465)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Minority interest in earnings of subsidiary</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">24</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT SIZE=2><P>(Increase) decrease in:</B></FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Trade receivables</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(25,924)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(14,138)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Finance receivables</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(179)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(4,522)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Inventories</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(593)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(3,715)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Prepaid expenses and other </FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">1,503</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">1,926</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Other receivables</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">568</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(1,361)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Other non-current assets</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(2,159)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(394)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT SIZE=2><P>Increase (decrease) in:</B></FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Accounts payable</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">4,318</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">6,918</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Accrued product warranty</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(588)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(1,280)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Other accrued liabilities</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(522)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(292)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Income taxes payable</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">2,268</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">4,305</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Other operating charges</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(598)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(42)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT SIZE=2><P>Net cash provided (used) by operating activities</B></FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(11,653)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">893</FONT></TD>
</TR>
<TR><TD WIDTH="101%" VALIGN="BOTTOM" COLSPAN=3 HEIGHT=17>
<B><FONT SIZE=2><P>Cash flows from investing activities:</B></FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Proceeds from sale of property and equipment - net</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">23</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">7</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Proceeds from sale and repayment of lease portfolio</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">11,633</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">16,202</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Expenditures for property and equipment</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(2,300)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(4,918)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Expenditures for equipment on operating lease</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(10,373)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(19,524)</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT SIZE=2><P>Net cash used by investing activities</B></FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(1,017)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(8,233)</FONT></TD>
</TR>
<TR><TD WIDTH="101%" VALIGN="BOTTOM" COLSPAN=3 HEIGHT=17>
<B><FONT SIZE=2><P>Cash flows from financing activities:</B></FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Net borrowings under revolving credit agreement</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">9,302</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">9,669</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Net borrowings under loan and note agreements</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">188</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">- </FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P>Proceeds from issuance of common stock</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">18</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">424</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT SIZE=2><P>Net cash provided by financing activities</B></FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">9,508</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">10,093</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT SIZE=2><P>Effect of exchange rate changes on cash</B></FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(721)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT SIZE=2><P>Net increase (decrease) in cash</B></FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(3,883)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">2,753</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT SIZE=2><P>Cash at beginning of period</B></FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">7,053</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">3,725</FONT></TD>
</TR>
<TR><TD WIDTH="64%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT SIZE=2><P>Cash at end of period</B></FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">$ 3,170</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">$ 6,478</FONT></TD>
</TR>
</TABLE>

<FONT FACE="MS Sans Serif" SIZE=2><P ALIGN="JUSTIFY">&nbsp;</P>
</FONT><FONT SIZE=2><P ALIGN="JUSTIFY">ASTEC INDUSTRIES, INC. </P>
<U><P>NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS </P>
</U><B><P>Note 1. Basis of Presentation</P>
</B><P ALIGN="JUSTIFY">&#9;The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10
of Regulation S-X promulgated under the Securities Act of 1933. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals)</FONT><FONT SIZE=1>, as well as the accounting change to adopt Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for Derivative Instruments and Hedging Activities,"</FONT><FONT SIZE=2> considered necessary for a fair presentation
have been included. Operating results for the three-month period ended March 31, 2001 are not necessarily indicative of the results that may be expected for the year ended December 31, 2001.</P>
<P ALIGN="JUSTIFY">The balance sheet at December 31, 2000 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete
financial statements.</P>
<P ALIGN="JUSTIFY">Certain reclassifications were made to the prior year presentation to conform to the current year presentation. For further information, refer to the consolidated financial statements and footnotes thereto included in the Astec
Industries, Inc. and subsidiaries annual report on Form 10-K for the year ended December 31, 2000.</P>
<B><P ALIGN="JUSTIFY">Note 2. Receivables.</P>
</B><P ALIGN="JUSTIFY">Receivables are net of allowance for doubtful accounts of $2,244,000 and $2,105,000 for March 31, 2001 and December 31, 2000, respectively. </P>
<B><P ALIGN="JUSTIFY">Note 3. Inventories</P>
</B><P ALIGN="JUSTIFY">&#9;Inventories are stated at the lower of first-in, first-out cost or market and consist of the following: </P><DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>

<P ALIGN="JUSTIFY">(in thousands) </P></DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=463>
<TR><TD WIDTH="43%" VALIGN="TOP">
<P ALIGN="JUSTIFY"></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">March 31, 2001</FONT></TD>
<TD WIDTH="27%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">December 31, 2000</FONT></TD>
</TR>
<TR><TD WIDTH="43%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="27%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="43%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="JUSTIFY">Raw Materials</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ 44,573</FONT></TD>
<TD WIDTH="27%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ 41,784</FONT></TD>
</TR>
<TR><TD WIDTH="43%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="JUSTIFY">Work-in-Process</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">25,767</FONT></TD>
<TD WIDTH="27%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">27,521</FONT></TD>
</TR>
<TR><TD WIDTH="43%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="JUSTIFY">Finished Goods</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">56,199</U></FONT></TD>
<TD WIDTH="27%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">57,003</U></FONT></TD>
</TR>
<TR><TD WIDTH="43%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="JUSTIFY">Total</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">$126,539</U></FONT></TD>
<TD WIDTH="27%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">$126,308</U></FONT></TD>
</TR>
</TABLE>

<B><FONT SIZE=2><P ALIGN="JUSTIFY">Note 4. Property and Equipment</P>
</B><P ALIGN="JUSTIFY">&#9;Property and equipment is stated at cost. Property and equipment is net of accumulated depreciation of $58,922,000 and $56,453,000 for March 31, 2001 and December 31, 2000, respectively. </P>
<B><P ALIGN="JUSTIFY">Note 5. Earnings Per Share</P>
</B><P ALIGN="JUSTIFY">&#9;Basic and diluted earnings per share are calculated in accordance with SFAS No. 128. Basic earnings per share exclude any dilutive effects of options, warrants and convertible securities.</P>
<U><P>Notes to Unaudited Financial Statements - Continued</P>
</U><P ALIGN="JUSTIFY">The following table sets forth the computation of basic and diluted earnings per share:</P></FONT>
<TABLE BORDER CELLSPACING=1 WIDTH=349>
<TR><TD WIDTH="50%" VALIGN="BOTTOM">
<P>&nbsp;</TD>
<TD WIDTH="50%" VALIGN="BOTTOM" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">Three Months Ended<BR>
March 31,</FONT></TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="BOTTOM">
<P>&nbsp;</TD>
<TD WIDTH="26%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="CENTER">2001</FONT></TD>
<TD WIDTH="24%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="CENTER">2000</FONT></TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="BOTTOM">
<FONT SIZE=2><P>Numerator:</FONT></TD>
<TD WIDTH="26%" VALIGN="BOTTOM">
<P>&nbsp;</TD>
<TD WIDTH="24%" VALIGN="BOTTOM">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="BOTTOM"><DIR>

<FONT SIZE=2><P>Net income</DIR>
</FONT></TD>
<TD WIDTH="26%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$5,303,000</FONT></TD>
<TD WIDTH="24%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$8,627,000</FONT></TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="BOTTOM">
<FONT SIZE=2><P>Denominator:</FONT></TD>
<TD WIDTH="26%" VALIGN="BOTTOM">
<P ALIGN="RIGHT">&nbsp;</TD>
<TD WIDTH="24%" VALIGN="BOTTOM">
<P ALIGN="RIGHT">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="BOTTOM"><DIR>

<FONT SIZE=2><P>Denominator for basic earnings per share</DIR>
</FONT></TD>
<TD WIDTH="26%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">19,324,234</FONT></TD>
<TD WIDTH="24%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">19,140,293</FONT></TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="BOTTOM">
<FONT SIZE=2><P>Effect of dilutive securities:</FONT></TD>
<TD WIDTH="26%" VALIGN="BOTTOM">
<P ALIGN="RIGHT">&nbsp;</TD>
<TD WIDTH="24%" VALIGN="BOTTOM">
<P ALIGN="RIGHT">&nbsp;</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="BOTTOM">
<FONT SIZE=2><P>Employee stock options</FONT></TD>
<TD WIDTH="26%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">276,305</FONT></TD>
<TD WIDTH="24%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">688,272</FONT></TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="BOTTOM"><DIR>

<FONT SIZE=2><P>Denominator for diluted earnings per share</DIR>
</FONT></TD>
<TD WIDTH="26%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">19,600,539</FONT></TD>
<TD WIDTH="24%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">19,828,565</FONT></TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="BOTTOM"><DIR>

<FONT SIZE=2><P>Earnings per common share:<BR>
Basic<BR>
Diluted</DIR>
</FONT></TD>
<TD WIDTH="26%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$0.27<BR>
$0.27</FONT></TD>
<TD WIDTH="24%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$0.45<BR>
$0.44</FONT></TD>
</TR>
</TABLE>

<B><FONT SIZE=2><P ALIGN="JUSTIFY">&nbsp;</P>
<P ALIGN="JUSTIFY">Note 6. Comprehensive Income</P>
</B><P ALIGN="JUSTIFY">Total comprehensive income was $3,889,000 for the first three months of 2001, comprised of net income of $5,303,000, accumulated net losses on derivative financial instruments of approximately $719,000, and a net decrease in
foreign currency translation of approximately $695,000. For the first quarter of 2000, total comprehensive income was $8,627,000, equal to net income for the same period.</P>
<B><P ALIGN="JUSTIFY">Note 7. Contingent Matters</P>
</B><P ALIGN="JUSTIFY">&#9;Certain customers have financed purchases of Astec products through arrangements in which the Company is contingently liable for customer debt aggregating approximately $14,982,000 at March 31, 2001 and $18,816,000 at December
31, 2000. </P>
<B><P>Note 8. Segment Information </P><DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>

<P>(in thousands)</P></DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</B></FONT>
<TABLE BORDER CELLSPACING=1 WIDTH=660>
<TR><TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=14>
<P>&nbsp;</TD>
<TD WIDTH="78%" VALIGN="BOTTOM" COLSPAN=6 HEIGHT=14>
<FONT SIZE=2><P ALIGN="CENTER">Three months ended</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=14>
<P>&nbsp;</TD>
<TD WIDTH="78%" VALIGN="BOTTOM" COLSPAN=6 HEIGHT=14>
<FONT SIZE=2><P ALIGN="CENTER">March 31, 2001</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=60>
<P>&nbsp;&nbsp;<BR>
&nbsp;</TD>
<TD WIDTH="10%" VALIGN="BOTTOM" HEIGHT=60>
<FONT SIZE=2><P ALIGN="CENTER">Asphalt</FONT><BR>
<FONT SIZE=2>Group</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=60>
<FONT SIZE=2><P ALIGN="CENTER">Aggregate</FONT><BR>
<FONT SIZE=2>and Mining</FONT><BR>
<FONT SIZE=2>Group</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" HEIGHT=60>
<FONT SIZE=2><P ALIGN="CENTER">Mobile Asphalt</FONT><BR>
<FONT SIZE=2>Paving</FONT><BR>
<FONT SIZE=2>Group</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=60>
<P ALIGN="CENTER">&nbsp;<BR>
<FONT SIZE=2>Underground</FONT><BR>
<FONT SIZE=2>Group</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM" HEIGHT=60>
<P ALIGN="CENTER">&nbsp;<BR>
<FONT SIZE=2>All</FONT><BR>
<FONT SIZE=2>Others</FONT></TD>
<TD WIDTH="11%" VALIGN="BOTTOM" HEIGHT=60>
<P ALIGN="CENTER"><BR>
&nbsp;<BR>
<FONT SIZE=2>Total</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="BOTTOM">
<FONT SIZE=2><P>Revenues from external customers</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$48,776</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$60,559</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$20,401</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$12,964</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$610</FONT></TD>
<TD WIDTH="11%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$143,310</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="BOTTOM">
<FONT SIZE=2><P>Intersegment revenues</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">4,494</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">6,696</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">(496)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">1,166</FONT></TD>
<TD WIDTH="11%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">11,860</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="BOTTOM">
<FONT SIZE=2><P>Segment profit</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">4,235</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">5,143</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">2,399</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">(761)</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">(5,960)</FONT></TD>
<TD WIDTH="11%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">5,056</FONT></TD>
</TR>
</TABLE>


<TABLE BORDER CELLSPACING=1 WIDTH=660>
<TR><TD WIDTH="22%" VALIGN="BOTTOM">
<P>&nbsp;</TD>
<TD WIDTH="78%" VALIGN="BOTTOM" COLSPAN=6>
<FONT SIZE=2><P ALIGN="CENTER">Three months ended</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="BOTTOM">
<P>&nbsp;</TD>
<TD WIDTH="78%" VALIGN="BOTTOM" COLSPAN=6>
<FONT SIZE=2><P ALIGN="CENTER">March 31, 2000</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=60>
<P>&nbsp;<BR>
&nbsp;<BR>
&nbsp;</TD>
<TD WIDTH="10%" VALIGN="BOTTOM" HEIGHT=60>
<P ALIGN="CENTER">&nbsp;<BR>
<FONT SIZE=2>Asphalt</FONT><BR>
<FONT SIZE=2>Group</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=60>
<FONT SIZE=2><P ALIGN="CENTER">Aggregate</FONT><BR>
<FONT SIZE=2>and Mining</FONT><BR>
<FONT SIZE=2>Group</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" HEIGHT=60>
<FONT SIZE=2><P ALIGN="CENTER">Mobile Asphalt</FONT><BR>
<FONT SIZE=2>Paving</FONT><BR>
<FONT SIZE=2>Group</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=60>
<P ALIGN="CENTER">&nbsp;<BR>
<FONT SIZE=2>Underground</FONT><BR>
<FONT SIZE=2>Group</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM" HEIGHT=60>
<P ALIGN="CENTER">&nbsp;<BR>
<FONT SIZE=2>All</FONT><BR>
<FONT SIZE=2>Others</FONT></TD>
<TD WIDTH="11%" VALIGN="BOTTOM" HEIGHT=60>
<P ALIGN="CENTER"><BR>
<BR>
<FONT SIZE=2>Total</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="BOTTOM">
<FONT SIZE=2><P>Revenues from external customers</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$46,554</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$56,420</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$19,323</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$18,271</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$304</FONT></TD>
<TD WIDTH="11%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">$140,872</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="BOTTOM">
<FONT SIZE=2><P>Intersegment revenues</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">6,524</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">4,559</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">(86)</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">(75)</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">876</FONT></TD>
<TD WIDTH="11%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">11,798</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="BOTTOM">
<FONT SIZE=2><P>Segment profit</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">5,072</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">7,019</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">3,361</FONT></TD>
<TD WIDTH="19%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">1,033</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">(7,483)</FONT></TD>
<TD WIDTH="11%" VALIGN="BOTTOM">
<FONT SIZE=2><P ALIGN="RIGHT">9,002</FONT></TD>
</TR>
</TABLE>

<U><FONT SIZE=2><P>Notes to Unaudited Financial Statements - Continued</P>
</U><P ALIGN="JUSTIFY">Reconciliations of the reportable segment totals for profit or loss to the Company's consolidated totals are as follows:</P>
<P>&#9;&#9;&#9;&#9;&#9; (in thousands)</P></FONT>
<TABLE BORDER CELLSPACING=1 WIDTH=432>
<TR><TD WIDTH="57%" VALIGN="BOTTOM" HEIGHT=13>
<P>&nbsp;</TD>
<TD WIDTH="43%" VALIGN="BOTTOM" COLSPAN=2 HEIGHT=13>
<FONT SIZE=2><P ALIGN="CENTER">Three months ended March 31,</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="BOTTOM" HEIGHT=13>
<P>&nbsp;</TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="CENTER">2001</FONT></TD>
<TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="CENTER">2000</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="BOTTOM" HEIGHT=13>
<B><FONT SIZE=2><P>Profit:</B></FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=13>
<P>&nbsp;</TD>
<TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=13>
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P>Total profit for reportable segments</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">$11,016</FONT></TD>
<TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">$16,485</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P>Other profit (loss)</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">(5,960)</FONT></TD>
<TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">(7,483)</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P>Equity in (loss)/income of joint venture</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">(48)</FONT></TD>
<TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">(32)</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P>Minority interest in earnings</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">(28)</FONT></TD>
<TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P>Elimination of intersegment (profit) loss</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">323</FONT></TD>
<TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">(343)</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P>Total consolidated net income</FONT></TD>
<TD WIDTH="21%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">$5,303</FONT></TD>
<TD WIDTH="22%" VALIGN="BOTTOM" HEIGHT=13>
<FONT SIZE=2><P ALIGN="RIGHT">$8,627</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P>&#9;</P>
<B><P ALIGN="JUSTIFY">Note 9. Legal Matters</P>
</B><P ALIGN="JUSTIFY">There have been no material developments in legal proceedings previously reported. See "Management's Discussion and Analysis of Financial Condition and Results of Operations - Contingencies" in Part I - Item 2 of this Report. </P>
<B><P ALIGN="JUSTIFY">Note 10. Seasonality</P>
</B><P ALIGN="JUSTIFY">Approximately 25% of the Company's business volume typically occurs during the first three months of the year.</P>
<B><P ALIGN="JUSTIFY">Note 11. Financial Instruments</P>
</B><P ALIGN="JUSTIFY">Effective January 1, 2001, the Company adopted SFAS No. 133, which requires the Company to recognize derivative instruments on the balance sheet at fair value. The statement also establishes new accounting rules for hedging
instruments, which depend on the nature of the hedge relationship. The Company has two cash flow hedges which require that the effective portion of the change in the fair value of the derivative instrument be recognized in Other Comprehensive Income
(OCI), a component of Shareholders' Equity, and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings.</P>
<P ALIGN="JUSTIFY">The Company's captive finance subsidiary, Astec Financial Services, Inc. ("AFS") entered into an interest rate swap agreement on April 6, 2000, to fix interest rates on variable rate debt. The swap agreement is effective for five years
with a notional amount of $7,500,000. The objective of the hedge is to offset the variability of cash flows relating to the interest payments on the variable rate debt outstanding under the Company's revolving credit facility. The sole source of the
variability in the hedged cash flows results from changes in the benchmark market interest rate, three-month U.S. Dollar LIBOR. Changes in the cash flows of the interest rate swap are expected to be highly effective at offsetting the changes in overall
cash flows (i.e., changes in interest rate payments) attributable to fluctuations in the benchmark market interest rate on the variable rate debt being hedged.</P>
<P ALIGN="JUSTIFY">Effective January 2, 2001 the Company entered into a one-year swap agreement with a notional amount of $40,000,000 to fix interest rates on variable rate debt. The objective of the hedge is to eliminate the variability of cash flows
relating to the interest payments on $40,000,000 of the variable rate debt outstanding under the Company's revolving credit facility. The sole source of the variability in the hedged cash flows results from changes in the benchmark market interest rate,
three-month U.S. Dollar LIBOR. Changes in the cash flows of the interest rate swap are expected to exactly offset the changes in cash flows (i.e., changes in interest rate payments) attributable to fluctuations in the benchmark market interest rate on the
of the variable rate debt being hedged.</P>
<U><P>Notes to Unaudited Financial Statements - Continued</P>
</U><P>The cumulative effect of the SFAS No. 133 adjustments was an after-tax reduction of OCI of approximately $719,000 related to the change in the time value and fair value of interest rate swaps.</P>
<B><U><P>Item 2. Management's Discussion and Analysis Of Financial Condition And Results Of Operations</P>
</B></U><P ALIGN="JUSTIFY">&#9;When used in this report, press releases and elsewhere by management or the Company from time to time, the words, "believes," "anticipates," and "expects" and similar expressions are intended to identify forward-looking
statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that involve certain risks and uncertainties. A variety of factors could cause actual results to differ materially from those anticipated in the Company's
forward-looking statements, which include the risk factors that are discussed from time to time in the Company's reports filed with the SEC, most recently in the Company's 2000 Annual Report on Form 10-K. Readers are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of the date such statements are made. The Company undertakes no obligations to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or
circumstances after the date such statements are made or to reflect the occurrence of unanticipated events.</P>
<B><P ALIGN="JUSTIFY">Results of Operations </P>
</B><P ALIGN="JUSTIFY">&#9;For the three months ended March 31, 2001, net sales increased to $143,310,000 from $140,872,000 for the three months ended March 31, 2000, representing a 1.7% increase. Net sales for the quarter ended March 31, 2001 for
companies acquired during the third quarter of 2000 account for $8,774,000 of the consolidated net sales for the first quarter of 2001. Excluding the net sales generated from those acquisitions, net sales for the first quarter of 2001 were $134,536,000,
for a decrease of 4.6% from the same period in 2000. International sales for the first quarter of 2001 increased to $25,795,000 from $12,266,000 for the same period of 2000. Excluding the sales from 2000 acquisitions, international sales for the three
months ended March 31, 2001 were $19,400,000.</P>
<P ALIGN="JUSTIFY">&#9;Gross profit for the three months ended March 31, 2001 decreased to $31,323,000 from $33,758,000 for the three months ended March 31, 2000, while the gross profit percentage for the three months ended March 31, 2001 decreased to
21.9% from 24.0% for the same period of 2000. Decreased margins of both the Aggregate and Mining Group and the Underground Group primarily accounted for the decrease in gross profit for the first quarter of 2001 compared to the same period of 2000. For
the three months ended March 31, 2001, the decreased margins for both of those industry segments related to reduced sales volumes resulting from economic uncertainty of customers, competitive price pressure and under utilization of capacity. The
Underground Group also experienced a significant downturn in international sales volume for the first quarter of 2001 compared to the first quarter of 2000.</P>
<P ALIGN="JUSTIFY">&#9;Selling, general and administrative expenses for the three months ended March 31, 2001 were $20,960,000 or 14.6% of net sales, compared to $18,255,000 or 13.0% of net sales for the three months ended March 31, 2000, an increase of
$2,705,000. Approximately $1,296,000 of the increase in selling, general and administrative expenses for the three months ended March 31, 2001 compared to the same period in 2000 relates to acquisitions made during the last quarter of 2000. The remaining
increase related mainly to an increase in sales and marketing personnel in the Underground Group.</P>
<P ALIGN="JUSTIFY">&#9;Interest expense increased to $2,339,000 for the three months ended March 31, 2001 from $2,186,000 for the three months ended March 31, 2000. Interest expense as a percentage of net sales was approximately 1.6% for the three months
ended March 31, 2001 and 2000. The increase in interest expense related primarily to borrowings required for 2000 acquisitions and for increased working capital.</P>
<P ALIGN="JUSTIFY">&#9;Other income, net of other expense, was $644,000, or 0.5% of net sales for the quarter ended March 31, 2001, compared to $802,000, or 0.6% of net sales for the quarter ended March 31, 2000. The decrease in other income, net of
other expense for the three months ended March 31, 2001 related primarily to increased goodwill amortization and a decrease in exchange rate gain of a foreign subsidiary compared to the same period in 2000. </P>
<P ALIGN="JUSTIFY">&#9;Income tax expense for the first quarter of 2001 decreased to $3,337,000 from $5,492,000 for the quarter ended March 31, 2000, a decrease of $2,155,000, or 39.2%. Tax expense was 2.3% of net sales for the three months ended March
31, 2001 and 3.9% of net sales for the three months ended March 31, 2000. The effective tax rate for the three months ended March 31, 2001 was 38.5% and the effective tax rate for the three months ended March 31, 2000 was 38.9%.</P>
<P ALIGN="JUSTIFY">&#9;Backlog of orders at March 31, 2001 was $74,342,000 compared to $118,610,000 at March 31, 2000, restated for acquisitions. With the exception of the Mobile Asphalt Paving Group, the backlog of confirmed orders at March 31, 2001 had
declined in each of the Company's industry segments from the same period in 2000. Management believes that this decline is reflective of the current economic conditions in the United States and the hesitancy of the Company's customers to commit to capital
equipment purchases. The Company is unable to determine whether this backlog effect was experienced by the industry as a whole.</P>
<B><P ALIGN="JUSTIFY">Liquidity and Capital Resources </P>
</B><P ALIGN="JUSTIFY">&#9;As of March 31, 2001, the Company had working capital of $171,350,000 compared to $155,736,000 at December 31, 2000. Total short-term borrowings, including current maturities of long-term debt, were $2,189,000 at March 31, 2001
compared to $1,987,000 at March 31, 2000. A financing agreement for imported, purchased inventory items accounts for $1,130,000 of the short-term borrowings at March 31, 2001, while outstanding Industrial Development Revenue Bonds accounted for $500,000
of the current maturities of long-term debt at March 31, 2001 and December 31, 2000. Net cash used by operating activities for the three months ended March 31, 2001 was $11,653,000 compared to net cash provided by operating activities of $893,000 for the
three months ended March 31, 2000.</P>
<P ALIGN="JUSTIFY">Long-term debt, less current maturities, increased to $127,780,000 at March 31, 2001 from $118,511,000 at December 31, 2000, an increase of $9,269,000. At March 31, 2001 debt of approximately $107,245,000 was outstanding under the
revolving credit facility and $19,200,000 was the principal amount of Industrial Revenue Bonds outstanding. The increase in debt from December 31, 2000 related to the funding of working capital needs using the revolving credit facility.</P>
<P ALIGN="JUSTIFY">&#9;Capital expenditures in 2001 for plant expansion and for further modernization of the Company's manufacturing processes are expected to be approximately $11,000,000. The Company expects to finance these expenditures using the
revolving credit facility and internally generated funds. Capital expenditures for the three months ended March 31, 2001 were $2,311,000, compared to $5,627,000 at March 31, 2000.</P>
<P ALIGN="JUSTIFY">The Company has an unsecured $150,000,000 revolving credit facility with a bank that expires on November 22, 2002. As part of the revolving credit facility, Astec Industries, Inc. may borrow up to $130,000,000, while Astec Financial
Services, Inc. has a segregated portion of up to $50,000,000, the total borrowing limited to $150,000,000. At March 31, 2001, Astec Financial Services' portion of outstanding debt under the revolving credit facility was $20,645,000. Advances to Astec
Financial Services, Inc. under this line of credit are limited to "Eligible Receivables" of Astec Financial Services, Inc. as defined in the credit agreement that governs the credit facility. The Company was in compliance with all financial covenants
related to the line of credit at March 31, 2001.</P>
<B><P ALIGN="JUSTIFY">Contingencies</P>
</B><P ALIGN="JUSTIFY">&#9;The Company is engaged in certain pending litigation involving claims or other matters arising in the ordinary course of business. Most of these claims involve product liability or other tort claims for property damage or
personal injury against which the Company is insured. As a part of its litigation management program, the Company maintains general liability insurance covering product liability and other similar tort claims providing the Company coverage of $8,000,000
subject to a substantial self-insured retention under the terms of which the Company has the right to coordinate and control the management of its claims and the defense of these actions. </P>
<P ALIGN="JUSTIFY">Management has reviewed all claims and lawsuits and, upon the advice of its litigation counsel, has made provision for any estimable losses. Notwithstanding the foregoing, the Company is unable to predict the ultimate outcome of any
outstanding claims and lawsuits. </P>
<B><P ALIGN="JUSTIFY">Risk Factors</P>
</B><P ALIGN="JUSTIFY">The information contained in this Form 10-Q is not a complete description of our business or the risks associated with an investment in us. Readers are referred to documents filed by Astec with the Securities and Exchange
Commission, specifically our 2000 Form 10-K, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements, some of which include: uncertainty in the economy, rising oil and liquid
asphalt prices, rising interest rates, decreased funding for highway projects, the timing of large contracts, production capacity, general business conditions in the industry, the ability to integrate acquisitions, demand for the Company's products,
seasonality and cyclicality in operating results, seasonality of sales volumes, and competitive activity.</P>
</FONT><B><P ALIGN="JUSTIFY">PART II - OTHER INFORMATION </P>
<U><FONT SIZE=2><P ALIGN="JUSTIFY">Item 1. Legal Proceedings</U> </P>
</B><P ALIGN="JUSTIFY">&#9;There have been no material developments in the legal proceedings previously reported by the registrant since the filing of its Annual Report on Form 10-K for the year ended December 31, 2000. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations - Contingencies" in Part I - Item 2 of this Report. </P>
<B><U><P ALIGN="JUSTIFY">Item 5. Other Items</P>
</B></U><I><P ALIGN="JUSTIFY">&#9;</I>The proxy statement solicited by the Board of Directors of the Company with respect to the 2001 Annual Meeting of Shareholders (to be held in 2002) will confer discretionary authority on the proxies named therein to
vote on any shareholder proposals intended to be presented for consideration at such Annual Meeting that are submitted to the Company after November 23, 2001 and on or before February 10, 2002.</P>
<B><U><P ALIGN="JUSTIFY">Item 6. Exhibits and Reports on Form 8-K</U> </P>
</B><P ALIGN="JUSTIFY">(a) Exhibits: <U>Exhibit No.</U>&#9;<U>Description</P>
</U><P ALIGN="JUSTIFY">3.1&#9;Restated Charter of the Company (incorporated by reference to the Company's Registration Statement on Form S-1, effective June 18, 1986, File No. 33-5348).</P>
<P ALIGN="JUSTIFY">3.2&#9;Articles of Amendment to the Restated Charter of the Company, effective September 12, 1988 (incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December 31, 1988, File No. 0-14714).</P>
<P ALIGN="JUSTIFY">3.3&#9;Articles of Amendment to the Restated Charter of the Company, effective June 8, 1989 (incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December 31, 1989, File No. 0-14714).</P>
<P ALIGN="JUSTIFY">3.4&#9;Articles of Amendment to the Restated Charter of the Company, effective January 15, 1999 (incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1999, File No. 0-14714).</P>
<P ALIGN="JUSTIFY">3.5&#9;Amended and Restated Bylaws of the Company, adopted March 14, 1990 (incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December 31, 1989, File No. 0-14714).</P>
<P ALIGN="JUSTIFY">4.1&#9;Trust Indenture between City of Mequon and FirstStar Trust Company, as Trustee, dated as of February 1, 1994 (incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December 31, 1993, File No.
0-14714).</P>
<P ALIGN="JUSTIFY">4.2&#9;Indenture of Trust, dated April 1, 1994, by and between Grapevine Industrial Development Corporation and Bank One, Texas, NA, as Trustee (incorporated by reference to the Company's Annual Report on Form 10-K for the year ended
December 31, 1993, File No. 0-14714).</P>
<P ALIGN="JUSTIFY">4.3 Shareholder Protection Rights Agreement, dated December 22, 1995 (incorporated by reference to the Company's Current Report on Form 8-K dated December 22, 1995, File No. 0-14714).</P>
<P ALIGN="JUSTIFY">27 Financial Data Schedule (EDGAR Filing Only).</P>
<P><BR>
Reports on Form 8-K:<BR>
&#9;<BR>
&#9;No reports on Form 8-K have been filed during the quarter ended March 31, 2001.<BR>
&#9;<BR>
&nbsp;</P>
<P ALIGN="CENTER"><BR>
<B>SIGNATURES <BR>
</B>&#9;Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. </P>
<P ALIGN="CENTER">ASTEC INDUSTRIES, INC. <BR>
(Registrant) </P>
<U><P>/s/ J. Don Brock&#9;</U>&#9;&#9;&#9;&#9;<U>/s/ J. Don Brock&#9;&#9;</U> <BR>
Date 5/14/2001&#9;&#9;&#9;&#9; &#9;J. Don Brock <BR>
&#9;&#9;&#9; &#9;&#9; &#9;Chairman of the Board <BR>
&#9;&#9;&#9;&#9;&#9; &#9;and President </P>
<U><P>/s/ F. McKamy Hall</U>&#9;&#9;&#9;&#9;<U>/s/ F. McKamy Hall&#9; </U><BR>
Date 5/14/2001&#9;&#9;&#9;&#9; F. McKamy Hall<BR>
&#9;&#9;&#9;&#9;&#9;&#9;Vice President and Chief <BR>
&#9;&#9;&#9;&#9;&#9;&#9;Financial Officer<BR>
&#9;&#9;&#9;&#9;&#9;&#9;&#9;<BR>
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