Headwaters Incorporated Provides Business Update at 2013 Analyst and Investor Day Conference

  Headwaters Incorporated Provides Business Update at 2013 Analyst and
  Investor Day Conference

  *Macro drivers in place for positive housing and remodel trends, which
    remain early in the up-cycle
  *Well positioned in all end markets—both light building products and heavy
    construction materials—for profitable, long-term growth
  *Reaffirms 2013 Adjusted EBITDA Guidance of $110 million to $125 million

Business Wire

SOUTH JORDAN, Utah -- March 25, 2013

HEADWATERS INCORPORATED (NYSE: HW), a building products company dedicated to
improving lives through innovative advancements in construction materials,
today announced takeaways from its Eleventh Annual Analyst and Investor Day
Conference, which was held Friday, March 22, 2013 in Salt Lake City, UT. The
event featured presentations by Chairman & Chief Executive Officer Kirk A.
Benson, Chief Financial Officer, Don Newman and Senior Executives: Bill
Gehrmann, Jerry Smith, Murphy Lents and Dave Ulmer.

Special Guest Speaker—Ivy Zelman, Zelman & Associates

Headwaters’ Analyst & Investor Day also featured special guest speaker, Ivy
Zelman, Chief Executive Officer of Zelman & Associates, a preeminent housing
market industry expert, well-known for calling the peak of the housing market
in 2005. Ms. Zelman shared her views on the market today noting key trends
including population growth, household formation, inventory trends, and
consumer psychology that support an unfolding housing recovery that remains in
its early stages. Ms. Zelman stated, “We believe that the housing market is at
the front end of a multi-year appreciation cycle and remain increasingly
bullish. There are huge opportunities for companies serving the residential
real estate end markets.”

CEO Commentary—Kirk A. Benson

“Headwaters’ goal is to be among the world’s elite construction materials
businesses and well-known for focusing on niche, high margin product
categories,” said Kirk A. Benson, Chairman and Chief Executive Officer of
Headwaters. “We are well positioned to capitalize on the new up-cycle in
demand that is occurring in a number of our end markets, particularly in the
new residential construction market and feel quite confident about our
business prospects.”

“Our light building products business has a portfolio of market leading brands
in six key product categories. We look to grow this business through a
combination of new product development, geographic expansion, and market share
gains, as well as through strategic product acquisitions, such as our recent
acquisition of Kleer Lumber, a manufacturer of high quality and eco-friendly
cellular PVC trim board and moulding products. These types of bolt-on
acquisitions enable us to expand and leverage our existing distribution
channels in order to drive incremental revenue.”

“Our heavy construction materials segment will continue to benefit from the
ongoing increase in demand for cement in the U.S., which is also primarily
being driven by new housing starts. Additionally, we expect that, over time,
we will see increased penetration of fly ash as an admixture in ready mix
concrete and other concrete products as U.S. cement producers find it
challenging to fully meet the expected increase in demand from domestic
production alone.”

CFO Commentary—Don Newman

“Both of our operating segments have strong contribution margins that will
provide significant flow through to our profitability as revenues increase,”
said Don Newman, Chief Financial Officer of Headwaters. “We also have a
culture of continuous improvement, driving efficiencies and lowering costs
that we expect will lead to increased profits in the future.”

“Strong contribution margins, coupled with the up-cycle in demand that is
occurring in a number of our end markets should result in solid cash
generation that can be used to repay debt and fund accretive growth, as well
as create opportunities to return capital to our shareholders.”

“We have relatively low capital requirements and when combined with our tax
NOL carry forwards and tax credits, we are positioned to generate significant
free cash flow. We remain committed to continuing to de-risk the balance
sheet, having reduced total debt by nearly $500 million since the peak in
2004, and over $63 million in the last seven quarters. Our leverage ratio of
4.7x is down from 6.7x in June 2011 and is trending towards our long-term goal
of between 2.5x and 3.0x.”

Guidance

Headwaters reaffirmed its recently raised guidance of expected 2013 Adjusted
EBITDA of $110 million to $125 million.

About Headwaters Incorporated

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

Forward Looking Statements

Certain statements contained in this press release are forward-looking
statements within the meaning of federal securities laws and Headwaters
intends that such forward-looking statements be subject to the safe-harbor
created thereby. Forward-looking statements include Headwaters’ expectations
as to the managing and marketing of coal combustion products, the production
and marketing of building products, the sale of its discontinued cleaned coal
operations, the licensing of residue hydrocracking technology and catalyst
sales to oil refineries, the availability of refined coal tax credits, the
development, commercialization, and financing of new technologies and other
strategic business opportunities and acquisitions, and other information about
Headwaters. Such statements that are not purely historical by nature,
including those statements regarding Headwaters’ future business plans, the
operation of facilities, the availability of feedstocks, and the marketability
of the coal combustion products, building products, cleaned coal, catalysts,
and the availability of tax credits, are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 regarding
future events and our future results that are based on current expectations,
estimates, forecasts, and projections about the industries in which we operate
and the beliefs and assumptions of our management. Actual results may vary
materially from such expectations. Words such as “may,” “should,” “intends,”
“plans,” “expects,” “anticipates,” “targets,” “goals,” “projects,” “believes,”
“seeks,” “estimates,” “forecasts,” or variations of such words and similar
expressions, or the negative of such terms, may help identify such
forward-looking statements. Any statements that refer to projections of our
future financial performance, our anticipated growth and trends in our
businesses, and other characterizations of future events or circumstances, are
forward-looking. In addition to matters affecting the coal combustion
products, building products, and energy industries or the economy generally,
factors that could cause actual results to differ from expectations stated in
forward-looking statements include, among others, the factors described in the
caption entitled “Risk Factors” in Item 1A in Headwaters’ Annual Report on
Form 10-K for the fiscal year ended September 30, 2012, Quarterly Reports on
Form 10-Q, and other periodic filings and prospectuses.

Although Headwaters believes that its expectations are based on reasonable
assumptions within the bounds of its knowledge of its business and operations,
there can be no assurance that our results of operations will not be adversely
affected by such factors. Unless legally required, we undertake no obligation
to revise or update any forward-looking statements for any reason. Readers are
cautioned not to place undue reliance on these forward-looking statements,
which speak only as of the date of this press release. Our internet address is
www.headwaters.com. There we make available, free of charge, our annual report
on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and
any amendments to those reports, as soon as reasonably practicable after we
electronically file such material with, or furnish it to, the SEC. Our reports
can be accessed through the investor relations section of our web site.

Contact:

AT THE COMPANY:
Sharon Madden, 801-984-9400
Vice President of Investor Relations
or
ANALYST CONTACT:
Tricia Ross, 916-939-7285
Financial Profiles