Headwaters : Acquires Assets of Metals USA's Roofing Products Business (PDF)

FROM:

RE: Headwaters Incorporated

10701 S. River Front Parkway, Suite 300

South Jordan, UT 84095

Phone: (801) 984-9400

NYSE: HW

FOR FURTHER INFORMATION

AT THE COMPANY:

Sharon Madden

Vice President of Investor Relations

(801) 984-9400

ANALYST CONTACT:

Tricia Ross

Financial Profiles

(916) 939-7285

FOR IMMEDIATE RELEASE

"One element of our business strategy is to increase the number of products that we provide to our core customers," said Kirk A. Benson, Headwaters' Chairman and Chief Executive Officer. The $2.6 billion specialty niche roofing market is of interest to our core customers and is an area of focus for Headwaters. With the addition of Gerard, we now have three product categories in niche roofing, including composite, concrete, and metal which we believe will open up opportunities for cross selling as well as bundling a complete roofing system, including our Tag & Stick underlayment product."

Gerard fits Headwaters' strategy to pursue building product opportunities where we can enjoy strong market share and top quartile industry margins. Gerard currently has the second leading market position and an opportunity to expand margins gradually to leadership status. "We are excited about the combination of our metal roofing products with Headwaters' composite product," said Ron Anderson, President of Gerard. "We strongly believe in the sales synergy associated with marketing both products with Gerard's national sales force, creating opportunities for roofing contractors to pull more product through distribution. There is an upside opportunity to expand our sales internationally, as our metal products are well received throughout the world."

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"The $28 million transaction will be immediately accretive to earnings. We are funding the transaction with existing balance sheet cash, and of course, will benefit from financial leverage as the operating returns significantly exceed the cost of our debt," said Don P. Newman, Chief Financial Officer. "Our net debt to adjusted EBITDA ratio will increase slightly with the use of cash, but we remain on track to achieve our desired leverage ratio in 2015."

Headwaters Incorporated is improving lives through innovative advancements in construction materials through application, design, and purpose. Headwaters is a diversified growth company providing products, technologies and services to the heavy construction materials, light building products, and energy technology industries. Through its coal combustion products, building products, and energy businesses, the Company has been able to improve sustainability by transforming underutilized resources into valuable products. www.headwaters.com

Certain statements contained in this press release are forward-looking statements within the meaning of federal securities laws and Headwaters intends that such forward-looking statements be subject to the safe-harbor created thereby. Forward-looking statements include Headwaters' expectations as to the managing and marketing of coal combustion products, the production and marketing of building products, the licensing of residue hydrocracking technology and catalyst sales to oil refineries, the development, commercialization, and financing of new technologies and other strategic business opportunities and acquisitions, and other information about Headwaters. Such statements that are not purely historical by nature, including those statements regarding Headwaters' future business plans, the operation of facilities, the availability of feedstocks, and the marketability of the coal combustion products, building products and catalysts, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding future events and our future results that are based on current expectations, estimates, forecasts, and projections about the industries in which we operate and the beliefs and assumptions of our management. Actual results may vary materially from such expectations. Words such as "may," "should," "intends," "plans," "expects," "anticipates," "targets," "goals," "projects," "believes," "seeks," "estimates," "forecasts," or variations of such words and similar expressions, or the negative of such terms, may help identify such forward-looking statements. Any statements that refer to projections of our future financial performance, our anticipated growth and trends in our businesses, and other characterizations of future events or circumstances, are forward-looking. In addition to matters affecting the coal combustion products, building products, and energy industries or the economy generally, factors that could cause actual results to differ from expectations stated in forward-looking statements include, among others, the factors described in the caption entitled "Risk Factors" in Item 1A in Headwaters' Annual Report on Form 10-K for the fiscal year ended September 30, 2013, Quarterly Reports on Form 10-Q, and other periodic filings.
Although Headwaters believes that its expectations are based on reasonable assumptions within the bounds of its knowledge of its business and operations, there can be no assurance that our results of operations will not be adversely affected by such factors. Unless legally required, we undertake no obligation to revise or update any forward-looking statements for any reason. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Our internet address is www.headwaters.com. There we make available, free of charge, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. Our reports can be accessed through the investor relations section of our web site.

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