Astec Industries, Inc.

News Release

1725 Shepherd Road | Chattanooga, TN 37421 | Phone (423) 899-5898 | Fax 899-4456

ASTEC INDUSTRIES REPORTS THIRD QUARTER RESULTS WITH HISTORICAL QUARTERLY HIGHS IN REVENUES AND NET INCOME

CHATTANOOGA, Tenn. (October 21, 2008) - Astec Industries, Inc. (Nasdaq:  ASTE) today reported results for its third quarter ended September 30, 2008.

Revenues for the third quarter of 2008 were $237.4 million compared with $206.2 million for the third quarter of 2007 for a 15.1% increase.  Domestic sales accounted for $135.3 million during the third quarter of 2008 compared to $131.7 million during the third quarter of 2007.  International sales accounted for $102.1 million of revenues during the third quarter of 2008 compared to $74.5 million during the third quarter of 2007.  The Company reported net income of $16.0 million for the third quarter of 2008 compared to net income of $11.6 million for the third quarter of 2007 for an increase of 37.9%.  Net income for the third quarter of 2008 was $0.71 per diluted share compared to $0.51 per diluted share for the third quarter of 2007 for a 39.2% increase.

The Company’s backlog at September 30, 2008 was $255.7 million compared to $239.9 million at September 30, 2007 for a 6.6% increase.

Consolidated financial statements for the third quarter ended September 30, 2008 and additional information related to segment revenues, profits, and backlog are attached to this press release.

Commenting on the announcement, Dr. J. Don Brock, Chairman and Chief Executive Officer, stated, “We are very pleased with our third quarter results.  With our present backlog, we expect a strong finish for the year.  The injection of $8.0 billion into the Highway Trust Fund ensures full funding at the federal level for 2009.  Many states, however, are experiencing lower tax revenues as a result of the economic downturn and, in particular, the higher oil prices.  The current trend toward lower oil prices should positively impact the state fuel tax collections as drivers return to the road and reduce the price of asphalt resulting in a greater number of road building contracts.  Furthermore, the growth in the energy and mining portions of our business and the strong possibility of a stimulus package for roads and bridges gives us hope of continued strength and growth in 2009.”

Investor Conference Call and Web Simulcast

Astec will conduct a conference call on October 21, 2008, at 10:00 A.M. Eastern Time to review its third quarter results as well as current business conditions.  The number to call for this interactive teleconference is (877) 407-9210.  International callers should dial (201) 689-8049.   Please reference Astec Industries.

The company will also provide an online Web simulcast and rebroadcast of the conference call.  The live broadcast of Astec’s conference call will be available online at the Company’s website:  www.astecindustries.com/www/docs/100, Conference Calls Section.  An archived webcast will be available for 90 days at www.astecindustries.com.

A replay of the conference call will be available through midnight on Tuesday, November 4, 2008, by dialing (877) 660-6853, or (201) 612-7415 for international callers, Account #286, Conference ID# 300071.  A transcription of the conference call will be made available under the Investor Relation section of the Astec Industries, Inc. website within 5 days after the call.

Astec Industries, Inc. is a manufacturer of specialized equipment for building and restoring the world’s infrastructure.  Astec’s manufacturing operations are divided into four business segments:  aggregate processing and mining equipment; asphalt production equipment; mobile asphalt paving equipment; and underground boring, directional drilling and trenching equipment.  Astec also has a company engaged in the wood chipping and grinding industry.

The information contained in this press release contains "forward-looking statements" (within the meaning of the Private Securities Litigation Reform Act of 1995) regarding the future performance of the Company, including statements about the Company’s financial performance for the fourth quarter and future generally, the ability to maintain or improve margins, the economy, the need for road improvements, state and federal initiatives to increase funding, the awarding of future contracts, the market’s acceptance of new products, the Company’s improving market share, and the increase in international sales.  These forward-looking statements reflect management’s expectations and are based upon currently available information, and the Company undertakes no obligation to update or revise such statements.  These statements are not guarantees of performance and are inherently subject to risks and uncertainties, many of which cannot be predicted or anticipated.  Future events and actual results, financial or otherwise, could differ materially from those expressed in or implied by the forward-looking statements.  Important factors that could cause future events or actual results to differ materially include: general uncertainty in the economy, downturns in the general economy or the commercial construction industry, cyclical nature of the commercial, construction industry and the customization of the equipment the Company sells,  increases in the price of oil or decreases in the availability of oil, increases in the price of raw materials, a failure to comply with covenants in the Company’s credit agreement, contingent liability for certain customer debt, rising interest rates, rising steel and steel component pricing, delayed or decreased funding for highway construction and maintenance, managing and expanding in international markets, the timing of large contracts, production capacity, general business conditions in the industry, demand for the Company’s products, seasonality of sales volumes, competitive activity and those other factors listed from time to time in the Company’s reports filed with the Securities and Exchange Commission, including but not limited to the Company’s annual report on Form 10-K for the year ended December 31, 2007.

For Additional Information Contact:

J. Don Brock

Chairman of the Board & C.E.O.

Phone: (423) 867-4210

Fax: (423) 867-4127

E-mail: dbrock@astecindustries.com

or

F. McKamy Hall

Vice President and Chief Financial Officer

Phone:  (423) 899-5898

Fax:  (423) 899-4456

E-mail: mhall@astecindustries.com

or

Stephen C. Anderson

Secretary / Director of Investor Relations

Phone:  (423) 899-5898

Fax:  (423) 899-4456

E-mail:  sanderson@astecindustries.com

Astec Industries, Inc. and Subsidiaries
Consolidated Balance Sheets
(In thousands)
(Unaudited)
		Sept 30,				Sept 30,
		2008				2007
Assets
Current assets
Cash and cash equivalents		$	28,839			$	48,164
Receivables, net			93,912				83,324
Inventories			249,378				201,982
Prepaid expenses and other			17,158				14,025
Total current assets			389,287				347,495
Property and equipment, net			147,822				137,312
Other assets			68,368				42,689
Total assets		$	605,477			$	527,496
Liabilities and shareholders' equity
Current liabilities
Accounts payable		$	55,115			$	55,303
Other current liabilities			88,131				83,511
Total current liabilities			143,246				138,814
Other non-current liabilities			25,405				22,646
Minority interest in consolidated subsidiary			836				833
Total shareholders' equity			435,990				365,203
Total liabilities and shareholders' equity		$	605,477			$	527,496

Astec Industries, Inc. and Subsidiaries
Consolidated Statements of Operations
(In thousands)
(Unaudited)
		Three Months Ended Sept 30,								Nine Months Ended Sept 30,
		2008				2007				2008				2007
Net sales		$	237,443			$	206,239			$	778,218			$	648,216
Cost of sales			178,640				157,678				586,906				486,339
Gross profit			58,803				48,561				191,312				161,877
Selling, general, administrative & engineering expenses			34,269				31,926				106,638				92,774
Income from operations			24,534				16,635				84,674				69,103
Interest expense			276				149				528				765
Other income, net of expenses			260				638				1,099				2,038
Income before income taxes and minority interest			24,518				17,124				85,245				70,376
Income taxes			8,512				5,482				30,593				24,812
Minority interest in earnings of subsidiary			44				68				99				151
Net income		$	15,962			$	11,574			$	54,553			$	45,413
Earnings per Common Share
Net income
Basic		$	0.72			$	0.52			$	2.45			$	2.08
Diluted		$	0.71			$	0.51			$	2.41			$	2.03
Weighted average common shares outstanding
Basic			22,289,973				22,116,275				22,270,121				21,881,565
Diluted			22,600,978				22,581,075				22,595,174				22,393,677

Astec Industries, Inc. and Subsidiaries
Segment Revenues and Profits
For the three months ended September 30, 2008 and 2007
(in thousands)
(Unaudited)
		Asphalt Group				Aggregate and Mining Group				Mobile Asphalt Paving Group				Underground Group				All Others				Total
2008 Revenues			56,658				90,268				27,993				40,443				22,081				237,443
2007 Revenues			51,860				81,801				33,323				28,335				10,920				206,239
Change $			4,798				8,467				(5,330	)			12,108				11,161				31,204
Change %			9.3	%			10.4	%			(16.0	%)			42.7	%			102.2	%			15.1	%
2008 Gross Profit			17,045				20,402				6,547				11,318				3,491				58,803
2008 Gross Profit %			30.1	%			22.6	%			23.4	%			28.0	%			15.8	%			24.8	%
2007 Gross Profit			12,375				18,700				8,096				7,498				1,892				48,561
2007 Gross Profit %			23.9	%			22.9	%			24.3	%			26.5	%			17.3	%			23.5	%
Change			4,670				1,702				(1,549	)			3,820				1,599				10,242
2008 Profit (Loss)			10,675				10,773				1,465				6,583				(11,948	)			17,548
2007 Profit (Loss)			6,656				8,154				3,542				3,223				(9,794	)			11,781
Change $			4,019				2,619				(2,077	)			3,360				(2,154	)			5,767
Change %			60.4	%			32.1	%			(58.6	%)			104.3	%			(22.0	%)			49.0	%
Segment revenues are reported net of intersegment revenues. Segment gross profit is net of profit on intersegment
revenues. A reconciliation of total segment profits to the Company's consolidated net income is as follows:

		For the three months ended September 30,
		2008				2007
Total profit for all segments		$	17,548			$	11,781
Minority interest in earnings of subsidiary			(44	)			(68	)
Elimination of intersegment profit			(1,542	)			(139	)
Consolidated net income		$	15,962			$	11,574

Astec Industries, Inc. and Subsidiaries
Segment Revenues and Profits
For the nine months ended September 30, 2008 and 2007
(in thousands)
(Unaudited)
		Asphalt Group				Aggregate and Mining Group				Mobile Asphalt Paving Group				Underground Group				All Others				Total
2008 Revenues			200,572				273,753				130,180				109,298				64,415				778,218
2007 Revenues			183,507				253,138				117,662				82,988				10,921				648,216
Change $			17,065				20,615				12,518				26,310				53,494				130,002
Change %			9.3	%			8.1	%			10.6	%			31.7	%			489.8	%			20.1	%
2008 Gross Profit			54,652				66,087				32,696				26,728				11,149				191,312
2008 Gross Profit %			27.2	%			24.1	%			25.1	%			24.5	%			17.3	%			24.6	%
2007 Gross Profit			48,358				62,444				28,999				20,209				1,867				161,877
2007 Gross Profit %			26.4	%			24.7	%			24.6	%			24.4	%			17.1	%			25.0	%
Change			6,294				3,643				3,697				6,519				9,282				29,435
2008 Profit (Loss)			33,964				32,942				16,030				11,972				(38,724	)			56,184
2007 Profit (Loss)			29,827				30,859				14,768				6,515				(36,534	)			45,435
Change $			4,137				2,083				1,262				5,457				(2,190	)			10,749
Change %			13.9	%			6.8	%			8.5	%			83.8	%			(6.0	%)			23.7	%
Segment revenues are reported net of intersegment revenues. Segment gross profit is net of profit on intersegment
revenues. A reconciliation of total segment profits to the Company's consolidated net income is as follows:

		For the nine months ended September 30,
		2008				2007
Total profit for all segments		$	56,184			$	45,435
Minority interest in earnings of subsidiary			(99	)			(151	)
Recapture (elimination) of intersegment profit			(1,532	)			129
Consolidated net income		$	54,553			$	45,413

Astec Industries, Inc. and Subsidiaries
Backlog by Segment
September 30, 2008 and 2007
(in thousands)
(Unaudited)
		Asphalt Group				Aggregate and Mining Group				Mobile Asphalt Paving Group				Underground Group				All Others				Total
2008 Backlog			126,604				104,365				974				14,841				8,880				255,664
2007 Backlog			110,234				96,363				2,779				21,638				8,892				239,906
Change $			16,370				8,002				(1,805	)			(6,797	)			(12	)			15,758
Change %			14.9	%			8.3	%			(65.0	%)			(31.4	%)			(0.1	%)			6.6	%