WASHINGTON, D.C. 20549

For the fiscal year ended December 31, 2005

Commission file number 1-3295

(Exact name of registrant as specified in its charter)

     Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes [X]     No [  ]

     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 [  ]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

     Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer [X]     Accelerated Filer [  ]     Non-accelerated Filer [  ]

     Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act).

Yes [  ]     No [X]

     The aggregate market value of the voting stock held by non-affiliates of the Registrant, based upon the closing price at which the stock was sold as of July 1, 2005, was approximately $1.2 billion. Solely for the purposes of this calculation, shares of common stock held by officers, directors and beneficial owners of 10% or more of the outstanding common stock have been excluded in that such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily a conclusive determination for other purposes.

     As of February 10, 2006, the Registrant had outstanding 19,951,730 shares of common stock, all of one class.

     Minerals Technologies Inc. (the "Company") is a resource-and technology-based company that develops, produces and markets worldwide a broad range of specialty mineral, mineral-based and synthetic mineral products and supporting systems and services. The Company has two reportable segments: Specialty Minerals and Refractories. The Specialty Minerals segment produces and sells the synthetic mineral product precipitated calcium carbonate ("PCC") and the processed mineral product quicklime ("lime"), and mines, processes and sells other natural mineral products, primarily limestone and talc. This segment's products are used principally in the paper, building materials, paint and coatings, glass, ceramic, polymer, food and pharmaceutical industries. The Refractories segment produces and markets monolithic and shaped refractory materials and specialty products, services and application equipment used primarily by the steel, non-ferrous metal and glass industries.

     The Company emphasizes research and development. The level of the Company's research and development spending, as well as its capability for developing and introducing technologically advanced new products, have enabled the Company to anticipate and satisfy changing customer requirements, creating market opportunities through new product development and product application innovations.

     The Company's PCC product line net sales were $521.3 million, $484.7 million and $436.1 million for the years ended December 31, 2005, 2004 and 2003, respectively. The Company's sales of PCC have been and are expected to continue to be made primarily to the printing and writing papers segment of the paper industry. The Company also produces PCC for sale to companies in the polymer, food and pharmaceutical industries. Sales to International Paper Company represented less than 10% of consolidated net sales in 2005 and 2004 and 10.0% of consolidated net sales in 2003.  See Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations."

          In the paper industry, the Company's PCC is used:

• as filler in the production of coated and uncoated wood-free printing and writing papers;

• as a filler for coated and uncoated groundwood (wood-containing) paper such as newsprint, magazine and catalog papers; and

• as a coating pigment for both wood-free and groundwood papers.

     The Company's Paper PCC product line net sales were $465.7 million, $434.0 million and $389.6 million for the years ended December 31, 2005, 2004 and 2003, respectively.

     Approximately 45% of the Company's sales are of PCC sold to papermakers at "satellite" PCC plants. A satellite PCC plant is a PCC manufacturing facility located within a paper mill, thereby eliminating costs of transporting PCC from remote production sites to the paper mill. The Company believes the competitive advantages offered by improved economics and superior optical characteristics of paper produced with PCC manufactured by the Company's satellite PCC plants resulted in the continued growth in the number of the Company's satellite PCC plants since the first such plant was built in 1986. For information with respect to the locations of the Company's PCC plants at December 31, 2005, see Item 2, "Properties," below.

     The Company currently manufactures several customized PCC product forms using proprietary processes. Each product form is designed to provide optimum paper properties including brightness, opacity, bulk, strength and improved printability. The Company's research and development and technical service staffs focus on expanding sales from its existing satellite PCC plants as well as developing new technologies for new applications. These technologies include, among others, acid-tolerant ("AT^®") PCC, which allowed PCC to be introduced to the large wood-containing segment of the printing and writing paper market, and OPACARB^® PCC, a family of products for coating paper.

     The Company owns, staffs, operates and maintains all of its satellite PCC plants, and owns or licenses the related technology. Generally, the Company and its paper mill customers enter into long-term evergreen agreements, initially ten years in length, pursuant to which the Company supplies substantially all of the customer's precipitated calcium carbonate filler requirements. The Company is generally permitted to sell to third-parties PCC produced at a satellite plant in excess of the host paper mill's requirement.

    The Company also sells a range of PCC products to paper manufacturers from production sites not associated with paper mills at Adams, Massachusetts; Lifford, England; Lappeenranta, Finland; Hermalle, Belgium; and Walsum, Germany.

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     Uncoated Wood-Free Printing and Writing Papers - North America. Beginning in the mid-1980's, as a result of a concentrated research and development effort, the Company's satellite PCC plants facilitated the conversion of a substantial percentage of North American uncoated wood-free printing and writing paper producers to lower-cost alkaline papermaking technology. The Company estimates that during 2005, more than 90% of North American uncoated wood-free paper was produced employing alkaline technology. Presently, the Company owns and operates 23 commercial satellite PCC plants located at paper mills that produce uncoated wood-free printing and writing papers in North America. The Company anticipates that the aggregate volume of PCC used by these paper mills will increase.

     Uncoated Wood-Free Printing and Writing Papers - Outside North America. The Company estimates the amount of uncoated wood-free printing and writing papers produced outside of North America at facilities that can be served by satellite and merchant PCC plants is more than twice as large (measured in tons of paper produced) as the North American uncoated wood-free paper market currently served by the Company. The Company believes that the superior brightness, opacity and bulking characteristics offered by its PCC products allow it to compete with suppliers of ground limestone and other filler products outside of North America. Presently, the Company owns and operates 23 commercial satellite PCC plants located at paper mills that produce uncoated wood-free printing and writing papers outside of North America.

     Uncoated Groundwood Paper. The uncoated groundwood paper market, including newsprint, represents approximately 35% of worldwide paper production. Paper mills producing wood-containing paper still generally employ acid papermaking technology. The conversion to alkaline technology by these mills has been hampered by the tendency of wood-containing papers to darken in an alkaline environment. In an attempt to introduce PCC to the wood-containing segments of the paper industry, the Company has developed and patented a system for the manufacture of high-quality groundwood paper in an acidic environment using PCC (AT^® PCC). Furthermore, as groundwood or wood-containing paper mills use larger quantities of recycled fiber, there is a trend toward the use of neutral papermaking technology in this segment for which the Company presently supplies traditional PCC chemistries. The Company now supplies PCC to approximately 40 paper machines at about 20 groundwood paper mills around the world.

     Coated Paper. The Company is also placing increased emphasis on the use of PCC to coat paper, and expects that its research and development in coating pigment technology will open up a large market for PCC that will build slowly as more paper companies include PCC in their proprietary coating formulations. PCC may be used to increase gloss, opacity, brightness and printability of the paper or has the ability to reduce costs while maintaining comparable quality. The coated paper market is large, and the Company believes this market will continue to grow at a higher average growth rate than the uncoated paper market and therefore provides a substantial market opportunity for the Company. PCC coating products are produced at 14 of the Company's PCC plants worldwide.

     The Company also produces and sells a full range of slurry and dry PCC products on a merchant basis for non-paper applications. The Company's Specialty PCC product line net sales were $55.6 million, $50.7 million and $46.5 million for the years ended December 31, 2005, 2004 and 2003, respectively. The Company sells surface-treated and untreated grades of PCC to the thermoset polymer industry for use in automotive and construction applications, as well as adhesives and printing inks industries. The Company's PCC is also used by the food and pharmaceutical industries as a source of bio-available calcium in tablets and foodstuffs, as a buffering agent in tablets, and as a mild abrasive in toothpaste. The Company produces PCC for specialty applications from production sites at Adams, Massachusetts; Brookhaven, Mississippi; and Lifford, England.

     The Company mines or purchases, and processes natural mineral products, primarily limestone and talc. The Company also manufactures lime, a limestone-based product and SYNSIL^® Products, a family of composite minerals for the glass industry. The Company's net sales of all processed mineral products were $146.7 million, $138.7 million and $121.0 million for the years ended December 31, 2005, 2004 and 2003, respectively. Net sales of talc products were $54.2 million, $51.6 million and $43.2 million for the years ended December 31, 2005, 2004 and 2003, respectively. See Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations."

     Lime produced at the Company's Adams, Massachusetts facility is used as a raw material for the manufacture of PCC at that site and at some satellite PCC plants, and is sold commercially to various chemical and other industries.

     The Company mines, beneficiates and processes talc at its Barretts site, located near Dillon, Montana and processes purchased talc in Mt. Vernon and Wellsville, Ohio. Talc is sold worldwide in finely ground form for ceramic applications and in North America for paint and coatings and polymer applications. Because of the exceptional chemical purity of the Barretts ore, a majority of automotive catalytic converter ceramic substrates manufactured in the United States, Japan and Western Europe contain the Company's Barretts talc.

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     The Company's natural mineral products are supported by the Company's limestone reserves located in the western and eastern parts of the United States, and talc reserves located in Montana. The Company estimates these reserves, at current usage levels, to be in excess of 30 years at its limestone production facilities and in excess of 20 years at its talc production facility.

     Refractories Products

     The Company offers a broad range of monolithic and pre-cast refractory products and related systems and services. The Company's Refractory segment net sales were $327.8 million, $300.3 million and $256.6 million for the years ended December 31, 2005, 2004 and 2003, respectively. See Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations."

     Refractory product sales are often supported by Company-supplied proprietary application equipment and on-site technical service support. The Company's proprietary application equipment is used to apply refractory materials to the walls of steel-making furnaces and other high temperature vessels to maintain and extend their lives. Net sales of refractory products, including those for non-ferrous applications, were $239.3 million, $243.0 million and $209.7 million for the years ended December 31, 2005, 2004 and 2003. Robotic-type shooters, including the Company's proprietary SCANTROL™ application system, other robotic application equipment systems and its MINSCAN™ system, allow for remote-controlled application in steel-making furnaces, as well as in steel ladles and blast furnaces. Since the steel-making industry is characterized by intense price competition, which results in a continuing emphasis on increased productivity, the SCANTROL™ application system, the MINSCAN™ system, and the related technologically advanced refractory materials developed in the Company's research laboratories have been well accepted by the Company's customers. These products allow steel makers to improve their performance through, among other things, the application of monolithic refractories to furnace linings while the furnace is at operating temperature, thereby eliminating the need for furnace cool-down periods and steel-production interruption. The result is a lower overall refractory cost per ton for steel produced to steel makers.

     The Company's experienced technical service staff and advanced application equipment provide customers assurance that they will achieve their desired productivity objectives. The Company's technicians are also able to conduct laser measurement of refractory wear, sometimes in conjunction with robotic application tools, to improve maintenance performance at many locations. The Company believes that these services, together with its refractory product offerings, provide it with a strategic marketing advantage.

     Over the past several years a significant amount of the Company's refractory product sales have come from new products. Some of the new products the Company has introduced in the past few years included:

      The Company has also expanded its refractories business through selective acquisitions over the past several years. In 2000, the Company acquired Ferrotron Elektronik GmbH, a manufacturer of advanced laser scanning devices, sensors and other instruments designed for the steel industry. In 2001, the Company acquired the refractories business of Martin Marietta Magnesia Specialties Inc. and purchased Rijnstaal B.V., a Netherlands-based producer of cored metal wires used mainly in the steel and foundry industries. These acquisitions have increased the breadth of the product lines and markets served by the Refractories segment. In 2002, the Company acquired VisionTech, a Finland-based company that develops and manufactures a refractory lining measuring system. In 2003, the Company acquired the assets of ISA Manufacturing, Inc., a U.S.-based company that develops and manufactures pre-cast refractory shapes. In 2005, the Company acquired the metallurgical measurement technology/digital electrode control system product line of ET Electrotechnology GmbH. This technology offers a system that maintains steady state conditions and optimizes power consumption in electric steelmaking and ladle furnaces.

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     The principal market for the Company's refractory products is the steel industry. Management believes that certain trends in the steel industry will continue to provide growth opportunities for the Company. These trends included rapid growth in select geographic regions (e.g., China), the development of improved manufacturing processes such as thin-slab casting, the trend in North America to shift production from integrated mills to mini-mills (electric arc furnaces) and the ever-increasing need for improved productivity and longer lasting refractories. The Company believes that the trend toward electric steel-making mini-mills and away from integrated steel mills in North America and Europe has facilitated the acceptance of a broader offering in new refractory products and technologies.

     The Company sells its refractory products in the following markets:

     Steel Furnace. The Company sells gunnable monolithic refractory products and application systems to users of basic oxygen furnaces and electric furnaces for application on furnace walls to prolong the life of furnace linings.

     Other Iron and Steel. The Company sells monolithic refractory materials and pre-cast refractory shapes for iron and steel ladles, vacuum degassers, continuous casting tundishes, blast furnaces and reheating furnaces. The Company offers a full line of materials to satisfy all continuous casting refractory applications. This full line consists of gunnable materials, refractory shapes and permanent linings.

     Industrial Refractory Systems. The Company sells refractory shapes and linings to non-steel refractories consuming industries including glass, cement, aluminum and petrochemicals, power generation and other non-steel industries. The Company also produces a specialized line of carbon composites and pyrolitic graphite primarily sold under the PYROID^® trademark, both primarily to the aerospace and electronics industries.

     The Company produces a number of other technologically enhanced products for the steel industry, including calcium metal, metallurgical wires and a number of metal treatment specialties. Net sales of metallurgical products were $88.5 million, $57.3 million and $46.9 million for the years ended December 31, 2005, 2004 and 2003. The Company manufactures calcium metal at its Canaan, Connecticut, facility and purchases calcium in international markets. Calcium metal is used in the manufacture of the Company's PFERROCAL^® +solid-core calcium wire, and is sold for use in the manufacture of batteries and magnets. The Company sells metallurgical wires and associated wire-injection equipment for use in the production of high quality steels. These metallurgical wires are injected into molten steel to improve castability and reduce imperfections. The steel produced is used for high-pressure pipeline and other premium-grade steel applications.

     The Company relies principally on its worldwide direct sales force to market its products. The direct sales force is augmented by technical service teams that are familiar with the industries to which the Company markets its products, and by several regional distributors. The Company's sales force works closely with the Company's technical service staff to solve technical and other issues faced by the Company's customers. The Company's technical service staff assists paper producers in ongoing evaluations of the use of PCC for paper coating and filling applications. In the Refractory segment, the Company's technical service personnel advise on the use of refractory materials, and, in many cases pursuant to service agreements, apply the refractory materials to the customers' furnaces and other vessels. Continued use of skilled technical service teams is an important component of the Company's business strategy.

     The Company works closely with its customers to ensure that their requirements are satisfied, and it often trains and supports customer personnel in the use of the Company's products. The Company conducts domestic marketing and sales from Bethlehem, Pennsylvania, and from regional sales offices in the eastern and western United States. The Company's international marketing efforts are directed from Brussels, Belgium; Tokyo, Japan; Sao Paulo, Brazil; Singapore; and Shanghai, China. The Company believes its refractory manufacturing facilities are at locations that satisfy the stringent delivery requirements of the steel industry. The Company also believes that its worldwide network of sales personnel and manufacturing sites facilitates the international expansion of its satellite PCC operations.

     The Company's ability to achieve anticipated results depends in part on having an adequate supply of raw materials for its manufacturing operations, particularly lime and carbon dioxide for the PCC product line, magnesia for its Refractory operations and talc ore, silicon sand and dolomitic lime for its Processed Minerals product line, and on having adequate access to ore reserves at its mining operations.

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     The Company uses lime in the production of PCC and is a significant purchaser of lime worldwide. Generally, lime is purchased under long-term supply contracts from unaffiliated suppliers located in close geographic proximity to the Company's PCC plants.

     The principal raw materials used in the Company's monolithic refractory products are refractory-grade magnesia and various forms of aluminosilicates. The Company also purchases calcium metal, calcium silicide, graphite, calcium carbide and various alloys for use in the production of metallurgical wires and uses lime and aluminum in the production of calcium metal. The Company purchases a significant portion of its magnesia requirements from sources in the People's Republic of China. High demand for bulk raw materials from the People's Republic of China has caused shortages and price increases of some key raw materials which ultimately could affect the Company's sales to these customers. The Company also purchases a portion of its talc ore for its Processed Minerals product line from the People's Republic of China, which are also affected by some of these higher costs. In addition, higher shipping costs are also increasing the delivered cost of raw materials imported from China to North America and Europe. The Company believes that in the event of supply interruptions of its refractory raw material requirements it could obtain adequate supplies from alternate sources in China and elsewhere at reasonable costs.

     The Company is continually engaged in efforts to develop new products and technologies and refine existing products and technologies in order to remain competitive and to position itself as a market leader.

     With respect to its PCC products, the Company competes for sales to the paper industry with other fillers, such as ground limestone and kaolin, based in large part upon technological know-how, patents and processes that allow the Company to deliver PCC that it believes imparts glossy brightness, opacity and other properties to paper on an economical basis. The Company is the leading manufacturer and supplier of PCC to the North American paper industry. It competes with certain companies both in North America and abroad that sell PCC or offer alternative products, principally ground calcium carbonate and kaolin, for use in paper filling and coating applications. Competition with respect to the Company's PCC sales is based upon cost-performance characteristics of the product (such as gloss, brightness and opacity), and the availability of technical support.

     With respect to the Company's refractory products, competitive conditions vary by geographic region. Competition is based upon the performance characteristics of the product (including strength, consistency and ease of application), price, and the availability of technical support. This competition is with different companies in different geographic areas and in separate aspects of its product line.

     The Company competes in sales of its limestone and talc based primarily upon quality, price, and geographic location.

     Many of the Company's product lines are technology-based. The Company's expertise in inorganic chemistry, crystallography and structural analysis, fine particle technology and other aspects of materials science apply to and support all of its product lines.

     The Company's business strategy for continued growth in sales and profitability depends to a large extent on the continued success of its research and development activities. Among the significant achievements of the Company's research and development effort have been the satellite PCC plant concept, AT^® PCC, advanced OPACARB^® PCC crystal morphologies for paper coating, the MAG-O-STAR^® family of refractory spray coatings, OPTISHOT™ shotcrete refractory products, LACAM^® laser-based refractory measurement systems, MINSCAN™ and SCANTROL™ application systems.

     The Company's research and development efforts have also resulted in the invention of SYNSIL^® Products, a family of composite mineral products for the glass industry.

     For the years ended December 31, 2005, 2004 and 2003, the Company expended approximately $29.1 million, $29.0 million and $25.1 million, respectively, on research and development. The Company's research and development spending for 2005 was approximately 2.9% of net sales.

     The Company maintains its primary research facilities in Bethlehem and Easton, Pennsylvania. It also has research and development facilities in Finland, Ireland, Germany and Japan. Approximately 134 employees worldwide are engaged in research and development. In addition, the Company has access to some of the world's most advanced papermaking and paper coating pilot facilities.

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     The Company owns or has the right to use approximately 530 patents and approximately 774 trademarks related to its business. The Company believes that its rights under its existing patents, patent applications and trademarks are of value to its operations, but no one patent, application or trademark is material to the conduct of the Company's business as a whole.

     The Company maintains liability and property insurance and insurance for business interruption in the event of damage to its production facilities and certain other insurance covering risks associated with its business. The Company believes such insurance is adequate for the operation of its business. There is no assurance that in the future the Company will be able to maintain the coverage currently in place or that the premiums will not increase substantially.

     At December 31, 2005, the Company employed 2,650 persons, of whom 974 were employed outside of the United States.

     The Company's operations are subject to federal, state, local and foreign laws and regulations relating to the environment and health and safety. Certain of the Company's operations involve and have involved the use and release of substances that are classified as toxic or hazardous within the meaning of these laws and regulations. Environmental operating permits are, or may be, required for certain of the Company's operations and such permits are subject to modification, renewal and revocation. The Company regularly monitors and reviews its operations, procedures and policies for compliance with these laws and regulations. The Company believes its operations are in substantial compliance with these laws and regulations and that there are no violations that would have a material effect on the Company. Despite these compliance efforts, some risk of environmental and other damage is inherent in the Company's operations, as it is with other companies engaged in similar businesses, and there can be no assurance that material violations will not occur in the future. The cost of compliance with these laws and regulations is not expected to have a material adverse effect on the Company. The Company obtained indemnification for certain potential environmental, health and safety liabilities under agreements entered into between the Company and Pfizer Inc ("Pfizer") or Quigley Company, Inc., a wholly-owned subsidiary of Pfizer, in connection with the initial public offering of the Company in 1992. See "Certain Relationships and Related Transactions" in Item 13.

     The Company maintains an internet website located at http://www.mineralstech.com. It makes its reports on Forms 10-K, 10-Q and 8-K, and amendments to those reports, as well as its Proxy Statement and filings under Section 16 of the Securities Exchange Act of 1934, available free of charge through the Investor Relations page of its website, as soon as reasonably practicable after they are filed with the Securities and Exchange Commission ("SEC"). Investors may access these reports through the Company's website by navigating to "Investor Relations" and then to "SEC Filings."

     The disclosure and analysis set forth in this report contains certain forward-looking statements, particularly statements relating to future actions, future performance or results of current and anticipated products, sales efforts, expenditures, and financial results. From time to time, the Company also provides forward-looking statements in other publicly-released materials, both written and oral. Forward-looking statements provide current expectations and forecasts of future events such as new products, revenues and financial performance, and are not limited to describing historical or current facts. They can be identified by the use of words such as "expects," "plans," "anticipates," and other words and phrases of similar meaning.

     Forward-looking statements are necessarily based on assumptions, estimates and limited information available at the time they are made. A broad variety of risks and uncertainties, both known and unknown, as well as the inaccuracy of assumptions and estimates, can affect the realization of the expectations or forecasts in these statements. Consequently, no forward-looking statement can be guaranteed. Actual future results may vary materially.

     The Company undertakes no obligation to update any forward-looking statements. Investors should refer to the Company's subsequent filings under the Securities Exchange Act of 1934 for further disclosures.

     As permitted by the Private Securities Litigation Reform Act of 1995, the Company is providing the following cautionary statements which identify factors that could cause the Company's actual results to differ materially from historical and expected results. It is not possible to foresee or identify all such factors. Investors should not consider this list an exhaustive statement of all risks, uncertainties and potentially inaccurate assumptions.

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7

     None.

     Set forth below is the location of, and the main customer served by, each of the Company's 54 satellite PCC plants at December 31, 2005. Generally, the land on which each satellite PCC plant is located is leased at a nominal amount by the Company from the host paper mill pursuant to a lease, the term of which runs concurrently with the term of the PCC production and sale agreement between the Company and the host paper mill.

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     The Company also owned at December 31, 2005 14 plants engaged in the mining, processing and/or production of lime, limestone, precipitated calcium carbonate, talc and SYNSIL® products and owned or leased approximately 18 refractory manufacturing facilities worldwide. The Company's corporate headquarters, sales offices, research laboratories, plants and other facilities are owned by the Company except as otherwise noted. Set forth below is certain information relating to the Company's plants and office and research facilities.

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     The Company believes that its facilities, which are of varying ages and are of different construction types, have been satisfactorily maintained, are in good condition, are suitable for the Company's operations and generally provide sufficient capacity to meet the Company's production requirements. Based on past loss experience, the Company believes it is adequately insured with respect to these assets, and for liabilities which are likely to arise from its operations.

     On November 28, 2005, the Company announced that it had reached a settlement of pending commercial and patent litigation with Omya AG. The settlement was on a worldwide basis, hence the litigation in both the United States and Italy have been dismissed. The settlement provides for the recognition of the Company's intellectual property and patent rights. As part of the settlement, the Company granted Omya AG a non-exclusive license for the terms of the patents in exchange for royalty payments.

     As previously reported, certain of the Company's subsidiaries are among numerous defendants in a number of cases seeking damages for exposure to silica or to asbestos containing materials. Most of these claims do not provide adequate information to assess their merits, the likelihood that the Company will be found liable, or the magnitude of such liability, if any. Additional claims of this nature may be made against the Company or its subsidiaries. At this time management anticipates that the amount of the Company's liability, if any, and the cost of defending such claims, will not have a material effect on its financial position or results of operations.

     As previously reported, on April 9, 2003, the Connecticut Department of Environmental Protection ("DEP") issued an administrative consent order relating to our Canaan, Connecticut, plant where both our Refractories segment and Specialty Minerals segment have operations. We agreed to the order, which includes provisions requiring investigation and remediation of contamination associated with historic use of polychlorinated biphenyls (PCBs) at a portion of the site. The following is the present status of the remediation efforts:

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     We believe that the most likely form of remediation will be to leave existing contamination in place, encapsulate it, and monitor the effectiveness of the encapsulation.

     We estimate that the cost of the likely remediation above would approximate $200,000, and that amount has been recorded as a liability on our books and records.

     The Company is evaluating options for upgrading the wastewater treatment facilities at its Adams, Massachusetts, plant. This work is being undertaken pursuant to an administrative consent order issued by the Massachusetts Department of Environmental Protection on June 18, 2002. The order required payment of a civil fine in the amount of  $18,500, the investigation of options for ensuring that the facility's wastewater treatment ponds will not result in discharge to groundwater, and closure of a historic lime solids disposal area. The Company is committed to identifying appropriate improvements to the wastewater treatment system by 2007, and to implementing the improvements by June 1, 2012. Preliminary engineering reviews indicate that the estimated cost of these upgrades to operate this facility beyond 2012 may be between $6 million and $8 million. The Company estimates that remediation costs would approximate $200,000, which has been accrued as of December 31, 2005.

     The Company and its subsidiaries are not party to any other material pending legal proceedings, other than routine litigation incidental to their businesses.

     No matters were submitted to a vote of security holders during the fourth quarter of 2005.

     The Company's common stock is traded on the New York Stock Exchange under the symbol "MTX."

     Information on market prices and dividends is set forth below:

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     On October 23, 2003, the Company's Board of Directors authorized the Company's Management Committee, at its discretion, to repurchase up to $75 million in additional shares over the next three-year period. As of December 31, 2005, the Company had purchased 1,084,100 shares under this program at an average price of approximately $59 per share.

     On October 26, 2005, the Company's Board of Directors authorized the Company's Management Committee, at its discretion, to repurchase up to $75 million in additional shares over the next three-year period. As of December 31, 2005, there were no shares repurchased under this program.

     On January 25, 2006, the Company's Board of Directors declared a regular quarterly dividend on its common stock of $0.05 per share. No dividend will be payable unless declared by the Board and unless funds are legally available for payment thereof.

     On February 10, 2006, the last reported sales price on the NYSE was $53.91 per share. As of February 10, 2006, there were approximately 201 holders of record of the common stock.

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13

     Overall, the Company had a very difficult year. We had very strong growth in the first quarter followed by three quarters of declining operating income. The Company was affected by start-up and ramp-up issues at three new major facilities in Germany and China; significantly higher raw material and energy costs; consolidation in the paper industry; and weakness in our largest steel markets. Worldwide net sales for 2005 grew 8% over the prior year from $923.7 million to $995.8 million. Foreign exchange had a favorable impact on sales of approximately 1 percentage point of growth. Operating income for the full year 2005, however, declined 8% to $81.8 million from $89.1 million in the prior year. Operating income represented 8.2% of sales in 2005 and was 9.6% of sales in 2004. Net income for the full year 2005 declined 9% to $53.3 million from $58.6 million in 2004.

     The comparison of our operating income and net income in the past three years has been affected by a number of factors:

     We face some significant risks and challenges in the future:

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     Despite these risks and challenges, we are optimistic about the opportunities for continued growth that are open to us, including:

     However, there can be no assurance that we will achieve success in implementing any one or more of these opportunities.

     On July 19, 2005, the Company's largest customer, International Paper Company, announced a general plan to restructure certain elements of its businesses. There has been no further release of public information related to this plan. Therefore, we have not been able to assess the potential impact of this restructuring on our Paper PCC product line and assets.

     Worldwide net sales in 2005 increased 8% from the previous year to $995.8 million. Foreign exchange had a favorable impact on sales of approximately $10.3 million or 1 percentage point of growth. Sales in the Specialty Minerals segment, which includes the PCC and Processed Minerals product lines, increased 7% to $668.0 million compared with $623.4 million for the same period in 2004. Sales in the Refractories segment grew 9% over the previous year to $327.8 million. In 2004, worldwide net sales increased 14% to $923.7 million from $813.7 million in the prior year. Specialty Minerals segment sales increased approximately 12% and Refractories segment sales increased approximately 17% in 2004.

     Worldwide net sales of PCC, which is primarily used in the manufacturing process of the paper industry, increased 8% to $521.3 million from $484.7 million in the prior year. Worldwide net sales of Paper PCC increased 7% to $465.7 million from $434.0 million

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in the prior year. Paper PCC volumes grew 4% for the full year with volumes in excess of 3.8 million tons. In 2005, worldwide printing and writing paper production totaled approximately 112.1 tons and increased 1.1% over 2004, and demand for uncoated freesheet, our largest market for PCC, increased slightly in 2005. Sales growth was achieved in all regions, except Latin America, with the largest growth occurring in Europe and Asia where sales volumes grew 7% and 20%, respectively. The growth in Europe was primarily attributable to our new facility in Germany and expansions of PCC capacity at certain locations. This growth was partially mitigated by the Finnish paper mill labor dispute in the second quarter of 2005. The sales growth in Asia was primarily attributable to the two new facilities in China. North American Paper PCC sales grew 5% as incremental sales from the restart in May 2004 of our Millinocket, Maine, facility more than offset the effect of paper machine and plant closures. Sales of Specialty PCC grew 10% to $55.6 million from $50.7 million in 2004. This growth was primarily attributable to improved volumes, especially in automotive and consumer applications. PCC sales in 2004 increased 11% to $484.7 million from $436.1 million in the prior year. Paper PCC volumes grew 7% in 2004 as sales growth was achieved in all regions. Foreign exchange had a favorable impact on sales in 2004 of approximately 4 percentage points of growth.

     Net sales of Processed Minerals products in 2005 increased 6% to $146.7 million from $138.7 million in 2004. The growth in this product line was attributable to the continued strength of the residential construction market and from polymer and health care applications for our talc products. Processed Minerals net sales in 2004 increased 15% to $138.7 million from $121.0 million in 2003. This increase was primarily attributable to strong demand from the residential construction markets.

     Net sales in the Refractories segment in 2005 increased 9% to $327.8 million from $300.3 million in the prior year. Foreign exchange represented approximately 1 percentage point of the sales growth. The sales growth was driven globally by the metallurgical product line in which sales grew 54% to $88.5 million from $57.3 million. This increase was attributable to a combination of price increases, due to the substantial escalation in the cost of raw materials for this product line, as well as volume growth. Sales of refractory products and systems to steel and other industrial applications decreased 2% to $239.3 million from $243.0 million. The weakness in the steel industry, particularly in the United States and Europe, had an adverse affect on our sales growth. Net sales in the Refractories segment in 2004 increased 17% to $300.3 million from $256.6 million in the prior year. The increase in sales for the Refractories segment in 2004 was primarily attributable to improved performance and better steel industry conditions in North America. In 2004, sales growth of 22% was attained in the metallurgical product line and 16% in the refractory products and systems product line, respectively.

     Net sales in the United States were $600.1 million in 2005, approximately 8% higher than in the prior year. International sales in 2005 also increased 8%. Foreign exchange had a 3% impact on international sales growth. In 2004, domestic net sales were 12% higher than the prior year and international sales were 16% greater than in the prior year primarily due to the impact of foreign exchange.

     Cost of goods sold in 2005 was 78.8% of sales compared with 76.8% in the prior year. Our cost of goods sold grew 11% which had an unfavorable leveraging impact on our sales growth resulting in a 2% decrease in production margin. This unfavorable leveraging occurred in both reporting segments. In the Specialty Minerals segment, production margins declined 4% as compared with 7% sales growth. Margins in this segment were affected by several factors:

• start-up and ramp-up costs related to the European coating development program;
• the effects of continuing paper industry capacity rationalization, which lowered demand at several satellite plants;
• unrecovered raw material and energy costs; and
• start-up and ramp-up costs at our two new facilities in China.

     Collectively, these factors had an adverse impact on production margin and operating income of approximately $13 million.

     In the Refractories segment, production margin increased 1% over the prior year as compared with 9% sales growth. The unfavorable leveraging was due to weakness in the steel industry, particularly in North America and Europe, and to higher raw material costs.

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     In 2004, cost of goods sold was 76.8% of sales compared with 75.7% in 2003. Cost of goods sold grew 15%, which had an unfavorable leveraging impact on our sales growth resulting in an 8% increase in the production margin. The unfavorable leveraging occurred in both reporting segments as they were affected by higher raw material and energy costs. Our Specialty Minerals segment was also affected by increased startup costs for our new plant in Walsum, Germany.

     Marketing and administrative costs increased 8% in 2005 to $100.4 million and represented 10.1% of net sales. Both segments increased marketing expenses to support worldwide business development efforts. The Company also experienced higher litigation costs to protect our intellectual property. The Company reached a settlement of pending commercial and patent litigation in the fourth quarter of 2005. This litigation settlement resulted in non-operating income of $2.1 million, while the costs to defend such litigation were included in marketing and administrative expenses. In 2004, marketing and administrative costs increased 10.7% to $92.8 million and increased to 10.1% of net sales from 10.3% of net sales in 2003.

     Research and development expenses remained flat at $29.1 million and represented 2.9% of net sales. In 2004, research and development expenses increased 16% over the prior year and represented 3.1% of sales due to increased product development activities in both segments, but particularly in the PCC product line relating to the filler-fibre composite mineral program and coating trial activities.

     We recorded bad debt expenses (recoveries) of $(0.5) million and $1.6 million in 2005 and 2004, respectively. In 2005, the reduction in bad debt charges was primarily related to recoveries of bad debt in excess of provisions. In 2004, the provision for bad debt was net of recoveries of approximately $2.3 million related to steel company bankruptcies, in which we had previously written off the related accounts receivable.

        During the fourth quarter of 2005, we recorded a write-down of impaired assets of $0.3 million. The impairment relates to the expected closure in the first quarter of our satellite facility in Cornwall, Ontario, resulting from the expected paper mill shutdown.

  In the fourth quarter of 2004, the Company recognized $1.0 million in pre-tax corporate charges related to due diligence costs from a terminated acquisition effort.

     During the fourth quarter of 2003, we restructured our operations to reduce operating costs and improve efficiency. This resulted in a 2003 restructuring charge of $3.3 million. As part of this restructuring program, we recorded $1.1 million in additional charges in 2004. The restructuring charges relate to workforce reductions from all business units throughout our worldwide operations and the termination of certain leases. There were no restructuring costs in 2005.

     During the fourth quarter of 2003, we recorded a write-down of impaired assets of $3.2 million. The impairment charges were related to the closure of our operations in River Rouge, Michigan, in 2004 and the retirement of certain SYNSIL^® Products' assets that have been made obsolete.

     Income from operations in 2005 decreased 8% to $81.8 million from $89.1 million in 2004. Income from operations was 8.2% of sales as compared with 9.6% of sales in 2004. Income from operations in 2004 increased 15% to $89.1 million from $77.2 million in 2003. Income from operations increased to 9.6% of sales as compared with 9.5% of sales in 2003.

     Income from operations for the Specialty Minerals segment decreased 10% to $53.6 million and was 8.0% of its net sales. Unfavorable leveraging to operating income for this segment was primarily due to the aforementioned factors affecting production margin. Operating income for the Refractories segment decreased 7% to $28.3 million and was 8.6% of its net sales. This segment was affected by higher raw material and energy costs and weakness in the steel industry.

     In 2004, income from operations for the Specialty Minerals segment increased 8% to $59.7 million and was 9.6% of its net sales. Operating income for the Refractories segment increased 39% to $30.4 million and was 10.1% of its net sales.

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     Non-operating deductions decreased 22% from the prior year. This decrease was primarily due to a litigation settlement gain of $2.1 million. This was partially offset by higher interest expense due to increased borrowings.

     The effective tax rate increased to 29.7% in 2005 compared with 28.7% in 2004. This increase is due to a change in the mix of earnings and higher level of repatriation of foreign earnings.

     The consolidated joint ventures continue to operate profitably and at approximately the same level as prior years.

     Net income decreased 9% in 2005 to $53.3 million. Earnings per common share, on a diluted basis, decreased 8% to $2.59 in 2005 as compared with $2.82 in the prior year.

     In 2004, net income increased 22% to $58.6 million. Earnings per common share on a diluted basis, increased 19% to $2.82 in 2004 as compared with $2.36 in the prior year.

     Effective January 1, 2003, we adopted SFAS No. 143, "Accounting for Asset Retirement Obligations." SFAS No. 143 establishes the financial accounting and reporting for obligations associated with the retirement of long-lived assets and the associated asset retirement costs. This statement requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The associated asset retirement costs are capitalized as part of the carrying amount of the long-lived asset.

     Upon adoption of SFAS No. 143, we recorded a non-cash, after-tax charge to earnings of approximately $3.4 million for the cumulative effect of this accounting change related to retirement obligations associated with our PCC satellite facilities and mining properties, both within the Specialty Minerals segment.

     2005 was a difficult year for the Company. The global economic environment, while slower than 2004, was still supportive in 2005 despite high energy and commodity prices. The U.S. economy also continued to expand despite hurricanes, higher interest rates and increased energy costs. Construction housing starts were at a 10-year high in 2005. Although the strong construction market benefited our Processed Minerals product line, we experienced a tightening in the two main markets we serve, paper and steel. Domestic demand for printing and writing paper was down 1.3% and domestic steel production was down 5.8%. We were able to achieve sales growth in 2005. However, a delay in some key programs, rapidly increasing raw materials and energy costs, a decline in North America and European steel production, the adverse effect of plant shutdowns and production interruptions, and start-up and ramp-up costs related to the European coating development program and our two new facilities in China caused a substantial decline in operating income. The outlook for these industries is for resumed growth in 2006.

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     In 2006, we plan to focus on the following growth strategies:

     However, there can be no assurances that we will achieve success in implementing any one or more of these strategies.

     The following are notable events that may impact our 2006 performance:

     In 2004, we began the construction of two new PCC plants at two APP China Paper Mills in the People's Republic of China. They are located at APP paper mills in Zhenjiang and Suzhou. We added a total capacity of 8 units, or approximately 250,000 tons of coating and filling PCC pigments and we expect an accelerated ramp-up of volume at these facilities in 2006.

     In 2004, we completed construction and began commissioning of our merchant Paper Coating PCC facility in Walsum, Germany. In 2005, we continued to experience delays in the start-up of this facility. In 2006 we expect an acceleration of the coating program, with improved volumes at Walsum.

     In 2005, the company began construction of two new plants for production of its SYNSIL^® products. The year 2006 will represent the first commercial sales from our new facility in Chester, South Carolina.

     In 2004, the Refractories segment began construction of a 100,000-ton capacity refractory manufacturing facility in China. We expect a volume ramp-up at this facility in 2006 which will allow this segment to effectively serve China the largest and fastest growing steel market in the world.

    As we continue to expand our operations overseas, we face the inherent risks of doing business abroad, including inflation, fluctuations in interest rates and currency exchange rates, changes in applicable laws and regulatory requirements, export and import restrictions, tariffs, nationalization, expropriation, limits on repatriation of funds, civil unrest, terrorism, unstable governments and legal systems and other factors. Some of our operations are located in areas that have experienced political or economic instability, including Indonesia, Israel, Brazil, Thailand, China and South Africa. In addition, our performance depends to some extent on that of the industries we serve, particularly the paper manufacturing, steel manufacturing, and construction industries.

     Our sales of PCC are predominantly pursuant to long-term evergreen contracts, initially about ten years in length, with paper companies at whose mills we operate satellite PCC plants. The terms of many of these agreements generally have been extended, often in connection with an expansion of the satellite PCC plant. Failure of a number of our customers to renew existing agreements on terms as favorable to us as those currently in effect could cause our future growth rate to differ materially from our historical growth rate, and if not renewed could also result in impairment of the assets associated with the PCC plant.

     At December 31, 2005, the Company also continues to supply PCC at one location where the PCC contract has expired and one location, representing one unit of PCC production, at which the host mill has provided notice to the Company of its plans to cancel the PCC supply contract upon its expiration in 2006. Failure of a PCC customer to renew an agreement or continue to purchase PCC from one of our facilities could result in an impairment of assets charge or accelerated depreciation at such facility.

     Cash flows in 2005 were provided from operations and short-term financing and were used principally to fund $111.5 million of capital expenditures and $47.6 million for purchases of common shares for treasury. Cash provided from operating activities amounted to $78.5 million in 2005 as compared with $129.2 million in 2004. The reduction in cash from operating activities was primarily due to an increase in working capital, primarily due to increased volumes and the higher costs of energy and raw materials which affected our inventories and accounts receivable levels. Included in cash flow from operations was pension plan funding of approximately $12.9 million, $17.6 million and $20.8 million for the years ended December 31, 2005, 2004 and 2003, respectively.

     We expect to utilize our cash reserves to support the aforementioned growth strategies.

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     On October 23, 2003, our Board of Directors authorized our Management Committee, at its discretion, to repurchase up to $75 million in additional shares over the next three-year period. As of December 31, 2005, the Company had purchased 1,084,100 shares under this program at an average price of $59 per share.

     On October 26, 2005, the Company's Board of Directors authorized the Company's Management Committee, at its discretion, to repurchase up to $75 million in additional shares over the next three-year period. As of December 31, 2005, there were no shares repurchased under this program.

     On January 26, 2006, our Board of Directors declared a regular quarterly dividend on our common stock of $0.05 per share. No dividend will be payable unless declared by the Board and unless funds are legally available for payment.

     We have $50 million in Guaranteed Senior Notes due on July 24, 2006, which we expect to refinance, in whole or in part, through a combination of bank loans and/or private placements. Such amount is included in current maturities of long-term debt.

     We have $138 million in uncommitted short-term bank credit lines, of which $43.0 million was in use at December 31, 2005. In addition, we have a $23 million committed short-term bank credit line of which $20 million was in use at December 31, 2005. We anticipate that capital expenditures for 2006 should approximate $100 million, principally related to the construction of PCC plants and other opportunities that meet our strategic growth objectives. We expect to meet our other long-term financing requirements from internally generated funds, uncommitted bank credit lines and, where appropriate, project financing of certain satellite plants. The aggregate maturities of long-term debt are as follows: 2006 - $53.7 million; 2007 - $1.9 million; 2008 - $6.8 million; 2009 - $4.4 million; 2010 - $4.6 million; thereafter - $22.6 million.

     Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities.

     On an ongoing basis, we evaluate our estimates and assumptions, including those related to revenue recognition, allowance for doubtful accounts, valuation of inventories, valuation of long-term assets, goodwill and other intangible assets, pension plan assumptions, income taxes, income tax valuation allowances and litigation and environmental liabilities. We base our estimates on historical experience and on other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that can not readily be determined from other sources. There can be no assurance that actual results will not differ from those estimates.

     We believe the following critical accounting policies require us to make significant judgments and estimates in the preparation of our consolidated financial statements:

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.	significant under-performance relative to historical or projected future operating results;
.	significant changes in the manner of use of the acquired assets or the strategy for the overall business;
.	significant negative industry or economic trends.

     For a detailed discussion on the application of these and other accounting policies, see "Summary of Significant Accounting Policies" in the "Notes to the Consolidated Financial Statements" in Item 15 of this report, beginning on page F-6. This discussion and analysis should be read in conjunction with the consolidated financial statements and related notes included elsewhere in this report.

     The SEC encourages companies to disclose forward-looking information so that investors can better understand companies' future prospects and make informed investment decisions. This report may contain forward-looking statements that set our anticipated results based on management's plans and assumptions. Words such as "expects," "plans," "anticipates," and words and terms of similar substance, used in connection with any discussion of future operating or financial performance identify these forward-looking statements.

     We cannot guarantee that the outcomes suggested in any forward-looking statement will be realized, although we believe we have been prudent in our plans and assumptions. Achievement of future results is subject to risks, uncertainties and the accuracy of assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could vary materially from those anticipated, estimated or projected. Investors should bear this in mind as they consider forward-looking statements and should refer to the discussion of certain risks, uncertainties and assumptions in Item 1A, "Risk Factors."

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     Historically, inflation has not had a material adverse effect on us. However, recently both business segments have been affected by rapidly rising raw material and energy costs. The Company and its customers will typically negotiate reasonable price adjustments in order to recover a portion of these rapidly escalating costs. The contracts pursuant to which we construct and operate our satellite PCC plants generally adjust pricing to reflect increases in costs resulting from inflation, there is a time lag before such price adjustments can be implemented.