3

CONTACTS

Darin Good

Managing Director

303-549-5674

dgood@capstoneheadwaters.com

Crista Gilmore

Director

303-531-5013

cgilmore@capstoneheadwaters.com

Brian Krehbiel

Senior Vice President

970-215-9572

bkrehbiel@capstoneheadwaters.com

Dominic Cervi

Vice President

303-531-4605

dcervi@capstoneheadwaters.com

April 2020www.capstoneheadwaters.com

In this quarterly report, provided exclusively for Rock Products, Capstone

Headwaters provides insight into mergers & acquisitions (M&A), capital markets

trends, aggregates production, and pricing through Q1 2020.

Capstone’s Building Products & Construction Services Team advises industry

business owners, entrepreneurs, executives, and investors in the areas of M&A,

capital raising, and various special situations advisory. Due to our extensive

background and laser focus within the industry, Capstone is uniquely qualified

and has an unparalleled track record of successfully representing Building

Products & Construction Services companies.

TABLE OF CONTENTS

Public Company Commentary

Aggregates Performance

M&A Overview

Private Equity Activity

Notable Transactions

Select Transactions

Company Spotlights

Construction Materials Update

Aggregate Materials

Firm Track Record

ROCK PRODUCTS

Q2 2020

Capstone Headwaters

*TEV = Total Enterprise Value (Market Capitalization + Net Debt)

Source: FactSet as of March 31, 2020

PUBLIC VALUATION COMMENTARY

Public Valuation Multiples

The coronavirus outbreak has substantially impacted valuations in Capstone’s

Aggregate Materials Index, with EBITDA multiples falling to an average of 8.1x, a

decline from 10.9x at the start of 2020.

U.S. Dollars in Millions EBITDA Enterprise Value/

Company Name TEV Revenue EBITDA Margin Revenue EBITDA

LafargeHolcim Ltd. $35,009 $27,384 $5,457 19.9% 1.3x 6.4x

CRH Plc $29,752 $28,126 $4,484 15.9% 1.1x 6.6x

HeidelbergCement AG $19,498 $19,984 $3,077 15.4% 1.0x 6.3x

Vulcan Materials Company $17,359 $4,929 $1,269 25.7% 3.5x 13.7x

Cemex SAB de CV $15,458 $13,513 $2,441 18.1% 1.1x 6.3x

Martin Marietta Materials, Inc. $15,148 $4,739 $1,257 26.5% 3.2x 12.1x

MDU Resources Group, Inc. $6,370 $5,337 $737 13.8% 1.2x 8.6x

Buzzi Unicem S.p.A. $4,117 $3,180 $628 19.7% 1.3x 6.6x

Eagle Materials Inc. $3,073 $1,420 $373 26.3% 2.2x 8.2x

Summit Materials, Inc. $3,346 $2,222 $433 19.5% 1.5x 7.7x

U.S. Concrete, Inc. $1,020 $1,479 $161 10.9% 0.7x 6.3x

Mean $13,650 $10,210 $1,847 19.3% 1.6x 8.1x

Median $15,148 $4,929 $1,257 19.5% 1.3x 6.6x

2

Rock Products | Q2 2020

M&A OVERVIEW

The impacts of the pandemic have yet to be fully realized in the Aggregates industry, although signs of disruption have

manifested in construction project delays, temporary plant closures, and potential workforce restrictions. Prior to the

outbreak, the Aggregates industry had benefited from heightened spending and a robust backlog of projects, which

reached 8.9 months in January, according to ABC.1 However, in an effort to protect workers, an estimated 50% of

construction sites across the country have been shut down, with the potential for this number to rise to 90%, according

to the International Union of Painters and Allied Trades.2 As governments and countries enter a lockdown phase to

mitigate exposure to the virus, construction activity has expectedly stalled, thwarting a robust streak of activity and

contractor confidence levels. The breadth of quantifiable metrics such as aggregates plant closures is difficult to

gauge at this stage, although HeidelbergCement (XTRA:HEI) cited three cement plant closures in Northern Italy.

However downtime for a plant is not an irrecoverable headwind for aggregates operators, especially those with a

presence across many geographies. The costs of shutting down and subsequently reengaging in aggregates

operations are not as drastic as other capital-intensive industries. “You cannot compare this with closing [a] full

automotive factory for four weeks,” commented Dominik von Achten, Chairman of the Managing Board and Chief

Digital Officer of HeidelbergCement in the company’s earnings call.3 While industries across the globe face mounting

uncertainly, aggregates operators expect healthy construction activity to resume in 2020 once there is a calming of the

virus’ effects.

Source: Capital IQ, PitchBook, FactSet, and Capstone Headwaters Research

Capstone’s Aggregates Materials Index (AMI) has historically been more volatile than the broader market and as such the

index’s returns have been significantly impacted by the disruptions brought by the pandemic. Through Q1 2020, the AMI

index has fallen 32.2%, declining further than the S&P 500 and Dow Jones Industrial Average.

AGGREGATES PERFORMANCE

DownAggregate Materials Index

32.2%

DownS&P 500

19.6%

DownDow Jones Industrial Average

23.2%

Total Return Comparison Q1 2020

M&A activity has remained steady through Q1 2020 with

25 transactions announced or completed. Total

disclosed deal value has amounted to nearly $288

million, outpacing the $250 million in value during the

same period in 2019. Strategic buyers have accounted

for nearly all transaction volume in 2020, with industry

operators typically comprising approximately 80% of

total consolidation activity (79.8% of transactions in

2019). Despite economic headwinds, active buyers have

continued to pursue aggregates operators with attractive

margin profiles in high-growth end markets through

Q1 2020.

Nu

mb

er

of

Tra

nsa

ctio

ns

37 35

2522

37

25

0

10

20

30

40

50

60

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2019 Q1 2020

Transaction Volume: Aggregates

-50.0%

-40.0%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

1/1/20 1/16/20 1/31/20 2/15/20 3/1/20 3/16/20 3/31/20

AMI Index S&P 500 Dow Jones Industrial Average

3

U.S. Concrete, Inc. acquires Coram Materials, Inc.

(February 2020, $142 Million)

U.S. Concrete (Nasdaq:USCR) has acquired Coram Materials, a premier provider of high-quality

sand and gravel products, for an enterprise value of $142 million. The transaction represents

approximately 7x EBITDA post synergies, which U.S. Concrete expects to achieve within two

years, according to a press release.4 Long Island-based Coram Materials owns and controls

~49.4 million tons of proven reserves with state-of-the-art excavation process infrastructure.5

“This acquisition possesses significant, premium sand reserves that will provide us with self-

sufficiency in meeting our sand supply needs to our ready-mixed concrete operations in New

York City as well as providing external sales to third party customers. Coram's 50 million tons

of reserves, located in the quickly depleting Long Island Sand market, increases the vertical

integration of our New York operations, strengthens our competitive position and advances the

continuation of our strategy of expanding into higher margin aggregates businesses,”

commented William J. Sandbrook, Chairman and CEO of U.S. Concrete in a press release.

Oldcastle APG, Inc. acquires US MIX Co.

(March 2020, Undisclosed)

Oldcastle APG, a subsidiary of CRH plc (ISE:CRG), has acquired leading dry mix

manufacturer, US MIX, for an undisclosed sum. Denver-based US MIX manufactures and

packages cementitious products including concrete mixes, sands, cements, grouts,

bonders, and mortars. It offers its products under the US SPEC brand which are formulated

and tested under American Society for Testing and Materials (ASTM) methods.

Oldcastle is a premier manufacturer of concrete building and hardscape products that operates

through 170 manufacturing facilities across the U.S. with over 6,000 employees. The acquisition

bolsters Oldcastle’s product portfolio and will gain significant materials science expertise. The

addition of US MIX also expands its geographic presence in the Denver, Colorado market and

enhances its manufacturing capabilities of its existing Sakrete, Amerimix, and the newly acquired

US SPEC brands.

Acquires

NOTABLE TRANSACTIONS

Acquires

PRIVATE EQUITY TRANSACTION ACTIVITY & VALUATIONS

GF Data Resources, a provider of detailed information on business transactions ranging in size from $10 to $250 million,

provides quarterly data from over 200 private equity firm contributors on the number of completed transactions. The

following chart provides the number of completed transactions from GF Data contributors, the average total enterprise value

(TEV)/EBITDA multiples, and the average amount of debt utilized in the transaction computed as a multiple of EBITDA. The

data, although not industry specific, displayed a moderate increase in transaction volume, with EBITDA multiples declining

slightly compared to the previous quarter. Total debt/EBITDA valuations remained steady at 4.0x, with a significant increase in

senior debt/EBITDA to 3.4x in Q4.

Private Equity Valuations & Leverage

Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019

# of Transactions 71 77 50 73 65 88 69 55 62

TEV/EBITDA 8.0x 6.9x 7.3x 7.1x 7.7x 6.8x 7.3x 7.5x 7.1x

Total Debt/EBITDA 4.3x 4.1x 3.8x 3.7x 3.7x 4.1x 3.9x 4.1x 4.0x

Senior Debt/EBITDA 3.4x 3.3x 3.2x 2.7x 2.9x 3.5x 3.2x 3.0x 3.4x

Source: GF Data®

Rock Products | Q2 2020

Coram Materials

Enterprise EV / LTM

Date Target Acquirer Target Business Description Value (mm) Revenue EBITDA

03/27/20 InstoneCapstone

Therapeutics

Distributes manufactured and natural stone veneer products.

- - -

03/17/20Strand-Tech

Manufacturing

Insteel Wire

Products

Manufactures fabricated wire products including concrete poles and building foundations.

$22.5 0.8x -

03/09/20Big Rock Natural

Stone SiteOne

Distributes stone products including boulders, slabs, bluestone, veneers, bulk stone, and pavers.

- - -

03/04/20Assets of Clio

HoldingsKC Solid Surfaces Provides granite countertop manufacturing. $1.2 - -

03/04/20Sealcoating

SuppliesGemSeal Distributes pavement preservation products. - - -

03/03/20 Rayner Equipment Etnyre Provides pavement maintenance solutions. - - -

03/02/20 Kleary MasonryCornerstone

Building BrandsManufactures and installs stone veneer. $40.0 1.0x -

03/02/20 US MIXOldcastle

APG

Manufactures concrete products including concrete mixes, sands, cements, and grouts.

- - -

02/28/20 WillcanSequatchie Concrete

ServiceDistributes and manufactures ready-mix concrete. - - -

02/25/20 Coram Materials U.S. Concrete Operates sand and gravel mining operations. $142.0 - ~7.0x

02/24/20Wall to Wall

Tile & StoneGinn Surfaces

Comprises granite and quartz production operations.

$6.9 - -

02/14/20Assets of Oldcastle

SpokaneKnife River

Comprises precast and prestressed concrete components business.

- - -

02/04/20Trowel Trades

SupplyGMS

Provides interior building materials including stone,

brick, masonry, and drywall.- - -

02/02/20 Geneva Pipe Northwest Pipe Manufactures concrete pipes and precast products. $49.4 1.1x -

01/15/20 Carstin Brands Wolf OrganizationProvides kitchen and bath products including marble

and granite countertops.- - -

01/06/20RidgeRock

Retaining Walls

Tysinger

AcquisitionsManufactures concrete blocks. - - -

01/02/20Wittkopf

Landscape SiteOne

Provides hardscape and landscape services and products including pavers and gravel.

- - -

12/12/19Cherry

IndustriesArcosa Offers natural and recycled sand and concrete. $298.0 1.7x 8.1x

12/12/19 Brooks Ready Mix Smyrna Ready Mix Distributes ready-mix concrete products. - - -

11/28/19Le Groupe

Bay-Val

Roxboro

Excavation

Manufactures aggregates, concrete, and other building material.

- - -

11/26/19Kosmos Cement

PlantEagle Materials

Comprises a cement plant, limestone quarry, an cement distribution terminals.

$665.0 - 12.1x

11/06/19Assets of Belden

BrickBrickworks

Comprises business operations related to soft mud bricks production.

$48.0 - -

11/06/19 Any Old StoneConstruction

ResourcesProduces and sells stone-made slabs. - - -

Source: Capital IQ, PitchBook, FactSet, and Capstone Research

SELECT TRANSACTIONS

4

Rock Products | Q2 2020

Eagle Materials (NYSE:EXP) recorded robust results in its

most recent fiscal quarter ending February 4, 2020 with

revenue increasing 5% compared to the same quarter in

the prior year, largely driven by higher cement sales

volume and prices, according to its earnings release.6

Eagle’s Heavy Materials segment, inclusive of cement,

concrete, and aggregates, experienced significant revenue

increases, exceeding $229 million. Operating earnings in

the Concrete and Aggregates segment alone rose to $3.3

million which marks a 222% increase compared to Q3 of

fiscal year 2019 while the company also posted record

concrete sales volume.

Prior to the pandemic, Eagle Materials cited strong

performance metrics and a favorable outlook for 2020.

“Notably, our Cement sales volume was up 7% to a record

1.4 million tons. Market demand for our Wallboard also

remained healthy, with shipments up 2%. Our operational

cost-control initiatives and continued strong operational

execution also contributed to the favorable third-quarter

performance. The outlook for calendar 2020 is positive.

We expect demand for our building materials and

construction products will continue to be supported by

several advantageous market dynamics, including

ongoing growth in jobs, high consumer confidence and

low interest rates,” commented Michael Haack, President

and CEO, in a press release.

Eagle Materials has continued to utilize inorganic growth

to bolster product offerings, scale, and expand its

geographic footprint. Notably, Eagle Materials’ acquired

Kosmos Cement Plant and seven distribution terminals

from Komos Cement Company, a joint venture between

CEMEX (NYSE:CV) and Buzzi Unicem (OTC:BZZFF) for an

enterprise value of $665 million and equivalent to 12.1x

EBITDA. The transaction is expected to increase annual

cement capacity by 25% and provide immediate

contribution to annual cash flow, according to Eagle

Materials’ earnings call.7

5

Ticker: NYSE:EXP

Headquarters: Dallas, Texas

Markets: Construction Materials

LTM Revenue: $1.4 Billion

Market Capitalization: $2.7 Billion

COMPANY SPOTLIGHT

Rock Products | Q2 2020

Historical EBITDACompany Description

Revenue Share by Segment

40.1%

33.2%

8.7%

6.3%

5.2%6.5%

Cement

Gypsum Wallboard

Concrete & Aggregates

Paperboard

Oil & Gas

Joint Venture

EB

ITD

A M

arg

in

EB

ITD

A (

$ in

millio

ns)

Source: FactSet

0%

5%

10%

15%

20%

25%

30%

35%

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

2013 2014 2015 2016 2017 2018 2019

EBITDA EBITDA Margin (%)

0%

5%

10%

15%

20%

25%

30%

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

2013 2014 2015 2016 2017 2018 2019

EBITDA EBITDA Margin (%)

6

Vulcan Materials (NYSE:VMC) experienced healthy growth

in 2019 with full year revenue reaching $4.9 billion, an

increase of 12% compared to the prior year, according to

its earnings release for the year ending December 31,

2019.8 Growth in shipments and improved pricing led to

an increase in the Aggregates segment with gross profit

rising 16% year-over-year. Vulcan is anticipating 2% to 4%

growth in aggregates shipments in 2020, contributing to a

forecasted double-digit growth in Aggregates segment

earnings, according to its earnings call.9 In addition, gross

profit in the Asphalt segment increased $4 million from the

prior year in Q4, benefiting from volume growth in

California, Vulcan Materials’ largest Asphalt market.

Notably, Vulcan Materials has traded at a premium

valuation compared to its industry peers through Q1 2020

at 13.7x EBITDA, well above the 8.1x average in Capstone’s

Aggregate Materials Index. Its concentration in high-

growth end markets, efficient allocation of costs, and solid

balance sheet has created a healthy backdrop for a

favorable margin profile.

Tom Hill, Chairman and CEO of Vulcan Materials

commented on industry dynamics prior to the disruption

brought by the coronavirus. “Looking ahead, demand in

our markets will continue to benefit from higher levels of

highway funding and continued growth in Residential and

Nonresidential markets. This visibility into demand

growth has already set the stage for solid price

improvement in 2020. Price improvement coupled with

our four strategic initiatives (Commercial and Operational

Excellence, Logistics Innovation and Strategic Sourcing)

should continue to increase unit profitability. For the full

year, we expect earnings from continuing operations

between $5.20 and $5.80 per diluted share with Adjusted

EBITDA between $1.385 and $1.485 billion.”

Ticker: NYSE:VMC

Headquarters: Birmingham, Alabama

Markets: Construction Materials

LTM Revenue: $4.9 Billion

Market Capitalization: $14.9 Billion

COMPANY SPOTLIGHT (CONTINUED)

Rock Products | Q2 2020

Historical EBITDACompany Description

Revenue Share by Segment

74.4%

17.4%

8.0%

0.2%

Aggregates

Asphalt

Concrete

Calcium

EB

ITD

A (

$ in

millio

ns)

Source: FactSet

EB

ITD

A M

arg

in

7

CONSTRUCTION MATERIALS UPDATE

Construction input prices decreased 0.6% in February from the previous month and have increased 0.4% year-over-year,

according to an Associated Builders and Contractors (ABC) analysis of data recently released by the U.S. Bureau of Labor

Statistics.10 Supply disruptions caused by the virus outbreak are likely to exacerbate pricing declines and potentially slow a

significant volume of construction projects.

Source: U.S. Bureau of Labor Statistics

Industry results in 2019 showed robust growth in production of several key aggregates compared to 2018. Notably, cement,

crushed stone, and sand & gravel all recorded year-over-year increases. In addition, aggregates pricing experienced solid

increases when compared to the prior year.

Source: U.S. Geological Survey and Capstone Headwaters Research

Cement

AGGREGATE MATERIALS

Rock Products | Q2 2020

-5.0%

-3.0%

-1.0%

1.0%

3.0%

5.0%

7.0%

9.0%

11.0%

Feb

-16

Ap

r-16

Jun

-16

Au

g-1

6

Oct

-16

Dec-

16

Feb

-17

Ap

r-17

Jun

-17

Au

g-1

7

Oct

-17

Dec-

17

Feb

-18

Ap

r-18

Jun

-18

Au

g-1

8

Oct

-18

Dec-

18

Feb

-19

Ap

r-19

Jun

-19

Au

g-1

9

Oct

-19

Dec-

19

Feb

-20

Figure 5: Producer Price Index

Percent Change Inputs to Construction Industries (February 2016 - February 2020)

One Month % Change 12 Month % Change

$85

$91

$97

$103

$109

$115

0

20

40

60

80

100

120

Pri

ce P

er

To

n

Millio

ns

of

To

ns

U.S. Cement Production

Cement Volume Cement Price

Portland cement consumption reached 94.2 million

metric tons through November of 2019, surpassing

2018 full year totals. December consumption figures

have not yet been reported.

The average net selling price per ton for Martin

Marietta and Eagle Materials in 2019 was $111.10, an

increase of 2.2% compared to 2018.

8

Ready-mix concrete (RMC) prices increased 2.2% in

2019 compared to the previous year. Price data is

computed from the average RMC net selling prices of

U.S. Concrete, Vulcan Materials, Martin Marietta, and

Eagle Materials.

Ready-mix concrete volume amounted to 346.4 million

cubic yards through November 2019. December

production figures have not yet been released.

Crushed stone production reached elevated levels in

2019 with 1,493 million metric tons produced and

shipped for consumption in the U.S. Production

volume increased nearly six percent when compared

year-over-year.

Crushed stone prices in 2019 increased three percent

year-over-year to $12.30 per metric ton, representing

the highest average selling value in the last five years.

Asphalt prices increased 3.5% in 2019 compared to the

prior year, as measured by the average net asphalt

selling prices of Vulcan Materials and Martin Marietta.

Asphalt prices declined 0.5% during Q4 2019 when

compared to the previous quarter.

Asphalt volume is reported on an annual basis and has

not been released.

Ready-Mix Concrete

Crushed Stone

Asphalt

Source: NRMCA Industry Data Survey, Average RMC selling price of U.S. Concrete, Vulcan Materials, Martin Marietta Materials, Eagle Materials, and Capstone Headwaters Research

Rock Products | Q2 2020

$9.5

$10.0

$10.5

$11.0

$11.5

$12.0

$12.5

$13.0

0

300

600

900

1,200

1,500P

rice

Per

To

n

Millio

ns

of

To

ns

U.S. Crushed Stone Production

Crushed Stone Volume Crushed Stone Price

Source: U.S. Geological Survey and Capstone Research

$34

$38

$42

$46

$50

$54

260

280

300

320

340

360

380

400

Pri

ce P

er

To

n

Millio

ns

of

To

ns

U.S. Asphalt Production

Asphalt Volume Asphalt Price

Source: NAPA Asphalt Pavement Industry Survey, Vulcan Materials, Martin MariettaMaterials average of net asphalt selling prices, and Capstone Research

$82

$90

$98

$106

$114

$122

40

90

140

190

240

290

340

390

Pri

ce P

er

Cu

bic

Yard

Millio

ns

of

Cu

bic

Yard

s

U.S. Ready-Mix Concrete Production

Ready-Mix Concrete Volume Ready-Mix Concrete Price

CITATIONS

1. Associated Builders and Contractors, “ABC’s Construction Backlog Indicator Rebounds in January,” https://www.abc.org/News-Media/News-

Releases/entryid/17037/abc-s-construction-backlog-indicator-rebounds-in-january, accessed March 23, 2020.

2. PR Newswire, “Construction Workers Speak Out: Fear Of Being Left Behind By Congress as COVID-19 Grinds Industry To A Halt,”

https://www.prnewswire.com/news-releases/construction-workers-speak-out-fear-of-being-left-behind-by-congress-as-covid-19-grinds-industry-

to-a-halt-301028293.html, accessed March 23, 2020.

3. HeidelbergCement “HeidelbergCement AG Earnings Call,” https://www.heidelbergcement.com/en/investor-relations, accessed March 23, 2020.

4. U.S. Concrete, “U.S. Concrete Reports Strategic Acquisition And 2019 Full Year and Fourth Quarter Results,” http://investorrelations.us-

concrete.com/news-releases/news-release-details/us-concrete-reports-strategic-acquisition-and-2019-full-year-and, accessed March 20, 2020.

5. U.S. Concrete, “Q4 2019 Results Overview,” http://investorrelations.us-concrete.com/financial-information/quarterly-results, accessed March 20,

2020.

6. Eagle Materials, “Eagle Materials Reports Third Quarter Results,” http://ir.eaglematerials.com/news-releases/news-release-details/eagle-materials-

reports-third-quarter-results-1, accessed March 20, 2020.

7. Eagle Materials, “Q3 2020 Eagle Materials Earnings Conference Call,” http://ir.eaglematerials.com/investor-relations, accessed March 20, 2020.

8. Vulcan Materials, “Vulcan Reports Fourth Quarter and Full Year Results,” https://ir.vulcanmaterials.com/investor-relations/news-releases/news-

details/2020/Vulcan-Reports-Fourth-Quarter-and-Full-Year-Results/default.aspx, accessed March 20, 2020.

9. Vulcan Materials, “Vulcan Materials 4Q 2019 Earnings Conference Call,”

https://event.webcasts.com/starthere.jsp?ei=1283617&tp_key=76ebd07607&LanguageId=1, accessed March 20, 2020.

10. Associated Builders and Contractors, “Monthly Construction Input Prices Drop in February, Says ABC,” https://www.abc.org/News-Media/News-Releases/entryid/17020/monthly-construction-input-prices-drop-in-february-says-abc, accessed March 23, 2020.

Disclosure: This report is a periodic compilation of certain economic and corporate information, as well as completed and announced merger and acquisi-

tion activity. Information contained in this report should not be construed as a recommendation to sell or buy any security. Any reference to or omission of

any reference to any company in this report should not be construed as a recommendation to buy, sell or take any other action with respect to any security of

any such company. We are not soliciting any action with respect to any security or company based on this report. The report is published solely for the

general information of clients and friends of Capstone Headwaters. It does not take into account the particular investment objectives, financial situation or

needs of individual recipients. Certain transactions, including those involving early-stage companies, give rise to substantial risk and are not suitable for all

investors. This report is based upon information that we consider reliable, but we do not represent that it is accurate or complete, and it should not be relied

upon as such. Prediction of future events is inherently subject to both known and unknown risks and other factors that may cause actual results to vary

materially. We are under no obligation to update the information contained in this report. Opinions expressed are our present opinions only and are subject

to change without notice. Additional information is available upon request. The companies mentioned in this report may be clients of Capstone Headwaters.

The decisions to include any company in this report is unrelated in all respects to any service that Capstone Headwaters may provide to such company. This

report may not be copied or reproduced in any form, or redistributed without the prior written consent of Capstone Headwaters. The information contained

herein should not be construed as legal advice.

9

Rock Products | Q2 2020

An estimated 969 million metric tons of sand & gravel

were produced and shipped for consumption in 2019,

an increase of 0.8% year-over-year.

Following historic highs in production in Q3 2019,

production levels declined in Q4 to 230 million metric

tons, falling slightly when compared to the 240 million

metric tons produced in Q4 of 2018.

Sand & gravel prices increased to $9.29 per metric ton,

an increase of 3.9% year-over-year and the highest

average price in the last five years.

Sand & Gravel

Source: U.S. Geological Survey and Capstone Research

$7.0

$7.4

$7.8

$8.2

$8.6

$9.0

$9.4

0

200

400

600

800

1,000

Pri

ce P

er

To

n

U.S. Sand & Gravel Production

Sand & Gravel Volume Sand & Gravel Price

Millio

ns

of

To

ns

ROCK PRODUCTS REPORT CONTRIBUTORS

10

Crista started her career at KPMG LLP where she audited a wide range of businesses from small non-profit to large Fortune 100 companies. Crista then accepted a Senior Associate role with a $12 billionmulti-strategy hedge fund managing the monthly PnL close process for several funds. She waspromoted to Vice President, Valuations responsible for pricing the portfolio of over 8,000 securitiesmonthly, as well as reporting to the Valuation Committee on a bi-monthly basis.

At Capstone Headwaters, Crista works with clients to improve their financial metrics and reportingcapabilities. Additionally, she performs research, valuation analysis, prepares marketingdocumentation, manages client data rooms and responds to due diligence inquiries.

Crista graduated summa cum laude from Drake University with a degree in Finance and Accounting.She also earned a Master’s of Accounting degree from Drake University and is a CFA Charterholder.

Darin is a recognized expert witness and speaks nationally regarding merger and acquisitions. Courts

and clients appreciate his ability to synthesize large amounts of complex business information and

present it in concise terms that are clearly understood by all parties. Trade groups and national

publications have recognized Darin’s business acumen and technical knowledge.

Prior to joining Capstone Headwaters, Darin started, operated, made acquisitions and sold three

successful companies in construction, import and distribution, and commercial real estate

management. Over a two year period, he implemented the turnaround of the underperforming

business units of a publicly held national franchisor.

Two sell side transactions that Darin performed are published and taught in business schools around

the globe. Darin teaches these cases at the University of Denver, where he received his Bachelor of

Science in Finance.

Crista Gilmore

Director

cgilmore@capstoneheadwaters.com | 303-531-5013

Darin Good

Managing Director

dgood@capstoneheadwaters.com | 303-549-5674

Rock Products | Q2 2020

Prior to joining Capstone Headwaters in 2011, Brian spent five years with a boutique investment bank

performing sell-side transactions, financial modeling and value-add client services. At Capstone

Headwaters, Brian is a member of the Building Products & Construction Services team assisting clients

with sell-side, buy-side and debt and equity raise transactions.

Prior to his career in Investment Banking, Brian developed construction industry and operations

experience owning and managing a successful family-owned residential construction company. His

education and industry expertise are resources used in all aspects of the transaction process.

Brian graduated from the University of Northern Colorado with a BS degree in Finance and he is a CFA

Charterholder.

Brian Krehbiel

Senior Vice President

bkrehbiel@capstoneheadwaters.com | 970-215-9572

Connor McLeod

Research Associate

cmcleod@capstoneheadwaters.com | 617-619-3319

Connor is a Research Associate at Capstone Headwaters primarily specializing in Building Products &

Construction Services, Healthcare, Business Services, and Cybersecurity. Prior to joining Capstone

Headwaters, Connor was a specialist with the Investor Services team at BlackRock where he worked

with mutual funds, closed end funds, and exchange traded funds and communicated fund

performance, relevant market dynamics, and facilitated trades for shareholders, financial advisors, and

institutional clients. Connor holds a BA in Economics from Bates College and is a Series 7 Registered

Securities Representative.

ROCK PRODUCTS REPORT CONTRIBUTORS

11

Dominic has spent the entirety of his investment banking career with Capstone Headwaters, primarily

focusing on sell-side M&A. In addition to 2017’s Cross Border Deal of the Year, Dominic has executed

deals ranging from $30mm to $200mm across a wide-range of industries, including Industrial

Manufacturing, Transportation & Logistics, TMT and Healthcare & Life Sciences. Dominic’s current

focus is representing Building Products and Construction Services-related businesses with financial

and operational analysis, process material creation, market research and data room management.

Dominic also teaches for the Colorado Bar Association, lecturing all Colorado lawyers on the current

state of the M&A market.

Prior to joining Capstone Headwaters, Dominic was a professional soccer player with the United States

Soccer Federation, including as a member of the 2008 Beijing Olympic Games, and the Celtic Football

Club. Dominic graduated Cum Laude from the University of Denver with a degree in Finance and

Accounting.

Dominic Cervi

Vice President

dcervi@capstoneheadwaters.com | 303-531-4605

SELECT CAPSTONE HEADWATERS BUILDING PRODUCTS & CONSTRUCTION SERVICES TRANSACTIONS

has been acquired by

a portfolio company of

has been acquired byhas been acquired by has been acquired by

management buyout

supported by

a portfolio company of

has been acquired by

a portfolio company of

has been acquired by

has recapitalized with has been acquired by

has been

recapitalized by

has been acquired by

a portfolio company of

has partnered with

Rock Products | Q2 2020

12

www.capstoneheadwaters.com

Capstone Headwaters is an elite investment banking firm dedicated to serving the corporate finance needs of middle market

business owners, investors and creditors. Capstone Headwaters provides merger & acquisition, private placement, corporate

restructuring and financial advisory services across 16 industry verticals to meet the life cycle needs of emerging enterprises.

Headquartered in Boston, MA and Denver, CO, Capstone Headwaters has 19 offices in the US, UK and Brazil with a global

reach that includes over 450 professionals in 40 countries.

BUILT FOR THE MIDDLE MARKET

UNITED STATES

170+ professionals

17 offices

Boston Boise Burlington Chicago

Dallas Denver Greenwich Houston

Los Angeles New York Orange

County Philadelphia San Diego

San Francisco St Louis Tampa

Washington DC

INTERNATIONAL

450+ professionals

60+ offices in 40 countries

Asia: China India Japan

Latin America: Argentina Brazil Chile Colombia Mexico Peru

Africa: Congo Egypt Ghana Ivory Coast Mauritius Morocco Senegal South Africa

Europe: Belgium Bosnia Croatia Czech Republic Finland France Germany Herzegovina

Hungary Ireland Italy London Netherlands Norway Poland Russia Serbia Slovenia

Spain Sweden Switzerland Turkey United Kingdom