UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                              FORM 10-Q

               QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                    OF THE SECURITIES EXCHANGE ACT OF 1934

     For the quarterly period ended        Commission file number
          September 30, 2001                      000-29619

                          KIEWIT MATERIALS COMPANY
           (Exact name of registrant as specified in its charter)

       Delaware                                    47-0819021
(State of Incorporation)              (I.R.S. Employer Identification No.)

   Kiewit Plaza, Omaha Nebraska                        68131
(Address of principal executive offices)             (Zip Code)

                                   (402) 536-3661
               (Registrant's telephone number, including area code)

      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. Yes [ X ]  No [  ]

      The number of shares outstanding of each of the registrant's classes of
common stock as of November 13, 2001:


          Title of Class                       Shares Outstanding
    Common Stock, $0.01 par value                   36,219,902


----------------------------------------------------------------------End Page


                    KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

                                 Table of Contents

                                                                         Page
-----------------------------------------------------------------------------

                          PART I - FINANCIAL INFORMATION
                          ------------------------------

Item 1.    Financial Statements.

           Consolidated Condensed Balance Sheets as of September 30, 2001
               and December 31, 2000                                        1
           Consolidated Condensed Statements of Earnings for the three
               and nine months ended September 30, 2001 and 2000            2
           Consolidated Condensed Statements of Cash Flows for the nine
               months ended September 30, 2001 and 2000                     3
           Notes to Consolidated Condensed Financial Statements             4

Item 2.    Management's Discussion and Analysis of Financial Condition
               and Results of Operations.                                  11

Item 3.    Quantitative and Qualitative Disclosure About Market Risk.      14


PART II - OTHER INFORMATION
                           ---------------------------

Item 6.    Exhibits and Reports on Form 8-K.                               15

Signatures                                                                 16

Index to Exhibits                                                          17
-----------------------------------------------------------------------------

----------------------------------------------------------------------End Page


                  KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

                    Consolidated Condensed Balance Sheets

                                             September 30,      December 31,
                                                 2001              2000
(in thousands, except share data)             (unaudited)
----------------------------------------------------------------------------
Assets

Current assets:
  Cash and cash equivalents                   $   116,144        $   68,468
  Receivables, less allowance of $1,897
   and $1,424                                      70,193            67,556
  Inventories                                      14,596            14,126
  Deferred income taxes                             4,305             3,625
  Other                                             4,670             3,176
                                              -----------         ---------
Total current assets                              209,908           156,951

Property, plant and equipment, less accumulated
   depreciation of $122,065  and $111,982         142,271           139,005
Goodwill, less accumulated amortization of
   $9,359 and $7,413                               56,978            58,924
Intangible and other assets                        20,361            20,234
                                              -----------         ---------
Total assets                                  $   429,518         $ 375,114
                                              ===========         =========

Liabilities and Redeemable Common Stock

Current liabilities:
  Accounts payable                            $    36,570        $   26,632
  Accounts payable with affiliates                 20,194            14,908
                                              -----------         ---------
Total accounts payable                             56,764            41,540

  Current portion of long-term debt                 1,637             1,112
  Accrued payroll and payroll taxes                 6,351             6,824
  Accrued insurance costs                           6,531             5,293
  Income taxes payable                              5,065             1,964
  Other                                             4,475             4,112
                                              -----------         ---------
Total current liabilities                          80,823            60,845

Long-term debt, less current portion                2,706             3,779
Convertible debentures                             15,836             8,075
Deferred income taxes                              15,042            12,528
Other liabilities                                     456               789
Minority interest                                   1,185             1,087
                                              -----------         ---------
Total liabilities                                 116,048            87,103
                                              -----------         ---------

Preferred Stock, par $.01; 10 million shares
  authorized, no shares issued                          -                 -

Redeemable Common Stock ($285 million aggregate redemption value):
  Common Stock, par $.01; 100 million
   shares authorized, 36,239,881 and
   36,463,482 issued and outstanding                  362               365
  Additional paid-in capital                      175,736           177,490
  Retained earnings                               137,372           110,156
                                              -----------         ---------
  Total redeemable common stock                   313,470           288,011
                                              -----------         ---------
Total liabilities and redeemable common stock $   429,518         $ 375,114
                                              ===========         =========
---------------------------------------------------------------------------
See accompanying notes to consolidated condensed financial statements.
-------------------------------------------------------------------End Page 1


                   KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

                 Consolidated Condensed Statement of Earnings
                                 (unaudited)

                                Three Months Ended       Nine Months Ended
                                  September 30,            September 30,
                                -------------------------------------------
(in thousands)                   2001         2000        2001        2000
----------------------------------------------------------------------------

Revenue                        $ 135,748   $ 128,462   $ 383,251   $ 347,316
Revenue from affiliates            1,299       6,378       4,697      12,843
                               ---------   ---------   ---------   ---------
Total revenue                    137,047     134,840     387,948     360,159

Cost of revenue                 (107,862)   (109,620)   (310,573)   (298,076)
Depreciation, depletion and
   amortization                   (5,806)     (5,329)    (17,341)    (15,045)
                               ---------   ---------   ---------   ---------
Gross profit                      23,379      19,891      60,034      47,038

General and administrative
   expenses                       (7,525)     (6,675)    (20,753)    (18,517)
Gain on sale of property,
   plant and equipment             1,753          95       3,535         532
                               ---------   ---------   ---------   ---------
Operating earnings                17,607      13,311      42,816      29,053
                               ---------   ---------   ---------   ---------

Other income (expense):
  Investment income                1,122       1,043       3,577       3,749
  Interest expense                  (329)       (120)       (800)     (1,402)
  Other, net                        (160)        222         (63)        291
                               ---------   ---------   ---------   ---------
Total other income (expense)         633       1,145       2,714       2,638
                               ---------   ---------   ---------   ---------

Earnings before income taxes
   and minority interest          18,240      14,456      45,530      31,691
Minority interest in net
   earnings of subsidiaries          (43)        (49)       (102)        (34)
Provision for income taxes        (7,296)     (5,805)    (18,212)    (12,673)
                               ---------   ---------   ---------   ---------

Net earnings                   $  10,901   $   8,602   $  27,216   $  18,984
                               =========   =========   =========   =========

Net earnings per share:
  Basic                        $     .30   $     .24   $     .75   $     .52
                               =========   =========   =========   =========
  Diluted                      $     .29   $     .24   $     .73   $     .52
                               =========   =========   =========   =========

See accompanying notes to consolidated condensed financial statements.
-------------------------------------------------------------------End Page 2


                  KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

               Consolidated Condensed Statements of Cash Flows

                                                      Nine Months Ended
                                                        September 30,
                                                ----------------------------
(in thousands)                                        2001            2000
----------------------------------------------------------------------------

Cash flows from operations:
  Net cash provided by operations               $    62,531      $    23,718
                                                -----------      -----------

Cash flows from investing activities:
  Sales of marketable securities                          -            2,500
  Short-term note receivable                         (5,824)               -
  Proceeds from sales of property, plant
    and equipment                                     7,347              982
  Purchases of plant and equipment                  (11,220)         (24,509)
  Investments in land and mineral properties         (6,626)               -
  Acquisitions                                       (2,156)         (78,174)
                                                -----------      -----------
    Net cash used in investing activities           (18,479)         (99,201)
                                                -----------      -----------

Cash flows from financing activities:
  Issuance of convertible debentures                  7,798              670
  Payments on long-term debt                         (2,417)            (417)
  Issuance of common stock                            1,318                -
  Repurchases of common stock                        (3,075)               -
  Contributions from former parent                        -           50,374
                                                -----------      -----------
     Net cash provided by financing activities        3,624           50,627
                                                -----------      -----------

Net increase (decrease) in cash and cash
   Equivalents                                       47,676          (24,856)

Cash and cash equivalents at beginning of period     68,468           72,368
                                                -----------      -----------

Cash and cash equivalents at end of period      $   116,144      $    47,512
                                                ===========      ===========
----------------------------------------------------------------------------
See accompanying notes to consolidated condensed financial statements.
-------------------------------------------------------------------End Page 3


                 KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

             NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                    (in thousands, except per share data)

1.   Organization:

     Kiewit Materials Company ("KMC") was formed on February 2, 1999 as a
wholly owned subsidiary of Peter Kiewit Sons', Inc. ("PKS").  The
consolidated condensed financial statements include the accounts of KMC and
its subsidiaries (collectively, the "Company").  KMC's subsidiaries
represent several affiliated operating corporations under common ownership,
each of which is engaged in an aspect of the materials business, that were
combined (the "Combination") on March 1, 1999 through a series of non-
monetary contributions from PKS.  On September 30, 2000, KMC became an
independent company when PKS spun off its materials businesses in a tax-free
transaction (the "Spin-off").

     The Combination has been accounted for at historical cost in a manner
similar to a pooling of interests.  All significant intercompany transactions
have been eliminated in consolidation.

2.  Basis of Presentation:

    Subsequent to the Spin-off, the consolidated condensed financial
statements include the accounts and operations of the Company on a stand-
alone basis.  PKS and the Company have entered into a number of agreements to
facilitate the transition of the Company to an independent business
enterprise.

    Prior to the Spin-off, the consolidated condensed financial statements
reflect the assets, liabilities, revenues and expenses that were directly
related to the Company as they were operated within PKS.  Where assets and
liabilities were not specifically identifiable to any particular business of
PKS, only those assets and liabilities transferred to the Company are
included in the Company's consolidated balance sheets.  Regardless of the
allocation of these assets and liabilities, however, the Company's
consolidated condensed statements of earnings include all of the related
costs of doing business including an allocation of certain general corporate
expenses of PKS which were not directly related to the Company including
costs for information technology, finance, legal, and corporate executive.
These allocations were based on a variety of factors including, for example,
personnel, space, time and effort and sales volume.  Management believes
these allocations were made on a reasonable basis.

    The financial information included herein for periods prior to the Spin-
off may not necessarily be indicative of the financial position, results of
operations or cash flows of the Company if it had been a separate,
independent company during the periods prior to the Spin-off.

    The consolidated balance sheet of the Company at December 31, 2000 has
been condensed from the Company's audited balance sheet as of that date.  All
other financial statements contained herein are unaudited and, in the opinion
of management, contain all adjustments (consisting only of normal recurring
accruals) necessary for a fair presentation of financial position and results
of operations for the periods presented.  The consolidated condensed
financial statements should be read in conjunction with the consolidated
financial statements and the notes thereto included in the Company's Annual
Report on Form 10K filed with the Securities and Exchange Commission on March
29, 2001.  When appropriate, items within the consolidated condensed
financial statements have been reclassed in the previous periods to conform
to current year presentation.

    The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes.  Actual results could differ from those estimates.

    The results of operations for the nine months ended September 30, 2001
are not necessarily indicative of the results to be expected for the full
year.
-------------------------------------------------------------------End Page 4


                   KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

      NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS - (Continued)
                    (in thousands, except per share data)

3.  Separation of KMC:

    On September 30, 2000, PKS management separated PKS's construction
business and materials business into two separate, independent companies by
distributing shares of common stock of KMC it then held as a dividend on a
pro rata basis to PKS stockholders in the Spin-off.  PKS stockholders
received one share of KMC common stock for each share of PKS common stock
they held on the record date.

    In connection with the Spin-off, KMC and PKS entered into various
agreements including a Separation Agreement and a Tax Sharing Agreement.

    The Separation Agreement provides for the allocation of certain risks and
responsibilities between KMC and PKS and for cross-indemnifications that are
intended to allocate financial responsibility to PKS for liabilities arising
out of the construction business and to allocate to KMC liabilities arising
out of the materials business.

    Under the Tax Sharing Agreement, with respect to periods, or portions
thereof, ending on or before the Spin-off, KMC and PKS generally will be
responsible for paying the taxes relating to such returns, including any
subsequent adjustments resulting from the redetermination of such tax
liabilities by the applicable taxing authorities, that are allocable to the
materials businesses and construction businesses, respectively.  The Tax
Sharing Agreement also provides that KMC and PKS will indemnify the other
from certain taxes and expenses that would be assessed if the Spin-off were
determined to be taxable, but solely to the extent that such determination
arose out of the breach by KMC or PKS, respectively, of certain
representations made to the Internal Revenue Service in connection with the
private letter ruling issued with respect to the Spin-off.

4.   Earnings Per Share:

     Basic earnings per share have been computed using the weighted average
number of shares outstanding during each period.  Diluted earnings per share
gives effect to convertible debentures considered to be dilutive common stock
equivalents.  The potentially dilutive convertible debentures are calculated
in accordance with the "if converted" method.  This method assumes that the
after-tax interest expense associated with the debentures is an addition to
income and the debentures are converted into equity with the resulting common
shares being aggregated with the weighted average shares outstanding.

    Earnings per share, as presented in the Consolidated Condensed Statements
of Earnings was calculated as if the 36,343,869 common shares issued in
connection with the Spin-off were outstanding for all periods prior to the
Spin-off.
-------------------------------------------------------------------End Page 5


                   KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

      NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS - (Continued)
                    (in thousands, except per share data)

                                Three Months Ended       Nine Months Ended
                                  September 30,            September 30,
                                -------------------------------------------
                                 2001         2000        2001        2000
                                --------------------------------------------


Net earnings available to
   common stockholders          $  10,901   $  8,602   $  27,216   $  18,984
Interest expense, net of tax
   effect, associated with
   convertible debentures             143          1         327           1
                                ---------   --------   ---------   ---------
Net earnings for diluted shares $  11,044   $  8,603   $  27,543   $  18,985
                                =========   ========   =========   =========

Total number of weighted
   average shares outstanding
   used to compute basic
   earnings per share              36,244     36,344      36,275      36,344
Additional dilutive shares
   assuming conversion of
   convertible debentures           1,800         22       1,374           7
                                ---------   --------   ---------   ---------
Total number of shares used to
   compute diluted earnings
   per share                       38,044     36,366      37,649      36,351
                                =========   ========   =========   =========

Net Earnings per share:
  Basic                         $     .30   $    .24   $     .75   $     .52
                                =========   ========   =========   =========
  Diluted                       $     .29   $    .24   $     .73   $     .52
                                =========   ========   =========   =========

5.   Inventories:

     Inventories consist of the following:

                                       September 30,           December 31,
                                           2001                    2000
                                       -------------           ------------
Raw materials                          $      12,765           $     12,147
Other                                          1,831                  1,979
                                       -------------           ------------
Total inventories                      $      14,596           $     14,126
                                       =============           ============
---------------------------------------------------------------------------

6.   Intangible and Other Assets:

     Intangible and other assets consist of the following:

                                       September 30,           December 31,
                                           2001                    2000
                                       -------------           ------------
Intangible assets, net of accumulated
 amortization of $1,880 and $1,363     $      15,084           $     15,454
Land option                                    2,000                  2,000
Notes receivable                               2,900                  2,403
Other                                            377                    377
                                       -------------           ------------
Total intangible and other assets      $      20,361           $     20,234
                                       =============           ============


-------------------------------------------------------------------End Page 6


                  KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

      NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS - (Continued)
                    (in thousands, except per share data)

7.   Comprehensive Income:

     Comprehensive income includes net earnings and unrealized gains (losses)
on securities.

     Comprehensive income for the three and nine months ended September 30,
2001 and 2000 was as follows:

                                Three Months Ended       Nine Months Ended
                                  September 30,            September 30,
                                -------------------------------------------
                                 2001         2000        2001        2000
                                --------------------------------------------

Net earnings                    $  10,901   $  8,602     $ 27,216   $ 18,984
Other comprehensive income
 (loss), before tax:
Unrealized losses
 arising during period                  -          -            -         (1)
                                ---------   --------     --------   --------

Comprehensive income            $  10,901   $  8,602     $ 27,216   $ 18,983
                                =========   ========     ========   ========

8.   Segment Reporting:

     The Company has four operating segments: Arizona Operations, Pacific
Northwest Operations, Northern California Operations and Quarries Operations,
which represent separately managed strategic business units that have
different marketing strategies.  Arizona Operations derives its revenue from
the sale of aggregates, ready-mix, asphalt and paving operations.  The
Pacific Northwest Operations and Northern California Operations derive their
revenues from the sale of aggregates, ready-mix and asphalt.  Quarries
Operations derives its revenue from the sale of aggregates.  Arizona and
Pacific Northwest Operations meet the requirements of the quantitative
thresholds and are being disclosed as reportable operating segments.  Other
Operations includes the Northern California and Quarries Operations.
Corporate Operations include corporate overhead, amortization and management
fees for corporate overhead, which collectively are not reported to the chief
operating decision maker by segment.

     The Company evaluates operating performance based on profit or loss from
operations before the following items: goodwill amortization related to
acquisitions, interest income, interest expense, management fees for
corporate overhead and income taxes.

     Due to geographic locations, no intersegment sales or transfers are made
between the segments.  Segment asset information has not been presented as it
is not reported to or reviewed by the chief operating decision maker.


-------------------------------------------------------------------End Page 7

                  KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

      NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS - (Continued)
                    (in thousands, except per share data)

                                 Pacific
                      Arizona    Northwest     Other     Corporate
                     Operations  Operations  Operations  Operations   Total
                     ------------------------------------------------------
Three months ended
September 30, 2001
------------------

Revenues             $  102,113  $  17,366  $  17,568  $       -   $137,047
Depreciation,
   depletion and
   amortization      $    2,581  $   1,368  $   1,143  $     714   $  5,806
Operating income
   (loss)           $    13,723  $   2,950  $   4,764  $  (3,830)  $ 17,607
Three months ended September 30, 2000
Revenues             $  100,124  $  19,301  $  15,415  $       -   $134,840
Depreciation,
   depletion and
   amortization      $    2,135  $   1,460  $     939  $     795   $  5,329
Operating income
   (loss)            $    7,802  $   3,097  $   3,296  $    (884)  $ 13,311

                                 Pacific
                      Arizona    Northwest     Other     Corporate
                     Operations  Operations  Operations  Operations   Total
                     ------------------------------------------------------

Nine months ended
September 30, 2001
Revenues             $  304,595  $  39,094  $  44,259   $      -   $387,948
Depreciation,
   depletion and
   amortization      $    7,795  $   3,980  $   3,210   $  2,356   $ 17,341
Operating income
   (loss)            $   37,648  $   5,358  $  10,639   $(10,829)  $ 42,816

Nine months ended
September 30, 2000
Revenues             $  280,687  $  43,578  $  35,894   $      -   $360,159
Depreciation,
   depletion and
   amortization      $    6,973  $   3,852  $   2,345   $  1,875   $15,045
Operating income
   (loss)            $   21,316  $   5,297  $   8,587   $ (6,147)  $29,053

     The Company's revenues by product for the three and nine months ended
September 30, 2001 and 2000 are as follows:

                                Three Months Ended       Nine Months Ended
                                  September 30,            September 30,
                                -------------------------------------------
                                 2001         2000        2001        2000
                                --------------------------------------------


Aggregates (sand, gravel,
   crushed stone and railroad
   ballast)                     $  38,998  $  30,883   $  95,361   $  82,852
Asphalt                            19,879     25,033      63,640      57,554
Ready mix concrete                 75,245     75,472     218,103     211,161
Other                               2,925      3,452      10,844       8,592
                                ---------   --------   ---------   ---------
Total revenue                   $ 137,047  $ 134,840   $ 387,948   $ 360,159
                                =========  =========   =========   =========

-------------------------------------------------------------------End Page 8


                  KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

      NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS - (Continued)
                    (in thousands, except per share data)

9.   Acquisitions:

     On January 3, 2000, the Company acquired 100% of the outstanding common
stock and related assets of Solano Concrete Co., Inc., a materials operation
operating in the Northern California area, for $30,880.  The acquisition was
accounted for by the purchase method of accounting.  Identifiable intangible
assets related to this purchase of $15,448 are being amortized over their
useful life of 27.5 years.  There was no goodwill related to this
transaction.

     On August 4, 2000, the Company acquired substantially all of the assets
of Fort Calhoun Stone Company, a limestone quarry located in Washington
County, Nebraska, for $41,753.  The acquisition was accounted for by the
purchase method of accounting.  The excess of aggregate purchase price over
fair value of identifiable assets and liabilities acquired of $30,836 was
recognized as goodwill and is being amortized over 40 years.

     The following pro forma financial information assumes the aforementioned
acquisitions occurred at the beginning of 2000.  These results have been
prepared for comparative purposes only and do not purport to be indicative of
what would have occurred had the acquisition been made at the beginning of
2000, or the results which may occur in the future:

                                Three Months Ended       Nine Months Ended
                                  September 30,            September 30,
                                -------------------------------------------
                                 2001         2000        2001        2000
                                --------------------------------------------

Revenue                         $ 137,047  $ 135,862    $ 387,948  $ 365,528

Net earnings                    $  10,901  $   8,897    $  27,216  $  20,069

Net earnings per share:
  Basic                         $     .30  $     .24    $     .75  $     .55
  Diluted                       $     .29  $     .24    $     .73  $     .55
----------------------------------------------------------------------------

     During 2001 and 2000, the Company acquired the assets of various
materials operations and invested in land and mineral property other than
those described above.  All of these were accounted for by the purchase
method and, accordingly, results of operations for the acquired businesses
have been included in the Consolidated Statements of Earnings from their
respective dates of acquisition.  Pro forma financial information is not
presented for these acquisitions because the impact is not material to the
results of operations.  The aggregate purchase prices were $8,782 and $7,803
during 2001 and 2000, respectively.  Contingent consideration of $1,500 may
be paid in 2001 based on a seller obtaining permits and zoning.  Notes
payable of $1,235 and $1,762 were issued in connection with the 2001 and 2000
purchases, respectively.  Goodwill related to these acquisitions was $962
during 2000, and is being amortized over 27.25 years.
-------------------------------------------------------------------End Page 9

                  KIEWIT MATERIALS COMPANY AND SUBSIDIARIES

      NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS - (Continued)
                    (in thousands, except per share data)

10.  Other Matters:

     The Company is involved in various lawsuits and claims incidental to its
business.  Management believes that any resulting liability, beyond that
provided, should not materially affect the Company's future financial
position, results of operations or cash flows.

-------------------------------------------------------------------End Page 10


Item 2. Management's Discussion and Analysis of Financial Condition and
        Results of Operations

         This document contains forward-looking statements and information
that are based on the beliefs of management as well as assumptions made by
and information currently available to the Company.  When used in this
document, the words "anticipate," "believe," "estimate," "expect" and
similar expressions, as they relate to the Company or its management, are
intended to identify forward-looking statements.  Such statements reflect the
current views of the Company with respect to future events and are subject to
certain risks or uncertainties and assumptions.  Should one or more of these
risks or uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those described in this
document.

         The following discussion is based upon and should be read in
conjunction with our Consolidated Condensed Financial Statements, including
the notes thereto, included elsewhere in this quarterly report on Form 10-Q.

         On September 30, 2000, Peter Kiewit Sons', Inc. ("PKS") management
separated PKS's construction business and materials business into two
separate, independent companies by distributing shares of common stock of
Kiewit Materials Company ("KMC") to PKS stockholders in a tax-free
transaction (the "Spin-off").  Prior to the completion of the share
exchange, the debenture exchange offer and the Spin-off described below, KMC
was a wholly owned subsidiary of PKS.

         On August 15, 2000, PKS commenced a share exchange in which it
offered PKS stockholders who were KMC employees the opportunity to exchange
their shares of PKS common stock for shares of KMC common stock with an equal
aggregate formula price.  The share exchange expired September 14, 2000.  In
the share exchange, KMC employees collectively exchanged 1,081,226 shares of
PKS common stock, representing 100% of the shares of PKS common stock
collectively owned by them and 3.24% of the total issued and outstanding PKS
common stock on September 14, 2000.  For each share of PKS common stock
tendered, KMC employees received 2.85 shares of KMC common stock.  KMC
employees who participated in the share exchange collectively received
3,081,646 shares of KMC common stock, representing 8.48% of the issued and
outstanding KMC common stock on September 15, 2000.

         On August 15, 2000, PKS also commenced a debenture exchange offer in
which it offered the holders of its outstanding convertible debentures the
opportunity to exchange their debentures for (1) KMC debentures convertible
into shares of KMC common stock, or (2) both shares of KMC common stock and
new reduced principal amount PKS debentures convertible into shares of PKS
common stock.  In the debenture exchange offer, PKS debentureholders
collectively exchanged $13,095,000 principal amount original PKS debentures
for (1) $670,000 aggregate principal amount KMC debentures, and (2) both
973,383 shares of KMC common stock and $5,475,045 principal amount new PKS
debentures.

         On September 30, 2000, PKS distributed the shares of KMC common
stock it then held as a dividend on a pro rata basis to holders of PKS common
stock in the Spin-off.  The record date for the Spin-off dividend was the
close of business on September 15, 2000.  PKS stockholders received one share
of KMC common stock for each share of PKS common stock they held on the
record date.

         Upon completion of the Spin-off, PKS no longer had any interest in
its materials operations.  The materials operations are owned and operated
solely by KMC.  The Spin-off has not and is not expected to adversely impact
KMC's equity, revenue or net income.  Current cash flows are expected to be
sufficient to fund current operations.  KMC's ability to execute its future
growth strategy will, however, be dependent upon its ability to continue to
obtain borrowings on terms deemed appropriate.
-------------------------------------------------------------------End Page 11


Results of Operations - Third Quarter of 2001 vs. Third Quarter of 2000

         Revenue.  Revenue increased $2 million to $137 million for the third
quarter of 2001 as compared to $135 million in the same period of 2000.
Revenue from Arizona Operations increased $2 million primarily due to higher
average selling prices partially offset by a 10% decline in unit sales of
aggregates.  Revenue from Pacific Northwest Operations decreased $2 million
between the two periods resulting from a 32% decline in asphalt unit sales
volumes.  Other Operations increased $2 million as revenue produced from 2000
acquisitions compensated for a 15% decrease in aggregate unit sales.

         Gross Profit.  Gross profit margins increased to 17% in the third
quarter of 2001 from 15% in the third quarter of 2000.  Gross profit for the
Arizona Operations increased largely due to improved asphalt margins as a
result of higher average selling prices.  Gross profit margins for both
Pacific Northwest Operations and Other Operations declined as they were
adversely affected by the decreases in unit volume sales.

         General and Administrative.  General and administrative expenses
increased $.9 million in the third quarter of 2001 when compared to the same
period of 2000.  Arizona Operations and Pacific Northwest Operations
experienced an increase in costs primarily due to higher legal and
professional service expenses.  Corporate Operations experienced an increase
due to ongoing costs related to becoming an independent company in September
2000.

         Gain on Sale of Property, Plant and Equipment.  Gains from the sale
of property, plant and equipment increased $2 million in the third quarter of
2001 when compared to the same period in 2000 due to a gain recognized on the
sale of land in the Arizona Operations.

         Other Income and Expenses.  Other income decreased $0.5 million in
the third quarter of 2001 when compared to same period in 2000.  The decrease
was attributable to higher interest expense resulting from a higher
convertible debenture balance and less other income.

         Income Tax Expense.  The income tax rates for the third quarter of
2001 and 2000 were unchanged at 40%.  Income taxes differ from the federal
statutory rate primarily because of state income taxes and percentage
depletion.

Results of Operations - Nine Months 2001 vs. Nine Months 2000

         Revenue.  Revenue increased $28 million to $388 million for the
first nine months of 2001 as compared to $360 million for the same period of
2000.  Revenue from Arizona Operations increased $24 million due to higher
unit sales of aggregates and asphalt.  The operating division also benefited
from higher average asphalt selling prices as the division became more
selective in supplying the market in an effort to improve gross profit
margins.  Revenue from Pacific Northwest Operations decreased $4 million
between the two periods resulting from an 8% decline in aggregate unit
volumes and a 16% decline in asphalt unit volumes.  Other Operations
increased $8 million as revenue produced from 2000 acquisitions compensated
for a 29% decrease in aggregate unit sales.

         Gross Profit.  Gross profit margins increased to 15% in the first
nine months of 2001 from 13% in the first nine months of 2000.  Gross profit
for the Arizona Operations increased largely due to improved asphalt margins
as a result of higher average selling prices.  Gross profit margins for both
Pacific Northwest Operations and Other Operations declined as they were
adversely affected by the decreases in unit volume sales.

     General and Administrative.  General and administrative expenses
increased $2 million in the first nine months of 2001 when compared to the
same period of 2000.  Arizona Operations expenses were unchanged when
compared to the same period in 2000.  The implementation of cost efficiency
measures offset the additional costs to support the unit volume increases.
Pacific Northwest Operations experienced a slight decrease due to a reduction
in activities necessary to support the lower unit volumes.  Other Operations
expenses increased to support an expanded operating area as a result of an
-------------------------------------------------------------------End Page 12


acquisition in the second half of 2000.  Corporate Operations experienced an
increase due to ongoing costs related to becoming an independent company in
September 2000.

         Gain on Sale of Property, Plant and Equipment.  Gains from the sale
of property, plant and equipment increased $3 million in the first nine
months of 2001 when compared to the same period in 2000 due to gains
recognized on the sale of land in the Pacific Northwest Operations and the
Arizona Operations.

         Other Income and Expenses.  Other income increased $0.1 million in
the first nine months of 2001 when compared to the same period in 2000.  The
increase was attributable to lower interest expense due to the payoff of
long-term debt.

         Income Tax Expense.  The income tax rates for the first nine months
of 2001 and 2000 were unchanged at 40%.  Income taxes differ from the federal
statutory rate primarily because of state income taxes and percentage
depletion.

Financial Condition - September 30, 2001

         Cash and cash equivalents increased $48 million to $116 million at
September 30, 2001 from $68 million at December 31, 2000.  The increase
reflects cash provided from operations of $63 million and $4 million provided
by financing activities offset by $19 million used in investing activities.

         Net cash provided by operations amounted to $63 million compared to
$24 million for the same period in 2000.  The $39 million increase was mainly
due to higher net income of $8 million and increases in accounts payable and
income taxes payable balances due to the timing of vendor and estimated tax
payments.

         Net cash used in investing activities in the first nine months of
2001 decreased $80 million as compared to the first nine months of 2000.  A
$76 million decrease in acquisitions, $7 million decrease in purchases of
plant and equipment and investments in land and mineral properties and an
increase in proceeds from sales of property, plant and equipment of $6
million comprised the decreases in cash used in investing activities.  These
were partially offset by a $3 million decrease in proceeds from the sales of
marketable securities and a $6 million increase in accounts receivable due to
the issuance of a short-term note receivable.

         Net cash provided by financing activities decreased $47 million
compared to the first nine months of 2000.  The decrease was mainly due to
the receipt of a final capital contribution from former parent of $50 million
in 2000, repurchases of common stock of $3 million and payments on long-term
debt of $2 million.  These decreases were slightly offset by increases in
cash provided by issuances of convertible debentures and common stock of $8
million.

         KMC believes that its current cash position together with
anticipated cash flows from operations will be sufficient for the working
capital and equipment replacement requirements of KMC for the next twelve
months.  KMC does not have any established credit facilities.  At September
30, 2001, KMC had $20 million of notes payable and convertible debentures
payable.  Further, KMC does not currently intend to pay any cash dividends.

         KMC intends to pursue a business plan to grow through acquisitions
that will require capital that is in addition to ongoing operational
requirements.  While historically KMC has received contributions from PKS to
fund a portion of acquisitions, KMC believes that cash on hand, cash
generated by operations and the ability to borrow funds will allow KMC to
make investments in connection with future acquisitions.  Ultimate growth
strategy capital requirements will largely depend on the number of
acquisition candidates, the cost of the acquisitions, and the level of
success KMC has in completing these transactions.  Should KMC be unable to
obtain any necessary funds from borrowings on terms deemed appropriate, KMC
would be limited in its ability to fully execute its growth strategy.  While
KMC believes its growth strategy to be important in enhancing shareholder
value, KMC does not believe that the inability to fully pursue it would have
a material adverse impact on current operations, financial condition or
liquidity.

-------------------------------------------------------------------End Page 13


Recent Accounting Pronouncements.

         In September 1998, the Financial Accounting Standards Board issued
SFAS No. 133, "Accounting for Derivative Instruments and Hedging
Activities," which established accounting and reporting standards for
derivative instruments and for hedging activities.  This statement as
amended, is effective for all fiscal years beginning after September 15,
2000.  The adoption of this statement on January 1, 2001 had no impact on our
financial statements as KMC has no derivative instruments or hedging
activities.

         In July 2001, the Financial Accounting Standards Board ("FASB")
issued Statements of Financial Accounting Standards No. 141 (SFAS 141),
"Business Combinations," and No. 142 (SFAS 142), "Goodwill and Other
Intangible Assets."

         SFAS 141 supercedes Accounting Principles Board Opinion No. 16 (APB
16), "Business Combinations."  The most significant changes made by SFAS 141
are: (1) requiring that the purchase method of accounting be used for all
business combinations initiated after June 30, 2001, (2) establishing
specific criteria for the recognition of intangible assets separately from
goodwill, and (3) requiring unallocated negative goodwill to be written off
immediately as an extraordinary gain (instead of being deferred and
amortized).

         SFAS 142 supercedes APB 17, "Intangible Assets."  SFAS 142
primarily addresses the accounting for goodwill and intangible assets
subsequent to their acquisition (i.e., the post-acquisition accounting).  The
provisions of SFAS 142 will be effective for fiscal years beginning after
December 15, 2001.  The most significant changes made by SFAS 142 are: (1)
goodwill and indefinite-lived intangible assets will no longer be amortized,
(2) goodwill will be tested for impairment at least annually at the reporting
unit level, (3) intangible assets deemed to have an indefinite life will be
tested for impairment at least annually, and (4) the amortization period of
intangible assets with finite lives will no longer be limited to forty years.

         During June 2001, the FASB issued SFAS No. 143 (SFAS 143),
Accounting for Asset Retirement Obligations.  This Statement addresses
financial accounting and reporting for obligations associated with the
retirement of tangible long-lived assets and the associated asset retirement
costs.  SFAS 143 requires an enterprise to record the fair value of an asset
retirement obligation as a liability in the period in which it incurs a legal
obligation associated with the retirement of a tangible long-lived asset.
SFAS 143 is effective for fiscal years beginning after June 15, 2002.

         On October 3, 2001, the FASB issued SFAS No. 144 (SFAS 144),
Accounting for the Impairment or Disposal of Long-Lived Assets, which
addresses financial accounting and reporting for the impairment or disposal
of long-lived assets.  While SFAS 144 supersedes SFAS No. 121, Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
Of, it retains many of the fundamental provisions of that Statement.  SFAS
144 is effective for fiscal years beginning after December 31, 2001.

         KMC has not yet determined the effect the adoption of SFAS No. 141,
142, 143 and 144 will have on our consolidated financial position or results
of operations.


Item 3.  Quantitative and Qualitative Disclosure about Market Risk.

         KMC does not believe that its business is subject to significant
market risks arising from interest rates, foreign exchange rates or equity
prices.
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PART II - OTHER INFORMATION


Item 6.  Exhibits and Reports on Form 8-K.

         a) Exhibits required by Item 601 of Regulation S-K.  Exhibits
            incorporated by reference are indicated in parentheses:

            Exhibit
            Number    Description
            -------   -----------

            3.1       Restated Certificate of Incorporation, effective July
                      28, 2000 (Incorporated by reference to Exhibit 3.1 to
                      Amendment No. 5 to Kiewit Materials Company's
                      Registration Statement on Form 10, filed with the
                      Securities and Exchange Commission on September 15,
                      2000)

            3.2       Amended and Restated By-laws, effective July 28, 2000
                      (Incorporated by reference to Exhibit 3.2 to the
                      Amendment No. 5 to Kiewit Materials Company's
                      Registration Statement on Form 10, filed with the
                      Securities and Exchange Commission on September 15,
                      2000).

            4.1       Indenture, dated as of September 14, 2000, by and
                      between Kiewit Materials Company and UMB Bank, N.A., as
                      trustee.  (Incorporated by reference to Exhibit 4.1 to
                      the Company's Quarterly Report on Form 10-Q, for the
                      quarter ended June 30, 2000).

            4.2       Form of Series 2000A Convertible Debentures due October
                      31, 2010 of Kiewit Materials Company.  (Incorporated by
                      reference to Exhibit 4.2 to the Company's Quarterly
                      Report on Form 10-Q, for the quarter ended June 30,
                      2000).

            4.3       Form of Series 2000B Convertible Debentures due October
                      31, 2010 of Kiewit Materials Company.  (Incorporated by
                      reference to Exhibit 4.3 to the Company's Quarterly
                      Report on Form 10-Q, for the quarter ended June 30,
                      2000).

            4.4       Form of Series 2000C Convertible Debentures due October
                      31, 2010 of Kiewit Materials Company.  (Incorporated by
                      reference to Exhibit 4.4 to the Company's Quarterly
                      Report of Form 10-Q, for the quarter ended June 30,
                      2000).

            4.5       Form of Series 2000D Convertible Debentures due
                      November 30, 2010 of Kiewit Materials Company
                      (Incorporated by reference to Exhibit 4.4 to the
                      Company's Registration Statement on Form S-8 filed
                      October 13, 2000).

            4.6       Form of Repurchase Agreement for Convertible Debentures
                      (Incorporated by reference to Exhibit 4.15 to Amendment
                      No. 4 to the Company's and Kiewit's Joint Registration
                      Statement on Form S-4 filed with the Securities and
                      Exchange Commission on August 8, 2000).

            4.7       Form of Series 2001 Convertible Debentures due July 31,
                      2011 of Kiewit Materials Company (Incorporated by
                      reference to Exhibit 4.4 to the Company's Registration
                      Statement on Form S-8 filed June 7, 2001).

         b)  No reports on Form 8-K have been filed during the third quarter
             of 2001.

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                                   SIGNATURES

         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.

                                      KIEWIT MATERIALS COMPANY

Date: November 13, 2001
                                      /s/ Donald E. Bowman
                                      --------------------------------
                                      Donald E. Bowman
                                      Vice President, Chief Financial Officer

-------------------------------------------------------------------End Page 16

                           KIEWIT MATERIALS COMPANY

                              INDEX TO EXHIBITS

            Exhibit
            Number    Description
            -------   -----------

            3.1       Restated Certificate of Incorporation, effective July
                      28, 2000 (Incorporated by reference to Exhibit 3.1 to
                      Amendment No. 5 to Kiewit Materials Company's
                      Registration Statement on Form 10, filed with the
                      Securities and Exchange Commission on September 15,
                      2000)

            3.2       Amended and Restated By-laws, effective July 28, 2000
                      (Incorporated by reference to Exhibit 3.2 to the
                      Amendment No. 5 to Kiewit Materials Company's
                      Registration Statement on Form 10, filed with the
                      Securities and Exchange Commission on September 15,
                      2000).

            4.1       Indenture, dated as of September 14, 2000, by and
                      between Kiewit Materials Company and UMB Bank, N.A., as
                      trustee.  (Incorporated by reference to Exhibit 4.1 to
                      the Company's Quarterly Report on Form 10-Q, for the
                      quarter ended June 30, 2000).

            4.2       Form of Series 2000A Convertible Debentures due October
                      31, 2010 of Kiewit Materials Company.  (Incorporated by
                      reference to Exhibit 4.2 to the Company's Quarterly
                      Report on Form 10-Q, for the quarter ended June 30,
                      2000).

            4.3       Form of Series 2000B Convertible Debentures due October
                      31, 2010 of Kiewit Materials Company.  (Incorporated by
                      reference to Exhibit 4.3 to the Company's Quarterly
                      Report on Form 10-Q, for the quarter ended June 30,
                      2000).

            4.4       Form of Series 2000C Convertible Debentures due October
                      31, 2010 of Kiewit Materials Company.  (Incorporated by
                      reference to Exhibit 4.4 to the Company's Quarterly
                      Report of Form 10-Q, for the quarter ended June 30,
                      2000).

            4.5       Form of Series 2000D Convertible Debentures due
                      November 30, 2010 of Kiewit Materials Company
                      (Incorporated by reference to Exhibit 4.4 to the
                      Company's Registration Statement on Form S-8 filed
                      October 13, 2000).

            4.6       Form of Repurchase Agreement for Convertible Debentures
                      (Incorporated by reference to Exhibit 4.15 to Amendment
                      No. 4 to the Company's and Kiewit's Joint Registration
                      Statement on Form S-4 filed with the Securities and
                      Exchange Commission on August 8, 2000).

            4.7       Form of Series 2001 Convertible Debentures due July 31,
                      2011 of Kiewit Materials Company (Incorporated by
                      reference to Exhibit 4.4 to the Company's Registration
                      Statement on Form S-8 filed June 7, 2001).


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