CONSTRUCTION DEMAND, MERGER AND ACQUISITION ACTIVITY IMPROVES

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CONSTRUCTION DEMAND, MERGER AND ACQUISITION

ACTIVITY IMPROVESCONSTRUCTION SERVICES INDUSTRY UPDATE | MARCH 2021

TABLE OF CONTENTS

Key Industry Takeaways

Industry Outlook

M&A Overview

Pricing Environment

Notable Transactions

Select Transactions

Client Case Studies

Public Company Data

Report Contributors

Firm Track Record

KEY INDUSTRY TAKEAWAYS

2

Construction Demand, M&A Activity Improves

Construction Services Industry

Capstone Headwaters’ Building Products & Construction Services Team is

pleased to share its Construction Services Industry Update. Through our

conversations with industry participants, private equity firms, and analysis of

trends and transaction activity, we expect a healthy M&A market in 2021.

1. Merger and acquisition (M&A) activity has rebounded substantially in Q4 andyear-to-date (YTD) 2021 as strategics and private equity have reengaged ingrowth initiatives and portfolio enhancement.

2. Many business owners are motivated to transact ahead of potential taxchanges under the new presidential administration to avoid unfavorablecapital gains treatment.

3. Debt financing is widely available and interest rates are low, which results inquality companies realizing outlier valuations.

4. Professional services providers remain in high demand, with leading publiccompanies trading at premium valuations. Contractor services providershave also experienced EBITDA multiple expansion in recent months.

5. Despite lower M&A volume in 2020, the pricing environment remainedresilient with quality companies garnering strong multiples from strategicand financial buyers.

6. Publicly traded companies and private equity firms are looking for growthand both groups realize that growing through acquisition is the fastest wayto achieve their goal.

Darin Good

Managing Director

303-549-5674

Crista Gilmore

Director

303-531-5013

Brian Krehbiel

Director

970-215-9572

INDUSTRY OUTLOOK

Optimism in the Construction Services industry has been

supported by an improving backlog of projects and

heightened confidence for near-term sales and

employment. Following depressed levels at year end, the

Commercial & Institutional and Infrastructure segments

have experienced a healthy pipeline of projects, with

backlog increasing in February to 8.3 months and 9.1

months, respectively, according to Associated Builders

and Contractors (ABC).1 Demand visibility has improved

substantially in Q1, evidenced by the Dodge Momentum

Index, a monthly measure for nonresidential projects in

planning, rising 7.1% in February from the prior month,

marking the index’s highest reading in nearly three years.2

In addition, as industry participants leverage greater

financial visibility and project certainty, confidence levels

for nonresidential sales, profit margins, and staffing levels

over the next six months have elevated, according to ABC.

While nonresidential construction spending has lagged

the prior year by 5%, according to the U.S. Census

Bureau,3 vaccinations and widespread resumption of

construction projects bodes well for industry demand

throughout the remainder of the year.

Professional services providers in the Construction

industry have experienced a resurgence of activity as

consulting, testing, architecture, and engineering demand

has approached pre-pandemic levels. This has been

evidenced by strong sales growth among top public

players with leading professional and technical

engineering and consulting provider NV5 (Nasdaq:NVEE)

recording 22% revenue growth in Q4, according to its

earnings release.4 The pipeline of activity for professional

services providers has also remained robust, with WSP

Global (TSX:WSP) recording a backlog of $8.4 billion,

representing 11.5 months of revenue as of December 31,

2020, according to its earnings call.5 In addition, industry

participants have increased investment towards cost

saving initiatives and technological solutions as margin

growth remains a key focus. Notably, 76% of engineering

and

Construction Services | March 2021

and construction executives expect to invest in digital

technology in 2021, with building information

management (BIM) platforms and digital supply networks

at the forefront of innovative cost-effective solutions,

according to Deloitte.6

Trading multiples in the Professional Services segment

have demonstrated robust expansion, with Capstone’s

Professional Services index standing at 13.3x EBITDA, far

outpacing the Contractor Services segment. As

construction activity continues to resume, and industry

employment recovers to pre-pandemic levels, industry

participants with favorable end market exposure are

poised to capture elevated revenues. Notably, data

center construction and environmental consulting have

emerged as highly sought-after capabilities, evidenced by

robust M&A activity discussed on the following page.

3

Darin Good, Managing Director

“2021 will be a perfect storm for the mergers and acquisitions industry and result in record levelsof successful transactions. Baby boomer owners looking to exit will be taking advantage of theirlast opportunity to lock in low capital gains tax rates while acquirers will take advantage ofrecord setting amounts of dry powder, low interest rates, and unprecedented levels of federalstimulus to generate continued growth.”

0x

2x

4x

6x

8x

10x

12x

14x

16x

Mar-20 Jun-20 Sep-20 Dec-20 Mar-21

Professional Services Contractor Services

EV

/EB

ITD

A

13.3x

8.4x

Professional Services Multiple Nears One-Year HighThe average EBITDA multiple among publicly traded professional services

firms has outpaced contractor services, demonstrating the premium placed

on sophisticated consulting, testing, and engineering capabilities.

Professional Services include: ACM, BVI, J, NVEE, STN, TTEK, WSP

Contractor Services include: FIX, EME, IESC, IBP, MYRG, PWR, BLD, TPC

Note: Market capitalization weighted index

Source: Capital IQ and Capstone Research

3

M&A OVERVIEW

M&A activity in 2020 trailed prior year levels by 14.5% as

Q2 experienced a drastic slowdown in transaction volume.

However, volume surged in Q4 as buyers returned to the

market with 115 transactions announced or completed, far

outpacing the prior year quarter. As market turbulence

has subsided, many deals previously placed on hold have

resumed, lending to robust transaction markets. In YTD

2021, transaction volume has outpaced the prior year by

26% with 91 deals announced or completed. The return to

inorganic growth by strategic buyers and private equity

reengaging in enhancing sector portfolios has contributed

to the recent uptick in transaction volume. In addition,

many sellers are capitalizing on a window of favorable tax

treatment, choosing to enter the market ahead of

potential negative capital gains treatment under the new

presidential administration.

Leading public companies have aggressively pursued

accretive acquisitions to foster defensibility and favorable

end market exposure. Notably, NV5 cited an acquisition

pipeline of over 30 acquisition pursuits at various stages,

according to its earnings call.7 While professional services

providers have been active in consolidation efforts, public

contractors have also remained acquisitive as Installed

Building Products (NYSE:IBP) completed nine acquisitions

in 2020, representing over $107 million of annual

revenues, according to its earnings call.8

Environmental consulting providers have emerged as

coveted assets as an increased emphasis has been placed

on green solutions in construction. This has been

evidenced by WSP acquisition of Golder (December 2020),

a leading earth sciences and environmental services

provider, for an enterprise value of $1.2 billion (see page

seven). In addition, industry participants have utilized

M&A to bolster their data center construction capabilities,

noted by WSP also purchasing KW Mission Critical

Engineering (December 2020, undisclosed).

9.8%

56.2%

11.7%

22.3%STRATEGIC

Public

Private

FINANCIAL

Platform

Add-on

M&A Transaction Volume Recovery in Q4Transaction activity surged in Q4 as buyers reentered the

market and sellers have looked to transact ahead of potential

negative tax legislation passed by the Biden administration.

Private Strategic Buyers Comprise Majority of M&APrivate strategic buyers have accounted for over half of all transactions

in 2020, with private equity firms primarily transacting through add-on

acquisitions to sector portfolio companies.

Source: Capital IQ, FactSet, and Capstone Research

Nu

mb

er

of

Tra

nsa

ctio

ns

Crista Gilmore, Director

“Despite some of the turbulence we are seeing in the public markets, middle market M&Aactivity, specifically in the Construction Services space, is accelerating.”


111 105115

7789

47

98115

0

50

100

150

200

Q1 Q2 Q3 Q4

2019 2020

4

PRICING ENVIRONMENT

5

While transaction volume declined YOY in 2020, pricing

has remained resilient with average transaction EBITDA

multiples exceeding 2019 averages and revenue multiples

falling modestly below the prior year. The strength in

valuations indicates that quality assets with favorable

growth prospects continued to command strong buyer

interest, despite unprecedented market disruption.

Notably, Bird Construction’s (TSX:BDT) acquisition of

Stuart Olsen (TSX:SOX) represented the highest multiple of

2020 at 22.2x EBITDA and equivalent to an enterprise

value of $215.4 million. As buyers increasingly return to

the market, pricing competition is likely to intensify,

contributing to healthy valuations for construction services

providers with attractive margins and a diverse geographic

reach and end market exposure.

Total debt levels fell drastically across all industries in Q2

as credit access was constrained during the height of the

pandemic. In the following quarters, Debt markets have

improved with average debt multiples increasing to 3.8x

EBITDA, slightly below the prior year quarter, according to

GF Data®.9 In addition, senior debt levels improved in Q4

to 3.2x EBITDA, mirroring the prior year quarter. As robust

M&A activity continues and credit markets remain

increasingly accessible, leading industry operators

exploring a sale may have a favorable window to garner a

premium valuation. For more information on pricing and

valuations, contact our Building Products & Construction

Services Team.

2020 EBITDA Multiple Improves Year-over-YearQuality assets have continued to garner premium multiples despite a

slowing of transaction activity in 2020, supporting a favorable

outlook for sellers transacting in 2021.

EV

/EB

ITD

A

Debt Availability Recovers to Pre-Pandemic LevelsCredit markets demonstrated a recovery in Q4 following tight access

to debt at the height of the pandemic, providing strong tailwinds for

robust consolidation in the near term.

4.1x 4.0x 3.9x 3.9x3.9x3.3x

3.7x 3.8x

0x

1x

2x

3x

4x

5x

6x

7x

Q1 Q2 Q3 Q4

2019 2020

To

tal D

eb

t/EB

ITD

A

Source: Capital IQ, FactSet, and Capstone Research

Source: GF Data®


1.8x1.0x 0.9x

9.8x8.7x

9.7x

0x

2x

4x

6x

8x

10x

12x

14x

2018 2019 2020

EV/Revenue EV/EBITDA

Select 2020 – YTD 2021 Transaction Valuations

Target Company M&A Enterprise Value/EBITDA

9.7x: Average

2020 Multiple

0x

5x

10x

15x

20x

25x

Apr-20 Jun-20 Aug-20 Sep-20 Nov-20 Jan-21 Feb-21 Apr-21

EV

/EB

ITD

A

https://capstoneheadwaters.com/industry-focus/building-products

NOTABLE TRANSACTIONS

6

Acquires

Acquires

Acquires

NV5 Global has acquired leading geotechnical engineering, environmental consulting, and materials

testing provider, TerraTech Engineers, for an undisclosed sum. Founded in 1990, TerraTech specializes

in foundation support studies, pavement system investigations, environmental assessments, and special

inspections. It serves public infrastructure and private development clients in North Carolina, South

Carolina, and Georgia. The acquisition is expected to be immedietly accretive to NV5’s earnings.

“The addition of TerraTech strengthens our environmental, geotechnical, and testing capabilities in the

growing Southeast market and will support our infrastructure operations throughout the region.

TerraTech’s strong management team, solid backlog, and impressive financial performance make it a

good fit for the NV5 organization, and we are pleased to have them on board,” said Dickerson Wright,

PE, Chairman and CEO of NV5 in a press release.10

Leading architecture, engineering, and construction firm The Vertex Companies has acquired premier

engineering design and construction administration provider Lockwood, Kessler & Bartlett (LKB). Terms

of the transaction were not disclosed. LKB offers an expansive team of mechanical, electrical, and

environmental engineers and technical professionals providing development and renovation of medical

buildings, industrial properties, and airports for clients in the public and private sector.

The addition of LKB bolsters Vertex east coast footprint and enhances its capabilities in engineering and

construction administration, while complementing LKB’s specialized services. “Vertex offers LKB a

tremendous geographical presence and breadth of resources enabling us to provide an expanded array

of services to our clients. Together, the combination of our distinctive resources and areas of expertise

give us a great advantage to provide unparalleled service to the industry,” commented Andre Haddad,

President and CEO of LKB in a press release.11

WSP Global has acquired leading engineering and consulting provider Golder Associates for an

enterprise value of approximately $1.2 billion and equivalent to 10.4x 2020 adjusted EBITDA (pre-IFRS

16). Founded in 1960, Golder offers environmental services, engineering, design, and regulatory and

compliance to industries including Mining, Manufacturing, Oil & Gas, Power, and Infrastructure. The

acquisition allows WSP to bolster its ESG portfolio, in addition to gaining and expanded customer base

and cross selling opportunities.

“Together we will create the leading Global Environmental Consulting Firm with approximately 14,000

of our 54,000 professionals dedicated to accelerating the world’s green transition. The combination

ideally positions WSP to capitalize on the rapidly growing ESG trends driving demand for

environmental services and sustainable infrastructure development,” commented Alexandre L’Heureux,

President and Chief Executive Officer of WSP in a press release.12

NV5 Global, Inc. acquires TerraTech Engineers, Inc.

(February 2021, Undisclosed)

The Vertex Companies, Inc. acquires Lockwood, Kessler & Bartlett, Inc.

(January 2021, Undisclosed)

WSP Global Inc. acquires Golder Associates Corporation

(December 2020, $1.2 Billion)

Several notable transactions have been announced or completed in the industry in 2020 and YTD 2021. Select transactions are

outlined below, followed by a more comprehensive list on the following page.


Enterprise EV/LTM

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

03/02/21Construction

Services

Sedgwick

CMS

Offers building code upgrade assessment, construction

productivity analysis, and project communications.- - -

03/02/21 GET SolutionsTerracon

Consultants

Provides geotechnical engineering and materials testing services.

- - -

02/25/21Alpha

Construction

Sanei Architecture

(TSE:3228)Offers general contracting services. - - -

02/24/21 LBYD North Wind Provides civil and structural engineering services. - - -

02/22/21 TerraTechNV5

(Nasdaq: NVEE)

Offers geotechnical engineering, environmental consulting, and construction materials testing.

- - -

02/16/21Aegion (Nasdaq:

AEGN)

New Mountain

Capital

Provides technologies to maintain, rehabilitate, and strengthen infrastructure.

$1,070.3 1.0x 7.9x

02/09/21Tedesco

Construction

Montante

Construction

Offers Design and construction of pre-engineered buildings.

- - -

02/02/21 EnerconAE Industrial

Partners

Provides architectural engineering, environmental, technical, and management services.

- - -

01/27/21kW Mission Critical

EngineeringWSP (TSX:WSP)

Offers engineering and consulting services for

data centers.- - -

01/26/21Lockwood, Kessler

& Bartlett

Vertex

Companies

Provides engineering and construction consulting services.

- - -

01/20/21 LCR ContractorsTopBuild

(NYSE:BLD)

Offers spray fireproofing and spray thermal insulation services.

- - -

01/13/21DynaGrid

ConstructionBBH Capital

Provides construction foundation services to the Utilities Market.

- - -

01/04/21SoilTech

Consultants

Burns Cooley

Dennis

Offers geotechnical engineering and construction

materials testing services.- - -

12/31/20Pikus Concrete &

ConstructionLithko

Provides commercial and industrial concrete

contractor services.CF CF CF

12/15/20 ENACT J.F. LehmanOffers environmental and geotechnical

construction services. - - -

12/13/20 Trinium Contractors Icon Structures Provides general contracting services. - - -

12/03/20 Golder Associates WSP (TSX:WSP)Offers consulting, design, and construction services in environment, earth, and energy.

$1,164.8 - -

12/03/20Wenck

Associates

Stantec

(TSX:STN)Offers engineering construction and consulting services. - - -

11/16/20Integrated

EngineeringPRIME AE Group Offers engineering and surveying services. - - -

11/11/20 Ei Companies DPIS EngineeringProvides energy inspections and construction quality observations.

CF CF CF

11/11/20Funderburk

ElectricalICS Offers electrical contracting services. - - -

11/09/20 Therma Blackstone

(NYSE:BX)Provides mechanical contracting services. - - -

Note: CF = confidential; highlighted deals are Capstone’s transactions

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

SELECT TRANSACTIONS

7


CLIENT CASE STUDY: PIKUS CONCRETE

CLIENT CASE STUDY: EI COMPANIES

Capstone Headwaters advised the Ei Companies (“Ei”) on its sale to

DPIS Builder Services (“DPIS”) – Closed November 2020

Headquartered in Las Vegas, Ei is a leading provider of energy inspections

and construction quality observations across the Western United States.

They also offer a full range of mechanical, electrical and plumbing design

and engineering services for single-family homes and multifamily projects.

"The acquisition of Ei solidifies us as the clear market leader with a truly

unique, nationwide platform in almost all of the top construction markets,"

said Jonathan Risch, CEO of DPIS. "In addition to creating a larger company

that offers the comprehensive services our customers require; this national

footprint will allow for the dissemination and application of construction

and energy efficiency best practices."

“Capstone Headwaters was an excellent partner in helping Ei complete this

strategic combination,” said Greg Cobb, President of Ei. “They became an

extension of the Ei team, providing critical analysis and advice along the

way. Capstone Headwaters’ support remained steadfast during the COVID-

19 crisis, which paused but did not disrupt our transaction process.”

has been acquired by

Capstone Headwaters, advised Pikus Concrete & Construction, LLC

(“Pikus”), on its asset sale to Lithko Contracting, LLC (“Lithko”) –

Closed February 2021

Pikus is a nationally recognized commercial and industrial concrete

contractor serving Salt Lake and the Wasatch Valley market since 1999.

They specialize in cast-in-place concrete including post-tensioned decks,

multi-story commercial structures, and parking structures. Pikus has

approximately 200 employees and serves a customer base of large

nationally recognized general contractors in Utah and the surrounding

region.

Lithko is a market-leading, full service commercial concrete contractor

specializing in the execution of walls, tilt-up structural frames, slabs, super

flats, site work, foundations, and pre-construction services. Lithko has over

3,000 coworkers serving over 500 clients across 19 geographic regions.

“The team at Pikus is excited to partner with Lithko. Our new partnership

will drive exceptional value and solidify our place as an industry leader in

Utah and the Wasatch Valley,” said Rob Pikus, Pikus President. “Capstone

Headwaters was a trusted advisor throughout the entire process leading

us to a successful partnership with Lithko in spite of the many challenges

in 2020. Working with their team proved to be invaluable, and we look

forward to partnering again on future projects.”

8


a portfolio company of


PUBLIC COMPANY TRADING & OPERATING DATA: PROFESSIONAL SERVICES

Price % 52 Wk Market Enterprise LTM EV / LTM

Company 03/09/21 High Cap Value Revenue EBITDA Margin Revenue EBITDA

AECOM $59.40 98.0% $8,774.1 $10,834.8 $13,317.5 $756.2 5.7% 0.8x 14.3x

Bureau Veritas SA $27.78 98.1% $12,474.9 $14,593.7 $5,628.1 $723.1 12.8% 2.6x 20.2x

Jacobs Engineering Group Inc. $121.65 100.0% $15,825.0 $17,223.3 $13,588.8 $1,133.3 8.3% 1.3x 15.2x

NV5 Global, Inc. $104.63 95.6% $1,391.1 $1,679.2 $659.3 $111.8 17.0% 2.5x 15.0x

Stantec Inc. $41.08 98.0% $4,569.8 $5,356.8 $2,891.6 $444.8 15.4% 1.9x 12.0x

Tetra Tech, Inc. $129.95 89.8% $7,047.0 $7,450.9 $2,339.7 $271.1 11.6% 3.2x 27.5x

WSP Global Inc. $95.67 95.0% $10,883.7 $11,795.2 $6,909.4 $730.4 10.6% 1.7x 16.1x

Mean 11.6% 2.0x 17.2x

Median 11.6% 1.9x 15.2x

Harmonic Mean 10.3% 1.7x 16.2x

EV = enterprise value; LTM = last twelve months

$ in millions, except per share data

NM = Not Meaningful

Source: Capital IQ as of March 9, 2021

9

PUBLIC COMPANY TRADING & OPERATING DATA: CONTRACTOR SERVICES

Price % 52 Wk Market Enterprise LTM EV / LTM

Company 03/09/21 High Cap Value Revenue EBITDA Margin Revenue EBITDA

Comfort Systems USA, Inc. $74.31 98.9% $2,680.0 $2,958.0 $2,856.7 $278.0 9.7% 1.0x 10.6x

EMCOR Group, Inc. $107.33 98.7% $5,881.3 $5,514.6 $8,797.1 $601.4 6.8% 0.6x 9.2x

IES Holdings, Inc. $52.24 94.5% $1,085.0 $1,108.7 $1,229.7 $74.5 6.1% 0.9x 14.9x

Installed Building Products, Inc. $109.59 84.2% $3,221.0 $3,612.5 $1,653.2 $235.2 14.2% 2.2x 15.4x

MYR Group Inc. $65.91 97.2% $1,106.5 $1,135.9 $2,247.4 $130.2 5.8% 0.5x 8.7x

Quanta Services, Inc. $83.23 94.9% $11,516.1 $12,789.3 $11,202.7 $911.0 8.1% 1.1x 14.0x

TopBuild Corp. $192.68 85.7% $6,299.4 $6,763.4 $2,718.0 $418.4 15.4% 2.5x 16.2x

Tutor Perini Corporation $19.02 99.4% $968.4 $1,667.6 $5,318.8 $371.8 7.0% 0.3x 4.5x

Mean 9.1% 1.1x 11.7x

Median 7.6% 1.0x 12.3x

Harmonic Mean 8.1% 0.8x 9.9x


CONSTRUCTION SERVICES 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 CapstoneHeadwaters, Crista works with clients to improve their financial metrics and reporting capabilities.Additionally, she performs research, valuation analysis, prepares marketing documentation, managesclient data rooms and responds to due diligence inquiries. Crista graduated summa cum laude fromDrake University with a degree in Finance and Accounting. She also earned a Master’s of Accountingdegree 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. Three 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

[email protected] | 303-531-5013

Darin Good

Managing Director


Connor McLeod

Research Associate


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

Services, Consumer & Retail, Healthcare, Cybersecurity. Prior to joining Capstone, 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.

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

Director



FIRM TRACK RECORD

Capstone Headwaters Building Products & Construction Services Team has represented clients across various construction

specialties. Our deep industry focus allows us to provide our clients with real-time transaction feedback and immediate

access to key decision makers among the most active acquirers and investors in the Construction industry. A sampling of

closed transactions are shown below.

11



has recapitalized with

management buyout

supported by





has been recapitalized by



has been acquired by has been acquired by

has partnered with


has been acquired by has been acquired by


CITATIONS

1. Associated Builders and Contractors, “ABC’s Construction Backlog Indicator Rose Sharply in February; Contractor

Optimism Builds,” https://www.abc.org/News-Media/News-Releases/entryid/18541/abc-s-construction-backlog-

indicator-rose-sharply-in-february-contractor-optimism-builds, accessed March 9, 2021.

2. Dodge Data & Analytics, “Dodge Momentum Index Posts Strong Gain in February Marking Highest Level in Nearly

Three Years,” https://www.construction.com/news/dodge-momentum-index-posts-strong-gain-in-february-marking-

highest-level-in-nearly-three-years, accessed March 8, 2021.

3. U.S. Census Bureau, “Construction Spending,” https://www.census.gov/construction/c30/c30index.html, accessed March

10, 2020.

4. NV5, “NV5 Announces Record Fourth Quarter and Full Year 2020 Results; Exceeds Analysts' Expectations,”

https://ir.nv5.com/news-events/news-releases/news-details/2021/NV5-Announces-Record-Fourth-Quarter-and-Full-

Year-2020-Results-Exceeds-Analysts-Expectations/default.aspx, accessed March 7, 2021.

5. WSP, “WSP'S Q4 AND 2020 RESULTS,” https://www.wsp.com/en-GL/investors/presentations-and-events/wsp-q4-and-

2020-results, accessed March 3, 2021.

6. Deloitte, “2021 engineering and construction industry outlook,” https://www2.deloitte.com/us/en/pages/energy-and-

resources/articles/engineering-and-construction-industry-trends.html, accessed March 8, 2021.

7. Seeking Alpha, “NV5 Global, Inc. (NVEE) CEO Dickerson Wright on Q4 2020 Results - Earnings Call Transcript,”

https://seekingalpha.com/article/4410915-nv5-global-inc-nvee-ceo-dickerson-wright-on-q4-2020-results-earnings-

call-transcript, accessed March 8, 2021.

8. Installed Building Products, “FISCAL 2020 FOURTH QUARTER CONFERENCE CALL,”

https://investors.installedbuildingproducts.com/events/event-details/fiscal-2020-fourth-quarter-conference-call,

accessed March 7, 2021.

9. GF Data, “Leverage Report,” https://gfdata.com/, accessed March 2, 2021.

10. Globe Newswire, “NV5 Acquires TerraTech Engineers, Strengthening Southeast Geotechnical, Environmental, and

Materials Testing Capabilities,” https://www.globenewswire.com/news-release/2021/02/22/2179502/0/en/NV5-

Acquires-TerraTech-Engineers-Strengthening-Southeast-Geotechnical-Environmental-and-Materials-Testing-

Capabilities.html, accessed March 10, 2021.

11. Cision, “The Vertex Companies, Inc. Acquires Lockwood, Kessler & Bartlett, Inc. to Expand Design & Other AEC work in

New York,”

https://www.prweb.com/releases/the_vertex_companies_inc_acquires_lockwood_kessler_bartlett_inc_to_expand_design_

other_aec_work_in_new_york/prweb17660960.htm, accessed March 10, 2021.

12. Globe Newswire, “WSP to Acquire Golder Creating the Leading Global Environmental Consulting Firm,”

https://www.globenewswire.com/news-release/2020/12/03/2139044/0/en/WSP-to-Acquire-Golder-Creating-the-

Leading-Global-Environmental-Consulting-Firm.html, accessed March 10, 2021.

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.

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https://www.abc.org/News-Media/News-Releases/entryid/18541/abc-s-construction-backlog-indicator-rose-sharply-in-february-contractor-optimism-builds

https://www.construction.com/news/dodge-momentum-index-posts-strong-gain-in-february-marking-highest-level-in-nearly-three-years

https://www.census.gov/construction/c30/c30index.html

https://ir.nv5.com/news-events/news-releases/news-details/2021/NV5-Announces-Record-Fourth-Quarter-and-Full-Year-2020-Results-Exceeds-Analysts-Expectations/default.aspx

https://www.wsp.com/en-GL/investors/presentations-and-events/wsp-q4-and-2020-results

https://www2.deloitte.com/us/en/pages/energy-and-resources/articles/engineering-and-construction-industry-trends.html

https://seekingalpha.com/article/4410915-nv5-global-inc-nvee-ceo-dickerson-wright-on-q4-2020-results-earnings-call-transcript

https://investors.installedbuildingproducts.com/events/event-details/fiscal-2020-fourth-quarter-conference-call

https://gfdata.com/

https://www.globenewswire.com/news-release/2021/02/22/2179502/0/en/NV5-Acquires-TerraTech-Engineers-Strengthening-Southeast-Geotechnical-Environmental-and-Materials-Testing-Capabilities.html

https://www.prweb.com/releases/the_vertex_companies_inc_acquires_lockwood_kessler_bartlett_inc_to_expand_design_other_aec_work_in_new_york/prweb17660960.htm

https://www.globenewswire.com/news-release/2020/12/03/2139044/0/en/WSP-to-Acquire-Golder-Creating-the-Leading-Global-Environmental-Consulting-Firm.html

12

www.capstoneheadwaters.com

Capstone Headwaters is one of the largest and most active independent investment banking firms in the United States. The

firm has a rich, 20-year history of achieving extraordinary results for middle market entrepreneurs, business owners, investors,

and creditors. Capstone offers a fully integrated suite of corporate finance services, including M&A, debt and equity

placement, corporate restructuring, valuation and fairness opinions, financial advisory, and ESOP advisory services.

Headquartered in Boston, the firm has 175+ professionals across 17 offices in the U.S., and an international presence

including over 450 professionals in 40 countries. With 16 dedicated industry groups, the firm delivers sector-specific expertise

through large, cross-functional teams on a global basis.

BUILT FOR THE MIDDLE MARKET

UNITED STATES

175+ professionals

17 offices

Boston Burlington Chicago Dallas

Denver Detroit Houston Los Angeles

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Richmond 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

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