*SigmaRoc is a research client of Alternative Resource Capital, a trading name of Shard Capital Partners LLP which is authorised and regulated by the

Financial Conduct Authority. This is a marketing communication, intended for institutional investors only. Please read disclaimer at end of this document.

SigmaRoc plc*

Building a unique construction materials business

SigmaRoc is pursuing a targeted ‘buy-and-build’ strategy in the construction materials sector, seeking to capitalise on fragmented northern European markets and asset divestments by majors to emerge as a significant operator of localised, high-quality businesses. Adding to the acquisition of its flagship Ronez Channel Islands aggregates business in late 2016, SigmaRoc progressed its strategy throughout 2017 with the establishment of a bulk shipping and trading arm and the purchase of two specialist concrete products businesses in the UK. All acquisitions to date have proven earnings accretive and have been executed at an average EBITDA multiple of under 7x (vs the sector average EV/EBITDA multiple of 10x). And in-keeping with the wider strategy, all the businesses procured have specific characteristics that enable them to avoid head-on competition with majors, collectively providing SigmaRoc with a diversified stream of income that should enable it to maintain robust margins through the industry cycle. Management has a well-stocked pipeline of potential further acquisitions and investments which we expect to be rolled out over the coming months and years as SigmaRoc pursues its ambition of building towards a c£100m pa EBITDA business. We believe this should drive an upwards re-rating of the shares, which at under 7x EV/EBITDA are trading at a wide discount to much lower-growth peers.

► Growing from solid foundations: A well-established business with a position of dominance in its local market, Ronez has proved an ideal cornerstone asset from which SigmaRoc has been able to leverage further growth. It’s stable earnings (>£6m pa EBITDA) and robust margin (>20%) helped SigmaRoc secure debt facilities from which it then financed the acquisition of Topcrete, a highly profitable concrete products business in the UK. The latter has in turn provided the group with opportunities to unlock potential operational and logistical synergies with its latest acquisition, Poundfield Products. Acquired for a cumulative total of £66m (net of working capital adjustments), we estimate that these businesses provide SigmaRoc with annualised EBITDA generation of over £10m (before central overheads), representing an attractive acquisition multiple of under 7x EBITDA.

► Pipeline in place to continue evolution: This track-record of value-accretive deal-making in just its first year of existence is testament to management’s sector experience and wide industry network. It has developed a sizeable portfolio of further acquisition and investment opportunities which we anticipate being rolled out over the coming months. Assuming it continues to transact at a pace at least in line with 2017 rates, and that funding (debt and/or equity) remains available to support these ambitions, we see a path to annualised EBITDA of c£50m being achieved over the next few years.

► Compelling valuation: SigmaRoc is trading at an undemanding EV/EBITDA of 6.7x based on our estimate of its current net debt position (£12m) and EBITDA base (£9.7m in 2018, net of central overheads). This is a significant, and in our view unwarranted, discount to the sector average of 10x. We believe this discount should narrow as the fruits of the group’s 2017 acquisitions become increasingly visible over the course of 2018 by way of real reported earnings growth. Moreover, if further M&A activity plays out at value-accretive levels, we believe there is potential for SigmaRoc to attain an above-average sector rating.

Initiation of Coverage 25 April 2018

SRC LN Construction Materials

Source: LSE

Market data

Price (p) 39

12m High (p) 49

12m Low (p) 37

Shares (m) 136.7

Mkt Cap (£m) 53.3

Company summary

SigmaRoc is an operator and acquirer of

construction materials businesses in

northern Europe. It is seeking to grow

through value-accretive purchases of niche

assets and subsequent unlocking of

synergies and implementation of operating

and logistical efficiencies.

Key forecasts 2017e 2018e 2019e

Revenue (£m) 26.6 39.6 40.6

EBITDA (£m) 5.1 9.7 10.0

EPS (GBp) 2.1 3.9 4.0

Net Debt (£m) 12.1 11.0 4.9

EV/EBITDA (x) 12.8 6.7 6.5

P/E (x) 18.3 10.0 9.9

ND/EBITDA (x) 2.4 1.1 0.5

Analyst contact

Nick Chalmers

Email: nchalmers@altrescap.com

Tel: +44 (0)20 7186 9003

Broking contact

Alex Wood

Email: awood@altrescap.com

Tel: +44 (0)20 7186 9004

SigmaRoc plc*

25 April 2018 2

Contents

Investment summary............................................................................................. 3

Valuation ............................................................................................................... 6

Undemanding valuation relative to wider sector................................................... 6

Valuation underpinned by DCF .............................................................................. 7

Forecasts ............................................................................................................... 8

Risks .................................................................................................................... 10

Company overview .............................................................................................. 11

Evolution and deal history ................................................................................ 11

Capital structure and funding position ............................................................. 12

Differentiated buy-and-build strategy ................................................................. 13

Ronez .................................................................................................................. 15

High-quality, stable flagship asset ........................................................................ 15

The Channel Islands construction materials market ......................................... 16

Jersey operations .............................................................................................. 16

Guernsey operations......................................................................................... 17

Contracting services .......................................................................................... 19

Financials: track record of robust performance ................................................... 19

SigmaGsy shipping and trading arm..................................................................... 20

UK concrete products cluster ............................................................................... 21

Topcrete ............................................................................................................... 21

Poundfield Products ............................................................................................. 22

Board and Senior Management ........................................................................... 24

Disclaimer ........................................................................................................... 26

SigmaRoc plc*

25 April 2018 3

Investment summary SigmaRoc aims to build towards a c£100m pa EBITDA construction materials business over the coming years through a differentiated buy-and-build strategy that prioritises long-term profitability and avoidance of head-on competition with industry majors over scale and geographic concentration.

The £45m reverse takeover in late 2016 of Channel Islands aggregates producer Ronez Ltd set the group on its way and encapsulates management’s approach. Ronez is a vertically-integrated business with diversified income streams in a supplier-controlled market that has high barriers to entry. Moreover, SigmaRoc has been able to unlock operational and trading efficiencies in its first full year of ownership of the business. Ronez’ robust margins enabled SigmaRoc to secure debt facilities from which it then funded its second significant acquisition, the £12m purchase of UK specialist concrete products business Topcrete in October 2017. The latter in turn placed the group in prime position to execute the acquisition of Poundfield Products, expanding and enhancing its UK cluster of concrete products manufacturing and distribution assets which we estimate is immediately accretive to earnings whilst further diversifying group revenue streams.

Leveraging its considerable industry network and experience of working with industry majors, management has developed a sizeable pipeline of further acquisition and investment opportunities which we expect to be rolled out over the coming months and years as the group builds on its progress to date.

Ronez: ideal cornerstone asset to launch strategy Ronez has proved an ideal cornerstone asset from which SigmaRoc can progress its growth strategy. An established, essentially self-sustaining business with a long track-record of profitability, it provided SigmaRoc with immediate critical mass and a stable income base which could be leveraged (though management is fully aware of the need to manage debt levels, and has indicated that it will only utilise debt to undertake investments that offer an expeditious path for subsequent de-gearing).

Ronez is the dominant supplier of construction materials in the Channel Islands, operating one of only two quarries in Jersey and the only quarry in Guernsey (and downstream production facilities and contracting services on both islands). This near monopoly position in a relatively stable market in which barriers to new entrants are high is reflected in the business’ strong financial performance – it has consistently generated EBITDA of c£4-5m over recent years, at above-sector-average margins of close to 20%.

Freeing Ronez’ operating and trading practices from constraints associated with being a very small part of a large multinational group (the business was acquired from a UK subsidiary of LafargeHolcim), SigmaRoc has in its first year of ownership implemented several efficiency-improvement initiatives. Together with slightly stronger trading conditions, we estimate this may see a c35% increase in operational-level EBITDA at Ronez reported for 2017 to just over £6m, an enhanced earnings base that we believe can be maintained and even improved upon going forward. On this basis, the 9x historical EBITDA multiple at which Ronez was acquired thus drops to a more compelling 7x in the context of future earnings potential.

UK concrete products cluster adds revenue diversification Ronez’ cash-generative base helped SigmaRoc secure debt facilities from which it has been able to further deliver upon its buy-and-build strategy. After first establishing

SigmaRoc aspires to create a

c£100m pa EBITDA diversified

construction materials business

Acquisition strategy and execution

ability demonstrated by year-one

purchase multiple of just c7x

EBITDA for the group’s Ronez

cornerstone investment

SigmaRoc plc*

25 April 2018 4

a bulk-shipping subsidiary that will help deliver the targeted trading efficiencies at Ronez (as well as contributing an estimated £0.2m of additional income through provision of services to third parties), SigmaRoc drew on this debt to acquire the Topcrete business for £12m (net of working capital adjustments) in October 2017.

A well-regarded manufacturer of specialist wet-cast concrete products with a significant asset footprint in the UK’s Midlands and South East, Topcrete is accretive to earnings (c£2m pa EBITDA) and provides revenue diversification. At just 6x EBITDA, the acquisition multiple was attractive given the quality of the business.

As at Ronez, SigmaRoc will look to introduce efficiencies at Topcrete, particularly in purchasing and distribution logistics, which could enhance margins going forward. These efforts will include identifying synergies with the group’s third significant acquisition to date, the £10.25m purchase of Poundfield Products in December 2017. Poundfield specialises in the manufacture of patented concrete products and systems, and thus expands SigmaRoc’s mainland UK cluster of specialist concrete products assets and income sources (Poundfield could add at least £1.5m pa of EBIDTA to the wider group). After adjusting for working capital, the business was acquired for the same 6x EBITDA as Topcrete. However, given the strong likelihood of synergies being unlocked between the two businesses, the effective acquisition multiple for each may prove to be lower with hindsight.

Undemanding valuation In just a little over a year SigmaRoc has thus built a business that now generates annualised EBITDA (before accounting for corporate-level overheads) of over £10m per our estimates going forward from 2018. This was achieved at an average acquisition multiple of under 7x, significantly below our estimate of the sector average EV/EBITDA trading multiple of 10x, demonstrating management’s ability to source and execute value-accretive deals.

Figure 1: Current-case* EBITDA and margin forecasts

*Incorporating Ronez, SigmaGsy, Topcrete and Poundfield business lines only Source: ARC estimates

Based on our estimates of its current earnings base and net debt position, SigmaRoc is trading at an undemanding EV/EBITDA multiple of just 6.7x. This represents a significant discount to the sector average of 10.0x, a discount we believe should narrow as the fruits of the group’s 2017 acquisitions become increasingly visible over the course of 2018 by way of real reported earnings growth. Applying the peer-group average multiple to our 2018 EBITDA estimate would point to a fair market valuation of 62p per share for SigmaRoc’s current earnings potential.

16%

18%

20%

22%

24%

26%

-

2.0

4.0

6.0

8.0

10.0

12.0

2017e 2018e 2019e 2020e 2021e

EBIT

DA

mar

gin

EBIT

DA

(£

m)

EBITDA EBITDA margin

Topcrete and Poundfield Products

give SigmaRoc a sizeable footprint

in the UK specialist concrete

products marketplace

SigmaRoc is currently trading at a

significant discount to sector,

representing an attractive entry

point for new investors

SigmaRoc plc*

25 April 2018 5

But we believe investors today should be looking ahead to what SigmaRoc could become in the future as it continues to roll-out its niche-asset buy-and-build strategy. If it can execute at least two deals per annum of progressively larger size relative to those completed to date, we see every chance of the group building its EBITDA base to a sustainable level approaching £50m pa over the next few years, assuming debt and equity funding support continues. Evidently one cannot second-guess the precise timing of future deals, nor their magnitude or source of funding. Nevertheless, we believe this evolution could see SigmaRoc’s share price grow well beyond 100p over the longer term, even absent a re-rating in its market multiple (which we believe should materialise).

Figure 2: Conceptual illustration of potential value evolution

*Assuming future acquisitions executed at 6.8x EBITDA (est historic average) Source: ARC research

Pipeline in place to continue evolution With its differentiated strategy, we see ample opportunity for SigmaRoc to add to its business in what remains a fragmented industry sector. We expect opportunities to emanate mainly from independent operators in the UK and mainland northern Europe whom are either financially constrained or willing sellers for other reasons (e.g. retiring founders/lack of succession plans), à la Topcrete and Poundfield, and from industry majors seeking to divest non-core assets (driven by over-leveraged balance sheets and/or competition issues) à la Ronez. We also see potential for SigmaRoc to partner with larger companies on specific projects.

CEO Max Vermorken, Chairman David Barrett and technical director Charles Trigg have a wealth of cumulative experience in the sector, most recently in senior positions with global majors, and a wide network of industry contacts. In addition to the deals already delivered, this expertise has resulted in the development of a well-stocked pipeline of further acquisition and investment opportunities that gives us every confidence that the group’s long-term vision can be realised.

Upcoming catalysts ► 2017 annual results (May 2018)

► Operational updates (H1 and H2 2018)

► Further deal flow (throughout 2018 and beyond)

Ronez Ronez Ronez Ronez

UK CP Cluster UK CP Cluster UK CP Cluster UK CP Cluster

New asset 1 New asset 1 New asset 1

New asset 2 New asset 2 New asset 2

New asset 3 New asset 3

New asset 4 New asset 4

New asset 5

New asset 6

0

100

200

300

400

500

0.0

10.0

20.0

30.0

40.0

50.0

EV/c

um

ula

tive

cap

ital

inve

sted

* (£

m)

EBIT

DA

(£

m p

a)

Time

Cumulative capital invested Potential EV at 6.7x Potential EV at 10.0x

We see substantial upside over the

longer term as the group further

progresses its niche asset buy-and-

build strategy

Market conditions remain in

SigmaRoc’s favour, and

management has the industry

network to deliver

SigmaRoc plc*

25 April 2018 6

Valuation

Undemanding valuation relative to wider sector

Public quoted construction materials companies are typically compared on earnings multiples, with EV/EBITDA in our view a more useful metric than P/E given the capital-intensive nature of the industry and thus the scope for significantly differing capital and depreciation profiles (which limit the value of comparing net earnings).

Given its differentiated buy-and-build growth strategy, SigmaRoc does not have close peers in the public markets-listed sphere. We have therefore selected a peer group that we believe is representative of the breadth of the sector, comprising a mix of established European and American majors but also higher-growth mid-caps (Figure 3).

The spread of forward-looking (2018) EV/EBITDA multiples is, perhaps unsurprisingly, relatively wide, averaging 10x but ranging from under 8x for the generally lower-growth majors (e.g. Cemex, HeidelbergCement and LafargeHolcim) to 12-15x for higher growth US-focused mid-caps such (e.g. Martin Marietta and Vulcan Materials). The only UK peer, Breedon, is trading at an EV of 10.2x 2018 EBITDA (according to Bloomberg consensus, adjusted for our addition of EBITDA contribution from the group’s recent acquisition of Lagan Group (based on 2017 EBITDA) and associated net debt increase). We note that in its formative, higher-growth years, Breedon was trading at an EV of over 12x EBITDA.

SigmaRoc is currently trading at just 6.7x our 2018 EBITDA estimate of £9.7m, lower than any company in the peer group. Moreover, our 2018 EBITDA estimate incorporates our forecast income from Ronez, SigmaGsy and the more recently-acquired UK concrete products businesses (Topcrete and Poundfield Products) only, taking no account of potential future acquisitions.

Figure 3: Construction materials companies market peer group (priced as at 24/04/18)

Company Ticker Share price Mkt Cap EV EBITDA EBITDA 2017-18 EV/EBITDA (local) (US$m) (US$m) 2018E ($m) forecast growth (%) (x)

Breedon Group BREE LN 83p 1,940 2,492* 243* 45* 10.2

Cemex SAB de CV CX US US$6.77 9,853 19,447 2,816 3 6.9

CRH plc CRH US US$34.85 29,317 36,481 3,583 8 10.2

Eagle Materials EXP US US$102.25 4,976 5,520 470 0 11.8

Granite Construction GVA US US$55.48 2,222 2,213 254 52 8.7

HeidelbergCement HEI GR €80.38 19,496 30,124 4,209 7 7.2

LafargeHolcim LHN VX CHF54.62 33,805 48,435 6,224 6 7.8

Martin Marietta MLM US US$197.14 12,384 13,965 1,116 11 12.5

Summit Materials SUM US US$28.67 3,189 4,621 500 16 9.2

Vulcan Materials VMC US US$114.05 15,094 17,802 1,186 21 15.0

Average 10.0

Median 9.7

SigmaRoc SRC LN 39p 74 91 14** 90** 6.7

Source: Company websites, Bloomberg consensus estimates, *Bloomberg consensus estimates adjusted for Lagan acquisition, **ARC estimates

SigmaRoc is trading at a discount

to even the low end of our peer-

group range, despite having above-

average growth prospects

SigmaRoc plc*

25 April 2018 7

Applying the peer-group average 2018 EV/EBITDA multiple of 10x would suggest a fair market valuation for SigmaRoc of 62p based on our estimate of its current (2018 forecast) EBITDA generation potential only (a conservative assumption – we expect the group to add to its business lines over the course of the next 12 months). This represents nearly 60% upside to SigmaRoc’s current share price. We believe this unwarranted valuation gap should erode over the next 12 months as SigmaRoc reports earnings growth from its recent acquisitions and rolls out further deals in its buy-and-build pipeline.

However, one could reasonably argue that, given management’s demonstrated ability to execute earnings-accretive acquisitions at multiples below both its own current trading multiple and the wider sector average, SigmaRoc might expect to command an above-average multiple as it builds critical mass. At 12x 2018 EBITDA, our implied valuation would be 77p.

The latter valuation range would imply a growth in annualised EBITDA from our estimated current steady-state base of around £10m pa to approximately £16m pa (assuming net debt increased by a quantum equating to 6.8x the EBITDA accretion, in line with our estimate of the average multiple of SigmaRoc’s acquisitions to date), if SigmaRoc were to trade at the sector average EV/EBITDA multiple of 10x. We think such a rate of growth in annualised EBITDA is eminently achievable over the next 12 months given the group’s rate of deal execution to date.

Figure 4: Peer-group EV/EBITDA multiple derived valuation scenarios

Sector average case Growth multiple case

£m p/share £m p/share

Forecast 2018 EBITDA 9.7 7 9.7 7

Multiple (x) 10.0x 10.0x 12.0x 12.0x

Target EV 97.3 71 116.7 85

Cash (current estimate) 6.9 5 6.9 5

Debt (current estimate) -19.0 -14 -19.0 -14

Implied valuation 85.2 62 104.7 77

*Base case valuation assumptions Source: ARC estimates

Valuation underpinned by DCF

Our market multiple based valuation range is backed up by discounted cash flow analysis, our NPV8% estimate of SigmaRoc’s free cash-flow generation over the next 20 years (assuming the company’s current business lines only) coming out at 63p. This is broadly in line with our sector-average case market-comparable valuation.

Figure 5: NPV sensitivity to discount rate and volume growth

£m p/share

20-year NPV of FCF At 8% discount rate 97.7 71

Cash Estimate at 31/12/17 6.9 5

Debt Estimate at 31/12/17 (19.0) (14)

SigmaRoc NAV 85.6 63

*Base case valuation assumptions Source: ARC estimates

Our analysis suggests 62-77p is a

fair aspirational valuation range for

SigmaRoc over the next 12 months

SigmaRoc plc*

25 April 2018 8

Forecasts Figures 6-9 below and over page summarise our key forecasts and financial measurements. Note that these incorporate only our forecast of income from the group’s four business lines at present (Ronez, SigmaGsy, Topcrete and Poundfield Products). We fully expect SigmaRoc to execute further acquisitions and/or organic investments over the coming months and years that will add materially to revenue and earnings.

Figure 6: Summary income statement

2016 2017e 2018e 2019e 2020e

Revenue £m 0.0 26.6 39.6 40.6 41.2

Operating costs £m (0.0) (18.5) (24.5) (25.2) (25.3)

Gross profit £m - 8.2 15.2 15.5 15.8

Marketing and admin costs £m - (1.7) (4.1) (4.1) (4.1)

Corporate G&A £m (0.7) (1.3) (1.4) (1.4) (1.4)

Other £m - - - - -

EBITDA £m (0.7) 5.1 9.7 10.0 10.4

D&A £m (0.0) (2.0) (2.6) (2.6) (2.6)

EBIT £m (0.7) 3.2 7.2 7.4 7.8

Net finance costs £m 0.0 (0.7) (0.9) (0.9) (0.9)

Pre-tax profit/(loss), before exceptional items £m (0.7) 2.5 6.3 6.5 6.9

Tax £m (0.0) (0.2) (0.9) (1.0) (1.0)

Net profit/(loss), adjusted £m (0.7) 2.3 5.4 5.5 5.9

Source: ARC estimates

Figure 7: Summary cash flow statement

2016 2017e 2018e 2019e 2020e

EBITDA £m (0.7) 5.1 9.7 10.0 10.4

Change in working capital £m 1.6 (1.0) 0.9 (0.1) (0.0)

One-time items £m (1.2) (1.4) - - -

Interest £m - (0.7) (0.9) (0.9) (0.9)

Tax £m (0.0) (0.2) (0.9) (1.0) (1.0)

Cash flow from operating activities £m (0.3) 1.9 8.8 8.1 8.4

Capex £m (0.0) (1.5) (4.3) (2.0) (2.0)

Investments £m - (63.4) (3.5) - -

Cash flow from investing activities £m (0.0) (64.8) (7.8) (2.0) (2.0)

Equity issue £m 0.5 51.2 - - -

Net borrowings £m - 18.5 - - -

Cash flow from financing activities £m 0.5 69.7 - - -

Net cash flow £m 0.2 6.8 1.1 6.1 6.5

Source: ARC estimates

SigmaRoc plc*

25 April 2018 9

Figure 8: Summary balance sheet

2016 2017e 2018e 2019e 2020e

Cash £m 0.2 6.9 8.0 14.1 20.6

P,P&E £m 0.0 28.9 30.6 30.0 29.3

Intangibles £m - 25.5 25.5 25.5 25.5

Other assets £m 0.2 18.6 18.9 19.0 19.0

Total Assets £m 0.3 80.0 83.0 88.5 94.4

Payables £m 1.8 2.7 3.3 3.4 3.4

Debt £m - 19.0 19.0 19.0 19.0

Other liabilities £m - 7.0 3.5 3.5 3.5

Total Liabilities £m 1.8 28.7 25.8 25.9 25.9

Shareholders' equity £m (1.4) 51.3 70.7 76.2 82.1

Total Equity and Liabilities £m 0.3 80.0 96.5 102.0 108.0

Source: ARC estimates

Figure 9: Key financial measurements and ratios

2016 2017e 2018e 2019e 2020e

Shares on issue (at year end) m 270.6 136.7 138.6 138.6 138.6

Shares on issue (year weighted average) m 193.2 105.5 137.7 138.6 138.6

EBITDA £m (0.7) 5.1 9.7 10.0 10.4

EBITDA margin % - 19 25 25 25

EV/EBITDA x na 12.8 6.7 6.5 6.3

EPS (adjusted) GBp na 2.1 3.9 4.0 4.2

P/E x na 18.3 10.0 9.9 9.2

Free cash flow £m (0.3) (63.0) 1.1 6.1 6.5

Net debt/(cash) £m (0.2) 12.1 11.0 4.9 (1.6)

Net debt/EBITDA x na 2.4 1.1 0.5 na

EBITDA/net finance charges x 7.7 11.2 11.5 11.9

Source: ARC estimates

SigmaRoc plc*

25 April 2018 10

Risks ► Execution risks: The investment proposition for SigmaRoc rests on the group

continuing to roll out its niche asset buy-and-build strategy. There can be no guarantee that suitable assets will continue to be available, or at a pricing point that provides adequate returns.

► Revenue risks: Though our revenue forecasts for individual business lines within the group assume only modest growth from recently achieved levels, these assumptions could be materially impacted by future local and macro-level economic conditions that cannot be predicted with any degree of certainty.

► Operating risks: As with all heavy industry investments, SigmaRoc group businesses carry operating risk – unforeseen changes to assumed operating parameters could negatively impact our financial forecasts. Moreover, our longer-term forecasts for Ronez are contingent on planning permissions being awarded to extend quarry lives.

► Funding risks: SigmaRoc has funded its acquisitions to date through a mixture of equity and debt. While the group now has an established cash-generative mix of businesses, there can be no guarantee that this and/or availability of additional external funding will be sufficient to fund growth plans. Moreover, and depending on price, any future equity raise could prove dilutive to our earnings forecasts and valuation.

SigmaRoc plc*

25 April 2018 11

Company overview SigmaRoc plc was formed in August 2016 from the erstwhile AIM-quoted shell Messaging International plc, with CEO Max Vermorken and directors David Barrett and Dominic Traynor joining the board at that time (and Messaging International’s previous board resigning). The company was renamed and commenced its new life in pursuit of specialist businesses in the construction materials sector.

Evolution and deal history Later that year SigmaRoc embarked on its maiden acquisition, Ronez Ltd, the Channel Islands business of Aggregate Industries (the latter a wholly-owned subsidiary of global construction materials major LafargeHolcim). Deemed a reverse takeover (RTO), SigmaRoc funded the £45m cash acquisition and its initial working capital requirements through a £40m institutional equity raise and simultaneous £10m convertible loan note issue. The acquisition and capital raise were concluded in January 2017, with shares in SigmaRoc then recommencing trading on AIM having been suspended throughout the RTO process.

SigmaRoc’s second acquisition was the £0.55m purchase of a dry bulk carrying ship in April 2017. The vessel was acquired principally to meet Ronez’ cement importation requirements (cement being the one key input material for which Ronez is not self-sufficient in on the Channel Islands), but also to provide supplementary shipping services to third-party cement majors around the British Isles and northern Europe via the group’s newly-incorporated trading arm, SigmaGsy.

In October 2017 the company completed its third acquisition, the £12m cash purchase of Topcrete Ltd, a mainland UK pre-cast concrete products business specialising in bespoke wet-cast products. The £9m upfront component of the total consideration was funded using a pre-existing term debt facility.

SigmaRoc then expanded its cluster of mainland UK concrete products business with its fourth and most recent acquisition, that of Poundfield Products, a specialist manufacturer of patented concrete products and systems. The £10.25m purchase was funded using part of the proceeds from a £13.9m equity issue in December 2017.

Figure 10: Deal history and capital evolution

Date Business acquired Vendor Consideration Funding source January 2017 Ronez Aggregate Industries £45m cash £40m equity raise at

40p, £10m convertible note issue

April 2017 Dry-bulk carrier vessel (creation of SigmaGsy)

Aggregate Industries £0.55m cash Cash on hand

October 2017 Topcrete Private owners £12.5m cash (£9m upfront, £3.5m conditional and deferred)

Term loan facility (up to £18m) with Santander

December 2017 Poundfield Products Private owners £10.25m cash (£9.5m upfront, £0.75m conditional and deferred)

£13.9m equity raise at 41p

Source: ARC estimates

SigmaRoc plc*

25 April 2018 12

Capital structure and funding position As detailed in Figure 10, SigmaRoc has funded its acquisitions to date through two equity issues and utilisation of debt facilities provided by Santander. Its first equity issue, raising £40m gross to part fund the acquisition of Ronez, was undertaken at 40p per share, closing in January 2017. Its second, raising gross proceeds of £13.9m to fund the purchase of Poundfield Products, was executed at 41p, closing in December 2017.

Post these raisings, SigmaRoc has 136.7m ordinary shares in issue, of which 74% are deemed to be in free float. The company’s major institutional shareholders are detailed in Figure 11 below.

Figure 11: Largest shareholders (as at January 2018)

Investor % holding Bailiwick Investments 10.1 Legal & General 10.0 Slater Investments 9.3 Pula Investments 9.1 Miton Asset Management 7.3 Mr Nigel Wray 5.8 Polar Capital 5.4 Mr Jeremy Peace 3.7 Hargreave Hale 3.4

Source: SigmaRoc

SigmaRoc reported a cash position at mid-2017 of £1.7m. Since then it has completed the acquisitions of Topcrete and Poundfield Products for a combined gross cash outgoing of £18.5m (funded through a combination of debt and equity as detailed above). Adjusting for these events and our forecast performance of Ronez in H2 2017 and Topcrete for the final two months of the year post-acquisition, we estimate SigmaRoc ended 2017 with cash of just under £7m and debt of £19m (Figure 12).

Group debt comprises the £10m in outstanding loan notes issued in January 2017, and an estimated £9m drawn under a term loan facility provided by Santander.

The loan notes accrue interest at 6% pa (payable bi-annually) and are convertible at any time prior to the fifth anniversary of the issuance date (January 2022) at a fixed price of 52p. They were admitted for trading on the official list of the International Stock Exchange in December 2017.

The term loan facility with Santander can be drawn up to £18m. In addition, Santander has also made available a £2m revolving credit facility (which we assume has yet to be drawn upon).

Figure 12: Estimated net debt position at end-2017

Cash £6.9

Convertible notes (January 2022) £10.0

Term debt facility £9.0

Net debt £12.1

Source: ARC estimates

SigmaRoc is adequately funded to

operate its current business

streams and service debt

SigmaRoc plc*

25 April 2018 13

Differentiated buy-and-build strategy SigmaRoc is seeking to build a c£500m market capitalisation company over the coming years through accumulation of a diversified portfolio of quality construction materials businesses in northern Europe.

However, in contrast to the highly geographically-centred approach prevalent in the sector, SigmaRoc is pursuing a more nuanced ‘buy-and-build’ strategy, targeting businesses that have inherent features that enable robust margins to be maintained throughout a cycle. This might include a degree of structural insulation from head-on competition with industry majors (e.g. Ronez, whose island location enables it to dominate its local market), and/or established branding and market supply lines in specialist products that represent a high barrier to entry to would-be competitors (e.g. Topcrete and Poundfield Products). Moreover, SigmaRoc will seek to add value to the businesses it acquires by optimising performance and cost structures through decentralisation and empowerment of local management.

SigmaRoc is principally targeting established cash-generative businesses where it sees opportunity to grow product offerings and/or streamline costs, but it will also look at potentially higher-return, near cash-generative growth opportunities and or partnerships with industry majors. We see opportunities emanating from two main sources: independent operators in the UK and mainland northern Europe whom are either financially constrained or willing sellers for other reasons (e.g. retiring founders/lack of succession plans); and industry majors divesting non-core assets (which may be driven by over-leveraged balance sheets and/or competition issues).

Figure 13: Illustration of possible investment/acquisition opportunities

Opportunity Rationale and competitive advantage Construction materials business buy-outs

► Majors divesting non-core assets (deleveraging and/or competition control driven) – e.g. LafargeHolcim targeting CHF2bn of divestments by 2022

► SigmaRoc not considered competition threat

► SigmaRoc has demonstrated its ability to successfully execute such a transaction through Ronez

UK specialist products companies

► Management has knowledge of and access to niche asset businesses and sub-sectors

► Typically owned by private individuals (potentially capital constrained and lacking succession plan)

Project specific partnerships with industry majors

► Local subsidiaries of majors under pressure to grow EBITDA but competing for capital from parent group

► SigmaRoc has good relations with major groups and not positioned as a direct competitor

Construction materials importation/ exportation

► Local scarcity of certain construction materials

► SigmaRoc has detailed knowledge of, and access to, downstream assets and can leverage existing SigmaGsy business unit

Partnership with key developer in niche geographic market

► SigmaRoc has relationships with key market participants capable of securing offtake

► Mutual benefit for new market entrant

Source: Company presentation and ARC research

SigmaRoc is pursuing a more

nuanced buy-and-build strategy,

targeting niche, high-quality assets

to achieve greater through-cycle

profitability versus the industry

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25 April 2018 14

Utilising its encyclopaedic knowledge of the sector and wide industry network, management has developed a large database of potential opportunities from which to add to the four acquisitions the group has made to date. Following the purchase of Poundfield Products in December, SigmaRoc revealed that is in “advanced negotiations” on a next potential transaction.

Clearly one cannot second-guess either the timing or scale of future acquisitions, but we have attempted in Figure 14 below to illustrate how SigmaRoc’s buy-and-build strategy may further play out over the coming years. Our illustration conservatively assumes two deals per year (one small, one larger), executed at acquisition multiples of 6.8x EBITDA, in line with our estimate of the average of its four completed deals to date. We have then plotted how SigmaRoc’s EV may evolve at both its current EV/EBITDA multiple of 6.7x and at the sector average multiple of 10.0x

How potential EV relates to eventual market capitalisation will be a function of the financing mix for future deals. To date SigmaRoc has funded its acquisitions through a mix of equity (Ronez and Poundfield Products) and existing debt facilities (Topcrete). We would expect future acquisitions to be funded similarly, increasingly supplemented over time with contributions from the group’s incrementally growing internal cash resources. Management has been clear in its intention to actively manage debt levels, and will only utilise debt to undertake investments that offer an expeditious path for subsequent de-gearing

On this basis we see scope for SigmaRoc to grow to a c£500m market capitalisation business over the coming years, assuming it can continue sourcing earnings accretive opportunities at price points in line with those achieved to date.

Figure 14: Conceptual illustration of potential evolution through buy-and-build

*Assuming future acquisitions executed at 6.8x EBITDA (average to date) Source: ARC research

Ronez Ronez Ronez Ronez

UK CP Cluster UK CP Cluster UK CP Cluster UK CP Cluster

New asset 1 New asset 1 New asset 1

New asset 2 New asset 2 New asset 2

New asset 3 New asset 3

New asset 4 New asset 4

New asset 5

New asset 6

0

100

200

300

400

500

0.0

10.0

20.0

30.0

40.0

50.0

EV/c

um

ula

tive

cap

ital

inve

sted

* (£

m)

EBIT

DA

(£

m p

a)

Time

Cumulative capital invested Potential EV at 6.7x Potential EV at 10.0x

We envisage significant earnings

growth over the coming years if

SigmaRoc maintains or accelerates

its current rate of deal flow

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25 April 2018 15

Ronez

High-quality, stable flagship asset

Ronez is the dominant supplier of construction materials in the Channel Islands, operating the only quarry in Guernsey and one of only two quarries in Jersey. It also operates downstream asphalt and pre-cast concrete products manufacturing facilities and provides contracting services on both islands.

A mature, stable business, Ronez has supplied construction materials to the islands for several decades, most recently under long-time owner Aggregates Industry (a UK subsidiary of the global concrete major LafargeHolcim). The latter sold the business to SigmaRoc as part of LafargeHolcim’s reported group-wide CHF5bn de-leveraging divestment programme.

Vertically integrated, Ronez produces a range of construction materials for sale into the local markets on each island, including raw aggregate, ready-mixed concrete, pre-cast concrete products and asphalt. It also provides construction contracting services, most notably road laying/repairing. Ronez is the sole importer of cement on each island.

Figure 15: Ronez owns several assets on Jersey and Guernsey

Source: SigmaRoc (January 2017 Admission Document)

Ronez has just one competitor on Jersey (quarry operator Granite Products, the Jersey subsidiary of UK construction materials business Brett Group), and none on Guernsey.

Figure 16: Ronez dominates supply of construction materials on the islands

Product/service Jersey market share (estimate)

Guernsey market share (estimate)

Aggregates 30-40% 80-90%

Ready-mixed concrete 40-50% 100%

Concrete products 50-60% 80-90%

Asphalt 100% 100%

Cement trading 100% 100%

Road contracting 50-60% 50-60%

Source: SigmaRoc

Ronez is a well-established stable

business with a position of

dominance in its local market

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25 April 2018 16

The Channel Islands construction materials market Jersey and Guernsey are self-governing UK Crown Dependencies, that, while not part of the European Union, have a freed trade arrangement with the European Community.

The construction industry is an important part of the islands’ domestic economy, representing c6% of combined GDP. As is the case everywhere, the Channel Island’s construction sector goes through cycles in sync with the wider economy, but historically it has demonstrated greater stability than the mainland UK market.

Publicly-funded building projects (hospitals, schools, municipal buildings and road laying/repairing) underpin construction activity on both islands, supplemented by a relatively buoyant private house-building and commercial developments sector. Crucially, the governments of both islands support local sourcing of building materials where possible.

The Jersey Government’s Draft Medium Term Financial Plan for 2017-2019 details over £150m of public spending on construction-intensive capital projects over the next three years, with notable projects including school development and refurbishing work, a prison refurbishment and a new sewage works. The Guernsey Government meanwhile has a £1.8bn pipeline of potential capital projects over the next 20 years, with confirmed initiatives including c£60m of spending on a schools and sports facilities. Most house building is undertaken by the private sector, and thus there is less visibility on future plans in this area of the islands’ construction industry (though house price indexes have been rising for several years on the back of rising population density and average earnings). That said, in Jersey £250m has been committed by Government to fund affordable housing projects, including the refurbishment of existing social housing stock.

Jersey operations In Jersey Ronez operates St John’s, a granodiorite hard-rock quarry on the north of the island whose origins can be traced back to the 1800s.

Figure 17: St John’s quarry, Jersey

Source: SigmaRoc

There is visibility on significant

construction activity on the islands

over the coming years

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25 April 2018 17

Unconstrained reserves are sufficient for at least three more years of mining at current rates, while moving the in-pit plant would liberate additional reserves sufficient for over around twelve more years of mining. Moreover, Ronez has applied for planning permission to develop some 1.8Mt of resources on the western flank of the current pit, which would service operations for a further c15 years at current production rates. A portion of these resources lie under State-owned ground, and so would be subject to marriage royalties if exploited.

There is an estimated 2.4Mt of resources lying beneath ground currently occupied by Ronez St John’s offices and concrete plant. Though accessing these resources would require relocating a significant amount of surface infrastructure, it nevertheless offers potential for significant (c20 years) life extension of the operation.

Figure 18: St John’s reserves and resources (as at end 2016)

Category Status Tonnes (Mt)

Proved Reserve Unconstrained 0.5

Constrained 1.4

Sub-total Reserves 1.9

Measured Resource 1.8

Indicated Resource 2.4

Sub-total Resource 4.2

Total Reserves & Resources 6.1

Source: SigmaRoc

Product manufacturing facilities at St John’s include a 150tph dry crushing and screening circuit within the quarry (for grading raw aggregates for direct sale or on-processing), with adjoining ready-mixed concrete and asphalt manufacturing circuits. Surface facilities outside the pit include a concrete-products casting plant, bagging line and service and administrative offices. Management plans to locate a new ready-mixed concrete facility at the surface infrastructure site (capex budget c£1m), which will reduce vehicle flow in the quarry itself.

Other assets on Jersey include the island’s only cement importation and storage facility (under long-term lease by Ronez) on the other side of the island at St Helier. This facility unloads and stores cement shipped by SigmaRoc’s dedicated bulk carrier vessel (see p20) for use its own concrete facility at St John’s as well as for sale to third-party customers on the island.

Guernsey operations

On Guernsey Ronez operates the Les Vardes hard-rock (granite) quarry and on-site aggregate-crushing/screening and asphalt plant. A short distance away at Monmains the group has a ready-mix concrete plant and product casting facility, while at St Sampson’s Port it owns the island’s sole cement importation and storage site.

Les Vardes is Guernsey’s only active quarry, and despite the island’s smaller market, this monopoly position means the business is of a comparable size to that in the larger market of Jersey (where Ronez has one competitor). On Guernsey Ronez also has a 65% interest in Island Aggregates, a secondary producer of aggregates from the recycling of construction and demolition waste material on the island. The 35% balance of ownership is held by Island Waste Ltd.

St John’s is a long-life asset

St John’s feeds a significant array

of downstream product

manufacturing facilities

Les Vardes is the only active quarry

on Guernsey

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25 April 2018 18

Les Vardes’ unconstrained reserves are sufficient for approximately six more years of production at current rates. However, additional constrained reserves within the existing quarry footprint and could extend the operational life by an additional five years if liberated (by moving the in-pit aggregate crushing plant that sits upon them).

Figure 19: Les Vardes and Chouet reserves and resources (as at end 2016)

Category Status Tonnes (Mt)

Les Vardes Reserve Unconstrained 0.80

Constrained 0.66

Sub-total Reserves 1.46

Chouet Indicated Resource* 2.00

Sub-total Resource 2.00

Total Guernsey Reserves & Resources 3.46

Source: SigmaRoc

Figure 20: Les Vardes quarry, Guernsey

Source: ARC

Ronez also owns freehold land at Chouet, a site of historic quarrying approximately 2km northeast of Les Vardes, that hosts an estimated 2Mt of resources. Immediately adjacent to this property lies Government-owned land that hosts an estimated additional 3Mt of resource, and Ronez is in active discussions with the Government to lease this land with a view to applying for planning permission to develop the entire c5Mt resource site. If developed, this would sustain operations at current rates for c40 years. Management estimates that it would cost approximately £5m to establish a new quarry at Chouet (including planning costs).

The environmental permitting and planning permission process for Chouet is expected to take around two years, with an additional year required to prepare the site for quarrying thereafter (management believe production could commence in 2021). We note that Les Vardes’ unconstrained reserves are more than sufficient to sustain operations at current rates during this period.

Exploratory drilling at Chouet commenced in November 2017.

Chouet offers potential for a

significant life extension of

quarrying activities on Guernsey

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25 April 2018 19

Contracting services

In addition to its quarrying and downstream building products businesses, Ronez provides contract construction and road surfacing services on both islands. This is an important source of income to the group, historically accounting for around 25% of its underlying revenue. In Jersey Ronez undertakes its contracting work via wholly-owned subsidiary Pallot Tarmac, the market leader in road-laying work on the island.

Financials: track record of robust performance

Ronez is a well-established, stable business with a long track record of robust financial performance. Underlying net revenue to the group (after stripping out internal sales) has been tightly ranged at £24-27m pa over the last four reported full years (2013-16), with operational EBITDA over this period has ranging £4.4-5.0m pa. This implies an above sector-average EBITDA margin of close to 20%, reflecting the business’ dominant market position on the islands.

Given fixed costs account for a sizable portion of the total cost base (we estimate around 40%), margins can expand with higher volumes in particular years (total aggregate production has historically averaged around 250kt pa, though can spike higher in years with large construction projects). 2016 was a slower than average year, with several large construction projects delayed. However, despite revenue dropping to £24m (from £26m in 2015), EBITDA remained robust at just under £5m.

Since taking control of the business at the start of 2017, SigmaRoc has overseen an upturn in Ronez’ fortunes. Revenue for the first half of the year rose by 12% compared with H1 2016, to £13.1m, reflecting slightly improved trading conditions in Jersey (offsetting still sluggish conditions in Guernsey). However, operational level EBITDA increased by a much larger 53%, reflecting the additional benefit of operating and cost efficiencies implemented by SigmaRoc since taking ownership.

Our forecasts assume future volumes and revenue generation are broadly in line with historic ranges. However, and as demonstrated in the business’ H1 2017 performance, we factor in some margin improvement relating to trading and operational efficiencies unlocked by SigmaRoc under Ronez’ now independent operating model. We estimate such efficiencies could add over £1m pa to the bottom line, and thus forecast underlying operating-level EBITDA from Ronez going forward of at least £6.5m pa (a margin of c25%, versus the historic level of c20%).

Figure 21: Forecast Ronez production volumes, revenue and EBITDA margin

Source: ARC estimates

15.0

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/%

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nes

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00

's)

Aggregates produced (kt) Revenue (£m) Ronez EBITDA margin (%)

We see potential for Ronez to

sustain annualised EBITDA

generation of >£6.5m

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25 April 2018 20

SigmaGsy shipping and trading arm SigmaGsy is SigmaRoc’s dedicated bulk-shipping and trading subsidiary. It maintains and operates a wholly-owned dry bulk material carrier that was acquired for £0.55m in April 2017.

SigmaGsy’s primary function is to support the material importation requirements of Ronez, which relies on imports from north European suppliers to meet its cement requirements on the Channel Islands. However, as the vessel has capacity to ship over and above Ronez’ annual requirements alone, SigmaGsy also provides supplementary shipping services to third-party cement majors around the British Isles and northern Europe. SigmaRoc has guided that such activity could generate at least £0.2m pa of additional operational EBITDA to the wider group.

Figure 22: SigmaGsy owns and operates the Ronez dry bulk carrier

Source: shipspotting.com

SigmaGsy has potential to bring in

c£0.2m pa to the group via

shipping services to third parties

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25 April 2018 21

UK concrete products cluster SigmaRoc’s most recent two acquisitions have both been in the UK concrete products space, establishing in a short space of time a significant cluster of mainland UK specialist pre-cast manufacturing businesses and distribution networks.

Topcrete

SigmaRoc’s maiden mainland UK asset purchase was the October 2017 acquisition of Topcrete Ltd, a specialist supplier of pre-cast concrete products to the construction industry with operational facilities in the Midlands and Greater London area. The acquisition comprised an initial cash consideration of £9m, funded through a pre-existing term loan facility with Santander, plus a deferred consideration of £3.5m payable over the next twelve months (conditional on certain business performance targets being met).

Netting off a £0.5m positive working capital position within the business at point of acquisition, the £12m full consideration (assuming the deferred amount is paid) equated to 6x Topcrete’s EBITDA generation for its 2016/17 fiscal year (the business’s last reported full-year).

Specialist in manufacturing of wet-cast products Topcrete’s wholly-owned subsidiary Allen Concrete Ltd is a pre-cast concrete products business that specialises in the manufacturing of bespoke wet-cast products. Wet-casting uses flowable concrete and customised moulds for applications that require customised casted shapes with a specific finish (e.g. decorative concrete pieces) and is therefore a more bespoke and skilled manufacturing process than standardised, mass production of dry-cast products (e.g. concrete breeze blocks).

A quality rather than volume-driven sector, barriers to entry are high and branding is important, and thus the business fits well with SigmaRoc’s overarching growth strategy, in our view.

Well-established brand and customer base Founded over 60 years ago, Allen Concrete is a well-established brand in the UK pre-cast concrete products supply chain, known for its high-quality wet-casted bespoke products (e.g. ornamental pieces, concrete sills and balustrades) and concrete fencing. The business has a wide and well-established customer base, ranging from small builders’ merchants through to local authorities and large infrastructure operators such as Network Rail.

Significant asset footprint in the Midlands and South East The Topcrete acquisition gave SigmaRoc a significant asset footprint in the Midlands and South East of England. The business’s main casting plant is in Northamptonshire and incorporates modern production methods and machinery overseen by an experienced and skilled staff base (necessary given the importance of quality control). It also has a free-held site of significant value in the Greater London area that facilitates distribution into the south-eastern UK marketplace.

The manufacturing operations of Topcrete are well optimised (there are just 36 staff employed across the two sites), but since taking control SigmaRoc management

Topcrete specialises in the

manufacturing of bespoke wet-cast

concrete products

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25 April 2018 22

considers there is potential to better optimise the commercial side of the business, such as raw materials purchasing and distribution logistics.

Financial performance and forecasts Allen Concrete turned over consolidated revenue of £5.2m in the year ended 28 February 2017, generating underlying profit before tax of £1.8m. According to SigmaRoc, the business achieved EBITDA of £2m for that period, a margin of 38%. We conservatively assume the business performs in line with historic levels going forward, though note the potential for upside given the commercial optimisation opportunities referred to above.

Poundfield Products

In December 2017 SigmaRoc expanded its mainland UK cluster of concrete products assets with the £10.25m acquisition of Poundfield Products Ltd, group of businesses specialising in patented concrete products and systems. The acquisition comprised an initial cash consideration of £9.5m on a debt-free/cash-free basis, and a deferred amount of £0.75m, payable in SigmaRoc shares one-year from completion (subject to certain conditions being met).

Adjusting for a £1.4m positive working capital position within the business at point of acquisition, the consideration equates to 6x Poundfield’s EBITDA for the year to 31 December 2016 (the business’s last reported full 12-month period), the same multiple SigmaRoc paid for Topcrete.

Manufacturer of specialist retainer walls and other pre-cast products

Founded in 1999, Suffolk-based Poundfield Products has established itself as a leading manufacturer of pre-cast and pre-stressed concrete products. It designed the trademarked Alfabloc retaining wall, a unique patented A-shaped concrete retaining wall system that can be used freestanding and which is now manufactured not just in the UK but also under licence elsewhere in Europe and in the US. Poundfield has since expanded its retaining wall range of products and has also diversified into bespoke pre-cast concrete products design and into the block and beam flooring market.

Figure 23: Poundfield manufactures the patented Alfabloc retainer wall system

Source: Poundfield Products

Poundfield is a well-regarded

manufacturer of patented concrete

products and systems

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25 April 2018 23

Expands SigmaRoc’s UK concrete products cluster As is the case with its Topcrete business, Poundfield’s unique product offering provides a significant degree of protection from competition on a regional market basis, thus further advancing delivery of SigmaRoc’s selective buy-and-build strategy. Moreover, we see potentially for synergies with the Topcrete as Poundfield’s is integrated into SigmaRoc’s now expanded UK concrete products business cluster.

Financial performance and forecasts Poundfield turned over consolidated revenue of £7.4m in the year to 31 December 2016 (its last full 12-months reporting period), generating underlying EBITDA of £1.5m. As at September 2017, Poundfield had already achieved underlying EBITDA of £1.3m for the first three-quarter of the year, and we therefore believe the business is on course to exceed its 2016 performance for the 2017 full year.

The acquisition should therefore prove earnings accretive to SigmaRoc in its first full year of ownership. Our forecasts assume a future performance broadly in line with current levels. However, we note the potential for operational, logistical and administrative synergies with the Topcrete business to be captured, which may enhance profitability. Moreover, SigmaRoc has earmarked £1m of the net proceeds from the £13.9m share placing it undertook in conjunction with the acquisition of Poundfield to grow existing and new product offerings, which could enhance revenue going forward.

Clear scope for synergies to be

unlocked between Topcrete and

Poundfield

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25 April 2018 24

Board and Senior Management

David Barrett – Executive Chairman

David Barrett co-founded London Concrete Ltd in 1997, subsequently building the business from one concrete plant in London to over a dozen plants around the capital. London Concrete was ultimately sold to Aggregate UK and is currently the number one concrete supplier by market share in London, with flagship projects including the London Olympic Park, the Shard, the new US Embassy and the new Bloomberg building. Prior to co-founding London Concrete, Mr Barrett held a number of positions in concrete and aggregates production. He retired from London Concrete at the end of 2014 and is widely considered an expert in the industry.

Max Vermorken – Chief Executive Officer Max Vermorken was most recently a strategic advisor to LafargeHolcim. His last role included responsibility for the hive-down and integration of two large asset portfolios (a mix which included two cement plants and ACM assets) in the context of the global merger of Lafarge SA and Holcim Ltd. Prior to working for LafargeHolcim, Mr Vermorken worked in private equity at Luxembourg-headquartered Genii Group, where he reported directly to the group’s founding principles. Mr Vermorken holds a PhD in Financial Economics from University College London and Bachelor and Masters degrees in both Civil Engineering and Financial Economics and Management, from University College London and the University of Brussels respectively.

Garth Palmer – Finance Director Garth Palmer is a partner at Heytesbury Corporate LLP, a partnership engaged in the provision of corporate financial and company secretarial services. He holds a Bachelor of Commerce Degree and is a member of the Institute of Chartered Accountants in England and Wales. Previous experience includes accountancy and finance roles with Horwath Chartered Accountants (now part of the BDO group), KPMG and the Apple group. More recently, Mr Palmer has been providing corporate and financial consulting services to AIM-quoted companies, predominantly within the mining and resources industries.

Charles Trigg – Operations Manager A trained quarry manager, Charles Trigg is the former Group Head of Capex at LafargeHolcim Northern Europe, where he was responsible for all regional operational capex and headed up the operations and supply chain team for the LafargeHolcim merger in Northern Europe. Mr Trigg has global experience, including time in New Zealand where he was involved in strategic planning of the reconstruction of Christchurch following the city’s earthquake, as well as on projects for the construction of roads of national significance. He has also worked for the State of Qatar, with whom he was charged with the country’s strategic construction materials supply and led the development and construction of various operational sites.

Mike Osborne – Ronez Managing Director Mike Osborne has been Managing Director of Ronez since 2006, during which time he has been responsible for the group’s strategic direction and operational management. Prior to this, Mr Osborne spent four years as director of Aggregate Industries’ overseas operations, reporting directly to that group’s chief executive officer. Between 1998 and 2001 he held several roles with the Tarmac group,

SigmaRoc plc*

25 April 2018 25

primarily in Central Europe. Mr Osborne has a BSc (Eng) in Mining Engineering from the University of London and is a Fellow of the Institute of Quarrying.

Patrick Dolberg – Non-Executive Director Patrick Dolberg was an Executive Committee Member of Holcim Ltd from 2008 to 2013, with whom he was responsible for the group’s Western and Central Europe businesses, reporting directly to the group’s chief executive officer. He joined the Holcim group in 1991, having previously held executive positions at Exxon Chemical International and Monsanto. From 1992 to 1996, Mr Dolberg was General Manager of Scrobiel, a member of the Holcim group. In 1998, he was appointed chief executive officer of St Lawrence Cement, another Holcim group company, before joining Holcim US as chief executive officer in 2003. Mr Dolberg has an MBA from Solvay Business School, graduating with distinction.

Dominic Traynor – Non-Executive Director Dominic Traynor is a corporate lawyer specialising in listings and reverse takeovers, M&A and corporate finance. He has acted on more than 20 AIM-admissions as well as several reverse takeovers, other acquisitions, joint ventures and secondary fundraisings, with a focus on the mining and oil and gas sectors. Mr Traynor graduated from Durham University in 1997 with a degree in Law and, after completing the LPC at the College of Law in York, joined Ronaldsons LLP in 1998, where he is currently a Partner.

Gary Drinkwater – Non-Executive Director Gary Drinkwater joined Ravenscroft Stockbroking & Investment Management in December 2015 as a Corporate Adviser and serves on the boards of several companies which are partly owned by Bailiwick Investments Ltd, including Jacksons (CI) Ltd and Sandpiper CI Ltd. Prior to joining Ravenscroft, Gary spent over 30 years in banking roles with HSBC, culminating in his appointment as Deputy Head of Corporate Banking, Channel Islands and Isle of Man from 2012 to 2015. Gary was the President of the Jersey Bankers Association between 2003 and 2005 and was previously the President of the Jersey Branch of the Institute of Directors. He also sits on the board of Help a Jersey Child and is an elected member of the Public Accounts Committee in Jersey.

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25 April 2018 26

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