Hello Tomas,
As you have probably found out, PTC_MATERIAL_NAME is more of a File name format, not allowing spaces. What you probably want to show in the format is to use the PTC_MATERIAL_DESCRIPTION. This is the Description that is defined in the mtl file. In order to to that, you need to create a Parameter in the model (Let's say MATERIAL) Then in order to grab the Description for the currently active material, you need to define a relation.
The relation should be:
MATERIAL=material_param("PTC_MATERIAL_DESCRIPTION")
This will set your Parameter &MATERIAL that you can use in your format, to be equal to the current Material Description.
Hope that helps.