UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13A - 16 OR 15D - 16 OF

THE SECURITIES EXCHANGE ACT OF 1934

23 February, 2015

Commission File No. 001-32846

CRH public limited company

(Translation of registrant’s name into English)

Belgard Castle, Clondalkin,

Dublin 22, Ireland.

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F  x             Form 40-F  ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ¨

Index of Exhibits

Exhibit 1.1 - Shareholder circular (the “Circular”) in relation to the proposed acquisition of certain assets being disposed of by Lafarge S.A. and Holcim Ltd in advance of their intended merger (the “Acquisition”).

Exhibit 1.2 – Form of Proxy for use at the Extraordinary General Meeting

Exhibit 1.1

THIS CIRCULAR AND THE ACCOMPANYING FORM OF PROXY ARE IMPORTANT AND REQUIRE YOUR IMMEDIATE ATTENTION.

If you are in any doubt as to the action you should take, you are recommended to seek your own personal financial advice from your stockbroker, bank manager, solicitor, accountant or other independent professional financial adviser immediately (being, in the case of Shareholders in Ireland, an organisation or firm authorised or exempted under the Investment Intermediaries Act, 1995 of Ireland (as amended) or the European Communities (Markets in Financial Instruments) Regulations (Nos. 1 to 3) 2007 or, in the case of Shareholders in the United Kingdom, an adviser authorised pursuant to the Financial Services and Markets Act 2000, or from another appropriately authorised independent financial adviser if you are in a territory outside Ireland or the United Kingdom).

If you sell or have sold or otherwise transferred your entire holding of Ordinary Shares in CRH, please send this Circular, together with the accompanying Form of Proxy, as soon as possible to the purchaser or transferee, or to the stockbroker, bank or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee. If you sell or have sold or otherwise transferred only part of your holding of Ordinary Shares in CRH, you should retain this Circular and the accompanying Form of Proxy and immediately consult the stockbroker, bank or other agent through whom the sale or transfer was effected.

CRH plc

(incorporated in Ireland with limited liability under the Companies Acts 1963 to 2013, registered number 12965)

Proposed acquisition of certain assets being disposed of by Lafarge S.A. and Holcim Ltd in advance of their intended merger

and

Notice of Extraordinary General Meeting

UBS Limited, which is authorised by the PRA and regulated by the PRA and the FCA in the United Kingdom, is acting exclusively for CRH as its financial adviser and sponsor and is not acting for anyone else in relation to the matters outlined in this Circular and will not be responsible to anyone other than CRH for providing the protections afforded to clients of UBS Limited nor for giving advice in relation to the matters outlined or any matter or arrangement referred to in this Circular. Apart from the responsibilities and liabilities, if any, which may be imposed on UBS Limited by FSMA or the regulatory regimes established thereunder, UBS Limited assumes no responsibility whatsoever and makes no representations or warranties, express or implied, in relation to the contents of this Circular, including its accuracy, completeness or verification or for any other statement made or purported to be made by CRH, or on CRH’s behalf, or by UBS Limited, or on UBS Limited’s behalf and nothing contained in this Circular is, or shall be, relied on as a promise or representation in this respect, whether as to the past or the future, in connection with CRH or the matters outlined in this Circular. UBS Limited accordingly disclaims to the fullest extent permitted by law all and any responsibility and liability whether arising in tort, contract or otherwise which it might otherwise be found to have in respect of this Circular or any such statement.

The Sellers each accept no responsibility whatsoever and make no representations or warranties, express or implied, in relation to the contents of this Circular, including its accuracy, completeness or verification or for any other statement made or purported to be made by CRH or on CRH’s behalf and nothing contained in this Circular is, or shall be, relied on as a promise or representation in this respect, whether as to the past or the future, in connection with CRH or the matters referred to in this Circular.

This Circular should be read as a whole. Your attention is drawn to the letter from the Chairman of CRH plc, which is set out on pages 1 to 12 of this Circular and which recommends that you vote in favour of the Resolution to be proposed at the Extraordinary General Meeting referred to below.

Notice of an Extraordinary General Meeting of CRH plc, to be held at 9.30 am on 19 March 2015 at the Clyde Court Hotel, Lansdowne Road, Dublin 4, Ireland is set out on pages 166 and 167 of this Circular. A Form of Proxy is enclosed for use by Shareholders in connection with the Extraordinary General Meeting. To be valid, Forms of Proxy, completed in accordance with the instructions printed thereon, must be received at the Company’s registrar, Capita Asset Services, Shareholder Solutions (Ireland), PO Box 7117, Dublin 2 (if delivered by post), or Capita Asset Services, Shareholder Solutions (Ireland), 2 Grand Canal Square, Dublin 2, Ireland (if delivered by hand) as soon as possible but in any event by no later than 9.30 am on 17 March 2015. Completion and return of the Form of Proxy will not preclude Shareholders from attending and voting at the Extraordinary General Meeting or any adjournment thereof should they wish to do so.

FORWARD-LOOKING STATEMENTS

This Circular contains or incorporates by reference certain “forward-looking statements” regarding the belief or current expectations of CRH, the Directors and other members of its senior management about CRH’s financial condition, results of operations and business and the transaction described in this Circular. Generally, but not always, words such as “may”, “could”, “should”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “assume”, “believe”, “plan”, “seek”, “continue”, “target”, “goal”, “would” or their negative variations or similar expressions identify forward-looking statements. Such forward-looking statements are not guarantees of future performance. Rather, they are based on current views and assumptions and involve known and unknown risks, uncertainties and other factors, many of which are outside the control of CRH and are difficult to predict, that may cause the actual results, performance, achievements or developments of the CRH Group or the industries in which it operates to differ materially from any future results, performance, achievements or developments expressed or implied from the forward-looking statements. A number of material factors could cause actual results to differ materially from those contemplated by the forward-looking statements – see the risk factors described in Part III (Risk Factors) for more information in this regard. In light of these risks, uncertainties and assumptions, the forward-looking events described in this Circular may not occur. Due to such uncertainties and risks, investors should not place undue reliance on such forward-looking statements, which speak only to belief or current expectations as at the date of this Circular.

Except as required by the Central Bank, the Irish Stock Exchange, the FCA, the London Stock Exchange, or applicable law, CRH does not have any obligation to update or revise publicly any forward-looking statement, whether as a result of new information, further events or otherwise. Except as required by the Central Bank, the Irish Stock Exchange, the FCA, the London Stock Exchange, or applicable law, CRH expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in CRH’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

PRESENTATION OF FINANCIAL INFORMATION

Unless otherwise indicated, all references in this Circular to “€”, “euro” or “cent” are to the lawful currency of participating member states of the European Union. The financial information presented in this Circular has been rounded to the nearest whole number or the nearest decimal place. In addition, certain percentages presented in this Circular reflect calculations based upon underlying information prior to rounding and, accordingly, may not conform exactly to the percentages that would be derived if the relevant calculations were based upon the rounded numbers.

TIME

All references in this Circular to times are to Dublin, Ireland times, unless otherwise stated.

DEFINITIONS

Capitalised terms used in this Circular have the meaning ascribed to them in the section headed “Definitions” in this Circular.

i

CONTENTS

ii

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Note: These dates are given on the basis of the Directors’ current expectations and are subject to change. If any of the above times and/or dates change, the revised times and/or dates will be notified to Shareholders by announcement through a Regulatory Information Service of the London Stock Exchange and will be available on www.crh.com.

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PART I

LETTER FROM THE CHAIRMAN

CRH plc

(incorporated in Ireland with limited liability under the Companies Acts 1963 to 2013, registered number 12965)

20 February 2015

To the holders of Ordinary Shares of CRH plc and, for information only, to the holders of Preference Shares.

Dear Shareholder,

Proposed acquisition of certain assets being disposed of by Lafarge S.A. and Holcim Ltd in advance of

their intended merger and

Notice of Extraordinary General Meeting

On 7 April 2014, Lafarge and Holcim announced their intention to merge their businesses, such merger to be implemented by a tender offer by Holcim for the shares of Lafarge. In order to obtain the regulatory clearances necessary to complete the Merger, the Sellers agreed to divest certain of their businesses. The assets for sale pursuant to the Acquisition are held by newly incorporated or pre-existing subsidiaries of the Sellers, such subsidiaries being collectively referred to as the “NewCo Group.”

On 1 February 2015, CRH announced that it had entered into a Binding Offer Letter with Lafarge and Holcim, and the Philippines SPA with Lafarge Holdings (Philippines) Inc., Calumboyan Holdings, Inc., Round Royal Inc. and Southwestern Cement Ventures Inc., in which CRH has made a binding irrevocable offer to acquire the NewCo Group for an enterprise value of €6.5 billion.¹

Due to the size of the NewCo Group in relation to the size of CRH, the Acquisition constitutes a Class 1 Transaction pursuant to the UKLA Listing Rules and is therefore both subject to and conditional upon the approval of Shareholders. An Extraordinary General Meeting is being convened for this purpose and will be held at 9.30 am on 19 March 2015 at the Clyde Court Hotel, Lansdowne Road, Dublin 4, Ireland. A Notice of Extraordinary General Meeting and the Resolution to be proposed and considered at the Extraordinary General Meeting is set out at the end of this Circular.

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The Board considers that the Acquisition is in the best interests of Shareholders as a whole and recommends that Shareholders vote in favour of the Resolution to be proposed at the Extraordinary General Meeting.

The purpose of this Circular is to: (i) explain the background to and reasons for the Acquisition; (ii) explain why the Board considers the Acquisition to be in the best interests of Shareholders as a whole; and (iii) convene an Extraordinary General Meeting to seek Shareholder approval for the Acquisition.

Holcim is a global leader in the manufacture and distribution of cement and aggregates (crushed stone, gravel and sand), as well as other activities including ready-mix concrete, asphalt and associated services with operations in 70 countries. In 2013, Holcim generated approximately 65% of EBITDA from emerging markets, in particular Asia-Pacific and Latin America. Holcim produced 139mt of cement, 155mt of aggregates and 40 million m³ of ready-mix concrete in 2013.

Lafarge is a world leader in cement, aggregates, and concrete, with operations in 62 countries. Lafarge produced 137mt of cement, 193mt of aggregates and 31 million m³ of ready-mix concrete in 2013. Lafarge derives 21% of its sales (2013) from North America, 21% from Western Europe, and 58% from emerging markets (Middle East and Africa 27%, Asia 18%, Central and Eastern Europe 7%, Latin America 6%).

On 7 April 2014, Lafarge and Holcim announced their intention to merge their businesses. In order to obtain the regulatory clearances necessary to complete the Merger, the Sellers agreed to divest certain of their businesses which have been or will be transferred to or which were already held by members of the NewCo Group.

The NewCo Group comprises a global portfolio of assets in the buildings materials industry. It is highly complementary to CRH’s existing footprint providing a strong strategic fit and attractive geographical balance.

The NewCo Group is a global producer of cement, aggregates, ready-mix and related construction activities across four regional platforms in North America, Western Europe, Central and Eastern Europe and Emerging Markets. In 2013 the NewCo Group produced 23mt of cement, 79mt of aggregates, 8mt of asphalt and 10m m³ of ready-mix concrete. The NewCo Group is expected to generate 2014E^* revenue of €5.1 billion and EBITDA of €752 million. Approximately two-thirds of the NewCo Group’s revenue is generated in the European region. Outside Europe, Canada is the largest country in terms of 2014E^* revenue, generating €1.0 billion, with Brazil and the Philippines generating a further combined €0.6 billion.

The NewCo Group has market-leading positions and covers all segments of the building materials sector in developed, transition and emerging markets. It operates 24 integrated cement plants together with 10 grinding stations for a total capacity of approximately 36mt per annum. The NewCo Group has approximately 15,000 employees across 11 countries (Canada, the United States, the United Kingdom, Romania, Serbia, Slovakia, Hungary, Germany, France & La Réunion, Brazil and the Philippines). There are certain members of the NewCo Group which (i) have third party minority shareholders, (ii) are the subject of joint venture arrangements with third parties or (iii) are entities in which the Sellers have a non-controlling/minority shareholding.

The Acquisition includes the following assets:

All of Holcim’s assets in Canada, plus related US cement terminals and the Trident cement plant in Montana, United States.

All of Lafarge’s assets in the UK (following the acquisition by Lafarge of the remaining 50% of the Lafarge UK JV) except for the Cauldon cement plant and related assets and certain non-operational properties (or rights therein);

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All of Lafarge’s assets in Germany; and

All of Holcim’s assets in France, except for the Altkirch plant and associated assets in the “Haut-Rhin” region, all of Lafarge’s assets in La Réunion (except its minority shareholding in Ciments de Bourbon) and Lafarge’s Saint Nazaire grinding station.

Substantially all of Holcim’s assets in Slovakia, Serbia and Hungary; and

All of Lafarge’s assets in Romania.

The assets of Lafarge Republic, Inc., Luzon Continental Land Corporation and Lafarge Cement Services Philippines, Inc. in the Philippines including certain assets related to the Bulacan quarry, but excluding certain other assets (Lafarge Iligan, Inc., Lafarge Republic Aggregates, Inc., Lafarge Mindanao, Inc., and certain assets related to the STAR Terminal and the Pinagtulayan lands); and

Certain cement and related assets from Lafarge and Holcim’s Brazilian footprint.

The NewCo Group comprises a global portfolio of assets in the building materials industry, across four regional platforms, currently owned by either Lafarge or Holcim that have been identified in order to satisfy competition authorities reviewing the Merger. Given the fact that the businesses and assets which comprise the NewCo Group have been carved-out of both Lafarge and Holcim’s businesses and there is no common control of the entirety of the NewCo Group, there is no single set of consolidated accounts in existence for the NewCo Group. As such, the Sellers have compiled various sets of “Cluster Accounts” for the purposes of this Circular.

Financial information in respect of the NewCo Group is being clustered by the Sellers as follows:

Lafarge’s assets in Germany and Romania (“Lafarge Europe”);

Holcim’s assets in France (with the exception of the Altkirch plant and associated assets in the Haut-Rhin region) and substantially all of Holcim’s assets in Slovakia, Serbia and Hungary (“Holcim Europe”)

Lafarge’s assets in the United Kingdom (following the acquisition by Lafarge of the remaining 50% of the Lafarge UK JV) (“Lafarge UK”)

Holcim’s assets in Canada, plus related US cement terminals and the Trident cement plant in Montana, United States (“Holcim Canada”)

The assets of Lafarge Republic, Inc., Luzon Continental Land Corporation and Lafarge Cement Services Philippines, Inc. in the Philippines, including certain assets related to the Bulacan quarry, but excluding certain other assets (Lafarge Iligan, Inc., Lafarge Republic Aggregates, Inc., Lafarge Mindanao, Inc., and certain assets related to the STAR Terminal and the Pinagtulayan lands) (“Lafarge Philippines”)

Certain cement and related assets from Lafarge’s Brazilian footprint (“Lafarge Brazil”)

Certain cement and related assets from Holcim’s Brazilian footprint (“Holcim Brazil”)

Lafarge’s assets in La Réunion (with the exception of its minority shareholding in Ciments de Bourbon) (“Lafarge La Réunion”)

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With the exception of Lafarge UK, historical financial information on the NewCo Group is only available for the two years and nine months to 30 September 2014. The business of the Lafarge UK JV which will be acquired by CRH as part of the Acquisition is the Lafarge Tarmac business, excluding the Cauldon cement plant. The Lafarge UK JV was formed in January 2013 following a 50:50 joint venture between Lafarge UK Holdings Limited and Anglo American Finance (UK) Limited’s tarmac business. Given that the Lafarge UK JV was not in existence prior to January 2013, and that there is no audited track record for the business before that (because part of each business was carved out to form Hope Materials Limited, which is now owned by a separate company), audited financial statements for the Lafarge UK JV are not available prior to this date. Financial information for the Lafarge UK JV is only available for the period 7 January 2013 to 30 September 2014.

Furthermore, the historical financial information prepared for the purpose of this Circular omits certain disclosures that are required for a complete set of historical financial information. As such, the accountant’s reports for each set of Cluster Accounts, as required by UKLA Listing Rule 13.5.21R, are modified. Details of the omitted disclosures are set out in the historical financial information for each set of Cluster Accounts included in Section B to F of Part IV (Historical Financial Information) of this Circular. The Directors believe that the historical financial information, together with the other information provided in this Circular, including the location and description of the assets, the relevant production metrics and the strategic fit for CRH, is sufficient for Shareholders to make an informed assessment as to the appropriateness of the Acquisition for CRH. Accordingly, the Directors do not believe the modified accountant’s opinions to be significant to Shareholders. CRH has carried out significant due diligence on the assets being acquired, the findings of which form the basis for the Board’s recommendation that Shareholders vote in favour of the Acquisition.

The Sellers have advised CRH that the historical financial statements provided in Sections B to F of Part IV (Historical Financial Information) of this Circular, as explained above, is the totality of the historical financial statements available with regard to these clusters of the NewCo Group.

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The following tables set out the summary financial information for each of the clusters:

The summary financial information in respect of Lafarge Europe, Holcim Europe, Holcim Canada, Lafarge UK and Lafarge Philippines set out above has been derived from the detailed historical financial information for each of the clusters set out in Sections B to F of Part IV (Historical Financial Information) on page 36 of this Circular. The financial information in respect of the period ending 30 September 2014 is unaudited. Non-Euro amounts have been converted to Euro at the exchange rates on page 35 of this Circular.

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The summary financial information in respect of Lafarge Brazil, Holcim Brazil and Lafarge La Réunion has been extracted from information provided by the Sellers, consisting of data derived from a number of sources including financial statements, accounting records, management information systems, plant data and other sources and is unaudited. Certain information is not available in respect of certain periods, as indicated in the foregoing table of summary financial information. Notwithstanding that the financial information for Lafarge Brazil, Holcim Brazil and Lafarge La Réunion is not considered to be material in the context of the acquisition as a whole, further financial information in respect of Lafarge Brazil, Holcim Brazil and Lafarge La Réunion is set out in Section G of Part IV (Historical Financial Information) on page 142. Shareholders’ attention is drawn to the risk factor “Reliance on third party information” set out on page 18.

The NewCo Group businesses have operated, and until the closing date of the Acquisition will continue to operate, in line with the customary practices of the relevant businesses of Lafarge or Holcim (as applicable) as regards sales, customers, suppliers, management, employees, working capital, maintenance and capital expenditure save as contemplated by the Global SPA or Philippines SPA (as applicable), including as required to implement the Local Reorganisation Conditions.

CRH has existing business activities in most of the regions contemplated pursuant to the Acquisition, and extensive experience in successfully integrating acquisitions into its footprint. Given the very limited overlap of our operations and our federal organisation structure, we would expect to incorporate the activities of the NewCo Group into our existing organisational structures in Europe, the Americas and Asia with the existing country level structures and management of the NewCo Group largely unchanged.

As a long term investor in the sector, CRH has a proud reputation as an employer of choice in the industry. As an international company, we recognise the differences in custom and practice regarding employee representation between countries. CRH intends to step into the shoes of Lafarge and Holcim in respect of existing collective agreements etc. at a country level. Further, in common with Lafarge and Holcim, CRH is committed to the highest international standards of employee safety and social and corporate responsibility. Accordingly, CRH expects a very smooth transition in the areas of safety, environmental management and employee relations.

The NewCo Group represents core strategic parts of both Lafarge’s and Holcim’s global portfolios and represents some of the highest quality assets in the industry. The Board of CRH believes the Acquisition provides a compelling strategic fit for CRH for the following reasons:

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The estimated financial benefits set out above are contingent on the Acquisition and could not be achieved independently. Such estimated financial benefits reflect both the beneficial elements and relevant costs.

Assuming completion in mid-2015, the acquisition of the NewCo Group is expected to be c.25% accretive to underlying earnings and to generate a ROIC in line with CRH’s weighted average cost of capital in the first full year of ownership. Return on equity is expected to be in the high teens in 2016 and return on net assets in line with previous returns generated by CRH.

Balance sheet strength remains a key focus for the Group. 2014E pro forma net debt / EBITDA ratio is approximately 3.2 times, before taking account of any future disposals arising from the previously announced portfolio review by CRH in 2014.

The pro forma net debt to EBITDA ratio of approximately 3.2x has not been reported on. As referenced on page 4 of this Circular, the Sellers have advised that the historical financial statements provided in Sections B to F of Part IV (Historical Financial Information) of this Circular, is the totality of the historical financial statements available with regard to the clusters of the NewCo Group. No financial statements are available for the NewCo Group post 30 September 2014. It is therefore not possible to report on the 2014E EBITDA for the NewCo Group and therefore on the pro forma net debt to EBITDA ratio of approximately 3.2x.

The 2014E EBITDA for the NewCo Group is estimated and unaudited. The EBITDA estimate represents information provided by the Sellers as adjusted by CRH for some minor normalisation differences.

CRH believes that the statement referring to the 2014E pro forma net debt / EBITDA ratio of approximately 3.2x is not misleading.

CRH remains strongly committed to investment grade credit ratings. Following CRH’s announcement confirming discussions were taking place with Lafarge and Holcim and the announcement, on 2 February 2015, of the proposed Acquisition, the following actions have taken place:

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As a result there has been no downgrade of CRH’s BBB+/Baa2/BBB ratings (respectively Standard and Poor’s/Moody’s/Fitch) since the announcement of the proposed Acquisition.

CRH has a strategy of active portfolio management which will continue post acquisition of the NewCo Group. CRH is exploring and will continue to explore options to involve partners for certain of the assets acquired to meet local regulatory requirements or CRH’s strategic objectives, though CRH has not entered into any such agreement concerning the assets of the NewCo Group as at the date of this Circular.

Due to the size of the NewCo Group in relation to the size of CRH, the Acquisition constitutes a Class 1 Transaction pursuant to the UKLA Listing Rules and is therefore both subject to and conditional upon the approval of Shareholders. An Extraordinary General Meeting is being convened for this purpose and will be held at 9.30 am on 19 March 2015 at the Clyde Court Hotel, Lansdowne Road, Dublin 4, Ireland. A Notice of Extraordinary General Meeting and of the Resolution to be proposed and considered at the Extraordinary General Meeting is set out on pages 166 and 167 of this Circular.

Key Terms

The CRH Group (through CRH International) has (i) made a binding irrevocable Offer to acquire the NewCo Group (excluding the Philippines Business) from Lafarge and Holcim, and (ii) entered into the Philippines SPA to acquire the Philippines Business from Lafarge Holdings (Philippines) Inc., Calumboyan Holdings, Inc., Round Royal Inc. and Southwestern Cement Ventures Inc., for an enterprise value of €6.5 billion.^*

Lafarge and Holcim may elect to accept the Offer following the conclusion of their works council consultation process and have full discretion whether to do so. The Offer will remain open for acceptance until the earlier of (a) two weeks following the conclusion of the works council consultation process and (b) 31 August 2015. It is expected that the works council consultation will take in the region of two to three months. If the Sellers accept the Offer, CRH will have no ability to withdraw from the deal and the agreed form Global SPA will come into effect. Certain pre-closing covenants in the Global SPA apply as from the date of the Binding Offer Letter.

The Global SPA is conditional on:

The long stop date for the Global SPA is the earlier of (a) three months following completion of the Merger and (b) 31 December 2015 but in any case no earlier than 31 August 2015.

Break Fees

If the Acquisition is not approved by CRH’s shareholders at the EGM, a termination fee of approximately €158 million in total (equivalent to 1% of CRH’s market capitalisation immediately prior to the date of the Acquisition Announcement) will be payable by CRH to Lafarge and Holcim.

If the EGM is not held by 21 March 2015, Lafarge and Holcim may terminate the Binding Offer Letter in which circumstances they would also be entitled to a termination fee of approximately €158 million.

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An equivalent termination fee of approximately €158 million in aggregate will be payable by Lafarge and Holcim to the CRH Group in either of the following circumstances:

Conditions

To proceed to closing of the Global SPA, the CRH Group requires:

The CRH Group has given “hell or high water” commitments to Lafarge and Holcim in the Global SPA in order to ensure it obtains all the required approvals to proceed to closing of the transaction. The Global SPA provides that, if, notwithstanding CRH’s commitments to take all steps and do all things necessary to obtain the required regulatory approvals, any approval is not obtained by the long stop date for the Global SPA, then:

If the business proposed to be acquired pursuant to the Global SPA is sold by the divestiture trustee for less than the price allocated to it in the Global SPA, this loss will be for the account of the CRH Group. Likewise, any profit on disposal will also accrue to the CRH Group.

CRH has agreed to “hell or high water” commitments and to the fallback divestment provisions referred to above to give Lafarge and Holcim the necessary execution certainty they require in the context of the Merger.

CRH does not anticipate any significant obstacle to obtaining all required regulatory approvals to the Global SPA.

Other Terms

The CRH Group has agreed to acquire the NewCo Group on a cash-free, debt-free basis, with normalised levels of working capital. The Global SPA and the Philippines SPA contain customary provisions to reflect this basis of acquisition.

The Global SPA contains customary warranties from Lafarge and Holcim in favour of the CRH Group, including in particular in relation to title, financial information on the NewCo Group’s (excluding the Philippines Business) compliance with law, antitrust, environmental matters, litigation, tax and material contracts. The warranties will be subject to disclosure of the contents of a virtual data room and are subject to customary limitations, including as to time, de minimis and deductible amounts and caps on liability. Separately, the Global SPA contains a limited number of specific indemnities in favour of the CRH Group. These indemnities are also subject to customary limitations.

CRH has agreed in the Global SPA that, for a period of not less than one year from closing of the Global SPA, it will, in respect of the NewCo Group, maintain employee benefits on at least as favourable terms to the current terms, to not close a plant in that period, and not to engage in any collective redundancy programme or mass lay-off.

Where CRH disposes of any business within the NewCo Group within 18 months of closing of the Global SPA, it has agreed to share any profit on disposal equally with Lafarge and Holcim.

If the Offer is accepted by Lafarge and Holcim, then in those circumstances the Global Tax Deed would be delivered on Closing. The Global Tax Deed is intended to indemnify the CRH Group against any pre-closing tax

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liabilities of the NewCo Group (excluding the Philippines Business), subject to exclusions and limitations, as well as addressing the conduct of tax matters.

Pursuant to the terms of the Global SPA and the Philippines SPA, CRH and the Sellers will enter into transitional services arrangements and other transitional related arrangements in respect of the NewCo Group at the closing of the Acquisition.

Philippines Transaction

A separate Philippines SPA has been entered into in respect of the Philippines Business, the terms of which are consistent in all material respects with the terms of the Global SPA (save as described in Part II (Principal Terms and Conditions of the Acquisition) of this Circular).

Further details of the terms of the Global SPA and the Philippines SPA are set out in Part II (Principal Terms and Conditions of the Acquisition) of this Circular.

CRH proposes to finance the Acquisition through existing cash resources, new bank facilities and the proceeds of a Placing of 74,039,915 new Ordinary Shares which raised gross proceeds of approximately €1.6 billion, and represented approximately 9.99% of CRH’s issued ordinary share capital before the Placing. Closing of the Placing and admission of the new Ordinary Shares to the Official Lists and to trading on the main markets of the London Stock Exchange and Irish Stock Exchange took place on 5 February 2015 in accordance with the terms of the Placing Agreement, the terms of which are summarised in Part VI (Additional Information) of this Circular.

On 1 February 2015, CRH agreed a €6.5 billion senior unsecured bridge loan facility (the “Facilities”) with Bank of America Merrill Lynch International Limited, J.P. Morgan Limited and UBS Limited (as bookrunners and mandated lead arrangers), Bank of America Merrill Lynch International Limited (as agent) and Bank of America, N.A., JP Morgan Chase Bank, N.A., London Branch and UBS AG, London Branch (as lenders) to support its offer for the NewCo Group. Since the initial agreement the Facilities have been reduced by €1.6 billion to reflect the Placing proceeds and a further €2.0 billion to reflect other cash balances which are intended to fund the Acquisition. As a result the Facilities now consist of a €0.4 billion Tranche A with an original maturity date of 31 December 2015, a €1.5 billion Tranche B with an original maturity date of 30 June 2016, and a €1.0 billion Tranche C with a maturity date of 30 June 2018. The full €2.9 billion amount of the Facilities is available to be utilised to complete the debt-funded portion of the Acquisition.

CRH has the option to extend the maturity dates of the outstanding commitments of each of Tranche A and Tranche B twice, each time by a period of six months. The drawn amount of the Facilities shall bear interest at the rate of EURIBOR plus a margin, which is subject to certain step-ups according to a time and credit ratings based schedule. The undrawn amount of the Facilities shall, from one month after the date of the Facilities, incur a fee calculated as a portion (which is subject to step-ups over time) of the margin. All payments in respect of interest and fees payable by CRH to the finance parties under the Facilities will be made in euro. The Facilities can be repaid prior to maturity without any break cost (provided that such repayment takes place at the end of the interest period applicable to the relevant loan being prepaid).

Subject to certain carve-outs, the Facilities contain provisions requiring mandatory prepayment from disposal proceeds and the proceeds of capital markets transactions. The Facilities contain customary representations and undertakings in relation to the Acquisition. The terms and conditions are otherwise substantially similar to CRH’s existing €2.5 billion revolving credit facility dated 11 June 2014.

CRH has a strong dividend track record, being one of the few companies within the sector to have maintained its dividend throughout the downturn. Following completion of the Acquisition, the dividend will remain a key focus for CRH. In this regard, while each dividend decision is made based on current trading and expectations regarding future performance, the Board anticipates that the Acquisition will result in significant earnings accretion and enhanced cash generation for the Combined Group.

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CRH attaches great importance to the skills and experience of the existing management and employees of the NewCo Group, who are expected to contribute to the success of the Combined Group.

On 11 November 2014, CRH issued an Interim Management Statement, which contained the following statement (extracted without material adjustment) on CRH’s current trading:

“Assuming normal weather patterns for the remainder of the year and a US dollar/euro exchange rate of 1.33* (2013: 1.3281), we expect EBITDA for the fourth quarter to be broadly similar to the strong performance in the final quarter of 2013. Against this backdrop, we reiterate our expectation for second-half EBITDA to be somewhat ahead of last year (H2 2013: €1.08 billion), resulting in expected full year EBITDA growth of c.10% in 2014 (2013: €1.475 billion).”

Since that date, the CRH Group’s trading performance continues to be in line with the Board’s expectations and we expect EBITDA for the full year ended 31 December 2014 to be not less than €1.625 billion with full year revenues of €18.9 billion. We expect year-end net debt to be approximately €2.5 billion (2013: €3.0 billion), with a net debt/EBITDA ratio of approximately 1.5 times. CRH will publish its preliminary results for the year ended 31 December 2014 on 26 February 2015.

NewCo Group’s estimated outturn for the year ended 31 December 2014 was marginally ahead of initial expectations, reflecting a strong finish to the year in the UK, while the results in the Philippines and Brazil were slightly behind expectations. NewCo is expected to generate 2014E revenue of €5.1 billion and EBITDA of €752 million.²

For a discussion of the risks and uncertainties which you should take into account when considering whether to vote in favour of the Resolution, please refer to Part III (Risk Factors) of this Circular.

The Acquisition is subject to the approval of Shareholders. Accordingly, an ordinary resolution will be proposed at the EGM for the purpose of seeking such approval.

Set out on pages 166 and 167 of this Circular is a notice convening an EGM, to be held at 9.30 am on 19 March 2015 at the Clyde Court Hotel, Lansdowne Road, Dublin 4, Ireland. This notice sets out the text of the ordinary resolution which will be proposed at the EGM to approve the Acquisition.

If passed, the Resolution will authorise the Acquisition substantially on the terms and subject to the Conditions, as summarised in Section 5 of Part I (Letter from the Chairman) of this Circular. The passing of the Resolution requires the support of a simple majority of the votes cast (whether in person or by proxy) in respect of the Resolution. If you would like to vote on the Resolution but cannot attend the EGM, you can appoint a proxy to exercise all or any of your rights to attend, vote and speak at the EGM by using one of the methods set out in the notes to the notice of the EGM.

Your attention is drawn to the further information set out in this Circular. Shareholders should read the whole of this Circular and not just rely on the summarised information set out in this letter.

You will find enclosed with this Circular a Form of Proxy for use at the EGM. Whether or not you intend to be present at the EGM in person, it is important that you complete and return the Form of Proxy (in accordance with the instructions printed thereon) and return it to the Company’s registrar, Capita Asset Services, Shareholder

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Solutions (Ireland), PO Box 7117, Dublin 2 (if delivered by post) or to Capita Asset Services, Shareholder Solutions (Ireland), 2 Grand Canal Square, Dublin 2, Ireland (if delivered by hand) as soon as possible and in any event so as to be received by no later than 9.30 am on 17 March 2015. You may also submit your proxies electronically using your investor code detailed on the Form of Proxy. The completion and return of the Form of Proxy will not preclude you from attending the EGM and voting in person if you wish to do so and are entitled.

CREST members may appoint one or more proxies through the CREST electronic proxy appointment service in accordance with the procedures described in the CREST Manual. CREST Personal Members or other CREST sponsored members who have appointed a voting service provider(s) should refer to their CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf. The message appointing a proxy(ies) must be received by the Registrar (ID 7RA08) not later than 9.30 am on 17 March 2015.

The Board, which has received financial advice from UBS, considers the terms of the proposed Acquisition to be fair and reasonable. In providing such financial advice to the Board, UBS has taken into account the Board’s commercial assessment of the proposed Acquisition.

The Board believes the proposed Acquisition and the Resolution to be in the best interests of the Shareholders as a whole and, accordingly, unanimously recommends that the Shareholders vote in favour of the Resolution to be proposed at the EGM, as each member of the Board intends to do in respect of their own beneficial holdings of, in aggregate, 319,740 Ordinary Shares, representing approximately 0.039% of the total number of voting rights in the Company as at 19 February 2015, being the last practicable day before the publication of this Circular.

Yours faithfully

Nicky Hartery

Chairman

For and on behalf of the Board

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PART II

PRINCIPAL TERMS AND CONDITIONS OF THE ACQUISITION

A summary of the essential terms of the Acquisition and the SPA is set out at Section 5 of Part I (Letter from the Chairman) of this Circular. Further details of the key terms of the SPA are set out below.

The CRH Group (through CRH International) has (i) made a binding irrevocable Offer to acquire the NewCo Group (excluding the Philippines Business) from Lafarge and Holcim, and (ii) entered into the Philippines SPA to acquire the Philippines Business from Lafarge Holdings (Philippines) Inc., Calumboyan Holdings, Inc., Round Royal Inc. and Southwestern Cement Ventures Inc., for an enterprise value of €6.5 billion.^* During the period of the Binding Offer Letter, Lafarge and Holcim have granted CRH exclusivity in respect of the assets and cannot engage with any other party in respect of their sale.

Lafarge and Holcim may elect to accept the Offer following the conclusion of their works council consultation process and have full discretion whether to do so. The Offer will remain open for acceptance until the earlier of (a) two weeks following the conclusion of the works council consultation process and (b) 31 August 2015. It is expected that the works council consultation will take in the region of two to three months. If the Sellers accept the Offer, CRH will have no ability to withdraw from the deal and the agreed form Global SPA will come into effect. Certain pre-closing covenants in the Global SPA will apply as from the date of the Binding Offer Letter.

The consideration payable by CRH will be €6.5 billion^* in cash, subject to certain agreed upon adjustments (including with respect to working capital, debt and agreed debt-like items at closing).

The Global SPA is conditional on:

As a Class 1 Transaction under the UKLA Listing Rules, the Acquisition is conditional on the approval of CRH’s shareholders.

The long stop date for the Global SPA is the earlier of (a) three months following completion of the Merger and (b) 31 December 2015 but in any case no earlier than 31 August 2015.

If the Acquisition is not approved by CRH’s shareholders at the EGM, a termination fee of approximately €158 million in total (equivalent to 1% of CRH’s market capitalisation immediately prior to the date of the Acquisition Announcement) will be payable by CRH to Lafarge and Holcim.

If the EGM is not held by 21 March 2015, Lafarge and Holcim may terminate the Binding Offer Letter in which circumstances they would also be entitled to a termination fee of approximately €158 million.

An equivalent termination fee of approximately €158 million in aggregate will be payable by Lafarge and Holcim to the CRH Group in either of the following circumstances:

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To proceed to closing of the Global SPA, the CRH Group requires:

The CRH Group has given “hell or high water” commitments to Lafarge and Holcim in the Global SPA in order to ensure it obtains all the required approvals to proceed to closing of the transaction. The Global SPA provides that, if, notwithstanding CRH’s commitment to take all steps and do all things necessary to obtain the required regulatory approvals, any approval is not obtained by the long stop date for the Global SPA, then:

If the business proposed to be acquired pursuant to the Global SPA is sold by the divestiture trustee for less than the price allocated to it in agreements, this loss will be for the account of the CRH Group. Likewise, any profit on disposal will also accrue to the CRH Group.

CRH has agreed to “hell or high water” commitments and to the divestment provisions referred to above to give Lafarge and Holcim the necessary execution certainty they require in the context of the Merger.

CRH does not anticipate any significant obstacle to obtaining all required regulatory approvals to the Global SPA.

The CRH Group has agreed to acquire the NewCo Group on a cash-free, debt-free basis, with normalised levels of working capital. The Global SPA and the Philippines SPA contain customary provisions to reflect this basis of acquisition.

The Global SPA contains customary warranties from Lafarge and Holcim in favour of the CRH Group, including in particular in relation to title, financial information on the NewCo Group’s (excluding the Philippines Business), compliance with law, antitrust, environmental matters, litigation, tax and material contracts. The warranties will be subject to disclosure of the contents of a virtual data room and are subject to customary limitations, including as to time, de minimis and deductible amounts and caps on liability.

Separately, the Global SPA contains a limited number of specific indemnities in favour of the CRH Group. CRH will be indemnified in respect of pre-closing taxes, certain antitrust matters, certain environmental matters and other specifically negotiated matters arising out of CRH’s due diligence. These indemnities are also subject to customary limitations.

The general warranties (warranties not in respect of tax, antitrust or environmental matters) shall survive until 30 June 2017. Warranties and indemnities in respect of antitrust or environmental matters shall survive for a period of five years after the closing date of the Acquisition. Other indemnities shall survive for a period of three years after the closing date of the Acquisition. Warranties and indemnities in respect of tax matters shall survive for a period of six years after the closing date of the Acquisition.

CRH has agreed in the Global SPA that, for a period of not less than one year from closing of the Global SPA, it will, in respect of the NewCo Group, maintain employee benefits on at least as favourable terms to the current terms, to not close a plant in that period, and not to engage in any collective redundancy programme or mass lay-off.

Where CRH disposes of any business within the NewCo Group in whole or in part within 18 months of closing, it has agreed to share any profit on disposal equally with Lafarge and/or Holcim, as applicable.

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If the Offer is accepted by Lafarge and Holcim, the Global Tax Deed will be delivered on Closing. The Global Tax Deed is intended to indemnify the CRH Group against any pre-closing tax liabilities of the NewCo Group (excluding the Philippines Business), subject to exclusions and limitations, as well as addressing the conduct of tax matters.

Pursuant to the terms of the Global SPA and the Philippines SPA, CRH and the Sellers will enter into transitional services arrangements and other transitional related arrangements in respect of the NewCo Group at the closing of the Acquisition.

The Philippines SPA and the Philippines Tax Deed are in all material respects consistent with the Global SPA and Global Tax Deed except in three important respects.

The Philippines SPA is conditional on CRH entering into arrangements with a local partner in the Philippines between now and closing of the Philippines SPA so as to comply with the laws of the Philippines in relation to restrictions on foreign ownership of certain Philippine assets. Once CRH has entered into a definitive agreement with a local partner, CRH can oblige Lafarge Holding (Philippines), Inc (LHPI) and the other sellers to sell the Philippines Business in accordance with the terms of the Philippines SPA (including the need to satisfy the other conditions to closing). Similarly, LHPI and the other sellers will have a reciprocal right to require that CRH and its local partner acquire the Philippines Business on the same terms.

CRH has had exploratory discussions with potential local partners and is confident that it will be able to finalise these co-ownership arrangements to enable completion of the Philippines SPA. If appropriate arrangements cannot be finalised by 15 August 2015, then in those circumstances, an independent investment bank will be appointed on a basis similar in all material respects to the divestiture trustee provisions of the Global SPA except that any profit on a disposal will be split 50:50 with LHPI and the other sellers and any loss will be for the account of CRH.

Second, while the Philippines SPA contains conditions to closing which are consistent with the conditions in the Global SPA, closing of the Philippines SPA is also conditional on the completion of the Global SPA.

Third, as part of the Philippines Business is contained in a listed company with minority shareholders, the CRH Group and the local partner will be required to make a mandatory cash tender offer to the minority shareholders on the same terms as those offered to LHPI and the other sellers in the Philippines SPA and which will be applicable to LHPI and the other sellers under the Philippines SPA at Closing. The mandatory tender offer will be structured such that completion of the mandatory tender offer will be contemporaneous with the completion of the Philippines SPA. It is intended that the sale of the listed shares which are the subject of the Philippines SPA will be effected by way of a special block sale on the Philippine Stock Exchange.

The Philippines Tax Deed will also be delivered on Closing. The Philippines Tax Deed is in substantially the same form as the Global Tax Deed but relates only to the Philippines Business.

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PART III

RISK FACTORS

The proposed Acquisition may give rise to certain risks which, if they occur, may have a material adverse effect on the business,  financial condition, results of operations or prospects of the CRH Group, as currently constituted, and/or the Combined Group (being the CRH Group, as currently constituted, supplemented by the proposed Acquisition, which will continue to be called CRH and have CRH plc as its ultimate parent). Accordingly, the risk factors set out in this Part III of this Circular should be afforded careful consideration together with all the other information set out in, or incorporated by reference into, this Circular in deciding whether to approve the Resolution being put to shareholders at an Extraordinary General Meeting of CRH plc.

The risks which the Directors consider to be material as at the date of this Circular are set out in this Part III. The risks described in this Part III are based on information known at the date of this Circular but may not be the only risks to which the CRH Group, as currently constituted, or the Combined Group, is or might be exposed. Additional risks and uncertainties, which are currently unknown to the CRH Group or that the CRH Group does not currently consider to be material, may adversely affect the business of  the CRH Group and/or the Combined Group and could have material adverse effects on the business, financial condition, results of  operations and future prospects of the CRH Group and/or the Combined Group. If any of the following risks were to materialise, the business, financial condition, results of operations and prospects of the CRH Group and/or the Combined Group could be materially adversely affected and the value of CRH Ordinary Shares could decline and shareholders could lose all or part of their investment in those Ordinary Shares.

Shareholders should read this Circular as a whole and not rely solely on the information set out in this section.

This section documents the principal transaction-specific risks and uncertainties presented by the proposed Acquisition.

Closing of the proposed Acquisition is subject to the satisfaction (or waiver, where applicable) of various conditions precedent.

Closing of the proposed Acquisition is subject to the fulfilment of conditions precedent, as described in the SPA and in more detail in Part II (Principal Terms and Conditions of the Acquisition) of this Circular, including shareholder approval of the Resolution to undertake the proposed Acquisition at an Extraordinary General Meeting of CRH plc and competition authority approval in certain jurisdictions. There can be no guarantee that these conditions precedent will be met, these approvals granted or that the proposed Acquisition will be completed as proposed or at all.

A failure to consummate the proposed Acquisition would give rise to a number of risks. The most material of these risks are the following:

Risks of executing the transaction could cause the market price of CRH’s Ordinary Shares to decline

The market price of CRH’s Ordinary Shares may decline as a result of the proposed Acquisition. Among other factors, the following could cause the market price of CRH’s Ordinary Shares to decline as a result of the proposed Acquisition:

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The Combined Group may fail, or may take longer than currently anticipated, to realise the perceived benefits of the proposed Acquisition. In addition, the Combined Group may encounter difficulties in integrating the acquired entities into pre-existing organisational structures.

There can be no assurance that the integration of the proposed Acquisition into the existing operations of the CRH Group will achieve the business growth opportunities, margin benefits, cost savings and other synergies anticipated by the CRH Board and management. Should the anticipated benefits and synergies fail to materialise or the quantum thereof falls short of expectations, the assumptions used to justify the consideration payable may prove to be incorrect and the results of operations and the financial condition of the Combined Group may be adversely affected.

The future prospects of the Combined Group will, in part, be dependent upon CRH’s ability to integrate the acquired entities. Some of the potential challenges in integration may not become known until after Closing. The key potential difficulties associated with integration of the NewCo Group could include the following:

Difficulties experienced in the integration process could potentially lead to, amongst other matters, higher integration costs, lower benefits or cost savings, interruption of business operations and loss of customers, suppliers or key personnel, which could have a material adverse effect on the business, results of operations, overall financial condition and prospects of the Combined Group.

Financing for the transaction (i) will increase the CRH Group’s and/or the Combined Group’s leverage and interest costs; (ii) may reduce operating flexibility under existing financial covenants; and (iii) may adversely impact credit ratings and the ability to obtain additional financing for future opportunities

In order to finance the proposed Acquisition, the CRH Group plans to use existing cash resources and enter into new bank facilities (as well as using the proceeds of the Placing by CRH of 74,039,915 new Ordinary Shares), which would increase its leverage and interest costs and may reduce its operating flexibility under the financial covenants for its existing debt and may adversely impact the CRH Group’s and/or the Combined Group’s credit ratings and its ability to obtain additional financing for future opportunities either in the medium or longer term. In addition, operating flexibility under the financial covenants for its existing indebtedness could decrease. The incurrence of this additional indebtedness and the related increase in funding costs could result in downgrades of credit ratings potentially making future financing more difficult to obtain due to limitations imposed by financial covenants and perceptions about the CRH Group’s and/or the Combined Group’s ability to meet its debt obligations.

Transaction-related costs may exceed expectations

Should the proposed Acquisition proceed, CRH will incur costs in integrating the acquired entities and in delivering the synergies identified. The actual costs incurred may exceed current estimates and additional and unforeseen expenses may arise in connection with the proposed Acquisition. In addition, CRH has incurred and

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will incur legal, accounting and transaction fees and other costs relating directly to the proposed Acquisition, the majority of which are payable irrespective of Closing. Such costs could materially and adversely affect the realisation of synergies and the results of operations of the CRH Group and/or the Combined Group.

Reliance on third party information

CRH has prepared the information in this Circular regarding the NewCo Group on the basis of the information which has been provided to CRH by the Sellers and their advisers in respect of the NewCo Group. Any failure by the Sellers to disclose matters that CRH is unaware of may affect the significance or accuracy of any such information. If any such undisclosed matters exist and are adverse to the NewCo Group, they may have an adverse effect on the Combined Group’s financial condition and results of operations and/or may result in additional costs or liabilities to the Combined Group.

This section documents those risks and uncertainties currently faced by the CRH Group, and following the proposed Acquisition, the Combined Group, which are potentially impacted by the proposed Acquisition. Given the heavyside materials focus of the proposed Acquisition, and the similarity of the businesses with existing operations, the CRH Board does not, as at the date of this Circular and subject to the introductory paragraphs on page 16, consider that material exposures will arise to previously unidentified risks.

Industry cyclicality

The level of construction activity in local and national markets is inherently cyclical being influenced by a wide variety of factors including global and national economic circumstances, ongoing austerity programmes in the developed world, governments’ ability to fund infrastructure projects, consumer sentiment and weather conditions. Financial performance may also be negatively impacted by unfavourable swings in fuel and other commodity/raw material prices. Failure of the CRH Group and/or the Combined Group to respond on a timely basis and/or adequately to unfavourable events beyond the CRH Group’s and/or the Combined Group’s control will adversely affect financial performance.

The CRH Group’s operating and financial performance is, and the Combined Group’s would be, influenced by general economic conditions and the state of the residential, industrial and commercial and infrastructure construction markets in the countries in which it operates, particularly in Europe and North America. Closing of the proposed Acquisition will extend or expand the geographic scope of the CRH Group’s existing heavyside activities in France & La Réunion, Germany, the United Kingdom, Hungary, Serbia, Romania, Slovakia, the United States, Canada, Brazil and the Philippines.

In general, economic uncertainty exacerbates negative trends in construction activity leading to postponement in orders. Construction markets are inherently cyclical and are affected by many factors that are beyond the CRH Group’s control, including:

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While economic conditions appear to be improving in the United States, a prolongation of or further deterioration in economic performance in Europe may result in further general reductions in construction activity in that area. Against this backdrop, the adequacy and timeliness of the actions taken by the CRH Group’s management team are of critical importance in maintaining financial performance at appropriate levels.

Each of the above factors could have a material adverse effect on the CRH Group’s and/or the Combined Group’s operating results and the market price of CRH plc’s Ordinary Shares.

Political and economic uncertainty

As an international business, the CRH Group operates, and the Combined Group would operate, in many countries with differing, and in some cases potentially fast-changing, economic, social and political conditions. These conditions could include political unrest, strikes, war and other forms of instability including natural disasters, epidemics, widespread transmission of diseases and terrorist attacks. With particular reference to developing markets, changes in these conditions, or in the governmental or regulatory requirements in any of the countries in which the CRH Group operates, or in which the Combined Group would operate, may adversely affect the business, results of operations, financial condition or prospects of the CRH Group and/or the Combined Group thus leading to possible impairment of financial performance and/or restrictions on future growth opportunities.

The adverse developments in eurozone economic performance in recent years, together with ongoing austerity programmes in various countries in Europe, have contributed to heightened global uncertainty. These uncertainties include whether the euro will continue as a unit of currency. While various actions have been taken by central banks and other institutions to stabilise the economic situation, the success of these actions cannot be guaranteed.

The CRH Group currently operates mainly in Western Europe and North America as well as, to a lesser degree, in developing countries/emerging markets in Eastern Europe, South America, China and India. The Combined Group would include a number of countries where the CRH Group does not currently have a significant presence, namely Serbia, Brazil and the Philippines. The economies of these countries are at varying stages of socioeconomic and macroeconomic development which could give rise to a number of risks, uncertainties and challenges and could include the following:

With regard to Ukraine, where the CRH Group has significant business interests, the outlook remains uncertain and the implications for construction activity in 2015 and beyond are unclear.

Commodity products and substitution

The CRH Group faces, and the Combined Group would face, strong volume and price competition across its product lines. In addition, existing products may be replaced by substitute products which the CRH Group and/or the Combined Group does not produce or distribute. Against this backdrop, if the CRH Group and/or the Combined Group fails to generate competitive advantage through differentiation and innovation across the value chain (for example, through superior product quality, engendering customer loyalty or excellence in logistics), market share, and thus financial performance, may decline.

The competitive environment in which the CRH Group operates, and the Combined Group would operate, can be significantly impacted by general economic conditions in combination with local factors including the number of competitors, the degree of utilisation of production capacity and the specifics of product demand. Across the multitude of largely local markets in which the CRH Group conducts business, and the Combined Group would

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conduct business, downward pricing pressure is experienced from time to time and the CRH Group and/or the Combined Group may not always be in a position to recover increased operating expenses (caused by factors such as increased fuel and raw material prices) through higher sale prices.

A number of the products sold by the CRH Group and/or the Combined Group (both those manufactured internally and those distributed) compete with other building products that do not feature in the existing product range. Any significant shift in demand preference from the CRH Group’s and/or the Combined Group’s existing products to substitute products, which the CRH Group and/or the Combined Group does not produce or distribute, could adversely impact market share and results of operations.

Acquisition activity

Growth through acquisition is a key element of the CRH Group’s strategy. The CRH Group and/or the Combined Group may not be able to continue to grow as contemplated in its business plan if it is unable to identify attractive targets (including potential new platforms for growth), execute full and proper due diligence, raise funds on acceptable terms, complete such acquisition transactions, integrate the operations of the acquired businesses and realise anticipated levels of profitability and cash flows. The CRH Group and/or the Combined Group may be liable for the past acts, omissions or liabilities of companies or businesses it has acquired, which may either be unforeseen or greater than anticipated at the time of the relevant acquisition.

The CRH Group’s acquisition strategy focuses on value-enhancing mid-sized acquisitions supplemented from time to time by larger strategic acquisitions into new markets or new building products. Subject to the factors highlighted below, the CRH Board intends that this will continue to be the case following completion of the proposed Acquisition.

The realisation of the CRH Group’s and/or the Combined Group’s acquisition strategy is dependent on the ability to identify and acquire suitable assets at appropriate prices thus satisfying the stringent cash flow and return on investment criteria underpinning such activities. The CRH Group and/or the Combined Group may not be able to identify such companies, and, even if identified, may not be able to acquire them because of a variety of factors including the outcome of due diligence processes, the ability to raise funds (as required) on acceptable terms, the need for competition authority approval in certain instances and competition for transactions from peers and other entities exploring acquisition opportunities in the building materials sector. If the proposed Acquisition is not completed, other acquisitions may not be identified and the Placing proceeds may be used for other corporate purposes. The CRH Group’s and/or the Combined Group’s ability to realise the expected benefits from acquisition activity depends, in large part, on its ability to integrate newly-acquired businesses in a timely and effective manner. Situations may arise where the CRH Group and/or the Combined Group may be liable for the past acts or omissions or liabilities of companies acquired; for example, the potential environmental liabilities addressed under the “Sustainability” Risk Factor below. Even if the CRH Group and/or the Combined Group is able to acquire suitable companies, it still may not be able to incorporate them successfully into the relevant legacy businesses and, accordingly, may be deprived of the expected benefits thus leading to potential dissipation and diversion of management resources and constraints on financial performance.

Joint ventures and associates

The CRH Group does not have, and the Combined Group would not have, a controlling interest in certain of the businesses (i.e. joint ventures and associates) in which it has invested and may invest. The absence of a controlling interest gives rise to increased governance complexity and a need for proactive relationship management, which may restrict the CRH Group’s and/or the Combined Group’s ability to generate adequate returns and to develop and grow these businesses.

Due to the absence of full control of joint ventures and associates, important decisions such as the approval of business plans and the timing and amount of cash distributions and capital expenditures, for example, may require the consent of partners or may be approved without the CRH Group’s consent.

These limitations could impair the CRH Group’s and/or the Combined Group’s ability to manage joint ventures and associates effectively and/or realise the strategic goals for these businesses. In addition, improper management or ineffective policies, procedures or controls for non-controlled entities could adversely affect the business, results of operations or financial condition of the relevant investment and, by corollary, the CRH Group and/or the Combined Group.

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Human resources

Existing processes to recruit, develop and retain talented individuals and promote their mobility may be inadequate thus giving rise to employee/management attrition and difficulties in succession planning and potentially impeding the continued realisation of the core strategy of performance and growth. In addition, the CRH Group and/or the Combined Group is exposed to various risks associated with collective representation of employees in certain jurisdictions. These risks could include strikes and increased wage demands with possible reputational consequences. The performance of the Combined Group would, amongst other things, be dependent on the retention and motivation of certain key management currently employed within the entities the CRH Group is proposing to acquire.

The identification and subsequent assessment, management, development and deployment of talented individuals is of major importance in continuing to deliver on the CRH Group’s and/or the Combined Group’s core strategy of performance and growth and in ensuring that succession planning objectives for key executive roles throughout its international operations are satisfied. Programmes designed to focus on performance management skills and leadership development may not achieve their desired objectives.

The maintenance of positive employee and trade/labour union relations is key to the successful operation of the CRH Group and/or the Combined Group. Some of the CRH Group’s employees, and those employed in the NewCo Group, are represented by trade/labour unions under various collective agreements. For unionised employees, the CRH Group and the individual entities within the NewCo Group may not be able to renegotiate satisfactorily the relevant collective agreements upon expiration and may face tougher negotiations and higher wage demands than would be the case for non-unionised employees. In addition, existing labour agreements may not prevent a strike or work stoppage with any such activity creating reputational risk and potentially having a material adverse effect on the results of operations and financial condition of the CRH Group and/or the Combined Group.

Corporate Communications

As a publicly-listed company, the CRH Group undertakes, and the Combined Group would undertake, regular communication with its stakeholders. Given that these communications may contain forward-looking statements, which by their nature involve uncertainty, actual results and developments may differ from those communicated due to a variety of external and internal factors giving rise to reputational risk.

The CRH Group places, and the Combined Group would place, great emphasis on timely and relevant corporate communications with overall responsibility for these matters being vested in senior management at the Group Head Office (largely the Chief Executive, the Finance Director, the Head of Investor Relations and the Group Director, Corporate Affairs) supported by engagement with highly experienced external advisors, where appropriate. The strategic, operational and financial performance of the CRH Group and of its constituent entities, including following the proposed Acquisition, the NewCo Group, is reported to the Board on a monthly basis with all results announcements and other externally-issued documentation (e.g. the Annual Report on Form 20-F) being discussed by the Board/Audit Committee prior to release.

Cyber and information technology

As a result of the proliferation of information technology in the world today, the CRH Group is, and the Combined Group would be, dependent on the employment of advanced information systems and is exposed to risks of failure in the operation of these systems. Further, the CRH Group is, and the Combined Group would be, exposed to security threats to its digital infrastructure through cyber-crime which might lead to interference with production processes, manipulation of financial data, the theft of private data or misrepresentation of information via digital media. In addition to potential irretrievability or corruption of critical data, the CRH Group and/or the Combined Group could suffer reputational losses and incur significant financial costs in remediation. Such attacks are by their nature technologically sophisticated and may be difficult to detect and defend in a timely fashion.

The CRH Group attaches importance to addressing security and cyber threats to its digital infrastructure given the increasing sophistication and evolving nature of these threats. Such attacks may result in interference with production software, corruption or theft of sensitive data, manipulation of financial data accessible through its digital infrastructure, or reputational losses as a result of misrepresentation via social media and other websites. While the CRH Group has made a significant investment in upgrading its digital infrastructure and governance processes with the overall objective of further enhancing system security, there can be no assurance that future attacks will not be successful due to their increasing sophistication and the difficulties in detecting and defending against them in a timely fashion.

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Sustainability

The CRH Group is, and the Combined Group would be, subject to stringent and evolving laws, regulations, standards and best practices in the area of sustainability (comprising corporate governance, environmental management and climate change (specifically capping of emissions), health and safety management and social performance) which may give rise to increased ongoing remediation and/or other compliance costs and may adversely affect the CRH Group’s and/or the Combined Group’s business, results of operations, financial condition and/or prospects.

The CRH Group is, and the Combined Group would be, subject to a broad and increasingly stringent range of existing and evolving laws, regulations, standards and best practices with respect to governance, the environment and health and safety measures in each of the jurisdictions in which it operates/would operate giving rise to significant compliance costs, potential legal liability exposure and potential limitations on the development of its operations. These laws, regulations, standards and best practices relate to, amongst other things, climate change, noise, emissions to air, water and soil, the use and handling of hazardous materials and waste disposal practices. Given the above, the risk of increased environmental and other compliance costs and unplanned capital expenditure is inherent in conducting business in the building materials sector and the impact of future developments in these respects on the CRH Group’s and/or the Combined Group’s activities, products, operations, profitability and cash flow cannot be estimated; there can therefore be no assurance that material liabilities and costs will not be incurred in the future or that material limitations on the development of its operations will not arise.

Environmental and health and safety and other laws, regulations, standards and best practices may expose the CRH Group and/or the Combined Group to the risk of substantial costs and liabilities, including liabilities associated with assets that have been sold or acquired and activities that have been discontinued. In addition, many of the CRH Group’s manufacturing sites have a history of industrial use and, while strict environmental operating standards are applied and extensive environmental due diligence is undertaken in acquisition activity, some soil and groundwater contamination has occurred in the past at a limited number of sites. Although the associated remediation costs incurred to date have not been material, they may become more significant in the future. Despite the CRH Group’s policy and efforts to comply with all applicable environmental and health and safety laws, it may face increased remediation liabilities and additional legal proceedings concerning environmental and health and safety matters in the future.

Based on information currently available, the CRH Group has budgeted capital and revenue expenditures for environmental improvement projects and has established reserves for known environmental remediation liabilities that are probable and reasonably capable of estimation. These figures are not material in the context of the CRH Group. However, neither the CRH Group nor the Combined Group can predict environmental and health and safety matters with certainty, and budgeted amounts and established reserves may not be adequate for all purposes. In addition, the development or discovery of new facts, events, circumstances or conditions, including future decisions to close plants, which may trigger remediation liabilities, and other developments such as changes in laws or increasingly strict enforcement by governmental authorities, could result in increased costs and liabilities or prevent or restrict some of the operations of the CRH Group and/or the Combined Group, which in turn could have a material adverse effect on the reputation, business, results of operations and overall financial condition of the CRH Group and/or the Combined Group.

Laws and regulations

The CRH Group is, and the Combined Group would be, subject to many local and international laws and regulations, including those relating to competition law, corruption and fraud, across many jurisdictions of operation and is/would be exposed to changes in those laws and regulations and to the outcome of any investigations conducted by governmental, international and other regulatory authorities, which may result in the imposition of fines and/or sanctions for non-compliance, and may potentially inflict reputational damage.

The CRH Group is, and the Combined Group would be, subject to various statutes, regulations and laws applicable to businesses generally in the countries and markets in which it operates/would operate. These include statutes, regulations and laws affecting land usage, zoning, labour and employment practices, competition, financial reporting, taxation, anti-bribery, anti-corruption, governance and other matters. The CRH Group mandates that its employees comply with its Code of Business Conduct which stipulates best practices in relation to regulatory matters. Neither the CRH Group, nor the Combined Group, can guarantee that their employees will at all times be successful in complying with all demands of regulatory agencies in a manner which will not materially adversely affect the business, results of operations, financial condition or prospects of the CRH Group or the Combined Group.

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The CRH Group seeks to comply fully with legislation such as the Foreign Corrupt Practices Act in the United States and the Bribery Act in the United Kingdom and has put in place significant internal controls and compliance policies and procedures. However, there can be no assurance that such established policies and procedures will afford adequate protection against fraudulent and/or corrupt activity and any such activity could have a material adverse effect on the CRH Group’s and/or the Combined Group’s business, results of operations, financial condition or prospects.

Financial instruments (interest rate and leverage, foreign currency, counterparty, credit ratings and liquidity)

The CRH Group uses, and, the Combined Group would use, financial instruments throughout its businesses giving rise to interest rate and leverage, foreign currency, counterparty, credit rating and liquidity risks. A significant portion of the cash generated by the CRH Group and/or the Combined Group from operational activity is currently/would be dedicated to the payment of principal and interest on indebtedness. In addition, the CRH Group has entered into certain financing agreements containing restrictive covenants requiring it to maintain a certain minimum interest coverage ratio and a certain minimum net worth.

Interest rate and leverage risks: The CRH Group’s exposures to changes in interest rates result from investing and borrowing activities undertaken to manage liquidity and capital requirements and stem predominantly from long-term debt obligations. Borrowing costs are managed through employing a mix of fixed and floating rate debt and interest rate swaps, where appropriate. On Closing, the Combined Group will have significant outstanding indebtedness, which may impair its operating and financial flexibility over the longer term and could adversely affect its business, results of operations and financial position. This high level of indebtedness could give rise to the Combined Group dedicating a substantial portion of its cash flow to debt service thereby reducing the funds available in the longer term for working capital, capital expenditure, acquisitions, distributions to shareholders and other general corporate purposes and limiting its ability to borrow additional funds and to respond to competitive pressures. In addition, the increased level of indebtedness as a result of the proposed Acquisition may give rise to a general increase in interest rates borne and there can be no assurance that the Combined Group will not be adversely impacted by increases in borrowing costs in the future.

For the year ended 31 December 2013, PBITDA/net interest (all as defined in the relevant agreements), which is the CRH Group’s principal financial covenant, was 6.3 times; we anticipate that, aside from the impact of once-off costs arising on acquisition, PBITDA/net interest cover will be largely unchanged as a result of the proposed Acquisition. The prescribed minimum PBITDA/net interest cover ratio is 4.5 times and the prescribed minimum net worth is €5 billion.

Foreign currency risks: If the euro, which is the CRH Group’s reporting currency, weakens relative to the basket of foreign currencies in which net debt is denominated (principally the US Dollar, Pound Sterling and the Swiss Franc), the net debt balance would increase; the converse would apply if the euro was to strengthen. The CRH Group’s established policy to spread its net worth across the currencies of its operations, with the objective of limiting its exposure to individual currencies and thus promoting consistency with geographical balance, may not be successful.

Counterparty risks: Insolvency of the financial institutions with which the CRH Group and/or the Combined Group conducts business, or a downgrade in their credit ratings, may lead to losses in derivative assets and cash and cash equivalents balances or render it more difficult either to utilise existing debt capacity or otherwise obtain financing for operations. The maximum exposure arising in the event of default on the part of the counterparty (including insolvency) is the carrying amount of the relevant financial instrument.

Credit rating risks: A downgrade of the CRH Group’s and or the Combined Group’s credit ratings may give rise to increases in funding costs in respect of future debt and may, among other concerns, impair its ability to access debt markets or otherwise raise funds or enter into letters of credit, for example, on acceptable terms. Such a downgrade may result from factors specific to the CRH Group and/or the Combined Group, including as a result of the increased indebtedness resulting from the proposed Acquisition, or from other factors such as general economic or sector-specific weakness or sovereign credit rating ceilings.

Liquidity risks: The principal liquidity risks stem from the maturation of debt obligations and derivative transactions. The CRH Group aims to achieve flexibility in funding sources through a variety of means including (i) maintaining cash and cash equivalents with a number of highly-rated counterparties; (ii) limiting the maturity

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of such balances; (iii) meeting the bulk of debt requirements through committed bank lines or other term financing; and (iv) having surplus committed lines of credit. However, market or economic conditions may make it difficult at times to realise this objective.

Defined benefit pension schemes and related obligations

The CRH Group, and various entities within the NewCo Group, operate a number of defined benefit pension schemes and related obligations (e.g. termination indemnities and jubilee/long-term service benefits, which are accounted for as defined benefit) in certain of their operating jurisdictions.

The assets and liabilities of defined benefit pension schemes may exhibit significant period-on-period volatility attributable primarily to asset values, changes in bond yields/discount rates and anticipated longevity. In addition to the contributions required for the ongoing service of participating employees, significant cash contributions may be required to remediate deficits applicable to past service. In addition, fluctuations in the accounting surplus/deficit may adversely impact credit metrics thus harming the CRH Group’s and/or the Combined Group’s ability to raise funds.

The assumptions used in the recognition of pension assets, liabilities, income and expenses (including discount rates, rate of increase in future compensation levels, mortality rates and healthcare cost trend rates) are updated based on market and economic conditions at the respective balance sheet date and for any relevant changes to the terms and conditions of the pension and post-retirement plans. These assumptions can be affected by (i) for the discount rate, changes in the rates of return on high-quality fixed income investments; (ii) for future compensation levels, future labour market conditions and anticipated inflation; (iii) for mortality rates, changes in the relevant actuarial funding valuations or changes in best practice; and (iv) for healthcare cost trend rates, the rate of medical cost inflation in the relevant regions. A prolonged period of financial market instability would have an adverse impact on the valuations of pension scheme assets.

In addition, a number of the defined benefit pension schemes in operation throughout the CRH Group have reported material funding deficits thus necessitating remediation either in accordance with legislative requirements or as agreed with the relevant regulators. The extent of such contributions may be exacerbated over time as a result of a prolonged period of instability in worldwide financial markets.

Adequacy of insurance arrangements and related counterparty exposures

The building materials sector is subject to a wide range of operating risks and hazards, not all of which can be covered, adequately or at all, by insurance; these risks and hazards would include climatic conditions such as floods and hurricanes/cyclones, seismic activity, technical failures, interruptions to power supplies, industrial accidents and disputes, environmental hazards, fire and crime. In its worldwide insurance programme, into which the NewCo Group would be assimilated, the CRH Group provides coverage for its operations at a level believed to be commensurate with the associated risks. In the event of failure of one or more of its insurance counterparties, the CRH Group and/or the Combined Group could be impacted by losses where recovery from such counterparties is not possible.

Insurance protection is maintained with leading, highly-rated international insurers with appropriate risk retention by wholly-owned insurance companies (captive insurers) and by insured entities in the context of the deductibles/excesses borne. The coverage includes property damage and business interruption, public and products liability/general liability, employer’s liability/workmens’ compensation, environmental impairment liability, automobile liability and directors’ and officers’ liability. Adequate coverage at reasonable rates is not always commercially available to cover all potential risks and no assurance can be given that the insurance arrangements in place would be sufficient to cover all losses or liabilities to which the CRH Group and/or the Combined Group might be exposed. The occurrence of a significant adverse event not covered, or only partially covered, by insurance could have a material adverse impact on the business, results of operations, financial condition or prospects of the CRH Group and/or the Combined Group.

Foreign currency translation

The CRH Group’s activities are conducted primarily in the local currency of the country of operation resulting in low levels of foreign currency transactional risk. This situation is equally applicable to the activities of the NewCo Group. The principal foreign exchange risks to which the consolidated financial statements of the CRH Group are exposed pertain to adverse movements in reported results when translated into euro (which is the CRH Group’s, and would be the Combined Group’s, reporting currency) together with declines in the euro value of net

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investments, which are denominated in a wide basket of currencies other than the euro. Closing of the proposed Acquisition will increase exposure to a number of currencies, which have hitherto been immaterial, and will introduce exposures to some new currencies. The most significant currency exposures for the Combined Group will be the US Dollar, the Canadian Dollar, the Swiss Franc, the Polish Zloty, the Pound Sterling and the Philippine Peso.

Goodwill impairment

Significant under-performance in any of the CRH Group’s and/or the Combined Group’s major cash-generating units or the divestment of businesses in the future may give rise to a material write-down of goodwill, which would have a substantial impact on income and equity.

Inspections by the Public Company Accounting Oversight Board (“PCAOB”)

CRH’s auditors, like other independent registered public accounting firms operating in Ireland and a number of other European countries, are not currently permitted to be subject to inspection by the PCAOB, and as such, investors are deprived of the benefits of PCAOB inspections.

CRH’s auditors are required by United States law to undergo regular PCAOB inspections to assess their compliance with United States law and professional standards in connection with their audits of financial statements filed with the SEC. Under Irish law, the PCAOB is currently unable to inspect and evaluate the audit work and quality control procedures of auditors in Ireland. Accordingly, investors who rely on CRH’s auditors’ audit reports are deprived of the benefits of PCAOB inspections of auditors.

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PART IV

HISTORICAL FINANCIAL INFORMATION

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SECTION A

ACCOUNTING POLICIES

Key Accounting Policies which involve Estimates, Assumptions and Judgements

The preparation of the Historical Combined Financial Information^* requires management to make certain estimates, assumptions and judgements that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Management believes that the estimates, assumptions and judgements upon which it relies are reasonable based on the information available to it at the time that those estimates, assumptions and judgements are made. In some cases, the accounting treatment of a particular transaction is specifically dictated by IFRS and does not require management’s judgement in its application.

Management consider that their use of estimates, assumptions and judgements in the application of accounting policies are inter-related and therefore discuss them together below. The critical accounting policies which involve significant estimates or assumptions or judgements, the actual outcome of which could have a material impact on the results and financial position outlined below, are as follows:

Impairment of long-lived assets and goodwill

Impairment of property, plant and equipment and goodwill

The carrying values of items of property, plant and equipment are reviewed for indicators of impairment at each reporting date and are subject to impairment testing when events or changes in circumstances indicate that the carrying values may not be recoverable. Goodwill is subject to impairment testing on an annual basis and at any time during the period if an indicator of impairment is considered to exist. A decision to dispose of a business unit represents one such indicator and in these circumstances the recoverable amount is assessed on a fair value less costs of disposal basis. In the period in which a business combination is effected and where some or all of the goodwill allocated to a particular cash-generating unit arose in respect of that combination, the cash-generating unit is tested for impairment prior to the end of the relevant annual period.

Property, plant and equipment assets are reviewed for potential impairment by applying a series of external and internal indicators specific to the assets under consideration; these indicators encompass macroeconomic issues including the inherent cyclicality of the building materials sector, actual obsolescence or physical damage, a deterioration in forecast performance in the internal reporting cycle and restructuring and rationalisation programmes.

Where the carrying value exceeds the estimated recoverable amount (being the greater of fair value less costs of disposal and value-in-use), an impairment loss is recognised by writing down the assets to their recoverable amount. In assessing value-in-use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the future cash flow estimates have not been adjusted. The estimates of future cash flows exclude cash inflows or outflows attributable to financing activities and income tax. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined by reference to the cash-generating unit to which the asset belongs. Impairment losses arising in respect of goodwill are not reversed once recognised.

Goodwill relating to associates and joint ventures is included in the carrying amount of the investment and is neither amortised nor individually tested for impairment. Where indicators of impairment of an investment arise in accordance with the requirements of IAS 39 Financial Instruments: Recognition and Measurement, the carrying amount is tested for impairment by comparing its recoverable amount with its carrying amount.

The impairment testing process requires management to make significant judgements and estimates regarding the future cash flows expected to be generated by the use of and, if applicable, the eventual disposal of, long-lived assets and goodwill as well as other factors to determine the fair value of the assets. Management periodically evaluates and updates the estimates based on the conditions which influence these variables.

The assumptions and conditions for determining impairments of long-lived assets and goodwill reflect management’s best assumptions and estimates, but these items involve inherent uncertainties described above, many of which are not under management’s control. As a result, the accounting for such items could result in different estimates or amounts if management used different assumptions or if different conditions occur in future accounting periods.

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Retirement benefit obligations

Costs arising in respect of defined contribution pension schemes are charged to the Combined Income Statement in the period in which they are incurred. There are no legal or constructive obligations to pay further contributions in the event that the fund does not hold sufficient assets to meet its benefit commitments.

The liabilities and costs associated with defined benefit pension schemes (both funded and unfunded) are assessed on the basis of the projected unit credit method by professionally qualified actuaries and are arrived at using actuarial assumptions based on market expectations at the balance sheet date. The discount rates employed in determining the present value of the schemes’ liabilities are determined by reference to market yields at the balance sheet date on high-quality corporate bonds of a currency and term consistent with the currency and term of the associated post-employment benefit obligations.

The net surplus or deficit arising on defined benefit pension schemes, together with the liabilities associated with the unfunded schemes, are shown either within non-current assets or non-current liabilities in the Combined Balance Sheet. The deferred tax impact of pension scheme surpluses and deficits is disclosed separately within deferred tax assets or liabilities as appropriate. Re-measurements, comprising of actuarial gains and losses and the return on plan assets (excluding net interest), are recognised immediately in the Combined Balance Sheet with a corresponding debit or credit to retained earnings through other comprehensive income in the period in which they occur. Re-measurements are not reclassified to profit or loss in subsequent periods.

The defined benefit pension asset or liability in the Combined Balance Sheet comprises the total for each plan of the present value of the defined benefit obligation less the fair value of plan assets out of which the obligations are to be settled directly. Plan assets are assets that are held by a long-term employee benefit fund or qualifying insurance policies. Fair value is based on market price information and, in the case of published securities, it is the published bid price. The value of any defined benefit asset is limited to the present value of any economic benefits available in the form of refunds from the plan and reductions in the future contributions to the plan.

Obligations in respect of post-employment healthcare and life assurance benefits represents the amount of future benefit that employees have earned in return for service in the current and prior periods. The obligation is computed on the basis of the projected unit credit method and is discounted to present value using a discount rate equating to the market yield at the balance sheet date on high-quality corporate bonds of a currency and term consistent with the currency and estimated term of the post-employment obligations.

The assumptions underlying the actuarial valuations from which the amounts recognised in the Historical Combined Financial Information are determined (including discount rates, rates of increase in future compensation levels, mortality rates and healthcare cost trend rates) are updated annually based on current economic conditions and for any relevant changes to the terms and conditions of the pension and post-retirement plans. These assumptions can be affected by (i) for the discount rate, changes in the rates of return on high-quality corporate bonds; (ii) for future compensation levels, future labour market conditions and (iii) for healthcare cost trend rates, the rate of medical cost inflation in the relevant regions.

While management believes that the assumptions used are appropriate, differences in actual experience or changes in assumptions may affect the obligations and expenses recognised in future accounting periods. The assets and liabilities of defined benefit pension schemes may exhibit significant period-on-period volatility attributable primarily to changes in bond yields and longevity. In addition to future service contributions, significant cash contributions may be required to remediate past service deficits.

Provisions for liabilities

A provision is recognised when there is a present obligation (either legal or constructive) as a result of a past event, it is probable that a transfer of economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where it is anticipated that a provision will be reimbursed, the reimbursement is recognised as a separate asset only when it is virtually certain that the reimbursement will arise. The expense relating to any provision is presented in the Combined Income Statement net of any reimbursement. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation. The increase in the provision due to passage of time is recognised as an interest expense. Provisions arising on business combination activity are recognised only to the extent that they would have qualified for recognition in the financial statements of the acquiree prior to acquisition. Provisions are not recognised for future operating losses.

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Rationalisation and redundancy provisions

Provisions for rationalisation and redundancy are established when a detailed restructuring plan has been drawn up, resolved upon by the responsible decision-making level of management and communicated to the employees who are affected by the plan. These provisions are recognised at the present value of future disbursements and cover only expenses that arise directly from restructuring measures and are necessary for restructuring; these provisions exclude costs related to future business operations. Restructuring measures may include the sale or termination of business units, site closures, and relocation of business activities, changes in management structure or a fundamental reorganisation of departments or business units.

Environmental and remediation provisions

The measurement of environmental and remediation provisions is based on an evaluation of currently available facts with respect to each individual site and considers factors such as existing technology, currently enacted laws and regulations and prior experience in remediation of sites. Inherent uncertainties exist in such evaluations primarily due to unknown conditions, changing governmental regulations and legal standards regarding liability, the protracted length of the clean-up periods and evolving technologies. The environmental and remediation liabilities provided for in the Historical Combined Financial Information reflect the information available to management at the time of determination of the liability and are adjusted periodically as remediation efforts progress or as additional technical or legal information becomes available. Due to the inherent uncertainties described above, many of which are not under management’s control, the accounting for such items could result in different amounts if management used different assumptions or if different conditions occur in future accounting periods.

Legal contingencies

The status of each significant claim and legal proceeding is reviewed by management on a periodic basis and the potential financial exposure is assessed. If the potential loss from any claim or legal proceeding is considered probable, and the amount can be estimated, a liability is recognised for the estimated loss. Because of the uncertainties inherent in such matters, the related provisions are based on the best information available at the time; the issues taken into account by management and factored into the assessment of legal contingencies include, as applicable, the status of settlement negotiations, interpretations of contractual obligations, prior experience with similar contingencies/claims, the availability of insurance to protect against the downside exposure and advice obtained from legal counsel and other third parties. As additional information becomes available on pending claims, the potential liability is reassessed and revisions are made to the amounts accrued where appropriate. Such revisions in the estimates of the potential liabilities could have a material impact on results of operations and financial position.

Taxation – current and deferred

Current tax represents the expected tax payable (or recoverable) on the taxable profit for the period using tax rates enacted for the period. Any interest or penalties arising are included within current tax. Where items are accounted for outside of profit or loss, the related income tax is recognised either in other comprehensive income or directly in equity as appropriate.

Deferred tax is recognised using the liability method on temporary differences arising at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts in the Historical Combined Financial Information. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill; in addition, deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. For the most part, no provision has been made for temporary differences applicable to investments in subsidiaries and joint ventures as the timing of reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future. However, a temporary difference has been recognised to the extent that specific assets have been identified for sale or where there is a specific intention to unwind the temporary difference in the foreseeable future. Due to the absence of control in the context of associates (significant influence only), deferred tax liabilities are recognised where appropriate in respect of investments in these entities on the basis that the exercise of significant influence would not necessarily prevent earnings being remitted by other shareholders in the undertaking.

Deferred tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets and liabilities are not subject to discounting.

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Deferred tax assets are recognised in respect of all deductible temporary differences, carry-forward of unused tax credits and unused tax losses to the extent that it is probable that taxable profits will be available against which the temporary differences can be utilised. The carrying amounts of deferred tax assets are subject to review at each balance sheet date and are reduced to the extent that future taxable profits are considered to be inadequate to allow all or part of any deferred tax asset to be utilised.

The income tax charge is based on reported profit and expected statutory tax rates, which reflect various allowances and reliefs and tax planning opportunities available. The determination of the provision for income tax requires certain judgements and estimates in relation to matters where the ultimate tax outcome may not be certain. The recognition or non-recognition of deferred tax assets as appropriate also requires judgement as it involves an assessment of the future recoverability of those assets. In addition, tax audits may involve complex issues that could require extended periods for resolution. Although management believes that the estimates included in the Historical Combined Financial Information and tax return positions are reasonable, no assurance can be given that the final outcome of these matters will not be different than that which is reflected in the historical income tax provisions and accruals. Any such differences could have a material impact on the income tax provision and profit for the period in which such a determination is made.

Property, plant and equipment

Property, plant and equipment are stated at cost less any accumulated depreciation and any accumulated impairments.

Repair and maintenance expenditure is included in an asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item represent an inflow and the cost of the item can be measured reliably. All other repair and maintenance expenditure is charged to the Combined Income Statement during the financial period in which it is incurred.

Borrowing costs incurred in the construction of major assets which take a substantial period of time to complete are capitalised in the financial period in which they are incurred.

Judgement is exercised in the determination of residual values and useful lives. Depreciation and depletion is calculated to write off the book value of each item of property, plant and equipment over its useful economic life on a straight-line basis at the following rates:

Land and buildings: The book value of mineral-bearing land, less an estimate of its residual value, is depleted over the period of the mineral extraction in the proportion which production for the period bears to the latest estimates of proven and probable mineral reserves. Land other than mineral-bearing land is not depreciated.

Plant and machinery: These are depreciated over the useful economic life of the asset.

Depreciation methods, useful lives and residual values are reviewed at each financial year-end. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are accounted for by changing the depreciation period or method as appropriate on a prospective basis.

Other Significant Accounting Policies

Investments in associates and joint ventures

Investments in associates and joint ventures are accounted for using the equity method from the date significant influence/joint control is deemed to arise until the date on which significant influence/joint control ceases to exist.

The Combined Income Statement reflects the operation’s share of profit after tax of the related associates and joint ventures. Investments in associates and joint ventures are carried in the Combined Balance Sheet at cost adjusted in respect of post-acquisition changes in the operation’s share of net assets, less any impairment in value. Loans advanced to equity accounted investments that have the characteristics of equity financing are also included in the investment held on the Combined Balance Sheet. If necessary, impairment losses on the carrying amount of an investment are reported within share of equity accounted investments results in the Combined Income Statement.

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Revenue recognition

Revenue represents the value of goods and services supplied and is net of trade discounts and value added tax/sales tax. Other than in the case of construction contracts, revenue is recognised to the extent that revenue and related costs incurred or to be incurred are subject to reliable measurement, that it is probable that there will be an inflow of economic benefits and that the significant risks and rewards of ownership have passed to the buyer, usually on delivery of the goods.

Construction contracts

When the outcome of a contract can be estimated reliably, revenue is recognised in accordance with the percentage-of-completion method. The completion percentage is generally measured based on the proportion of contract costs incurred at the balance sheet date relative to the total estimated costs of the contract. When the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised only to the extent of contract costs incurred where it is probable that these costs will be recoverable.

When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised immediately as an expense. Revenue and/or costs in respect of variations or contracts claims and incentive payments, to the extent that they arise, are recognised when it is probable that the amount, which can be measured reliably, will be recovered from/paid to the customer.

If circumstances arise that may change the original estimates of revenues, costs or extent of progress towards completion, estimates are revised. These revisions may result in increases or decreases in revenue or costs and are reflected in income in the period in which the circumstances that give rise to the revision became known by management.

Business combinations

The acquisition method is applied in accounting for business combinations. The cost of an acquisition is measured as the aggregate of the consideration transferred (excluding amounts relating to the settlement of pre-existing relationships), the amount of any non-controlling interest in the acquiree and, in a business combination achieved in stages, the acquisition-date fair value of the acquirer’s previously-held equity interest in the acquiree. Transaction costs are expensed as incurred.

To the extent that settlement of all or any part of consideration for a business combination is deferred, the fair value of the deferred component is determined through discounting the amounts payable to their present value at the date of exchange. The discount component is unwound as an interest charge in the Combined Income Statement over the life of the obligation. Any contingent consideration is recognised at fair value at the acquisition date and included in the cost of the acquisition. The fair value of contingent consideration at acquisition date is arrived at through discounting the expected payment (based on scenario modelling) to present value. In general, in order for contingent consideration to become payable, pre-defined profit and/or profit/net asset ratios must be exceeded. Subsequent changes to the fair value of the contingent consideration will be recognised in profit or loss unless the contingent consideration is classified as equity, in which case it is not remeasured and settlement is accounted for within equity.

The assets and liabilities arising on business combination activity are measured at their acquisition-date fair values. Contingent liabilities assumed in business combination activity are recognised as of the acquisition date, where such contingent liabilities are present obligations arising from past events and their fair value can be measured reliably. In the case of a business combination achieved in stages, the acquisition-date fair value of the acquirer’s previously-held equity interest in the acquiree is remeasured to fair value as at the acquisition date through profit or loss. When the initial accounting for a business combination is determined provisionally, any adjustments to the provisional values allocated to the consideration, identifiable assets or liabilities (and contingent liabilities, if relevant) are made within the measurement period, a period of no more than one year from the acquisition date.

Goodwill

Goodwill arising on a business combination is initially measured at cost, being the excess of the cost of an acquisition over the net identifiable assets and liabilities assumed at the date of acquisition and relates to the future economic benefits arising from assets which are not capable of being individually identified and separately recognised. Following initial recognition, goodwill is measured at cost less any accumulated impairment losses.

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If the cost of the acquisition is lower than the fair value of the net assets of the subsidiary acquired, the identification and measurement of the related assets and liabilities and contingent liabilities are revisited and the cost is reassessed with any remaining balance recognised immediately in the Combined Income Statement.

The carrying amount of goodwill in respect of associates and joint ventures is included in investments accounted for using the equity method (i.e. within financial assets) in the Combined Balance Sheet.

Where a subsidiary is disposed of or terminated through closure, the carrying value of any goodwill of that subsidiary is included in the determination of the net profit or loss on disposal/termination.

Intangible assets (other than goodwill) arising on business combinations

An intangible asset is capitalised separately from goodwill as part of a business combination at cost (fair value at date of acquisition).

Subsequent to initial recognition, intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses. The carrying values of definite-lived intangible assets are reviewed for indicators of impairment at each reporting date and are subject to impairment testing when events or changes in circumstances indicate that the carrying values may not be recoverable.

Intangible assets are amortised on a straight line basis. In general, definite-lived intangible assets are amortised over periods ranging from one to ten years, depending on the nature of the intangible asset.

Amortisation periods, useful lives, expected patterns of consumption and residual values are reviewed at each financial year-end. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are accounted for by changing the amortisation period or method as appropriate on a prospective basis.

Other financial assets

All investments are initially recognised at the fair value of consideration given plus any directly attributable transaction costs. Where equity investments are actively traded in organised financial markets, fair value is determined by reference to Stock Exchange quoted market bid prices at the close of business on the balance sheet date. Unquoted equity investments are recorded at historical cost in accordance with IAS 39 given that it is impracticable to determine fair value.

Leases

Leases where the lessor retains substantially all the risks and rewards of ownership are classified as operating leases. Operating lease rentals are charged to the Combined Income Statement on a straight-line basis over the lease term.

Inventories and construction contracts

Inventories are stated at the lower of cost and net realisable value. Cost is based on the first-in, first-out principle (and weighted average, where appropriate) and includes all expenditure incurred in acquiring the inventories and bringing them to their present location and condition. Raw materials are valued on the basis of purchase cost on a first-in, first-out basis. In the case of finished goods and work-in-progress, cost includes direct materials, direct labour and attributable overheads based on normal operating capacity and excludes borrowing costs.

Net realisable value is the estimated proceeds of sale less all further costs to completion, and less all costs to be incurred in marketing, selling and distribution. Estimates of net realisable value are based on the most reliable evidence available at the time the estimates are made, taking into consideration fluctuations of price or cost directly relating to events occurring after the end of the period, the likelihood of short-term changes in buyer preferences, product obsolescence or perishability and the purpose for which the inventory is held. Materials and other supplies held for use in the production of inventories are not written down below cost if the finished goods, in which they will be incorporated, are expected to be sold at or above cost.

Amounts recoverable on construction contracts, which are included in receivables, are stated at the net invoiced value of the work done less amounts received as progress payments on account. Cumulative costs incurred, net of amounts transferred to cost of sales, after deducting foreseeable losses, provisions for contingencies and

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payments on account not matched with revenue, are included as construction contract balances in inventories. Cost includes all expenditure directly related to specific projects and an allocation of fixed and variable overheads incurred in contract activities based on normal operating capacity.

Trade and other receivables

Trade receivables are carried at original invoice amount less an allowance for potentially uncollectible debts. Provision is made when there is objective evidence that the associated debts will not be collected. Bad debts are written-off to the Combined Income Statement on identification.

Cash and cash equivalents

Cash and cash equivalents comprise cash balances held for the purpose of meeting short-term cash commitments and investments which are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value. Bank overdrafts are included within current interest-bearing loans and borrowings in the Combined Balance Sheet. Where the overdrafts are repayable on demand and form an integral part of cash management, they are netted against cash and cash equivalents for the purposes of the Combined Statement of Cash Flows.

Interest-bearing loans and borrowings

All loans and borrowings are initially recorded at the fair value of the consideration received net of directly attributable transaction costs. Subsequent to initial recognition, current and non-current interest-bearing loans and borrowings are, in general, measured at amortised cost employing the effective interest methodology. Fixed rate term loans, which have been hedged to floating rates (using interest rate swaps), are measured at amortised cost adjusted for changes in value attributable to the hedged risks arising from changes in underlying market interest rates. The computation of amortised cost includes any issue costs and any discount or premium materialising on settlement.

Gains and losses are recognised in the Combined Income Statement through amortisation on the basis of the period of the loans and borrowings.

Borrowing costs arising on financial instruments are recognised as an expense in the period in which they are incurred (unless capitalised as part of the cost of property, plant and equipment).

Derivative financial instruments and hedging practices

In order to manage interest rate, foreign currency and commodity risks and to realise the desired currency profile of borrowings, derivative financial instruments (principally interest rate swaps, currency swaps and forward foreign exchange contracts) may be employed. Derivative financial instruments are recognised initially at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value. The carrying value of derivatives is fair value based on discounted future cash flows and adjusted for counterparty risk. Future floating rate cash flows are estimated based on future interest rates (from observable yield curves at the end of the reporting period). Fixed and floating rate cash flows are discounted at future interest rates and translated at period end foreign exchange rates.

At the inception of a derivative transaction, the relationship between the hedged item and the hedging instrument is documented, together with its risk management objective and the strategy underlying the proposed transaction. The assessment, both at the inception of the hedging relationship and subsequently on an ongoing basis, of the effectiveness of the hedging instrument in offsetting movements in the fair values or cash flows of the hedged items is also documented. Where derivatives do not fulfil the criteria for hedge accounting, changes in fair values are reported in the Combined Income Statement.

Fair value and cash flow hedges

Fair value hedges and cash flow hedges are used in treasury activities. For the purposes of hedge accounting, hedges are classified either as fair value hedges (which entail hedging the exposure to movements in the fair value of a recognised asset or liability or an unrecognised firm commitment that could affect profit or loss) or cash flow hedges (which hedge exposure to fluctuations in future cash flows derived from a particular risk associated with a recognised asset or liability, or a highly probable forecast transaction that could affect profit or loss).

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Where the conditions for hedge accounting are satisfied and the hedging instrument concerned is classified as a fair value hedge, any gain or loss stemming from the re-measurement of the hedging instrument to fair value is reported in the Combined Income Statement. In addition, any gain or loss on the hedged item which is attributable to the hedged risk is adjusted against the carrying amount of the hedged item and reflected in the Combined Income Statement. Where the adjustment is to the carrying amount of a hedged interest-bearing financial instrument, the adjustment is amortised to the Combined Income Statement with the objective of achieving full amortisation by maturity.

Where a derivative financial instrument is designated as a hedge of the variability in cash flows of a recognised asset or liability or a highly probable forecast transaction that could affect profit or loss, the effective part of any gain or loss on the derivative financial instrument is recognised as other comprehensive income, net of the income tax effect, with the ineffective portion being reported in the Combined Income Statement. The associated gains or losses that had previously been recognised as other comprehensive income are transferred to the Combined Income Statement contemporaneously with the materialisation of the hedged transaction. Any gain or loss arising in respect of changes in the time value of the derivative financial instrument is excluded from the measurement of hedge effectiveness and is recognised immediately in the Combined Income Statement.

Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated or exercised, or no longer qualifies for hedge accounting. At that point in time, any cumulative gain or loss on the hedging instrument recognised as other comprehensive income remains there until the forecast transaction occurs. If a hedged transaction is no longer anticipated to occur, the net cumulative gain or loss previously recognised as other comprehensive income is transferred to the Combined Income Statement in the period.

Net investment hedges

Where foreign currency borrowings provide a hedge against a net investment in a foreign operation, and the hedge is deemed to be effective, foreign exchange differences are taken directly to a foreign currency translation reserve. The ineffective portion of any gain or loss on the hedging instrument is recognised immediately in the Combined Income Statement. Cumulative gains and losses remain in equity until disposal of the net investment in the foreign operation at which point the related differences are transferred to the Combined Income Statement as part of the overall gain or loss on sale.

Fair value hierarchy

For financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: valuation techniques for which the lowest level of inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: valuation techniques for which the lowest level of inputs that have a significant effect on the recorded fair value are not based on observable market data.

Emission rights

Emission rights are accounted for such that a liability is recognised only in circumstances where emission rights have been exceeded and the differential between actual and permitted emissions will have to be remedied through the purchase of the required additional rights at fair value. Assets and liabilities arising in respect of under and over-utilisation of emission credits respectively are accordingly netted against one another in the preparation of the Historical Combined Financial Information. To the extent that excess emission rights are disposed of during a financial period, the profit or loss materialising thereon is recognised immediately within cost of sales in the Combined Income Statement.

Foreign currency translation

Items included in the financial information are measured using the currency of the primary economic environment of the operation (“the functional currency”). The Historical Combined Financial Information is presented in the respective functional currency.

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Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance sheet date. All currency translation differences are taken to the Combined Income Statement with the exception of all monetary items that provide an effective hedge for a net investment in a foreign operation. These are recognised in other comprehensive income until the disposal of the net investment, at which time they are recognised in the Combined Income Statement.

Results and cash flows of subsidiaries, joint ventures and associates with differing functional currencies have been translated into the relevant functional currency at average exchange rates for the period, and the related balance sheets have been translated at the rates of exchange ruling at the balance sheet date. Adjustments arising on translation of the results and net assets of subsidiaries, joint ventures and associates with differing functional currencies are recognised in a separate translation reserve within equity, net of differences on related currency borrowings. All other translation differences are taken to the Combined Income Statement.

Goodwill and fair value adjustments arising on acquisition of a foreign operation are regarded as assets and liabilities of the foreign operation and are translated accordingly.

The principal exchange rates used for the translation of results, cash flows and balance sheets into euro were as follows:

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SECTION B

HISTORICAL COMBINED FINANCIAL INFORMATION RELATING TO LAFARGE EUROPE

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ACCOUNTANT’S REPORT ON THE HISTORICAL COMBINED FINANCIAL INFORMATION RELATING TO LAFARGE EUROPE

Lafarge Europe

We report on the financial information in respect of Lafarge Europe for the years ended 31 December 2012 and 2013 as set out in Section B of Part IV (the “Lafarge Europe Historical Financial Information”). Lafarge Europe has been defined in Note 1 to the Lafarge Europe Historical Financial Information. The Lafarge Europe Historical Financial Information has been prepared for inclusion in the class 1 circular (the “Circular”) dated 20 February 2015 relating to the proposed acquisition by CRH plc of certain assets being disposed of by Lafarge S.A. and Holcim Ltd in advance of their intended merger, on the basis of the accounting policies set out in Note 1.1 to the Lafarge Europe Historical Financial Information. This report is required by rule 13.5.21 of the Listing Rules issued by the UK Listing Authority (the “UKLA Listing Rules”) and is given for the purpose of complying with that rule and for no other purpose.

Save for any responsibility which we may have to those persons to whom this report is expressly addressed and which we may have to ordinary shareholders as a result of the inclusion of this report in the Circular, to the fullest extent permitted by law we do not assume any responsibility and will not accept any liability to any other person for any loss suffered by any such other person as a result of, arising out of, or in connection with this report or our statement, required by and given solely for the purposes of complying with UKLA Listing Rule 13.4.1R (6) consenting to its inclusion in the Circular.

We have not audited or reviewed the financial information for the nine months ended 30 September 2014 and 2013 and accordingly do not express an opinion thereon.

Responsibilities

The Directors of CRH plc are responsible for preparing the Lafarge Europe Historical Financial Information on the basis of preparation set out in Note 1.2 to the Lafarge Europe Historical Financial Information and in a form that is consistent with the accounting policies adopted in CRH plc’s latest annual accounts.

It is our responsibility to form an opinion on the Lafarge Europe Historical Financial Information and to report our opinion to you.

Basis of Qualified Opinion

We conducted our work in accordance with Standards for Investment Reporting issued by the Auditing Practices Board in the United Kingdom. Our work included an assessment of evidence relevant to the amounts and disclosures in the financial information. It also included an assessment of significant estimates and judgments made by those responsible for the preparation of the financial information and whether the accounting policies are appropriate to the entity’s circumstances, consistently applied and adequately disclosed.

We planned and performed our work so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial information is free from material misstatement whether caused by fraud or other irregularity or error.

As described in Note 1.3, the Lafarge Europe Historical Financial Information does not include all of the disclosures required for a complete set of historical financial information prepared in accordance with the basis of preparation set out in Note 1.2. The information required for the Directors of CRH plc to prepare such disclosures is not available because of the nature and objective of the combined financial information prepared by the Sellers for the purposes of the divestment process, upon which the historical financial information included in the Circular is based. The Sellers have confirmed the information is not available to complete full disclosures.

Our work has not been carried out in accordance with auditing or other standards and practices generally accepted in other jurisdictions and accordingly should not be relied upon as if it had been carried out in accordance with those standards and practices.

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Qualified Opinion

In our opinion, except for the omission of certain disclosures that are required for a complete set of historical financial information as described in the Basis of Qualified Opinion section above, the Historical Financial Information gives, for the purposes of the Circular dated 20 February 2015, a true and fair view of the state of affairs of Lafarge Europe as at 31 December 2013 and 2012, and of its profits, cash flows and changes in equity for the years then ended in accordance with the basis of preparation set out in Note 1.2.

Yours faithfully

Ernst & Young

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LAFARGE EUROPE

Combined Income Statement

All of the results relate to continuing operations.

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LAFARGE EUROPE

Combined Statement of Comprehensive Income

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LAFARGE EUROPE

Combined Balance Sheet

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LAFARGE EUROPE

Combined Statement of Changes in Equity

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LAFARGE EUROPE

Combined Statement of Cash Flows

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LAFARGE EUROPE

Notes to the Combined Historical Financial Information

Lafarge S.A. (‘Lafarge’) is a French limited liability company governed by French law. Holcim Ltd. (‘Holcim’) is a Swiss limited liability company governed by Swiss law.

On 7 April 2014, Holcim and Lafarge (together, the ‘Sellers’) announced their intention to merge their businesses, such merger to be implemented by a tender offer by Holcim for the shares of Lafarge (the ‘Merger’). In order to obtain the regulatory clearances necessary to complete the Merger, the Sellers agreed to divest certain of their businesses. The businesses are grouped geographically into ‘clusters’ and held by newly incorporated or pre-existing subsidiaries of the Sellers, such subsidiaries being collectively referred to as the NewCo Group.

On 1 February 2015, CRH plc (‘CRH’) announced that it had entered into a Binding Offer Letter with Lafarge and Holcim, and the Philippines SPA with Lafarge Holdings (Philippines) Inc., Calumboyan Holdings, Inc., Round Royal Inc. and Southwestern Cement Ventures Inc., to acquire the NewCo Group (the ‘Acquisition’). One of the clusters within NewCo Group is Lafarge’s business activities in Germany and Romania identified in Note 14 – Scope of the combined historical financial information (“Lafarge Europe”).

The Acquisition constitutes a Class 1 transaction pursuant to the UKLA Listing Rules, with CRH required to send an explanatory circular (‘Class 1 Circular’) to its shareholders and obtain their prior approval in an extraordinary general meeting for the Acquisition. The historical combined financial information relating to Lafarge Europe (‘Lafarge Europe Historical Financial Information’) has been prepared specifically for the purposes of inclusion in the Class 1 Circular.

In accordance with the requirements of the Listing Rules, the Lafarge Europe Historical Financial Information has been prepared on the basis of the accounting policies which are set out at pages 27 to 35 of this document (and which form part of the Lafarge Europe Historical Financial Information) and in a form that is consistent with the accounting policies adopted in CRH’s financial statements for the year ended 31 December 2013.

Lafarge Europe has not been formed as a legal group in the past, and has not previously prepared consolidated financial statements. The Lafarge Europe Historical Financial Information has been prepared on a basis that consolidates the results, assets and liabilities of entities comprising Lafarge Europe (as set out in Note 14), except for:

The combined historical financial information presents historical financial information of Lafarge Europe for the years ended 31 December 2012 and 2013 and the nine month periods ended 30 September 2013 and 2014.

The Lafarge Europe Historical Financial Information has been prepared on a basis that combines the assets and liabilities, operations and cash flows of the entities set out in Note 1.1 above using the principles underlying the

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consolidation procedures of IFRS 10 Consolidated Financial Statements. International Financial Reporting Standards as adopted by the European Union (IFRSs as adopted by the EU)) does not provide for the preparation of combined financial information, and accordingly, in preparing the Lafarge Europe Historical Financial Information, certain accounting conventions commonly used for the preparation of historical financial information for inclusion in investment circulars as described in the Annexure to SIR 2000 Standards for Investment Reporting applicable to public reporting engagements on historical financial information issued by the UK Auditing Practices Board have been applied.

The Lafarge Europe Historical Financial Information has been prepared in accordance with the requirements of the UK Listing Rules and in accordance with this basis of preparation. The basis of preparation describes how the financial information has been prepared in accordance with International Financial Reporting Standards as adopted by the European Union (IFRSs as adopted by the EU), except as described below.

The application of these conventions results in the following material departures from IFRSs as adopted by the EU. In other respects IFRSs as adopted by the EU have been applied.

In addition, and as set out in Note 1.3, certain disclosures required by IFRSs have not been provided.

As Lafarge Europe has not formed in the past a legal group with a parent company and thus the Lafarge Europe Historical Financial Information is presented on a carve-out basis, it is not meaningful to present share capital nor any analysis of the equity accounts of Lafarge Europe. The net assets of Lafarge Europe (shown as combined equity) reflect the aggregated share capital and other equity accounts of the entities combined as part of this financial information, after elimination of combined investments. Elements of “Other comprehensive earnings” presented in combined equity are, however, presented separately within the Combined Statement of Comprehensive Income.

All cash and other movements in equity accounts in the periods presented, such as cancellation of shares (or share issues), dividends and other distributions or contributions made from/to Lafarge Europe group companies to/from entities outside the scope of combination have been reflected respectively as “Distributions” or “Contributions” in the Combined Statement of Changes in Equity and in the Combined Cash Flow Statement.

Subsidiaries, joint ventures and associates that are part of Lafarge Europe and that were acquired directly or indirectly by Lafarge Europe have been included in the Lafarge Europe Historical Financial Information from the date control, joint control or significant influence was obtained. Legal subsidiaries of Lafarge Europe entities and related business operations that are outside the scope of combination have been excluded from the Lafarge Europe Historical Financial Information since the beginning of the periods presented.

Lafarge Europe has not previously been required to prepare standalone historical combined financial information. In the absence of any requirement or guidelines in IFRSs as adopted by the EU for purchase price allocation accounting for the establishment of combined financial information, purchase price adjustments and goodwill arising from previous acquisitions and allocated to Lafarge Europe reporting entities that form part of Lafarge Europe have been included in the Lafarge Europe Historical Financial Information, as recognised in Lafarge’s consolidated financial statements. Goodwill from previous acquisitions relating to the reporting entities that form part of Lafarge Europe has been allocated at the level for purpose of the foreign currency translation in the Lafarge consolidated financial statements, i.e. the goodwill relating to each entity is calculated by deducting the fair values of the net assets of that entity from the cost of the acquisition of the entity in the relevant functional currency.

All balances arising from routine transactions between Lafarge Europe and other Lafarge entities are presented in the combined financial information as receivables from and payables to third parties outside the scope of combination. All loans and borrowings between Lafarge Europe and other Lafarge entities are presented in the combined financial information as financial assets and liabilities (see Note 10 – related parties).

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Lafarge had historically billed royalties and costs in accordance with its agreements to its affiliates including entities part of Lafarge Europe (trade mark, know-how, patent, part of corporate office costs, assistance).

Costs billed by Lafarge to Lafarge Europe were impacted by historical cost allocation arrangements within Lafarge. For the purposes of preparing the Lafarge Europe Historical Financial Information, costs have been allocated to Lafarge Europe based on these historical arrangements. They are not representative of the position that may prevail in the future.

In this context, Lafarge Europe booked an expense amounting to €11 million for the nine-month period ending on 30 September 2014 in operating costs (nine months ended 30 September 2013; €12 million, year ended 31 December 2013; €15 million, year ended 31 December 2012; €14 million).

Lafarge Europe has historically managed its financing needs and cash flow surpluses for the Lafarge Group through its cash pooling activities. For the purposes of preparing the Lafarge Europe Historical Financial Information, such centrally managed financing and cash pooling has been reflected in line with existing balances within Lafarge’s consolidated financial statements at the end of each period presented. Such balances are presented in financial assets and financial liabilities. The interest income and expense recorded in the Historical Combined Statement of Income have been impacted by the financing arrangements within Lafarge. They are not representative of the interest charges that would have been reported if Lafarge Europe had been an independent group. They are not representative of the interest charges that may arise in the future.

The tax expense and deferred tax assets and liabilities recorded in the Lafarge Europe Historical Financial Information have been determined based on the existing balances of tax expense and deferred tax assets and liabilities in Lafarge’s consolidated financial statements at the end of each period presented and as a result have been impacted by the taxation arrangements in some countries.

The Lafarge Europe Historical Financial Information does not include all of the disclosures required for a complete set of historical financial information, as required by the following standards:

The information required for the Directors of CRH plc to prepare such disclosures is not available due to the nature and objective of the special purpose financial statements, upon which the Lafarge Europe Historical Financial Information had originally been prepared by the Sellers. As the contemplated Acquisition has not been completed, CRH plc does not possess the ability to obtain the requisite information in order to provide the absent disclosures in the Lafarge Europe Historical Financial Information.

The Lafarge Europe Historical Financial Information does not include historical financial information for the year ended 31 December 2011, as required by Listing Rule 13.5.13R, for the same reason that the information referred to in note 1.3 above has not been disclosed.

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The schedule below presents foreign exchange rates for the main currencies used within Lafarge Europe Group:

Note 2 – Elements related to the combined income statement

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C – Finance income and costs

D – Income tax expense

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Tax expense reconciliation – Lafarge Romania