Rock Products

AUG 2019

Rock Products is the aggregates industry's leading source for market analysis and technology solutions, delivering critical content focusing on aggregates-processing equipment; operational efficiencies; management best practices; comprehensive market

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88 • ROCK products • August 2019 www.rockproducts.com Aggregates Industry Almanac Aggregate Industry Market Report Aggregate Industry Market Report In This Quarterly Report, Provided Exclusively to Rock Products, Capstone Headwaters Provides Insight Into Mergers and Acquisitions (M&A), Capital Markets Trends, Aggregate Production and Pricing Through Q4 2018. By Darin Good and Brian Krehbiel C apstone Headwaters' 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 Headwaters is uniquely qualified and has an unparalleled track record of successfully representing building products and construction companies. PUBLIC VALUATION COMMENTARY Capstone Headwaters' Aggregates Materials Index (Figure 1) indicates that average public company EBITDA multiples de- clined from 12.9x at the end of Q3 2018 to 10.3x at the end of Q4 2018. Figure 1: Public Valuation Multiples US Dollars in Millions EBITDA Enterprise Value/ Company Name TEV Revenue EBITDA Margin Revenue EBITDA LafargeHolcim Ltd. $46,985 $27,384 $5,457 19.9% 1.7x 8.6x CRH Plc $34,837 $31,605 $3,993 12.6% 1.1x 8.7x HeidelbergCement AG $27,215 $19,984 $3,077 15.4% 1.4x 8.8x Cemex SAB de CV $20,358 $14,392 $2,538 17.6% 1.4x 8.0x Vulcan Materials Company $17,947 $4,383 $1,114 25.4% 4.1x 16.1x Martin Marietta Materials, Inc. $15,298 $4,244 $1,042 24.6% 3.6x 14.7x MDU Resources Group, Inc. $7,106 $4,532 $626 13.8% 1.6x 11.4x Buzzi Unicem S.p.A. $5,252 $3,180 $628 19.7% 1.7x 8.4x Eagle Materials Inc. $3,969 $1,393 $410 29.4% 2.8x 9.7x Summit Materials, Inc. $3,670 $2,101 $359 17.1% 1.7x 10.2x U.S. Concrete, Inc. $1,403 $1,506 $168 11.2% 0.9x 8.3x Mean $16,731 $10,428 $1,765 18.8% 2.0x 10.3x Median $15,298 $4,383 $1,042 17.6% 1.7x 8.8x AGGREGATES PERFORMANCE 2018 Total Returns (Figure 2) • Aggregate Materials Index – (28.7%) • S&P 500 – (4.4%) • Dow Jones Industrial Average – (5.6%) Capstone Headwaters' Aggregates Materials Index has significantly underperformed the S&P 500 and the DJIA, declining 28.7% during 2018. *TEV = Total Enterprise Value (Market Capitalization + Net Debt) Sources: FactSet and Capital IQ

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