##### Table of Contents



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 September 30, 2006
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File No 001-32440
 READY MIX, INC.
  Nevada
(State or other Jurisdiction of 
incorporation or organization)
    
    86-0830443
(I.R.S. Employer Identification Number)
 3430 East Flamingo Road, Suite 100
Las Vegas, Nevada 89121
(702) 433-2090
 þ o
  o o þ
 o þ
  Common Stock, $.001 par value
3,807,500 shares




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##### 



READY MIX, INC.
INDEX
REPORT ON FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2006
 PART I. FINANCIAL INFORMATIONItem 1. Financial StatementsCondensed Balance Sheets  As of September 30, 2006 (Unaudited) and December 31, 2005
    
    
    3Condensed Statements of Operations (Unaudited)  Nine months and three months ended September 30, 2006 and 2005 and Statement of Changes in Stockholders Equity (Unaudited)
    
    
    4Condensed Statements of Cash Flows (Unaudited)  Nine months ended September 30, 2006 and 2005
    
    
    5Notes to Condensed Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    16Item 3. Quantitative and Qualitative Disclosure About Market Risk
    
    
    24Item 4. Controls and Procedures
    
    
    25PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    25Item 1A. Risk Factors
    
    
    25Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    25Item 3. Defaults Upon Senior Securities
    
    
    25Item 4. Submission of Matters to a Vote of Security Holders
    
    
    25Item 5. Other Information
    
    
    25Item 6. Exhibits
    
    
    26EX-31.1EX-31.2EX-732.1
  2




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 READY MIX, INC.
 
 CONDENSED BALANCE SHEETS
 September 30,
    
    
    December 31,2006
    
    
    2005(Unaudited)Assets:Current assets:Cash and cash equivalents
    
    $
    9,723,473
    
    
    $
    12,110,417Accounts receivable, net
    
    
    10,368,551
    
    
    
    8,502,504Inventory
    
    
    1,384,653
    
    
    
    604,906Prepaid expenses
    
    
    1,052,988
    
    
    
    1,114,001Deferred tax asset
    
    
    192,240
    
    
    
    184,591Total current assets
    
    
    22,721,905
    
    
    
    22,516,419Property and equipment, net
    
    
    24,999,016
    
    
    
    17,049,210Refundable deposits
    
    
    658,338
    
    
    
    341,165Total assets
    
    $
    48,379,259
    
    
    $
    39,906,794Liabilities and stockholders equity:Current liabilities:Accounts payable
    
    $
    5,910,650
    
    
    $
    4,146,636Accrued liabilities
    
    
    2,211,015
    
    
    
    1,735,287Notes payable
    
    
    2,377,594
    
    
    
    1,670,643Obligations under capital leases
    
    
    365,720
    
    
    
    468,972Due to affiliate
    
    
    20,732
    
    
    
    84,810Income tax payable
    
    
    355,170
    
    
    
    224,514Total current liabilities
    
    
    11,240,881
    
    
    
    8,330,862Notes payable, less current portion
    
    
    8,573,355
    
    
    
    5,625,360Obligations under capital leases, less current portion
    
    
    9,201
    
    
    
    254,946Deferred tax liability
    
    
    1,729,472
    
    
    
    1,729,472Total liabilities
    
    
    21,552,909
    
    
    
    15,940,640Commitments and contingenciesStockholders equity:Preferred stock  $.001 par value; 5,000,000 shares authorized,
none issued and outstanding
    
    
    
    
    
    
    Common stock  $.001 par value; 15,000,000 shares authorized,
3,807,500 issued and outstanding
    
    
    3,808
    
    
    
    3,808Additional paid-in capital
    
    
    17,753,535
    
    
    
    17,632,465Retained earnings
    
    
    9,069,007
    
    
    
    6,329,881Total stockholders equity
    
    
    26,826,350
    
    
    
    23,966,154Total liabilities and stockholders equity
    
    $
    48,379,259
    
    
    $
    39,906,794
  3




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READY MIX, INC.
 
 CONDENSED STATEMENTS OF OPERATIONS AND
 CHANGES IN STOCKHOLDERS EQUITY
 (Unaudited)
 Nine months ended
    
    
    Three months endedSeptember 30,
    
    
    September 30,2006
    
    
    2005
    
    
    2006
    
    
    2005Revenue:Revenue
    
    $
    64,349,284
    
    
    $
    49,965,790
    
    
    $
    20,419,050
    
    
    $
    18,708,224Revenue  related parties
    
    
    372,867
    
    
    
    703,186
    
    
    
    173,963
    
    
    
    143,314Total revenue
    
    
    64,722,151
    
    
    
    50,668,976
    
    
    
    20,593,013
    
    
    
    18,851,538Cost of revenue
    
    
    57,287,589
    
    
    
    45,074,022
    
    
    
    18,671,984
    
    
    
    16,407,852Gross profit
    
    
    7,434,562
    
    
    
    5,594,954
    
    
    
    1,921,029
    
    
    
    2,443,686General and administrative expenses
    
    
    3,291,073
    
    
    
    2,153,774
    
    
    
    901,837
    
    
    
    571,507Income from operations
    
    
    4,143,489
    
    
    
    3,441,180
    
    
    
    1,019,192
    
    
    
    1,872,179Other income (expense):Interest income
    
    
    297,171
    
    
    
    65,516
    
    
    
    117,133
    
    
    
    51,266Interest expense
    
    
    (115,943
    )
    
    
    (191,768
    )
    
    
    (52,029
    )
    
    
    (60,898
    )Other income (expense)
    
    
    10,882
    
    
    
    16,192
    
    
    
    (2,942
    )
    
    
    3,903192,110
    
    
    
    (110,060
    )
    
    
    62,162
    
    
    
    (5,729
    )Income before income taxes
    
    
    4,335,599
    
    
    
    3,331,120
    
    
    
    1,081,354
    
    
    
    1,866,450Income tax expense
    
    
    1,596,473
    
    
    
    1,199,203
    
    
    
    401,266
    
    
    
    671,922Net income
    
    $
    2,739,126
    
    
    $
    2,131,917
    
    
    $
    680,088
    
    
    $
    1,194,528Basic net income per common share
    
    $
    0.72
    
    
    $
    0.94
    
    
    $
    0.18
    
    
    $
    0.43Diluted net income per common share
    
    $
    0.71
    
    
    $
    0.93
    
    
    $
    0.18
    
    
    $
    0.42Basic weighted average common
shares outstanding
    
    
    3,807,500
    
    
    
    2,270,417
    
    
    
    3,807,500
    
    
    
    2,761,250Diluted weighted average common
shares outstanding
    
    
    3,842,273
    
    
    
    2,290,073
    
    
    
    3,807,500
    
    
    
    2,820,220
 Common StockNumber of
    
    
    
    
    
    
    AdditionalShares
    
    
    
    
    
    
    Paid-in
    
    
    RetainedOutstanding
    
    
    Amount
    
    
    Capital
    
    
    EarningsBalance at January 1, 2006
    
    
    3,807,500
    
    
    $
    3,808
    
    
    $
    17,632,465
    
    
    $
    6,329,881Stock based compensation
expense
    
    
    
    
    
    
    
    
    
    
    121,070Net income for the nine months
ended September 30, 2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,739,126Balance at September 30, 2006
    
    
    3,807,500
    
    
    $
    3,808
    
    
    $
    17,753,535
    
    
    $
    9,069,007
  4




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READY MIX, INC.
 
 CONDENSED STATEMENTS OF CASH FLOWS
 (Unaudited)
 Nine months endedSeptember 30,2006
    
    
    2005Increase (decrease) in cash and cash equivalents:Cash flows from operating activities:Cash received from customers
    
    $
    62,881,516
    
    
    $
    49,370,122Cash paid to suppliers and employees
    
    
    (56,628,845
    )
    
    
    (45,892,202
    )Taxes paid
    
    
    (1,473,466
    )
    
    
    (2,168,367
    )Interest received
    
    
    297,171
    
    
    
    65,516Interest paid
    
    
    (115,943
    )
    
    
    (191,768
    )Net cash provided by operating activities
    
    
    4,960,433
    
    
    
    1,183,301Cash flows from investing activities:Purchase of property and equipment
    
    
    (7,731,132
    )
    
    
    (2,496,214
    )Proceeds from sale of property and equipment
    
    
    8,500
    
    
    
    Net cash used in investing activities
    
    
    (7,722,632
    )
    
    
    (2,496,214
    )Cash flows from financing activities:Proceeds from the issuance of common stock
    
    
    
    
    
    
    17,747,900Offering costs from the issuance of common stock
    
    
    
    
    
    
    (597,081
    )Repayment of due to affiliate
    
    
    (64,078
    )
    
    
    (1,358,093
    )Proceeds from notes payable
    
    
    3,083,540
    
    
    
    543,598Repayment of notes payable
    
    
    (2,295,210
    )
    
    
    (2,028,642
    )Repayment of capital lease obligations
    
    
    (348,997
    )
    
    
    (328,082
    )Net cash provided by financing activities
    
    
    375,255
    
    
    
    13,979,600Net increase (decrease) in cash and cash equivalents
    
    
    (2,386,944
    )
    
    
    12,666,687Cash and cash equivalents at beginning of period
    
    
    12,110,417
    
    
    
    1,424,629Cash and cash equivalents at end of period
    
    $
    9,723,473
    
    
    $
    14,091,316Reconciliation of net income to net cash provided by
operating activities:Net income
    
    $
    2,739,126
    
    
    $
    2,131,917Adjustments to reconcile net income to net cash
provided by operating activities:Depreciation and amortization
    
    
    2,635,501
    
    
    
    1,752,135Loss on sale of equipment
    
    
    3,941
    
    
    
    Intercompany income tax allocation payable
    
    
    
    
    
    
    (1,298,367
    )Deferred taxes, net
    
    
    (7,649
    )
    
    
    329,203Stock-based compensation expense
    
    
    121,070
    
    
    
    Provision for doubtful accounts
    
    
    (10,589
    )
    
    
    (278,390
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    (1,855,458
    )
    
    
    (1,315,046
    )Prepaid expenses
    
    
    61,013
    
    
    
    (131,420
    )Inventory
    
    
    (779,747
    )
    
    
    (34,314
    )Refundable deposits
    
    
    (317,173
    )
    
    
    (133,422
    )Accounts payable
    
    
    1,764,014
    
    
    
    (202,488
    )Accrued liabilities
    
    
    475,728
    
    
    
    363,493Income tax payable
    
    
    130,656
    
    
    
    Net cash provided by operating activities
    
    $
    4,960,433
    
    
    $
    1,183,301
  5




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READY MIX, INC.
 
 NOTES TO CONDENSED FINANCIAL STATEMENTS
 1. Summary of Significant Accounting Policies and Use of Estimates:
 Presentation of Interim Information:
  Seasonal Variations:
  Nature of Corporation:
  Revenue Recognition:
  Earnings per Share:
  Stock-Based Compensation:
   
    
    Expected term is determined using a weighted average of the contractual term and vesting
period of the award;
 6




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READY MIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
 1. Summary of Significant Accounting Policies and Use of Estimates (Continued):
 Stock-Based Compensation (Continued):
 
    
    Expected volatility is measured using the weighted average of historical daily changes
in the market price of the Companys peer groups common stock over the expected term of
the award. The peer group is used since the Company does not have sufficient historical
daily changes in its common stock over the expected term of the award;
    
    Risk-free interest rate is equivalent to the implied yield on zero-coupon U.S. Treasury
bonds with a remaining maturity equal to the expected term of the awards; and,
    
    Forfeitures are based on the history of cancellations of similar awards granted by the
Company and managements analysis of potential forfeitures.
   Nine months endedSeptember 30,2005Net income, as reported
    
    $
    2,131,917Add: Stock-based employee compensation expense included in reported
income, net of related tax effects
    
    
    Deduct: Total stock-based employee compensation expense determined
under fair value based methods for all awards, net of related tax effects
    
    
    72,657Pro forma net income
    
    $
    2,059,260Basic net income per common shareAs reported
    
    $
    0.94Pro forma
    
    
    0.91Diluted net income per common shareAs reported
    
    $
    0.93Pro forma
    
    
    0.90
 New Accounting Pronouncements:
  7




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READY MIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
 1. Summary of Significant Accounting Policies and Use of Estimates (Continued):
 New Accounting Pronouncements (Continued):
       8




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READY MIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
 2. Stock-Based Compensation:
     Equity Incentive Plan
    Awards prior toJanuary 1, 2006Dividend yield
    
    
    0
    %Expected volatility
    
    
    21.4% - 23.3
    %Weighted-average volatility
    
    
    21.55
    %Risk-free interest rate
    
    
    5.00
    %Expected life of options (in years)
    
    
    3Weighted-average grant-date fair value
    
    $
    2.02
  9




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READY MIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
 2. Stock-Based Compensation (Continued):
  Weighted AverageWeighted Average
    
    
    Remaining
    
    
    Aggregate
    
    
    AggregateExercise Price
    
    
    Contractural
    
    
    Fair
    
    
    IntrinsicShares
    
    
    per Share
    
    
    Term (1)
    
    
    Value
    
    
    Value (2)Outstanding January 1, 2006
    
    
    253,125
    
    
    $
    11.12
    
    
    
    3.89
    
    
    $
    511,616Granted
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited or expired
    
    
    (2,500
    )
    
    
    11.00
    
    
    
    
    
    
    
    (4,875
    )Outstanding September 30, 2006
    
    
    250,625
    
    
    $
    11.12
    
    
    
    3.39
    
    
    $
    506,741
    
    
    $
    Exercisable September 30, 2006
    
    
    76,791
    
    
    $
    11.00
    
    
    
    3.33
    
    
    $
    149,742
    
    
    $
    
 
 (1)
    
    Remaining contractual term is presented in years.(2)
    
    The aggregate intrinsic value is calculated as the difference between the
exercise price of the underlying awards and the closing price of our common stock as of
September 30, 2006, for those awards that have an exercise price currently below the
closing price as of September 30, 2006. Awards with an exercise price above the closing
price as of September 30, 2006 are considered to have no intrinsic value.  Weighted AverageGrant-DateShares
    
    Fair ValueNonvested stock options at January 1, 2006
    
    
    253,125
    
    
    $
    2.02Granted
    
    
    
    
    
    
    Vested
    
    
    (76,791
    )
    
    
    1.95Forfeited
    
    
    (2,500
    )
    
    
    1.95Nonvested stock options at September 30, 2006
    
    
    173,834
    
    
    $
    2.05
  3. Statement of Cash Flows:
 Non-Cash Investing and Financing Activities:
    10




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READY MIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
 4. Notes Payable:
  September 30,
    
    
    December 31,2006
    
    
    2005Note payable, variable interest rate was 7.75% at March 31,
2006, with monthly principal payments of $4,121, due March
11,
2006, collateralized by equipment
    
    $
    
    
    
    $
    12,3636.65% note payable, with monthly payments of $723, due
July 9, 2006, collateralized by equipment
    
    
    
    
    
    
    4,2555.99% note payable, with monthly payments of $471, due
September 28, 2008, collateralized by a vehicle
    
    
    10,636
    
    
    
    14,307Non-interest bearing note payable, with monthly payments of
$390, due February 12, 2007, collateralized by equipment
    
    
    1,950
    
    
    
    5,4595.31% note payable, with monthly payments of $1,730, due
March 22, 2009, collateralized by vehicles
    
    
    48,511
    
    
    
    61,8555.31% note payable, with monthly payments of $788, due
April 8, 2009, collateralized by a vehicle
    
    
    22,084
    
    
    
    28,1596.21% note payable, with monthly payments of $4,921 and a
principal payment of $443,902, due April 16, 2009,
collateralized
by land
    
    
    514,222
    
    
    
    534,0226.34% note payable, with monthly payments of $3,450 and a
principal payment of $309,412, due April 16, 2009,
collateralized
by land
    
    
    357,943
    
    
    
    371,6045.90% note payable, with monthly principal payments of
$1,905,
plus interest, due May 24, 2007, collateralized by equipment
    
    
    15,238
    
    
    
    32,3805.22% note payable, with monthly payments of $10,398, due
May 25, 2008, collateralized by equipment
    
    
    198,776
    
    
    
    282,7365.75% note payable, with monthly payments of $59,149, due
April 20, 2006, collateralized by equipment
    
    
    
    
    
    
    233,7907.05% note payable, with monthly payments of $2,930 and
a principal payment of $254,742, due August 27, 2009,
collateralized by land
    
    
    297,149
    
    
    
    307,6458.55% note payable, with monthly payments of $22,071, due
February 27, 2006, collateralized by vehicles
    
    
    
    
    
    
    43,6765.90% note payable, with monthly payments of $593, due
December 15, 2009, collateralized by vehicles
    
    
    21,006
    
    
    
    25,3096.60% note payable, with monthly payments of $30,812, due
December 15, 2007, collateralized by equipment
    
    
    442,468
    
    
    
    690,9926.60% note payable, with monthly payments of $22,806, due
December 29, 2007, collateralized by equipment
    
    
    327,490
    
    
    
    511,434$
    2,257,473
    
    
    $
    3,159,986
 11




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READY MIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
 4. Notes Payable (Continued):
  September 30,
    
    
    December 31,2006
    
    
    2005Total from previous page
    
    $
    2,257,473
    
    
    $
    3,159,9865.90% notes payable, with combined monthly payments
of $5,322, due dates ranging from January 31, 2010 to
March 11, 2010, collateralized by vehicles
    
    
    194,855
    
    
    
    233,1877.25% note payable, with monthly payments of $4,153, due
May 4, 2009, collateralized by equipment
    
    
    128,757
    
    
    
    166,1397.50% notes payable, with combined monthly principal
payments of $15,100 plus interest, due September 1, 2008,
collateralized by equipment
    
    
    347,299
    
    
    
    483,1986.85% notes payable, with combined monthly payments of
$1,098, due September 28, 2010, collateralized by vehicles
    
    
    45,994
    
    
    
    53,3056.85% note payable, with a monthly payment of $522, due
October 13, 2010, collateralized by a vehicle
    
    
    22,251
    
    
    
    25,705Note payable, variable interest rate was 9.75% at September 30,
2006, with monthly principal payments of $21,429
plus interest, due July 29, 2012, collateralized by
mining water rights
    
    
    1,500,000
    
    
    
    1,692,8577.99% note payable, with monthly principal payments of
$14,362 plus interest, due March 25, 2011, collateralized
by equipment
    
    
    775,542
    
    
    
    8.14% note payable, with monthly principal payments of
$30,470 plus interest, due March 28, 2011, collateralized
by equipment
    
    
    1,645,402
    
    
    
    5.99% note payable, with a monthly payment of $496, due
November 30, 2008, collateralized by a vehicle
    
    
    12,065
    
    
    
    15,893Line of credit, variable interest rate was 8.50% at September 30,
2006, interest only payments until December 31, 2008,
36 equal monthly principal payments plus interest therafter,
collateralized by all of the Companys assets
    
    
    860,263
    
    
    
    1,465,7338.45% notes payable, with combined monthly principal
payments of $26,182 plus interest, due June 28, 2011,
collateralized by equipment
    
    
    1,492,402
    
    
    
    7.46% note payable, with a monthly payment of $13,867, due
May 26, 2021, collateralized by a building and land
    
    
    1,480,135
    
    
    
    $
    10,762,438
    
    
    $
    7,296,003
 12




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READY MIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
 4. Notes Payable (Continued):
  September 30,
    
    
    December 31,2006
    
    
    2005Total from previous page
    
    $
    10,762,438
    
    
    $
    7,296,0037.04% note payable, with monthly principal payments of
$4,496 plus interest, due September 30, 2009,
collateralized by equipment
    
    
    161,867
    
    
    
    7.55% note payable, with a monthly payment of $550, due
July 20, 2011, collateralized by a vehicle
    
    
    26,644
    
    
    
    10,950,949
    
    
    
    7,296,003Less: current portion
    
    
    (2,377,594
    )
    
    
    (1,670,643
    )$
    8,573,355
    
    
    $
    5,625,360
  2007
    
    $
    2,377,5942008
    
    
    1,873,7692009
    
    
    2,725,6282010
    
    
    1,658,2812011
    
    
    958,994Subsequent to 2011
    
    
    1,356,683$
    10,950,949
 5. Line of Credit:
   13




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READY MIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
 6. Commitments:
  2007
    
    $
    981,0382008
    
    
    923,4282009
    
    
    923,4282010
    
    
    923,4282011
    
    
    538,666$
    4,289,988
  2007
    
    $
    167,500
    14




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READY MIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
 7. Earnings per Share:
   Nine months ended
    
    
    Three months endedSeptember 30,
    
    
    September 30,2006
    
    
    2005
    
    
    2006
    
    
    2005Weighted average common shares
outstanding
    
    
    3,807,500
    
    
    
    2,270,417
    
    
    
    3,807,500
    
    
    
    2,761,250Dilutive effect of:Stock options and warrants
    
    
    34,773
    
    
    
    19,656
    
    
    
    
    
    
    
    58,970Weighted average common shares
outstanding assuming dilution
    
    
    3,842,273
    
    
    
    2,290,073
    
    
    
    3,807,500
    
    
    
    2,820,220
   8. Income Taxes:
   15




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READY MIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
 9. Subsequent Events:
   
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Forward-Looking Disclosure
    General
   16




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Overview
 RL Brown Housing Reports The Las Vegas Housing
Market Letter Engineering News-Record
   17




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New Accounting Pronouncements
        18




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##### Table of Contents



Critical Accounting Policies, Estimates and Judgments
       19




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Results of Operations
  Nine months ended
    
    
    Three months endedSeptember 30,
    
    
    September 30,2006
    
    
    2005
    
    
    2006
    
    
    2005(dollars in thousands)
    
    
    
    
    
    (Unaudited)
    
    
    
    
    
    
    (Unaudited)Revenue
    
    $
    64,349
    
    
    
    99.4
    %
    
    $
    49,966
    
    
    
    98.6
    %
    
    $
    20,419
    
    
    
    99.2
    %
    
    $
    18,708
    
    
    
    99.2
    %Related party revenue
    
    
    373
    
    
    
    0.6
    %
    
    
    703
    
    
    
    1.4
    %
    
    
    174
    
    
    
    0.8
    %
    
    
    144
    
    
    
    0.8
    %Total revenue
    
    
    64,722
    
    
    
    100.0
    %
    
    
    50,669
    
    
    
    100.0
    %
    
    
    20,593
    
    
    
    100.0
    %
    
    
    18,852
    
    
    
    100.0
    %Gross profit
    
    
    7,435
    
    
    
    11.5
    %
    
    
    5,595
    
    
    
    11.0
    %
    
    
    1,921
    
    
    
    9.3
    %
    
    
    2,444
    
    
    
    13.0
    %General and
administrative expenses
    
    
    3,291
    
    
    
    5.1
    %
    
    
    2,154
    
    
    
    4.2
    %
    
    
    902
    
    
    
    4.4
    %
    
    
    572
    
    
    
    3.0
    %Income from operations
    
    
    4,143
    
    
    
    6.4
    %
    
    
    3,441
    
    
    
    6.8
    %
    
    
    1,019
    
    
    
    4.9
    %
    
    
    1,872
    
    
    
    10.0
    %Interest income
    
    
    297
    
    
    
    0.5
    %
    
    
    66
    
    
    
    0.1
    %
    
    
    117
    
    
    
    0.6
    %
    
    
    51
    
    
    
    0.3
    %Interest expense
    
    
    (116
    )
    
    
    -0.2
    %
    
    
    (192
    )
    
    
    -0.4
    %
    
    
    (52
    )
    
    
    -0.3
    %
    
    
    (61
    )
    
    
    -0.3
    %Income tax expense
    
    
    (1,596
    )
    
    
    -2.5
    %
    
    
    (1,199
    )
    
    
    -2.4
    %
    
    
    (401
    )
    
    
    -1.9
    %
    
    
    (672
    )
    
    
    -3.6
    %Net income
    
    $
    2,739
    
    
    
    4.2
    %
    
    $
    2,132
    
    
    
    4.2
    %
    
    $
    680
    
    
    
    3.3
    %
    
    $
    1,195
    
    
    
    6.3
    %Depreciation and
amortization
    
    $
    2,636
    
    
    
    4.1
    %
    
    $
    1,752
    
    
    
    3.5
    %
    
    $
    980
    
    
    
    4.8
    %
    
    $
    601
    
    
    
    3.2
    %
 Nine Months Ended September 30, 2006 compared to Nine Months Ended September 30, 2005
 Revenue
 20




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Gross Profit.
 Depreciation and Amortization.
 General and Administrative Expenses.
 Interest Income and Expense.
 Income Taxes.
 Net Income.
 Three Months Ended September 30, 2006 compared to Three Months Ended September 30, 2005
 Revenue.
 21




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##### Table of Contents



Gross Profit. rd
 Depreciation and amortization.
 General and Administrative Expenses.
 Interest Income and Expense.
 Income taxes.
 Net income.
 Liquidity and Capital Resources
   22




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Nine months endedSeptember 30,2006
    
    
    2005(dollars in thousands)
    
    (Unaudited)Cash flows provided by operating activities
    
    $
    4,960
    
    
    $
    1,183Cash flows used in investing activities
    
    
    (7,723
    )
    
    
    (2,496
    )Cash flows provided by financing activities
    
    
    375
    
    
    
    13,980
    23




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##### Table of Contents



Summary of Contractual Obligations and Commercial Commitments
  Payments Due by PeriodLess than
    
    
    1 - 3
    
    
    4 - 5
    
    
    AfterTotal
    
    
    1 Year
    
    
    Years
    
    
    Years
    
    
    5 Years(dollars in thousands)Contractual ObligationsLong-term debt
    
    $
    10,951
    
    
    $
    2,378
    
    
    $
    4,599
    
    
    $
    2,617
    
    
    $
    1,357Interest payments on
long-term debt(1)
    
    
    2,556
    
    
    
    695
    
    
    
    969
    
    
    
    419
    
    
    
    473Capital lease obligations
    
    
    402
    
    
    
    391
    
    
    
    11
    
    
    
    
    
    
    
    Operating leases
    
    
    8,401
    
    
    
    2,573
    
    
    
    4,093
    
    
    
    1,735
    
    
    
    Purchase obligations
    
    
    4,558
    
    
    
    1,397
    
    
    
    2,491
    
    
    
    670
    
    
    
    Other long term liabilities(2)
    
    
    941
    
    
    
    524
    
    
    
    417
    
    
    
    
    
    
    
    Total contractual obligations
    
    $
    27,809
    
    
    $
    7,958
    
    
    $
    12,580
    
    
    $
    5,441
    
    
    $
    1,830
 
 (1)
    
    Interest payments are based on the individual interest rates of each obligation,
which range from 5.22% to 9.75% per annum. We do not assume an increase in the variable
interest rate. See Note 4Notes payable in the accompanying condensed financial
statements.(2)
    
    Other long-term liabilities include employment contracts with two of our key
executive officers that call for annual salaries of $150,000 and $110,000 through
January 2008, and are to be reviewed annually by our Compensation Committee. In
addition, other long-term liabilities include the administrative services agreement
with Meadow Valley in the amount of $22,000 per month expiring December 31, 2008. Website Access
  
 Item 3. Quantitative and Qualitative Disclosure About Market Risk
    24




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Item 4. Controls and Procedures
   
 PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  25




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##### Table of Contents



Item 6. Exhibits
  31.1
    
    Certification of Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.31.2
    
    Certification of Chief Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.32.1
    
    Certifications of Chief Executive Officer and Chief Financial Officer pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.
 
 SIGNATURE
  READY MIX, INC.
(Registrant)By
    
    /s/ Bradley E. Larson

Bradley E. LarsonChief Executive OfficerNovember 13, 2006By
    
    /s/ Clint Tryon

Clint TryonChief Financial Officer, Secretary and Treasurer(Principal Accounting Officer)November 13, 2006
 26