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Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised andregulated by the Financial Conduct Authority. Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business.

BUILDING PRODUCTS & MATERIALSINDUSTRY UPDATE │ JANUARY 2016

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BUILDING PRODUCTS & MATERIALS GROUP OVERVIEW

1

CONTENTS

WHAT WE’RE READING

ECONOMIC UPDATE

M&A MARKET TRENDS

SELECT SECTOR OVERVIEWS & TRENDS

PUBLIC MARKETS

PUBLIC COMPARABLES

M&A TRANSACTIONS

CONTACTS

Mike HoganManaging [email protected]+1 (804) 915-0104

Ryan NelsonManaging [email protected]+1 (804) 915-0121

Trey PackardVice [email protected]+1 (804) 887-6016

INTRODUCTION

Harris Williams & Co. is pleased to present our Building Products and MaterialsIndustry Update for January 2016. This report provides commentary and analysison current capital market trends and merger and acquisition dynamics within theglobal building products and materials industry.

We hope you find this edition helpful and encourage you to contact us directly ifyou would like to discuss our perspective on current industry trends and M&Aopportunities or our relevant industry experience.

BUILDING PRODUCTS & MATERIALS

INDUSTRY UPDATE │ JANUARY 2016

OUR PRACTICE

Harris Williams & Co. is a leading advisor to the building products and materialsindustry. Our significant experience covers a broad range of end markets,industries, and business models.

Aggregates

Asphalt

Aluminum

Bricks

Clay

Glass

Precast Concrete /

Ready Mix

Steel

Stone

Acoustical

Cabinets and

Countertops

Carpet and Flooring

Gypsum / Wallboard

Electrical Fixtures

HVAC

Lumber

Plumbing Fixtures

Roofing

Siding

Tools and Hardware

Windows and Doors

Architectural and

Engineering

Installation and

Contracting

Lumber and

Hardware

Plumbing

Roofing and Siding

Site Development

Wallboard

Construction

MaterialsBuilding Products

Distribution &

Services

www.harriswilliams.com

Construction

Materials

Building

Products

Distribution &

Services has been acquired by

a portfolio company of

has been acquired by

Select Atlanta, Georgia

aggregates assets of LaFarge

SA have been acquired byhas been acquired by

a division of


a subsidiary of






a division of



a subsidiary of




a portfolio company of a portfolio company of









mailto:[email protected]



http://www.harriswilliams.com/

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RECENT MOMENTUM IN BUILDING PRODUCTS






is being acquired by



Harvey: Company Description

Leading building products supplier focused on Northeast region

Founded in and family-owned since 1961, headquartered outside Boston in Waltham, MA

Vertically integrated window and door manufacturer and distributor

Distributes broad line of exterior building products including windows, siding and roofing to over 44,000 customers annually through its network of 33 warehouses

Woodcraft Industries: Company Description

Best-in-class cabinet door and components manufacturer with highly automated and efficient operations

Offers a comprehensive line of over one million hardwood and engineered wood SKUs in a wide variety of styles, sizes, designs, and wood species

Focus on providing high-quality components and just-in-time (“JIT”) service to large, demanding cabinet OEMs

US LBM: Company Description

Provides a comprehensive line of specialty products, including engineered lumber, windows and doors, roofing and siding, drywall, and cabinetry

Over 30,000 residential and commercial construction customers

Broad coverage, going to market through 19 local or regional brands with 150 locations across 22 states in the Northeast, Midwest and Southeast United States

Infiltrator: Company Description

Leading manufacturer of engineered plastic chambers, synthetic aggregate leachfields, tanks, and accessories for the onsite wastewater and stormwater industries

Pioneer in innovative plastic technologies for onsite wastewater management

Demonstrated ability to drive conversion through enhanced product performance and installed cost savings


2

PAGE |

WHAT WE’RE READING

3

THE U.S. ECONOMY’S LATEST GROWTH IS LOOKING INCREASINGLY FRAIL

THE YEAR AHEAD IN HOUSING

NOVEMBER CONSTRUCTION SLIDES 5%

10 CONSTRUCTION INDUSTRY TRENDS TO WATCH IN 2016

Wall Street Journal 1/4/2016

The first week of 2016 has brought sinking temperatures and stocks–and now weaker estimates of economic growthfor the fourth quarter. Before Monday, the U.S. economy appeared to have ended 2015 on solid, thoughunspectacular, footing. Many economists were estimating that the nation’s gross domestic product–or the sum of allgoods and services produced–grew at an annual pace of roughly 2% in October through December. That wouldmatch the third quarter’s pace and fall roughly in line with average growth throughout the current expansion. Butthose estimates are falling, due to weak readings Monday morning on the nation’s manufacturing and constructionactivity, two key drivers of economic growth.

Read the full article here.

NAHB 1/4/2016

Steady employment, economic growth, pent-up demand, affordable home prices, and attractive mortgage rates willkeep the housing market on a gradual upward trend in 2016. However, persistent headwinds related to shortages ofavailable lots and labor are impeding a more robust recovery. Job formation is the key to this housing recovery. Unlikeprevious recoveries when housing played a key role in the rebound, this recovery needs more jobs to convinceconsumers that the recession is over, that they will retain their jobs, their incomes will grow and that their friends andrelatives feel that way too.


Dodge 12/18/2015

At a seasonally adjusted annual rate of $563.3 billion, new construction starts in November fell 5% from the previousmonth, according to Dodge Data & Analytics. The decline represented a partial pullback after the 13% increasereported for total construction in October, as nonresidential building lost some momentum following its improvedOctober pace. Decreased activity was also reported for housing in November, while the non-building constructionsector (public works and electric utilities/gas plants) held steady. During the first eleven months of 2015, totalconstruction starts on an unadjusted basis were $597.9 billion, up 8% from the same period a year ago.


Construction Dive 1/4/2016

Now that 2015 has come and gone, construction professionals are focusing attention on the year ahead. Analystspredict 2016 will be a strong year for the industry, as Dodge Data & Analytics' 2016 Construction Outlook reportpredicted 6% growth, with the value of construction starts reaching an estimated $712 billion. We talked with expertsfrom various sectors of the construction industry to find out their predictions for 2016. Their answers varied from newtechnology trends, to workforce concerns, to homebuyer preferences. But one common thread connected all of theexperts: they have high hopes that 2016 will bring strong demand and booming business.


CONSTRUCTION SPENDING FALLS FOR FIRST TIME IN 17 MONTHS

Construction Dive 1/4/2016

Construction spending slipped 0.4% in November to a seasonally adjusted annual rate of $1.12 trillion — the firstdecline since June 2014, the Commerce Department reported Monday. Nonresidential construction declined 0.7%,offsetting a 0.3% gain in residential construction. Within residential, single-family home construction increased 0.6%,and multifamily fell 0.7%. November's results came in below expectations, as economists polled by Reuters hadpredicted spending would rise 0.6%. October's spending rate was also revised down in the Commerce Departmentreport, from a 1.0% gain to a 0.3% rise.




http://blogs.wsj.com/economics/2016/01/04/the-u-s-economys-latest-growth-is-looking-increasingly-frail/

http://www.building-products.com/January-2016/The-Year-Ahead-in-Housing/

http://construction.com/about-us/press/November-Construction-Slides-5-Percent.asp

http://www.constructiondive.com/news/10-construction-industry-trends-to-watch-in-2016/411402/

http://www.constructiondive.com/news/construction-spending-falls-for-1st-time-in-17-months/411473/

PAGE |

94

96

98

100

102

104

106

108

110

Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15

ECONOMIC UPDATE

4

INDUSTRIAL PRODUCTION INDEX


GDP

Real GDP increased by an annual rate of2.0% in the third quarter of 2015, whileoverall GDP increased 2.2% since Q3 2014

Current dollar GDP increased 0.8%, or$146.5 billion in the third quarter to a levelof $18.1 trillion

The Gross Domestic Income (GDI), whichmeasures the value of the production ofgoods and services in the U.S. as the costsincurred and the incomes earned inproduction, increased 0.7% in the thirdquarter of 2015

Industrial production decreased 0.6% inNovember after decreasing 0.4% inOctober; it is down 1.2% YoY sinceNovember 2014

Capacity utilization for the industrial sectorfell 0.5% in November to 77.0% and is down2.1% since November 2014

Seasonally-Adjusted

Seasonally-Adjusted

(QoQ percentage change)

(Indexed to 2012)


(2.5%)

(2.0%)

(1.5%)

(1.0%)

(0.5%)

0.0%

0.5%

1.0%

1.5%

Q32006

Q32007

Q32008

Q32009

Q32010

Q32011

Q32012

Q32013

Q32014

Q32015

Source: Federal Reserve

Source: Bureau of Economic Analysis

PAGE |

ECONOMIC UPDATE

5

PERSONAL CONSUMPTION EXPENDITURES

ECONOMIC SENTIMENT

In November, personal incomedecreased $9.4 billion, or 1.2%, whilepersonal consumption expenditures(PCE) increased $40.2 billion, or 0.3%

Wages and salaries were flat inSeptember, following a flat August aswell

Purchases of durable goods was flat inNovember compared to an increase of2.8% in the previous month; whilepurchases of non-durable goodsdecreased 0.2%, compared to adecrease of 0.2% in October

The Leading Economic Index (LEI)measures how consumers view prospectsfor their own financial situation, how theyview the near-term general economyprospects, and their long-term view ofeconomic prospects

The LEI for the U.S. improved in Novemberby 0.4% to 124.6, following a 0.6% changein October, and no change in September

For the eleven months ending November2015, the LEI increased 3.4%(approximately a 4.9% annual rate)

The continued rise in LEI suggests economicgrowth will remain moderate in 2016 withlittle reason to expect growth to pick upsubstantially



(Percentage change in 3-month rolling average)

(Indexed to 2010)

0.0%

0.1%

0.2%

0.3%

0.4%

0.5%

0.6%

Nov-10 Nov-11 Nov-12 Nov-13 Nov-14 Nov-15

100

105

110

115

120

125

130

Nov-12 May-13 Nov-13 May-14 Nov-14 May-15 Nov-15

Source: Conference Board Leading Economic Index (LEI)


PAGE | 6

ECONOMIC UPDATE

CONSUMER CONFIDENCE INDEX (CCI)

KEY INTEREST RATES

The Consumer Confidence Indexincreased to 96.5 in December, up from92.6 in November

Consumer confidence is currently up6.0% over the last six months, and 3.7%higher than December 2014

Consumers’ appraisal of currentconditions was mixed in December.Those saying business conditions are“good” increased from 25.0% to 27.3%.However, those saying businessconditions are “bad” also increasedfrom 16.9% to 19.8%

Consumers were more positive aboutthe labor market. The proportionclaiming jobs are “plentiful” increasedfrom 21.0% to 24.1%, while thoseclaiming jobs are “hard to get”decreased to 24.7% from 25.8%

The 30-year mortgage rate increased inDecember 2015 to 3.96%

The current mortgage rate is 10 basispoints higher than the rate fromDecember 2014

The Fed has indicated that it couldincrease rates over the next six months



Seasonally-Adjusted

(Indexed to 1985)

0

20

40

60

80

100

120

0%

1%

2%

3%

4%

5%

6%

7%

8%

30-Yr Mortgage Rates 10-Yr Treasury

Effective Federal Funds Rate


Source: Conference Board

PAGE | 7

ECONOMIC UPDATE

U.S. NON-RESIDENTIAL CONSTRUCTION

U.S. HOUSING STARTS



Non-residential construction has laggedin recovery but has increased 10.2% sinceNovember of 2014

Non-residential construction decreasedby 0.8% from October to November, andhas decreased 0.1% over the last sixmonths

Several sectors within non-residentialconstruction that continue to seespending increases include commercial,industrial, and office / lodging

In the release of its estimates forNovember 2015, the U.S. Census Bureaurestated each of its monthly estimatesgoing back to January 2005, citing aprocessing error in the tabulation of data

Seasonally-Adjusted Annual Rate

-12%

-8%

-4%

0%

4%

8%

12%

$450

$500

$550

$600

$650

$700

$750

Non-Residential Construction MoM Change

($ in billions)

U.S. housing starts in November increased10.5% over October, and 16.5% YoY

Increases were driven by a 7.6% MoMincrease in single-family homes and a16.4% increase in multi-family homes

Rising employment and historically-lowmortgage rates are enticing buyers, whileincreasing prices induced by a lack ofhomes on the market are an incentive tostart new developments

Housing starts continue to rebound fromunprecedented lows reached in 2009,yet remain ~20% below the 50-yearaverage of 1.4 million starts per year

(Units in 000’s)

Nov. 2015 Total: 1,173MoM Δ: 10.5%YoY Δ: 16.5%

0

500

1,000

1,500

2,000

2,500

3,000

1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015

Source: U.S. Census Bureau

Source: U.S. Census Bureau

50-year average of 1,443 starts

PAGE | 8

ECONOMIC UPDATE

RESIDENTIAL HOUSING SPENDING

NAHB REMODELING MARKET INDEX (RMI)

Total residential building spending for2015 is projected to be $382 billion, upfrom $354 billion in 2014

Residential building spending increasedat a 10.0% CAGR between 2012 and2015

FMI projects that spending will increaseat an 8.6% CAGR from 2016E through2019P

The Q3 RMI was 58 and has not dippedbelow 50 since Q3 2009

The overall RMI averages the indicatorsof current and future remodeling activity.An RMI over 50 indicates that remodelersare reporting higher activity than theprevious quarter

On a seasonally-adjusted basis, RMIposted a gain of 2.1% year-over-year inthe third quarter



2016E – 2019P CAGR: 8.6%

$249 $253

$287

$342 $354 $382

$412 $447

$486

$527

0

100

200

300

400

500

600

2010 2011 2012 2013 2014 2015 2016E 2017P 2018P 2019P

Single-Family Multi-Family Improvements*

*Improvements includes additions, alterations, and major replacements. It does not include maintenance and repairs.

($ in billions)

Source: FMI Consulting

2012 – 2015 CAGR: 10.0%

Source: NAHB

30

35

40

45

50

55

60

65

70

Q3 2007 Q3 2009 Q3 2011 Q3 2013 Q3 2015

Seasonally-Adjusted Annual Rate

PAGE | 9

M&A MARKET TRENDS

MARKET OBSERVATIONS

BUILDING PRODUCTS QUARTERLY M&A ACTIVITY

2015 global M&A activity reached record levels due to a buying spree from companies looking for growth

The total value of deals announced in 2015 reached $4.28 trillion, comfortably exceeding the $3.67 trillion recordset in 2007

− Q4 2015 was the third quarter in a row to post over $1 trillion in announced deal value

− Ten $50+ billion M&A deals were announced in 2015, accounting for 19% of the total announced dealvalue, the highest share on record

− Average deal size has increased for the fifth year-over-year period to reach the highest average on record

The favorable conditions in the debt markets from the first half of 2015 dissipated as the year came to a close,and second lien markets have significantly moderated over the last two months

Large corporations continue to drive M&A activity with significant cash balances and relatively cheap credit

Market volume in 2015 was driven primarily by outsized activity within a few sectors, most notably healthcareand technology, media & telecom

− North American building products deal activity was down 3.3% compared to 2014



Note: Includes all building products or construction materials M&A transactions announced in the U.S. or Canada

Total Transactions: 270

YoY Change: 55.2%


YoY Change: (2.6%)


YoY Change: 1.5%


YoY Change: (18.7%)


YoY Change: 11.5%


YoY Change: (3.3%)

0

10

20

30

40

50

60

70

80

Q4 2010

Q4 2011

Q4 2012

Q4 2013

Q4 2014

Q4 2015

Sources: PitchBook, Mergermarket

PAGE | 10


LUMBER AND WOOD PRODUCTS

ROOFING

WINDOWS AND DOORS

Description

Lumber, boards, beams, bolts oriented strand board, poles, shingles, siding,and wood chips

Industry Commentary:

70% of U.S. lumber demand is driven by housing, including new constructionand remodeling

Prices recovered in Q4 2015 from depressed levels in August through October

Framing Lumber Composite Price Index($ per thousand board feet)

Description

Roofing market includes bituminous, wood, and tile roofing used in residentialapplications and metal elastomeric and plastic roofing used in non-residential applications


U.S. demand for roofing is projected to rise 3.9% annually to 252 millionsquares in 2019, valued at approximately $21.4 billion dollars

Demand for roofing is closely linked to building construction expenditures, buthas been more sheltered than other building products markets from thehousing slump due to the non-discretionary need for roof repair andreplacement

Houses need to be re-roofed every fifteen years on average and the agingU.S. housing stock will drive continued demand for replacement

Additionally, renewed strength in new housing construction and a generallystronger economic climate will support growth

Roofing Demand by Primary Segment

Description

Windows and doors market includes metal, wood, and vinyl windows anddoors for residential and non-residential end markets


Window and door demand is primarily driven by new commercial andresidential construction, as well as repair and remodel spending

Quarterly remodeling spend decreased 0.8% during Q4 of 2015, following twoconsecutive positive quarters. Spend for Q4 was ~$148 billion

Leading Indicator of Remodeing Activity –LIRA ($ in billions)



$100

$200

$300

$400

$500

Residential Reroofing

44%

Non-Residential Reroofing

37%

New Residential11%

New Non-Residential

8%

$80

$100

$120

$140

$160

Dec-11 Dec-12 Dec-13 Dec-14 Dec-15

Source: Random Lengths

Source: Freedonia

Source: Joint Center for Housing Studies of Harvard University

PAGE |


11

WALLBOARD AND PLASTER

HVAC

PLUMBING FIXTURES AND FITTINGS

Description

Primarily made from gypsum, products include wallboard, plaster,plasterboard, molding, ornamental moldings, statuary, and architecturalplasterwork


Industry executives are uncertain on ability to continue price increases into2016, though confidence in demand remains high

Gypsum product demand is primarily driven by new commercial andresidential construction, as well as repair and remodel spending

Over the past two years, rising wallboard prices and cost-saving measureshave improved industry profit margins

New home inventories remain near historically low levels and as demand fornew homes grows, builders will respond by increasing their stock

U.S. Wallboard Demand Outlook($ in millions)

U.S. HVAC Demand Outlook($ in millions)

Plumping Equipment Industry Revenue Outlook($in millions)



Description

Residential, commercial, and industrial heating, ventilation, air-conditioning,and refrigeration equipment


U.S. shipments of central air conditioners and air-source heat pumpsdropped modestly in 2015 compared to 2014

HVAC demand is primarily driven by residential and non-residentialconstruction, HVAC replacement, and weather patterns

Aging domestic buildings (75% of buildings were built before the 1980s) arefueling the demand for replacement equipment

New minimum energy efficiency standards for air conditioning andcorresponding tax credits are driving replacement demand

Description

Plumbing fixtures, bathtub and shower fixtures, and indoor pipes constitutethis segment


Through 2018, U.S. demand for plumbing fixtures and fittings is projected toadvance ~3% annually to nearly $55 billion

Primary demand determinants are repair and remodel spending, new homeconstruction, and non-residential improvement and repair

Rising demand for higher-margin products such as hydronic heating systemsand insulated pipes have expanded overall profit margins since 2010

Domestic manufacturers are facing strong headwinds from cheap importswhich have increased from 69.9% of the market in 2008 to an estimated78.4% in 2013

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

2007 2009 2011 2013 2015 2017P

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

2007 2009 2011 2013 2015 2017P

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

2007 2009 2011 2013 2015 2017P

Source: IBIS World

Source: IBIS World

Source: IBIS World

PAGE |

0

4,000

8,000

12,000

16,000

20,000


12

AGGREGATES

ASPHALT

CEMENT AND CONCRETE



Description

Broad category of materials such as crushed rock, manufactured sand,natural sand, and gravel

Most-used material in the world, after water


Markets are local in nature due to high shipping costs

Major players include Lafarge, Cemex, CRH, Heidelberg Cement, MartinMarietta, Vulcan Materials and a large number of independent operators

Demand is derived from total construction spending, which is based onglobal, national, regional, and local economic conditions. 25 billion tonsof aggregates are used per year globally, roughly four tons per person

On July 9th 2015, Congress passed a bill to ease permitting for domesticmines, which included aggregates

U.S. Aggregates Consumption (values in millions of metric tons)

Description

Paving and roofing materials include asphalt and tar-paving mixtures andblocks, shingles, roofing cements, and coatings


Asphalt is used over 85% of the time in U.S. highway and road construction

On December 4th, 2015, Congress passed The Fixing America’s SurfaceTransportation (FAST) Act, a comprehensive five-year, $305 billion highwayspending bill

MAP 21 regulations extend and fund federal highway programs, includingover $120 billion for infrastructure programs

Simultaneously, resurgent U.S. housing activity supports asphalt shingle androofing cement demand

U.S. Refinery Net Production of Asphalt and Road Oil (thousands of barrels)

Description

Portland, natural, masonry, pozzolanic, and other hydraulic cements

Typically, manufacturers also thermally treat and mine or quarry lime


Two of the industry’s largest players, Lafarge and Holcim, finalized theirmerger on July 10th, 2015

U.S. cement consumption has historically exceeded domestic productioncapacity

Concrete has been gaining share over asphalt since 2008

U.S. cement capacity and import terminals are largely owned orcontrolled by international producers

Significant barriers to entry exist for new cement capacity andtransportation costs lead to regional markets

U.S. Cement Demand Outlook ($ in millions)

1,200 1,200 1,200 1,220 1,230 1,310991

834 798 811 816 850914

702

0

500

1,000

1,500

2,000

2,500

2009 2010 2011 2012 2013 2014 2015

Q1-Q3Crushed Stone Sand/Gravel

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

2007 2009 2011 2013 2015 2017P

Source: U.S. Geological Survey

Source: U.S. Energy Information Administration

Source: IBIS World

PAGE |

6.0x

7.0x

8.0x

9.0x

10.0x

11.0x

12.0x

13.0xBuilding Products Index

Building Products Distributors Index

Construction Materials Index

S&P 500 Index

PUBLIC MARKETS



13

MEDIAN TEV / 2015E EBITDA

MEDIAN REVENUE GROWTH (2014 – 2015E)

MEDIAN EBITDA MARGIN (2011 – 2014) MEDIAN EBITDA MARGIN (2014 – 2015E)

MEDIAN CAPEX / 2015E REVENUE

MEDIAN REVENUE GROWTH (2011 – 2014)

HISTORICAL STOCK PRICES (DECEMBER 31ST, 2010 – DECEMBER 31ST, 2015)

HISTORICAL MEDIAN TEV / NTM EBITDA (DECEMBER 31ST, 2010 – DECEMBER 31ST, 2015)

9.5x

10.2x

10.6x

Construction Materials

Building Products Distributors

Building Products

60

80

100

120

140

160

180

200

220

240

Building Products Index

Building Products Distributors Index

Construction Materials Index

S&P 500 Index

5.8%

1.1%

2.8%



Building Products

12.4%

3.6%

10.0%



Building Products

7.5%

8.5%

7.3%



Building Products

9.6%

1.1%

2.6%



Building Products

13.9%

5.1%

12.6%



Building Products

PAGE |

PUBLIC COMPARABLES

14

BUILDING PRODUCTS



As of December 31, 2015 ($ U.S. in millions, except per share amounts)

Stock Performance

Current % of 2015E TEV / EBITDA

Price LTM High Mkt Cap TEV Revenue EBITDA Margin 2015 2016

ASSA ABLOY AB $21.09 11.2% $23,422 $26,063 $8,049 $1,482 18.4% 17.6x 16.5x

Mohawk Industries Inc. 189.39 89.3% 14,001 17,110 8,130 1,381 17.0% 12.4x 10.6x

Masco Corporation 28.30 92.5% 9,522 11,599 7,312 1,050 14.4% 11.0x 10.1x

Fortune Brands Home & Security, Inc. 55.50 97.4% 8,863 9,857 4,590 641 14.0% 15.4x 12.8x

Lennox International, Inc. 124.90 90.1% 5,627 6,511 3,454 442 12.8% 14.7x 12.5x

Owens Corning 47.03 97.0% 5,483 7,459 5,359 824 15.4% 9.0x 8.1x

Kingspan Group plc 26.40 100.0% 4,673 5,192 2,920 331 11.3% 15.7x 13.8x

USG Corporation 24.29 73.9% 3,535 5,301 3,815 567 14.9% 9.4x 8.2x

Armstrong World Industries, Inc. 45.73 75.3% 2,531 3,301 2,427 380 15.7% 8.7x 7.9x

Masonite International Corporation 61.23 83.6% 1,860 2,289 1,844 186 10.1% 11.3x 9.2x

Simpson Manufacturing Co., Inc. 34.15 88.8% 1,649 1,406 781 138 17.6% 10.2x 9.0x

American Woodmark Corp. 79.98 89.0% 1,302 1,130 828 67 8.1% 11.9x 10.2x

Apogee Enterprises, Inc. 43.51 71.3% 1,266 1,195 929 93 10.0% 12.9x 7.9x

Interface Inc. 19.14 70.4% 1,260 1,419 1,018 150 14.8% 9.4x 8.3x

Trex Co. Inc. 38.04 65.9% 1,174 1,220 437 95 21.8% 12.8x 10.6x

Richelieu Hardware Ltd. 48.91 67.0% 956 947 563 66 11.8% 14.8x 13.4x

NCI Building Systems Inc. 12.41 66.7% 919 1,264 1,556 122 7.9% 9.4x 7.9x

Ply Gem Holdings, Inc 12.54 82.0% 854 1,828 1,876 176 9.4% 10.4x 8.0x

Tyman plc 4.45 100.0% 749 903 527 85 16.1% 10.6x 10.0x

Continental Building Products, Inc. 17.46 72.1% 737 1,034 422 124 29.4% 8.3x 7.4x

Nortek Inc. 43.62 46.9% 709 2,085 2,510 268 10.7% 7.8x 6.7x

Quanex Building Products Corporation 20.85 95.1% 708 742 650 92 14.2% 8.0x 6.5x

PGT, Inc. 11.39 70.5% 554 692 387 67 17.3% 10.3x 8.4x

Overall Median 82.0% 14.4% 10.6x 9.0x

Overall Mean 78.1% 14.5% 11.4x 9.7x

PAGE |

PUBLIC COMPARABLES

15

BUILDING PRODUCTS DISTRIBUTORS




Stock Performance

Current % of 2015E TEV / EBITDA


Wolseley plc $54.43 100.0% $13,890 $15,121 $20,932 $1,531 7.3% 9.9x 9.4x

HD Supply Holdings, Inc. 30.03 81.6% 6,010 10,327 8,914 856 9.6% 12.1x 10.7x

Beacon Roofing Supply, Inc. 41.18 93.6% 2,426 2,602 2,516 156 6.2% NM 8.1x

Builders FirstSource, Inc. 11.08 66.4% 1,211 3,137 3,686 222 6.0% NM 7.5x

BMC Stock Holdings, Inc.1 16.75 66.5% 1,095 1,463 1,378 120 8.7% 12.2x 11.7x

Hardwoods Distribution Inc. 12.96 69.4% 216 249 409 24 6.0% 10.2x 8.9x

CanWel Building Materials Group Ltd. 3.45 55.1% 146 247 580 23 4.0% 10.8x 7.9x

Huttig Building Products Inc. 3.80 92.2% 95 160 649 16 2.4% 10.1x NA

Goodfellow Inc. 7.21 65.6% 61 103 390 12 3.1% 8.6x NA

Bluelinx Holdings Inc. 0.53 41.4% 47 509 1,943 27 1.4% 18.6x NA

Taiga Building Products Ltd. 0.58 63.4% 19 170 1,032 31 3.0% 5.4x NA


Overall Mean 72.3% 5.2% 10.9x 9.2x

1) Pro forma Rev enue & EBITDA figures from the company's inv estor presentation

PAGE |

PUBLIC COMPARABLES

16

CONSTRUCTION MATERIALS




Stock Performance

Current % of 2015 TEV / EBITDA


Aggregates and Cement

LafargeHolcim Ltd. $50.24 68.1% $30,491 $52,606 $29,143 $5,509 18.9% 9.5x 8.6x

CRH plc 29.00 100.0% 23,869 25,310 25,163 2,339 9.3% 10.8x 7.6x

HeidelbergCement AG 82.29 100.0% 15,464 23,060 14,751 2,747 18.6% 8.4x 7.2x

Vulcan Materials Company 94.97 88.9% 12,661 14,472 3,458 824 23.8% 17.6x 13.7x

Martin Marietta Materials, Inc. 136.58 76.4% 9,034 10,304 3,609 800 22.2% 12.9x 10.2x

CEMEX, S.A.B. de C.V. 0.55 3.5% 7,360 22,914 14,336 2,718 19.0% 8.4x 7.6x

Eagle Materials Inc. 60.43 68.0% 3,024 3,528 1,106 353 31.9% 9.7x 8.2x

Summit Materials, Inc. 20.04 70.1% 997 2,329 1,411 276 19.6% 8.4x 6.7x

Median 73.3% 19.3% 9.6x 7.9x

Mean 71.9% 20.4% 10.7x 8.7x

Heavy Construction Materials

James Hardie Industries plc $17.47 87.2% $5,667 $6,196 $1,654 $362 21.9% 14.5x 13.3x

Boral Limited 5.91 85.7% 3,200 3,788 3,623 451 12.5% 8.5x 8.1x

Headwaters Incorporated 16.87 77.5% 1,247 1,679 891 166 18.6% 9.8x 8.7x

U.S. Concrete, Inc. 52.66 83.8% 772 1,055 966 127 13.2% 8.3x 6.9x

Median 84.7% 15.9% 9.2x 8.4x

Mean 83.5% 16.5% 10.3x 9.3x

Lumber and Wood Products

Weyerhaeuser Co. $29.98 80.9% $15,303 $19,671 $7,062 $1,419 20.1% 13.9x 11.0x

West Fraser Timber Co. Ltd. 52.53 66.9% 3,122 3,429 2,974 315 10.6% 10.9x 6.7x

Louisiana-Pacific Corp. 18.01 94.9% 2,573 2,879 1,906 56 NM NM 11.9x

Canfor Corp. 20.19 63.2% 1,948 2,368 2,688 261 9.7% 9.1x 5.5x

Norbord, Inc. 26.95 92.2% 1,659 2,414 1,411 106 7.5% NM 7.9x

Universal Forest Products Inc. 68.37 86.9% 1,377 1,413 2,898 172 5.9% 8.2x 7.5x

Boise Cascade Company 25.53 58.2% 991 1,130 3,614 170 4.7% 6.6x 5.9x

Median 80.9% 8.6% 9.1x 7.5x

Mean 77.6% 9.8% 9.7x 8.1x


Overall Mean 76.4% 16.0% 10.3x 8.6x

PAGE |

M&A TRANSACTIONS

17



Announced

DateTarget Vertical Business Description Acquirer

1/12/2016 Western Emulsions, Inc. Construction Materials Western Emulsions, Inc. manufactures and supplies asphalt emulsion

solutions for pavement preservation, repair, and recycling applications.

Idaho Asphalt Supply, Inc.

1/8/2016 JMF Company Building Products JMF Company manufactures rough plumbing and HVAC products. Zhejiang Hailiang Co.

1/7/2016 Darby Doors, Inc. Building Products Darby Doors, Inc. manufactures and sells doors, millwork, hardware,

and building specialties.

U.S. LBM Holdings, LLC

1/6/2016 Source Refrigeration &

HVAC, Inc.

Building Products Source Refrigeration & HVAC, Inc. designs, installs, repairs, maintains,

and optimizes refrigeration and HVAC systems for customers in North

America.

Audax Group, Inc.

1/6/2016 SunSetter Products, LP Building Products SunSetter Products, LP manufactures deck and patio awnings in

America.

Springs Window Fashions

LLC

12/29/2015 Statewide Wholesale, Inc. Building Products

Distribution

Statewide Wholesale, Inc. distributes roofing material and supplies for

commercial and residential applications.

Beacon Roofing Supply,

Inc.

12/22/2015 Trend Windows & Doors

Pty Ltd.

Building Products Trend Windows & Doors Pty Ltd. manufactures and markets aluminium,

timber, and thermal energy efficient windows and doors.

JELD-WEN, Inc.

12/22/2015 White Silica Sand Reserves

in Jackson County

Construction Materials White Silica Sand Reserves in Jackson County of Performance

Technologies, L.L.C. comprises white silica sand reserves in Jackson

County.

Superior Silica Sands LLC

12/21/2015 Builder Specialties, Inc.

and Construction

Resources, Inc.

Building Products

Distribution

Builder Specialties, Inc. and Construction Resources, Inc. prov ides and

installs building products.

Monomoy Capital Partners

12/21/2015 NPI Holding Corp. Building Products NPI Holding Corp., through its subsidiaries, manufactures and sells wall

panel solutions for the building products, signage, transportation, and

other commercial markets.

Stabilit America, Inc.

12/21/2015 Boyle & Chase,

Incorporated

Building Products

Distribution

Boyle & Chase, Incorporated distributes commercial and decorative

hardware worldwide.

Top Notch Distributors, Inc.

12/18/2015 Roofing & Insulation

Supply, Inc.

Building Products

Distribution

Roofing & Insulation Supply, Inc. operates as a wholesale distributor of

roofing, insulation, sheathing, and related materials.


Inc.

12/18/2015 Jameson LLC Building Products Jameson LLC manufactures cabling and lighting products. Huskie Tools, Inc.

12/18/2015 Parker's Building Supply Building Products

Distribution

Parker's Building Supply offers products in various categories, such as

automotive, building materials, cleaning supplies, clothing and apparel,

doors and windows, electrical, farm and ranch, hand tools, hardware,

heating, ventilation and air conditioning, housewares, lawn and


12/18/2015 J&J Industries, Inc. Building Products J&J Industries, Inc. designs, engineers, and manufactures commercial

carpets, broadlooms, and tiles.

Engineered Floors LLC

12/17/2015 Clarion Boards, Inc. and

Clarion Laminates LLC

Building Products Clarion Boards, Inc. and Clarion Laminates LLC manufacture flooring

products.

Kronospan

12/15/2015 Arrow Storage Products

Inc.

Building Products Arrow Storage Products Inc. is engaged in the design, manufacture,

and marketing of DIY outdoor steel storage solutions. I t offers storage

sheds, steel sheds, and garden sheds, and storage buildings.

ShelterLogic Corp.

12/14/2015 Self Industries, Inc. Building Products Self Industries, Inc. manufactures and markets metal stampings, bolts,

nuts, rivets, washers and machine tools.

Ringmetall AG

12/10/2015 Hathaway Building

Materials

Building Products

Distribution

Hathaway Building Materials distributes drywall, steel framing, lath, and

plaster to the Southern California residential and commercial

construction markets.

GMS Inc.

12/3/2015 Balboa Water Group, Inc. Building Products Balboa Water Group, Inc. designs, develops, manufactures, assembles,

and supplies whirlpool bath and portable spa products for the leisure

hot water industry.

AEA Investors Small

Business Fund

PAGE |

M&A TRANSACTIONS

18



Announced


12/2/2015 Badgerland Supply, Inc. Building Products

Distribution

Badgerland Supply, Inc. supplies building materials to Wisconsin and

Northern I llinois.

GMS Inc.

12/2/2015 Elite Door & Trim, Inc. Building Products Elite Door & Trim, Inc. manufactures doors, hardware, and trim products. National Millwork Inc.

12/1/2015 ARN Industries, Inc. Building Products ARN Industries, Inc., doing business as Halco Lighting Technologies, LLC,

manufactures lamps and ballasts for residential, industrial/commercial,

and special lighting applications in the United States and internationally.

Summer Street Capital

Partners

12/1/2015 Rci Roofing Supply

Company, Inc.

Building Products

Distribution

Rci Roofing Supply Company, Inc. distributes building supplies and

materials for residential and commercial projects throughout the

Midwest. The company offers residential roofing products, commercial

roofing products, sidings, soffits, gutters and downpipes, metals, vents,


Inc.

12/1/2015 Rhem, LLC Building Products

Distribution

Rhem, LLC, doing business as E.J. Bartells, distributes, fabricates, and

manufactures insulation, low-to-high temperature refractory, and HVAC

products and accessories; and offers mechanical and refractory

insulation contracting serv ices in Alaska, Colorado, Idaho, Montana,

Distribution International,

Inc.

11/30/2015 WinDoor Incorporated

and LTE, LLC

Building Products WinDoor Incorporated and LTE, LLC represents the combined

operations of WinDoor Incorporated and LTE, LLC in their sale to PGT

Industries, Inc. WinDoor Incorporated manufactures extruded aluminum

and v inyl sliding glass doors and window systems.

PGT Industries, Inc.

11/10/2015 M3 Glass Technologies Building Products M3 Glass Technologies produces and sells custom fabricated and

decorative glass products for customers in the United States and

internationally.

LongWater Opportunities,

LLC

11/10/2015 Overhead Door Company

of Burlington Inc.

Building Products Overhead Door Company of Burlington Inc. manufactures integrated

door and operator systems for commercial, industrial, and residential

applications.

Installed Building Products,

Inc.

11/9/2015 Team Wholesale, Inc. Building Products

Distribution

Team Wholesale, Inc. supplies siding and windows to the Michigan

construction market.

American Builders &

Contractors Supply Co.,

Inc.

11/9/2015 Sierra Insulation

Contractors, Inc. and Eco-

Tect Insulation, Inc.

Building Products Sierra Insulation Contractors, Inc. and Eco-Tect Insulation, Inc.

represents the combined operations of Sierra Insulation Contractors,

Inc. and Eco-Tect Insulation, Inc. in their sale to Installed Building

Products, Inc. As of November 9, 2015, Sierra Insulation Contractors, Inc.

Installed Building Products,

Inc.

10/30/2015 Silver State Specialties, LLC Building Products

Distribution

Silver State Specialties, LLC supplies building products to contractors

and homeowners.

United Subcontractors, Inc.

10/28/2015 Heavy Materials, LLC and

Spartan Concrete

Products, LLC

Building Materials Heavy Materials, LLC and Spartan Concrete Products, LLC represents

the combined operations of Heavy Materials, LLC and Spartan

Concrete Products, LLC in their sale to U.S. Concrete, Inc. As of October

28, 2015, Heavy Materials, LLC and Spartan Concrete Products, LLC was

U.S. Concrete, Inc.

10/27/2015 Building Supply

Association, Inc.

Building Products

Distribution

Building Supply Association, Inc. operates as a building supply company. U.S. LBM Holdings, LLC

10/20/2015 HomeXterior Building

Supply, Inc.

Building Products

Distribution

HomeXterior Building Supply, Inc. distributes building products to

contractors in the United States.

American Builders &


Inc.

10/19/2015 Florida Screen Enterprises

Inc.

Building Products Florida Screen Enterprises Inc. manufactures residential and commercial

window screens, patio doors, roll formed shapes, and associated

hardware.

The RiteScreen Company,

LLC

10/13/2015 Quantum Windows &

Doors, Inc.

Building Products Quantum Windows & Doors, Inc. manufactures and sells hand-crafted

wood windows and doors for residential and commercial markets in the

United States.

Swiftsure Capital, LLC

10/8/2015 Wilkinson Construction

Company, Inc.

Building Materials Wilkinson Construction Company, Inc. offers road construction and

pavement maintenance serv ices.

Geneva Rock Products,

Inc.

10/5/2015 LaCantina Doors, Inc Building Products LaCantina Doors, Inc. designs and manufactures opening door systems. JELD-WEN, Inc.

10/1/2015 Cretex Concrete Products

North, Inc.

Building Materials Cretex Concrete Products North, Inc. develops, manufactures, and

supplies various precast and prestressed products for the construction

industry in Minnesota, North Dakota, Wisconsin, South Dakota, Iowa,

Missouri, Kansas, and Montana.

Hanson Pipe & Precast, LLC

9/28/2015 The Wantage Stone Building Materials As of September 28, 2015, The Wantage Stone was acquired by U.S.

Concrete, Inc. The Wantage Stone comprises a site development

quarry including 80 acre land parcel and mining rights for additional 77

acres of land.

U.S. Concrete, Inc.

PAGE |

M&A TRANSACTIONS

19



Announced


9/28/2015 Grabber Construction

Products, Inc.

Building Products

Distribution

Grabber Construction Products, Inc. manufactures and distributes

fasteners and fastening systems for wood, metal, and drywall

applications in the commercial and residential construction markets.

Svoboda Capital Partners

LLC; Dot Foods, Inc.

9/25/2015 CEMEX, Inc., Gypsum

Wallboard Business

Building Products

Distribution

CEMEX, Inc., Gypsum Wallboard Business comprises cement

manufacturing plant.


9/24/2015 Harvey Industries, Inc. Building Products / Building

Products Distribution

Harvey Industries, Inc., doing business as Harvey Building Products,

manufactures and distributes building products.

Dunes Point Capital, LLC

9/22/2015 GBS Building Supply Building Products

Distribution

GBS Building Supply manufactures and markets building and

construction products.


9/17/2015 Foundation Building

Materials, LLC

Building Products

Distribution

Foundation Building Materials, LLC, also known as LSF9 Cypress Holdings

LLC, distributes building products in the United States.

Lone Star Funds

9/17/2015 Gravel and Sand site in

Mankato

Building Materials Gravel and Sand site in Mankato comprises a gravel and sand

production property.

City of Mankato

9/15/2015 Norandex Building

Materials Distribution, Inc.

Building Products

Distribution

Norandex Building Materials Distribution, Inc. distributes building

materials.

American Builders &


Inc.

9/14/2015 Murray Supply Company,

LLC

Building Products

Distribution

Murray Supply Company, LLC, a wholesale distributor, supplies

commercial and residential plumbing products in North Carolina.

Morrison Supply Company,

LLC

9/10/2015 Karona, Inc. Building Products Karona, Inc. manufactures commercial and residential doors. JELD-WEN, Inc.

9/2/2015 Skyline Group of

Companies

Building Products Skyline Group of Companies prov ide commercial and residential roofing

products for the residential and commercial builders, homeowners,

building owners, and property managers.

Thermal Systems KWC Ltd.

9/1/2015 Capitoline Products, Inc. Building Products Capitoline Products, Inc. manufactures post formed countertops, high

pressure laminate panels, finished high pressure laminate panel

component parts, and extended plywood.

VT Industries, Inc.

8/31/2015 WII Components Inc. Building Products WI I Components Inc., through its subsidiaries, manufactures and sells

hardwood cabinet doors, hardwood components, and engineered

wood products.

Quanex Building Products

Corporation

8/28/2015 E&A Materials, Inc., Select

Assets

Building Materials As of August 28, 2015, Select Assets of E&A Materials, Inc. were acquired

by U.S. Concrete, Inc. Select Assets of E&A Materials, Inc. comprises

sand and gravel operations and are located in the United States.

U.S. Concrete, Inc.

8/27/2015 C.R. Laurence Co., Inc. Building Products C.R. Laurence Co., Inc. designs, engineers, manufactures, and supplies

architectural hardware for glazing, railing, architectural, construction,

industrial, food serv ice, and automotive industries worldwide.

Oldcastle

BuildingEnvelope, Inc.

8/20/2015 Robert Bowden, Inc. Building Products Robert Bowden, Inc. manufactures, assembles, sells, installs, and

serv ices various building materials for the construction professionals and

homebuilders in Georgia.

Building Materials Holding

Corporation

8/19/2015 Superior Manufacturing

Group, Inc.

Building Products Superior Manufacturing Group, Inc. manufactures floor mat products. Checkers Industrial Safety

Products, Inc.

8/12/2015 Quest Construction

Products, LLC

Building Products Quest Construction Products, LLC manufactures protective systems and

coatings for the construction industry.

Building Materials

Corporation of America,

Inc.

8/11/2015 Lindab Inc. Building Products Lindab Inc. engages in the development, manufacture, and marketing

of sheet metal products for the heating, ventilation, and air conditioning

(HVAC) industry.

Ductmate Industries, Inc.

8/4/2015 Martin Marietta Materials,

Inc., California Cement

Business Assets

Building Materials Martin Marietta Materials, Inc., California Cement Business Assets

includes the business operations manufacturing cement.

CalPortland Company, Inc.

8/4/2015 Three Aggregates Facilities

and Seven Ready-Mixed

Concrete Operations

Building Materials As of quarter ended June 30, 2015, Three Aggregates Facilities and

Seven Ready-Mixed Concrete Operations in Arizona and New Mexico

were acquired by Vulcan Materials Company.

Vulcan Materials Company

PAGE |

REPRESENTATIVE BUILDING PRODUCTS & MATERIALS TRANSACTIONS

19





Select Atlanta,

Georgia aggregates

assets of LaFarge SA

have been acquired

by






has purchased

certain assets of









a subsidiary of


A Private Investor

Group

a subsidiary of



has sold certain assets to


















a division of

has completed a

recapitalization

with

have been acquired by

The Wichita, Kansas

aggregates, concrete,

asphalt, and paving

assets

of LaFarge SA







a division of






Strategic

Industries, LLC

Private Investors


a portfolio company ofa portfolio company of


portfolio companies of


Dyad Partnershas been acquired by





a portfolio company ofa portfolio company of


a division of



a subsidiary of



a division of






a division of






has been acquired by has been acquired by



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