Myles Lee - Group Chief Executive Officer, Director, Member of Acquisitions Committee and Member of Finance Committee Maeve C. Carton - Group Finance Director, Director, Member of Acquisitions Committee and Member of Finance Committee Albert Jude Manifold - Chief Operating Officer, Director and Member of Acquisitions Committee Erik J. Bax - Managing Director of Products & Distribution - Europe Henry Morris - Managing Director of Materials - Europe and Regional Director for Switzerland Finland & The Baltic Region Mark S. Towe - Executive Director and Chief Executive Officer of Oldcastle Doug Black - President of Oldcastle, Inc and Chief Operating Officer of Oldcastle, Inc.

Luis Prieto Bartolome - Deutsche Bank AG, Research Division Barry Dixon - Davy, Research Division Paul Roger - Exane BNP Paribas, Research Division John Messenger - Redburn Partners LLP, Research Division Howard Seymour - Numis Securities Ltd., Research Division Charlie Campbell - Liberum Capital Limited, Research Division Yuri Serov - Morgan Stanley, Research Division Gregor Kuglitsch - UBS Investment Bank, Research Division John Fraser-Andrews - HSBC, Research Division Arnaud Palliez - Raymond James Euro Equities William Jones - Redburn Partners LLP, Research Division Arnaud Lehmann - BofA Merrill Lynch, Research Division Aynsley Lammin - Citigroup Inc, Research Division Robert Eason - Goodbody Stockbrokers, Research Division

Good morning, everybody. You're all very welcome to the presentation of CRH's results for the year [indiscernible] December 2012. I'm joined this morning for the presentation and for the question-and-answer session by my executive colleagues. On my left, we have Erik Bax, who heads up our Europe Products and Distribution Division. On Eric's left is Henry Morris, Head of Europe Materials. Moving over along the line, we have Doug Black, Chief Operating Officer for our Americas Divisions. And just next to Doug, Mark Towe, who's our Chief Executive of our Americas Divisions, Chief Executive of Oldcastle Inc. And then next to Mark, you have Maeve Carton, our Finance Director; and Albert Manifold at the -- on the wing there, our Chief Operating Officer. So together with Albert and Maeve, I'll be presenting the results and some of the highlights of 2012 and then all of us will be happy to deal with your questions and answers. So to kick off the presentation, I'd like to say a few words about the trading during 2012. You can see on this particular slide the highlights of the year. Our sales for the year at EUR 18.7 billion were about 2% ahead of 2011, but that included a like-for-like decline of 2%, more than offset by acquisition contributions and also beneficial exchange effects. Like-for-like sales in the U.S. were up 3%; but in Europe, like-for-like sales were down about 6%, contributing to the overall 2% decline. Reported EBITDA this morning at EUR 1.64 billion was about 1% behind the 2011 level, but ahead of the guidance we would have provided to you in the November Interim Management Statement. And that was helped, if you like, by good cost delivery in the final 2 months of the year. And a somewhat better trading in…

Thanks, Myles, and good morning, everybody. I'm going to start with a quick snapshot of the EBITDA outturn for the year by segment compared with the guidance, which we gave in November with the IMS statement. Myles already mentioned in his opening remarks the fact that EBITDA was ahead of guidance for 2012 and as you can see here, for all 6 segments, we were ahead of the guidance that we gave in November. Our European operations overall showed a decline of 12% compared with last year. That was slightly better than the 15% that we had indicated or expected in November. In our Americas operations, a 4% better outturn in U.S. dollars compared with 2011, again was slightly better than the indications we'd given in November and reflect a slightly better finish up to the year in our European -- or Americas distribution business, in particular, with some beginnings of activity picking up from the start of repairs subsequent to the Hurricane Sandy devastation in the Northeast, in particular. If we look at the income statement, there's a couple of big moving parts to the income statement below the operating profit line, which I'll touch on briefly here. Operating profit was down 3%, so that reflects the 1% decline in EBITDA that we talked about earlier. And depreciation and amortization charges -- fairly similar to last year at EUR 795 million. A big mover this year was the profit on disposals. The figure for 2012 included EUR 187 million in respect to the disposals of divestments -- of businesses during 2012. The largest one in there, of course, was the disposal of Secil in May of this year. And with the benefit of that EUR 187 million, the total profits for the year increased to EUR 230 million compared…

Thanks, Maeve, and good morning to you, all. In November at our Capital Markets Day, we outlined to you how we were going to continue concentrating on the reduction of our cost base and also how we were going to continue on focusing improving the efficiencies within our business. Now in November, we set out for you how we had targeted further savings over the 4-year period to 2015 of about EUR 450 million. And when you combine those with the savings that we had in place, for the programs we had in place, that would bring our total savings through those programs, which started way back in 2007, to EUR 2.5 billion. Now as part of those programs, we had targeted savings of about EUR 150 million in 2012. But as you can see from the slide behind me here, we actually achieved more than that. We actually achieved savings of about EUR 166 million. However, really what we did was we actually accelerated savings back into 2012, those that we had initially targeted for 2013. So overall, our target is still, at this moment in time, remains at EUR 450 million. Now it's worthwhile just take to take a moment to look and see exactly some of the areas where we achieved those savings. And I should say that about 80% of those savings come through our European divisions in 2012. In our Europe Materials division here, you can see we made great progress increasing the amount of alternative fuels used in our cement operations. That allows us to reduce the consumption of expensive fossil fuels in those cement plants. Now Europe Products and Distribution business. We focus very much on the reorganization of our business units, mothballing or closing locations in response to the challenges we saw…

All right. Thank you, Albert, and thank you, Maeve, for that. Before I move to the overall outlook for the group for 2013, I might ask my operational heads here to just say a few words about what their particular businesses are focusing on in the months ahead as we move further into the main trading season in 2013. So maybe if could, first of all, ask Eric Bax to say what their primary attention is being paid to in Europe Products. And then maybe I'll ask Henry to come in on Europe Materials. So, Eric, over to you.

Thanks, Myles. In Europe products and distribution, the focus for this year is on finalizing the back-office integrations we have started to establish the centralized CRH [ph] functions. Because the markets will remain -- will not grow in the coming years, we focus very much on getting bigger market shares and bigger share of wallets from our customers. We will continuously review our portfolio to keep focus on the attractive markets. For products, we hope to reap the benefits of the restructurings we did last year, and so we took [ph] that out, these costs and improve margins because of that. We will continue to focus on operational improvements in the business and very important is the innovation for new products. There is a growing demand for sustainable products, and we are working on that. We will serve customers with that to get a bigger share of the wallet. On distribution, it's very much on the commercial activities, like gaining market share, category management, procurement, all these type of things to really improve the margins we have and get a bigger market share. And on the development front for distribution, we want to grow further in our successful sanitary heating and plumbing business. And we want to consolidate further in our building merchants [ph] in the attractive markets. Henry?

Thanks, Erik. Albert mentioned alternative fuels. Despite capital expenditure constraints over the last few years, we maintain the commitment to investments in Poland and Finland and Ireland. And we were able to increase the percentage to 28% in 2012. And we would want to build further on that into 30%-plus in 2013. In the Capital Markets Day, we identified that in the downturn we had lost some ground on pricing with the gap between what we've got in price increases versus cost increases had widened. We told you that we had made some progress in 2011 and again in 2012. And in 2013, that is getting a lot of attention, and it is, I would say, our primary focus that we drive through real price increases. And then finally, we also, during the last 3 years, we invested in Ukraine. We now have a very modern efficient plant there with significant competitive advantage. In 2011, we extended our market reach with the purchase of Odessa Cement, and that's added to our sales volume last year. And that allowed us to leverage the very significant cost advantage that we have in that plant, and that's an area that we'd look to build on also in 2013.

Thanks, Henry, and thanks, Erik. Obviously a tougher outlook on the European side than in our U.S. markets currently. I might ask Mark Towe and Doug, maybe, to comment on what their priorities are for 2013.

Thank you, Myles. We had a very good year in Americas in 2012, a lot of good trends going on. That's going to continue into 2013, so we are very confident that we'll make -- and continue to grow into 2013. On the materials business, I guess the 2 focus areas that we're looking is really the margin recovery. We need to continue to work on that. We will focus most around pricing, get price increases through value selling. The other segment that we continue to look at will be the operating efficiencies. We've been working on that for the last 4, 5 years. And we've made a lot of progress, but there's a lot of stuff that we're having an opportunity to continue to cut the costs there. There's a lot of good things going on there, automation, a lot of different things that we talked a little bit about on the Capital Days day. The other piece that we're focusing on, Albert mentions the procurement. We've been working on that for years and years. But I think we've really got to focus now on the global efficiencies there. Something we've talked about, we're driving that now, and we still feel confident that we've got a lot to do there. So we are going to focus on that as well. The other area would be to take a look at our acquisitions. As Myles mentioned, we had 16 acquisitions in 2012, the big one being in New Jersey that we closed in December. We're excited about these acquisitions, but we have to drive the integration through there and that will be a big focus for us, very important for us in 2013. And Doug, I'll switch over on the products and distribution.

Yes, thanks, Mark. On the products and distribution side, we have good momentum going into 2013. In our products space, sales were up 7% like-for-like last year, and we see that continuing and actually gaining momentum in 2013. Our focus there will be to take advantage of the market recovery. We continue to gain market share through innovation, innovation in our products. And as Myles mentioned, our building solutions has been quite successful in terms of bringing the product groups together and selling solutions throughout the projects early in the project life cycle. We'll also be focused on costs. Procurement will be a big initiative there in products. And then as Mark mentioned, acquisitions, we did some nice acquisitions in 2012, which we expect to pay off nicely in 2013. Integration there will be important and so we'll be working on that in the product space. In the distribution space, we're very encouraged. We had a strong fourth quarter in 2012 going into 2013. Again, good momentum on the volume side and in pricing. We feel like in external, the exterior products space, we'll get good price increases in 2013. And in interior products, as Myles mentioned, where we got good pricing last year, that will continue in 2013. So we're encouraged in our distribution space that 2013 will be a good year for us.

All right, thanks, Mark, and thanks, Doug. I'm sure you'll probably want to question, guys, on some of the comments they made there in relation to their priorities for 2013. But just to wrap up and to enable you to get to your questions, just in terms of overall, when we look at our business, across our 2 main platforms, in the Americas, we do expect positive momentum in the U.S. economy, which should enable us to make good progress in our U.S. activities in 2013. Obviously, Europe, it's going to be another challenging year, so really, it's all about internal action across the business to counteract some of the market pressures that we're seeing across our business footprint in Europe. But overall, we believe that the combination of our operations in the Americas and the combination of a lot of internal actions being taken right across the businesses should outweigh those pressures in Europe and enable CRH to achieve progress in 2013. So that's the end of the formal presentation. We are happy now to move to questions and answers. We will, first of all, take questions from the floor here in London, then we'll move any dial-in questions and then we'll take any questions that have come in through the web that haven't already been addressed either through the floor or through dial-in. [Operator Instructions]

Luis Prieto from Deutsche Bank. On Europe, I had a couple of questions, which are pretty obvious, I think. One is, what's the situation of the Polish market now with EU funds potentially coming their way? And regarding The Netherlands, what do you think the cycle is, are we bottoming out or how do you see 2013?

Okay. Thanks, Luis. Two questions there, one on Poland, one on The Netherlands. Henry, our Europe Materials business, obviously, has a big footprint in Poland. I'd ask you to deal with that, and then I'll come to Erik with regard to outlook in The Netherlands.

Yes, Myles, after a lot of activity in 2011 and first half of 2012, we've seen a slowdown. Some jobs completed, some canceled because contractors run into difficulties. They are being re-tendered. We expect those to resume during the current year. At the moment, there is an issue with funding for a particular tranche, and that's been dealt with. We understand that, that will take another month or 2 to be resolved, and we would expect that, that funding will come through. We don't see that as having a major impact on the flow of activity during the year.

However, I suppose there will be -- the first half, particularly, will probably continue to be challenging on the volume side, and we will expect a better, better level of activity as those projects kick in, in the second half of the year. On The Netherlands, Erik?

If you look to the Dutch economy, macro economically, you can say it's still a strong economy. If you look through the state, debt is slow, the deficit is low and unemployment is reasonably low, but there is an issue in consumer confidence. What we expect in The Netherlands is that 2013 will be the lowest point in the cycle, and we expect the markets to recover after that, so maybe second half 2014, 2015, we expect a recovery of the market in The Netherlands.

I think, again, it'll be a tough year in The Netherlands and a lot of our restructuring in the second half of last year. And currently, it is focused on our Dutch activities.

So yes, top line will be difficult in The Netherlands this year, but we will benefit from the restructurings we did. Bottom line wise, it won't be as bad as top line.

Barry?

It's Barry Dixon from Davy. Just in terms of the cement price environment in Europe, very strong performance given the sort of volume declines you've seen in most of your markets bar Ukraine. In terms of cement pricing for '13, I suppose just to get a sense of that and how you would expect to -- cement prices to progress, particularly in that difficult environment that you've outlined. Second question, I suppose it is Europe in terms of European materials, at least, in terms of Chinese market or your Chinese business saw very sharp decline in volumes in 2012, and just in terms of the prospects for that part of the business in 2013?

Thanks, Barry. I'm glad to hear China is part of Europe. I think we'll -- should we ask Henry to deal first of all about the European domestic pricing, and then maybe Albert can comment and respond to your question on China.

I think, Barry, in pricing, it's tough in all markets. And against the volume backdrop in the second half of last year, getting price increases is difficult. There is a very strong determination, I think, within our own organization and I think we see it across peers to recover cost increases, especially have suffered over the last couple of years. I think energy will be fairly flat in the year ahead. So I think in Poland, we would expect to see some movement in price. Middle-single digits is what we'll be aiming for. In Ukraine, stronger than that. Finland, Switzerland, I think, flat or slightly positive. And the rest of Europe, fairly flat, I would say.

Thanks, Henry. Albert?

Yes, Barry. In China last year, quite a significant slowdown in volumes in all markets, our market in the Northeast also in the region of 15% to 25%. Depending on where you were, we saw more volume declines. I think probably it was anticipated to happen. We just weren't sure when it was going to happen. And standing back, looking at the industry, actually, it's a very healthy thing. But 40% of the cement production in China is very old, vertical shaft kiln manufacturing, high cost, inefficient polluting. And really, what we're going through now is through an industry shakedown basically. These businesses will slowly, but surely close because of businesses like ourselves. We have spent a significant amount of money investing in large, modern, low-cost cement operations. And we are the ones who'll be able to prevail during these circumstances. So I think that we're quite pleased that this is starting to happen. What's interesting in our part of China, although our volume declines were 20% or such, our prices held, which showed, a, to the disciplined industry, shows a -- b to where our position is there and also the vertical integration model at CRH. We sell to our own business, to our captive demand, and that allowed us to maintain prices. So I think it's a healthy issue in terms of [ph] this was going to happen. It's going to continue to happen for a couple of years. But we think with our asset base, we're in a good position.

And I think just to add there in China, whether overall returns on investments flip back somewhat in 2012 compared to 2011, still very healthy levels for developing economy, if you like, so we're still pleased with the way, as Albert said, with the way that business held up in 2012. So I think there's another question at the back there?

It's Paul from Exane BNP Paribas. Just sticking on the theme of emerging markets in Europe and asking about India. Obviously, you withdrew from negotiations with JP last year, I believe, over pricing. What are your ambitions in India? Could you talk about your strategy in that country? And then secondly, sticking with price in European materials, we've seen a 1 or 2 your competitors have announced more formal schemes, called innovation or customer actions or whatever you want to term them. And they've done things like changing incentivization of middle-management level, are you considering anything like that?

Okay. Thanks, Paul. Maybe I might just continue on the emerging markets theme and then come back and respond to your questions on Europe Materials and pricing and the incentivization. Albert?

Just the reason why we actually withdrew from negotiations with the particular asset you talking about was much as to do with the seller changing the structure of the deal. We had initially been talking about a block of assets up in Gujarat, and they expanded it to include their assets down in Andhra Pradesh as well. It was a much bigger deal. That was the principal reason why we pulled out of that particular deal. Our strategy for India, we've tried to communicate this over the years, it has been fairly constant, and it's based on us finding a good resource back assets, which primarily will be cement in India and then investing in those assets, both within the asset to ensure it's a low-cost producer, but also investing in the infrastructure to sort of, so we can ensure that we are actually are targeting markets where we believe we can actually get premium pricing. In India, it's a different cement strategy than it is for the rest of the world. Normally, the rest of the world, one builds a cement plant and grinds cement and sells it within the local market of 300 kilometers around that particular plant. It doesn't work that way in India because the way that the limestone is in India, which is what cement is produced from, it's in very narrowly defined geographic areas. So it's just as important to invest in logistics to get your product out of those areas and into the main conurbations. Our strategy is very much along the lines of continuing to invest in low-cost well-located operations, resource-backed assets, but also ensuring that we have got the logistics network to ensure that we're not stuck with one particular market, that we have a number of particular markets to go with there. And I think India is -- the cement demand in India now is just around 250 million tonnes. It's likely in the next 20 years, that will probably grow close to 1 billion tonnes. So there's significant room for growth for anybody who's prepared to invest in there. And as always with emerging markets, you take your time, you invest as the returns come and we take a patient view to that. Also, we're happy with the investment we've made there, and we'll continue to progress that over the years.

Thanks, Albert. Henry, I'm not sure what particular insights you can provide into the commercial strategies of other peers, but maybe you might try and respond to Paul's comments.

Well, the pricing and margin and margin improvement are very high priority. So a lot of effort in identifying areas of the commercial piece to improve the returns. Yes, it's part of the incentive package to improve the margins. A lot of initiatives with customers to improve the product offering charge for extras. Recover discounts and work on the general margin management across the patch and not just in cement, but also in the downstream products. So it's getting high priority, it's getting a lot of attention and efforts redoubled there to improve the margins in the full product range that we're engaged in.

A question here, John, John Messenger has a question.

John Messenger from Redburn. Two, if I could. One was just it's really back to Henry and just on Poland and Ukraine. Could you give us a bit of an update as to what the combined sales and EBITDA, maybe not individually, but for those 2 combined? And just a comment around the Ukraine. Can you just remind us of the real advantages there? Is it just because it's brand-new effectively that the advantage, or is there a limestone or just an alternative fuel dynamic to the Ukraine position? And that 32% jump in sales, how much spare capacity that are left in terms of ramping up further as a profit contributor in '13? And then the second question, which was just a comment made by Albert when you talked about the cost savings about if markets deteriorate, I think beyond what we currently anticipate. I just wondered, which markets -- obviously Netherlands, I guess is one, Poland is another. Which are the markets that are sort of highest on your list in terms of concerns about where they dip to and how far that might go?

Maybe if I'll ask Henry to deal with the strategic aspects there of the Ukraine. Maeve might give you some indication then of combined EBITDA for Poland and the Ukraine. And then maybe Albert can flesh out his particular comments that you referred there. Henry, just strategic presence and the advantages of what we have currently in the Ukraine.

Having invested in the new processing in Ukraine, we're in a very commanding competitive position. There's only one other dry process producer. So about half the market is relying on wet process, which is cost wise, inefficient use of about twice the fuel levels. And then there's a further 25% of the market that's relying on gas, which of course, is very uncompetitive. And those producers are relying mainly on imported clinker from Russia, which is probably only the par with wet production. So with our position, we have, if you like, a decided advantage. I think what's also important is that the ramp of [ph] production is dictating a price level, which gives us a very sound margin. And then regarding capacity, the current plans would take a little bit over 2/3 of the clinker capacity that we have installed, so there's considerable headroom there. We have engaged in some clinker sales for using up some of that. We'd be looking at that as the year progresses.

Maeve?

On EBITDA, John, the combined Poland and Ukraine operations account for probably about 6%, 6% or 7% of group EBITDA.

And Albert?

Yes, the countries, John that we would have a careful eye on, obviously the European countries being the main ones. And the big ones for us at Poland, exactly how -- what Poland's -- the outturns of Poland's going to be this year and for the Benelux executive [ph]. Two key ones we will keep a close eye on. Germany and France, also although we think a little bit more predictable than those 2. And also just keeping an eye on -- although no concerns really. But Finland, Switzerland and Ukraine, we think we can call those this year, but they're the main ones we're watching all the time.

And as for [ph], more generally, we've had a period now of relative stability in European financial markets since last August when the ECB demonstrated a very strong commitment to supporting and doing whatever needed to be done. And I suppose that has, if you like, maintained a pretty good degree of stability and there'd always be concerns, that events might conspire to destabilize that somewhat. And we do see some concerns at the moment with regards to the outcome in the Italian elections, so I think one has to be mindful and watchful with regard to the overall European backdrop. And I think, hopefully, we will see the stability that we've seen continue and lead to recovery in sentiment as we move into the back end of 2013 and onto 2014. But there are risks remaining obviously in the eurozone. Howard, I think you had the European question as well.

Howard Seymour from Numis. [indiscernible] Myles, actually, really on the question of the European recovery potential, where we stand on sort of first half, second half, how you see the outlook? Would you expect that -- I mean obviously, you saw a worsening second half last year in materials. And looking specifically on volumes, would you say that you'd see a mirror image of that in the current year on the volume side of things, i.e. weaker first half and better second half, if I can put it that way? And similarly, would that have any implications for pricing, would you expect pricing to move up south of the -- would it require volume stabilization to see prices better?

Obviously, I think the comparisons get easier in the second half of the year, which is I think the point you're getting at. But I think there is -- there does seem to be a very strong sort of rhetoric across the industry in terms of the necessity for price increases. And I think, Henry, we're seeing that already in terms of notifications across the industry in a number of countries, which...

I think there are good signs [indiscernible] go up in the first half and then we get some benefit of that already by the half year. And that, that would be there then for the second half, which would make the returns a bit stronger.

Of course, it's not uniform across all countries, Howard. I mean we did have an experience last year, for instance, in Switzerland. Where neither the volume experience in the first half was certainly more difficult than it turned out to be in the second half of the year because there were some delays on some major infrastructure projects. They've now started, so I think, for example, in Switzerland, we're probably looking at a better first half volume progression relative to first half of last year. So it's not uniform across our heavy side markets in Europe, and I just like to make that point.

[indiscernible] I think it will be stronger in the year ahead. It has proven to be very good market for us, continues to perform very well. And Finland, with the benefits of the acquisitions that we did in the autumn, we'll have the full year benefits of that, which gives us a bigger footprint in the concrete products and exposure to housing. And we expect that to perform quite well throughout the year.

Thanks, Henry. Maybe just this side of the room hasn't got the mic yet, so maybe I'll go to them, first of all. Charlie, you have some questions?

Charlie Campbell at Liberum. Just one question really, a bit broad though. On European products and distribution, Erik, in your introduction, you talked a lot about maintaining market share, which given the volume outlook, it's probably quite difficult. That maybe implies some continued pressure on price, is that the right interpretation, or do you think you might do better than that?

Well, it's not exactly what I meant is getting market share by reduced pricing, because we do a lot to keep our prices at the right level and to maintain margins. It's more about the commercial activities being close to customers having the better innovative products that's very important in the organic part of the business. On the other hand, we're always looking for consolidation of restructuring opportunities in the markets. So for instance, last year, we did buy -- builders merchant [ph] business in The Netherlands to really fill white spots in our network, and we increase our market share by doing that. And these sometimes distressed assets you can buy at good values, it really improves our business and our bottom line. That's more the way we look at it.

I think what's been a feature and I think we talked about this in one-to-ones and also in general discussion with you is that despite the depth of the recession, the level of business failure so far in our sector and indeed in other sectors across Europe hasn't been as significant as one would've expected. But I think we have seen over the last 6 or 9 months, we have seen more evidence of distress and more opportunities to take advantage of that ourselves in terms of consolidating some of the markets that Erik just referred to there in responding to Charlie. And I think our sense will be that we're probably going to see more of that in the course of 2013, which will enable us to gain market position and also have a more positive impact in terms of some of the pricing trends in the particular market. Yuri, you had a question there.

Yuri Serov, Morgan Stanley. Quick, very narrow question on Poland. I think you said that you believe that cement prices in 2013 are likely to increase in mid-single digits. In 2012, volumes were weak, but prices were weak as well. As we know, and everybody in the industry obviously wanted to increase prices, they didn't, prices went down. What gives you more confidence that 2013 will be different?

Henry?

I think like ourselves, we're disappointed with margins, and we're disappointed with the recovery of cost increases during the downturn. And I think there is a stronger determination there. It is challenging, but I think there's a strong willingness to push prices and to try and get to higher margins and to recover the cost increases that we've endured.

Of course, the evidence of the success of that will be in the -- as we move out into the second quarter and as the season begins to pick up in Poland. Gregor?

Questions. Gregor Kuglitsch from UBS. First one is just in terms of the -- I think it's EUR 120 million of extra cost savings, give or take. How much of that falls into '13 into Europe? And sort of summing up your outlook for Europe, you're obviously talking about pressure, would you expect organic EBITDA to still be down despite those cost savings? Is that the message, is that the right interpretation? And then secondly, can you just maybe give us if it's meaningful, obviously, you've announced an asset swap today, I think for Uniland or for a cement plant in Bilbao, I believe, what the revenues, profitabilities, if it is profitable, I suspect it to not very profitable, is for that asset because clearly that's going to impact the P&L.

Okay, Albert, would you deal with the particular swap and explain for people just what's involved in that?

Indeed, maybe cost. In the current year -- in 2013, Gregor, about 60%, 65% of this cost savings that we're targeting for this year should come through the European divisions, 60%, 65% [indiscernible]. Just to recap on the other announcement today, we announced that we were swapping our 26% shareholding in Uniland, which was a Catalonian-based cement business across 2 plants, Catalonia, about 3.2 million, 3.3 million tonnes of cement capacity. And we have swapped that for 100% -- or 99.9%, is should say, of a Bilbao-based cement business called, Cementos Lemona. Cementos Lemona has about 1 million tonnes of capacity based in Bilbao. The big advantage for us is that we move away from being a minority player to being a fully owned, controlled business. And it's a facility which has its own local market. It also has export facilities and with that deal, we've also acquired import terminals and infrastructure in the United Kingdom where there is a well-established network of [indiscernible] cement from Northern Spain up to the United Kingdom. So it's a modern plant. It's had its difficulties like all of Spain. In fact, over the last year, actually, it has been closed down and shut down as cement [indiscernible] have optimized production within their cement network. I think if it was a separate plant, it would be different. There have been some union difficulties there with Cementos Portland, management and indeed the plant there over the cuts they wanted to impose across Spain, but we're buying it free of those encumbrances now at this stage. It'll be a standalone plant, but it'll sit well within our network of cement plants in Northwest and Northwestern Europe. We have a good flow of cement clinker from our Irish plants into U.K. from our Irish plant into The Netherlands and Belgium where you got significant distribution and grinding facilities and this will add to that whole network because we have history of trading cement in and around the Mediterranean, from Turkey, from Ukraine, into Ireland, into Northeast [ph] Europe. And it'll give us a low-cost modern facilities right on the water there, and we think it is a good addition to what we have.

In terms of the sort of the cost savings in Europe and their impact, I mean, obviously very difficult to say what the whole trading patterns will be in Europe in 2013. But I think we would see at the moment, the additional cost savings and the work that we've done last year is broadly compensating for any market pressures that we might see in 2013. But obviously, we'll keep you updated on that as we move through the year and get a better sense of activity. It has been somewhat difficult to discern underlying trends in trading thus far in 2013. Last year, you'll remember January was a relatively mild month weather-wise. February was very severe, in terms of weather patterns, and was quite a dampener on early activity. This year, the pattern has been somewhat reversed and January was a tough month weather-wise across Continental Europe. And February is proving a bit better, so it'll be another couple of months before we really get a sense of the underlying trends in the market. We'll take 1 more question in Europe if there's any left before we move across the Atlantic.

John Fraser-Andrews, HSBC. Myles, could I attempt you to put some numbers on those first 2 months in terms of like-for-like sales or volumes if you could, please? And secondly, are you seeing signs of Ireland bottoming out and any early signals of recovery and that being a positive contribution in 2013?

Thanks, John. I'm not so sure how useful it is putting sort of figures on the volumes, but I think just for an example, at the end of January, I think our Polish volumes were down 40% on January of 2013. By the end of last week, our Polish volumes were in line with the same number of weeks last year. So I think you get very variable patterns, and I'm not so sure at this early in the year that it's really worth dimensioning that by market. We'll be with our AGM updating statement on the 8th of May, we'll be able give you a picture for the first 4 months of the year, which we think will be much more meaningful as we strip out those weather effects and obviously move beyond the Easter season as well, which has an influence, particularly in products and distribution. In Ireland, in terms of the overall macro backdrop for Ireland, has stabilized. I think it's one of the few countries in the Eurozone for which the external analysts are projecting some GDP growth for 2013. It's based very much on the recovery in export industries. Domestic demand is still fairly challenged, though we would expect the construction activity in Ireland this year will show a further decline. But I guess, at this stage, Henry, it's looking like more mid-single digits?

Yes.

But there will be some further pressures. So hopefully, 2013 we'll see the trough in the Irish market. So hopefully, we seem to have some other hands there, so maybe 1 or 2 more, Luis?

I had on the U.S.

You're obviously getting in ahead there on the U.S., so you might kick off this segment like you did for Europe.

A couple of questions from the U.S. The first one is your views on the latest PCA forecasts on construction output? And the second one is, if you can give us an estimate of what the Sandy impact could be, positive impact in the first half of the this year, if any?

I think on Sandy impact, I think the benefit is really probably going to come in our distribution business. Doug, maybe you might comment on that and maybe Mark might comment on just the PCA forecast, which obviously -- in [ph] their spring forecast is much more positive than their autumn forecast. We would've felt their autumn forecast was a bit too depressive. I don't know if Mark, you might comment on what the spring forecast looks like, how you feel about it?

Let me take Sandy first. We are busy in the Northeast. As you know, Hurricane Sandy affected that part of the country. The Northeast represents about 25% of our Exterior Products business in distribution, about 10% of our interior products business. And we suspect in the first half, the impact could be -- approach the EUR 4 million to EUR 5 million range in terms of overall increase versus last year in that area. So it's a meaningful impact to our business there. We'll see how it goes, but right now we are busy in that area.

On the PCA, I think we thought they were too pessimistic in the fall. And I think, we have always said that they're probably the better indicator out there and they've missed it quite a bit in the last 2 or 3 years. I would feel that what they're saying now is probably realistic. I think the issue on -- for us to take a look at that, there's the trends on the housing, for example. You have to look at the mix of what's going on there and what that really means to us. And then the other piece, if you take a look at what they're talking about on the commercial side, and we get back into the ABI index, that's an indicator of activity. It's very positive on what's going on and positive for the last 6 months. We're starting to see activity -- to see [ph] there. We're bidding more, but you have to remember is a lagging indicator. It really won't probably mean much to us in 2013, but it's very positive going forward.

The number you've given for Sandy, what's that again? I didn't get it.

I think about EUR 4 million to EUR 5 million positive impact on our distribution activities. I think calling it on some of the other areas is a bit more difficult in terms of the work that's probably going to be phased out. But reroofing is a sort of an essential aspect when your home is damaged. I think that's where we probably see the early impact as the insurance checks have begun to flow through. So lots of hands here. Arnaud maybe [indiscernible].

Arnaud Palliez, Raymond James. Can you give us some ideas about the pricing trends in the U.S. for Materials, especially in -- or you can fill the gap with the cost inflation you had in recent years? And in readymixed concrete, you can pass on the cement price increases?

Okay. Thanks, Arnaud. I mean, you'll have seen in the slide for U.S. Materials, you will have seen very good price progression for asphalt in 2012 relative to the underlying cost base, which enabled us to expand our margins. You'll have seen obviously for readymixed that the sort of cost achieve -- the price achievements we have seen lag somewhat the cost. But there were some mix effects in there in relation to the type of contracts that we're undertaking and there were some large individual contracts in there as well. So there are different trends, but as we've said, one of our key areas of focus is for our pricing in U.S. Materials in 2013. And maybe, Mark, you'd like to comment on just what we would expect.

The cement pricing in the U.S., it kind of lagged last year. They have momentum going into 2013. I think it's positive for us. And it looks to me like they've put an increase in January, it's held. And they expect to try to do that later on in the year. And depending on where the geography lays, I think that would be positive in some areas for them. Our view is that we'll be able to pass that on through our products. As Myles mentioned, some of the mix that we had last year, we had a big project out in Utah with lower margins there that we worked through that now. And bid activity has been positive on the pricing. So we feel comfortable on the pricing on the readymixed business.

And would you care to comment, Mark, on asphalt pricing as you see it? I mean, good success last year but obviously more to go in terms of expanding our asphalt margins.

Yes. We continue to take a look at that. And we've got a good winter fill program going in, in place right now. It would be the racks are being -- we had, I guess, in the last part of the year, last year, the bitumen prices went down, stabilized and has been held right there where they are. So we feel we have a good winter fill program right now. We've got about half of our storage full right now. And that's by design for us, and we'll take a look and see how it goes, where we're going to go going forward. We've got the flexibility to do that. And then one of the good things that are going for us this year is there's no supply issue for us. And we've been in the past few years, we were worried about that. We don't have an issue for that. So it will all be -- gives us an opportunity really to look at the pricing there going forward.

Barry?

Maybe just continuing -- it's Barry Dixon from Davy Research. Just maybe to continue on the theme on Americas Materials. On the highway side, in particular, Mark, is there -- I mean, we've seen pretty good data over the last few months on the contract awards data. You highlighted in the statement that it was weak contract awards which gave rise to the decline in volumes in the second half of the year in Americas Materials. How should we read it? Is this just a timing issue? Or is there something more significant going on in the funding environment on U.S. highways?

I mean, I think it is timing, Barry. I mean, I think it kind of lagged in the third quarter last year. I'm trying to figure out what's really going on. But you have to remember MAP-21 is capped to what the federal funds are there. So I think the activity is going on now, there's a lot of bidding going on right now, but you have to -- we've got $40 billion to spend on the federal funds. I don't see any opportunity to grow that. I mean, the upside for us on the funding there would be on the states, if they could come up with some more revenue to do there. But I think the federal thing, it is varied [ph] activity. A lot of stuff going on right now, but it'll catch itself up. I think, Doug, maybe you might want to expand...

If you go back and look at the obligations in '09, in '10, fiscal '09 and '10, the current obligations are similar to those years in fiscal '11 and '12. They were way down this time last year and the year before. But if you remember, we were under a situation, where the constant extensions in the states were more unsure about the funding. I think what MAP-21 has done is secured the funding for next year. And so the states are confidently moving forward on projects. But the overall spend, as Mark said, will be flat versus last year. So we're just -- we're getting off to good start. We feel good about that, but it will be flat in the end.

And just second question is in terms of the contracting side. You talked previously about margins being under pressure because of increased competition from contractors coming in from the private side or from the res and nonres side. As that recovers, are you seeing those guys going back to their old jobs and it's become less competitive for you guys in highways?

I'll take that. We're encouraged. As you know, our construction margins had been dropping for the last 4 or 5 years as we had competition coming in from the private side in paving, et cetera. That has bottomed out in 2012, and we do see that starting to normalize. There's not a plethora of private work yet for them to run back to, so we still have the same competitors that we had last year. But I think all competitors are under pressure, financial pressure. All competitors want to raise prices and make more on the margin side. And so as the activity stabilizes and moves forward and as the private market comes back, we do feel like we can start to move construction margins back up, which is a huge positive for the Materials group.

And maybe if I could just clarify one point because I've seen some misreporting in the press about the impact of the sequestration might have on a number of funding programs, including highways. And just a report on the Financial Times yesterday referred to the 5% applying also to highway funding. Just to clarify, it doesn't apply, it only applies to a very small proportion of highway funding. And it applies to about $350 million of funding, which out of the total combination of state and federal funding is less than 0.5%. So just to clarify for anybody who may have seen or read any of those reports, the potential impact of sequestration is very minor, less than 0.5%. Sorry, a question here?

Will Jones, Redburn. Just a question around the operating leverage with the numbers last year, please, in the Americas. If you look at the Products division, I think like-for-like sales are up 7%, but the drop-through to organic EBITDA was about a EUR 0.12. And the dollar drop-through rose in Distribution. Like-for-like sales are up 2%, and I think the drop-through is about EUR 0.30 [ph]. Could you just explain? I guess, cost savings and input cost inflation can mess that around a bit. But perhaps some explanation there, please. And then just really a feel for, particularly when Americas Materials starts to turn, what kind of leverage you might be looking at in that division relative to, say, Products and how the order of priority might be this year on that front.

Well, I think in relation to the Products and Distribution, the leverage, it's a complex equation naturally enough. I suppose some of the upturn that we saw, particularly in our precast activities last year in the U.S., would have been some of the sort of larger -- lower-margin project work coming through more significantly than some of the tailored precast work, which would have higher margins. So there's an influence there. I think -- but more generally, what's prevailing is that we haven't yet developed that price momentum in the U.S. that is needed to really kick through on the leverage. I think if you look at the pattern of what we've seen in the various -- through the cycle it's been and in the initial stages of decline, pricing discipline generally held. But then as the declines in volume became more severe, pricing discipline frayed and you began to get an adverse combination of price and volume. I think as we're moving now into the upturn phase in the U.S., it's the volume that's coming back first. And hopefully, as things gather a bit of momentum, we'll be able to get the combination of stronger pricing potential and also some -- and the better volumes, which will be a strong combination. Putting a figure on what that leverage might be is obviously very difficult at this particular point. One question over here.

Arnaud Lehmann from Bank of America Merrill Lynch. Could I ask about your M&A strategy in the U.S.? I mean, obviously, the market is in the process of picking up. So I'm guessing valuations have gone up significantly as well. Are you still in a position to make accretive or value-creative acquisitions in the U.S. at this stage?

Well, I think what we have seen for a prolonged period has been that in many of the opportunities we looked at in the U.S. through, '09, '10, much of '11. The valuations were much too high for our particular approach and our particular valuation criteria. I think what we've seen in 2012 particularly has been people beginning to temper, if you like, unreasonably high expectations for their businesses. At the same time, we've been able to become a bit more positive about the outlook because of the trading trends we've experienced ourselves. And that's enabling transactions to happen. So for a lot of the transactions that we would've completed in 2012, the actual prices struck were lower than the prices we would've been in dialogue with some of the sellers about back in '10 and '11. So I think in some cases, what we're finding is that as things prove tougher as leverage proves more stubborn for many of these companies, they're having to trim their valuation expectations. And we're being able to see deals get done. Doug or Mark, you'd might like to comment on that?

Yes. I think we're seeing a good deal flow. I think valuations, as Myles has said, have been high, too high. Obviously, we've completed 16 deals in the Materials space last year and several deals in the Products space, so we were able to achieve some deals. As the markets start to correct, I think there's a natural tendency for folks to get more bullish. But I think at the same time, valuation expectations are coming back in line with reality. So I think the combination of the markets coming back, remember that allows us to get better returns on deals when we have a robust future. So I think the deal flow has been good, and we would expect similar deal activity, maybe even more deal activity in 2013 as was in '12. We did some nice deals in the Products space up in Canada. And I might mention we're seeing additional deal flow in Canada. It's an area that we want to grow in, in all of our spaces. And that provides opportunity, as well as the United States. Mark, did you have anything to add?

Well, I guess, the other thing that like what we've done, a lot of companies have taken a look at their portfolio to see where they want to be. And I think some of the opportunities we have, they may decide to exit some of those product lines, and we've continued to have dialogues there. And I think that's a positive for us. And like Doug says, we're looking at a lot of things right now, so pretty [ph] positive.

Aynsley?

Aynsley Lammin from Citigroup. If you just comment on the RMI market in the U.S., just the outlook there, if the momentum is still continuing. And then just on the U.S. residential market, do you expect -- kind of how strong is the momentum in the recovery in that market? Do you expect another couple of years of 20-plus percent growth? How quickly do you think we get back to the kind of 1.4 million, 1.5 million starts? And I don't know if you're more willing to give a kind of like-for-like figure for first 8 weeks for trading in the U.S.

Doug, you might comment on RMI trends and housing trends.

Yes. RMI trends are more positive going into '13 than in '12. We believe RMI was down in 2012, which put a drag on our business, especially the Architectural Products business, which is heavily weighted toward RMI. But also roofing, residential roofing actually declined in 2012. We expect residential roofing to be up on order of 3% in 2013. We expect RMI in total, the business at Home Depot and Lowe's, et cetera, due to be up 4%. I think that's the PCA view and we agree with that. So we do see some positive momentum in RMI, which provides underlying leverage for especially our APG business and our Distribution business. The second question?

Was just on the housing growth.

On the housing, we are seeing a real housing recovery. It's very encouraging. And so we do expect the 20% increases for the next few years. Again, PCA forecast has it returning to 1.4 million total starts, I think, in the next 4 years. And we would agree with that. That's the norm. Somewhere, 1.2 million, 1.4 million would be the ongoing norm for the U.S., so we do feel while it will have to get there, current starts in 2012 were about 780,000. So we've got ways to go. It'll double in the next 5 years, let's say. So good increases in the next 2 or 3 years, leveling out after that.

Well, I think it is a different type of house in many respects to what would have been constructed on average before the downturn in terms of square footage, and also in terms of the value add and the quality and the sort of the spec of some of the materials being used. So I think one just has to recognize that. I think in terms of like-for-like sales thus far in the year, again weather effects come in. January has been a pretty tough month weather-wise in parts of the U.S., whereas last year it was very mild. So I don't think at this stage, it's productive to be providing indications in that respect. Again, as I mentioned, AGM in early May, where we'll be giving you the like-for-like trends in the -- for the first 4 months, which I think will be far more instructive. Sorry, John?

Your competitors have been making positive noises about the take-up for TIFIA funding being a 2014 issue. Could you give your outlook for that and whether you think, given that it's likely to be a lot of PPP projects, what your outlook for asphalt's market share of that road building is?

Well, I think just TIFIA has been around for a long time. I mean, it isn't just an invention of the last few years. It has been a feature going back to TEA-21 back in the late '90s, 1998. So it's not something new. Some of the -- it's been -- I think the TIFIA contribution has been of the order of maybe $120 million a year. Under a SAFETEA-LU, I think the funds that have been allocated for 2013, 2014 are around the $700 million mark. So there's a step-up there in that funding. But I think it's significance has been dramatically overstated. Doug, you would like to comment maybe on that?

Yes. I think TIFIA is a good program. It helps fund the P3 types of projects, the toll road and the major projects. It has been around since 1998. There's been 31 projects that have used TIFIA funds. So while it's -- but it's another way to allow funding of projects. And so while it is useful, you have to remember that P3 projects take a long time to plan and execute. They tend to be the larger projects. And I think for TIFIA to be applied, it has to be a project over $50 million. So that money will tend to support very large projects that will take several years to plan, several years to construct. We do think we'll get some share of that, our normal share of those projects. In terms of the impact though in 2013 and 2014, we see that being modest. I mean, it's going to be part of the program, but it will have an overall modest impact, especially in the shorter term.

Thanks, Doug. I think maybe we might move to -- if there are any questions of a general nature with regard to group issues, we'd like to take those because we are beginning to run a bit short on time. Yuri?

Yuri Serov from Morgan Stanley. A few things. First of all, your guidance, you're talking about progress in 2013. I mean, I personally take it as single-digit growth in EBITDA. I don't know what your -- I mean, my question is basically for this single-digit, what's your definition of progress? Is it low single-digit or high single-digit? Number one. The second question, on the development spend, you had another year of only EUR 500 million to EUR 600 million spent on acquisitions. Although we've heard for some time now that your assessment of your firepower is about EUR 1.5 billion, I mean, my conclusion is that you're struggling to find targets. Is that the right conclusion?

No, I would say we're not struggling to find opportunities. What we are continuing to be is very careful that those opportunities come at the right valuation for CRH and enable us to earn an adequate return. And I think what you've seen during the year is a good delivery of acquisitions, following on also from good delivery in 2011, and a number of transactions, where we actively engaged with the seller but didn't complete for various reasons. So I think we're seeing good opportunities out there, but we are obviously not biting and signing on everything that we see. That continues to be the case. I mentioned expectations for valuations for businesses remain very high in some areas and from some sellers. We've seen some of those expectations moderate in the course of the year, which has enabled us to complete deals at valuations that makes sense for us. And we continue to engage and continue to try and work down some of those valuations. So I mean, when we talked about EUR 1 billion to EUR 1.5 billion in previous years and when we talk about it now, it's about an indication of capacity. It's not about a target in terms of completions for the year. What we complete in the year will always be dictated by the value that we can achieve for our shareholders. Mike?

What about the second -- the first question about the guidance?

I think at this stage in the year, I think we're limiting our statements to progress. I think a lot will depend obviously naturally as how things work out. I think you guys are the experts in terms of economies and growth more so than us, so you have to factor into your models what you believe is appropriate. If things continue to be challenging and at this early point in the year, probably people should, I think, be naturally cautious in terms of what they project. As I say, AGM in May will give a much better view of what the underlying patterns are in our business and we'll be able to provide some further color at that particular stage. But it's still very early.

Sorry, can I ask a very quick technical question? On your associates, once you strip out the one-offs, it's quite clear that the number fell quite significantly by more than 1/3. Is that all China? Could you just give us some more detail as to what's driving that line?

Well, 2 things drove that line: 1 would be China, but obviously the other thing will be Uniland, which was part of our portfolio for last year, would also see a sharp decline in its profitability there. I think, Maeve, they would be the 2 major influences?

Yes. Those are the 2 factors. And we've obviously now swapped out, out of that Uniland. And so we will not -- that will not be part of the story going forward.

Mike?

I had 3 quick questions, if I could. Firstly, a question to Maeve. You kind of given us an overall level, a group level of what the joint venture changes would be. Could we at some point have it by division? Because most of us forecast by division, but maybe at this stage you could indicate which are the major divisions that are impacted. Secondly, for Albert, have we seen now most of reorganization costs of the cost saving? I think we saw another EUR 60 million of reorganization cost go through. What's -- is that going to step down now, assuming no further increase in the plans? And then the final, the more difficult one, the management change, the perspective that's announced at this stage, Myles, can you add any more to that? And it's very early for that announcement to be made, I have to say, when it's end of the year. But maybe if you can add any more to that sort of process and what's going to go on and why now announce it?

Okay. Well, maybe if I can just deal with that one last. We're obviously -- post these results and post our presentation to you today, we're obviously embarking on our usual intensive roadshows and meeting investors both in Europe and in the U.S. and in North America generally. And the question will obviously be coming up with regard to my particular timing. I think if you read the annual report, it's evident that I have a 5-year incentive deal, which ends at the end of 2013. So I think as we would have expected in the roadshow, the issue would have been raised. And we think it's far better to provide clarity to the market at this stage before we embark on those particular rounds of investor meetings. So I think from here, succession committee has been appointed. Everything will be handled in an orderly fashion in keeping with our tradition and aimed at making a successor -- appointing a successor in good time to allow an orderly transition.

When will we expect the announcement?

Well, I think we wouldn't want to be tied to that. But I think you might assume it could be somewhere in the third quarter of the year. Two questions for Maeve in just terms of the segmental impacts of the accounting changes.

Yes. We will be giving the details for the last couple of years. But just for the sake of giving a sense of it at the moment, the bulk of the joint ventures are in the Materials group in Europe, so they would be maybe roughly 60% of the EBITDA and sales numbers that we've reported in the announcement. The second question?

Albert, in terms of the cost to implement the cost restructuring program?

Yes. Of what's left to do of the current program, 2015, May [ph].

Well, I guess, what I'm interested is you get [ph] EUR 60 million restructuring costs we've seen in the last couple of years, are we likely to see in 2013?

Probably about close to around EUR 50 million, at EUR 50 million thereabouts of restructuring costs.

John?

John Messenger, Redburn. One for Maeve, if I could, please. Just on tax rate guidance. Obviously, the tax rate is moving up. Clearly, the mix will matter. But from 16% to 17.8%, just an idea of where we should think about the world of tax rates in 2013 and '14, if we could, please?

Thanks, John. Yes. With the outlook for 2013 being still challenges in Europe and a slight -- an improving outlook in the U.S., as that reflects itself in the mix of our profits, we should see the tax rate edging up as well. So we'd see another couple of percentage points maybe added on to the tax rate for 2013.

And just one back to Myles or maybe for Albert as well. But when we look at development actions last year, clearly things like concrete products in the U.S. was an area where you did some deals. Erik, when you talked about Distribution, and I think the comment was, we won't forget about Builders Merchanting in certain more attractive markets. When we look at the next year ahead, we know that clearly there's a U.S. peer of yours with lots of concrete products businesses, bricks and the like that they need to sell or would ideally sell. But we've got Distribution in Europe, where France -- I don't know whether France would be defined as an attractive market these days. Just an idea as to where you think your spending might end up. Clearly, it has to be about opportunity and the right value. But when you look at where you'd like to put your money, would it still be very much look at the spread exercise? Or are there markets like France that you'd want to steer away from right now? Or is the U.S. with products and utilities in those kind of the areas, where you've already got good experience, the bits that you'd like to buy more of?

Well, I think in terms of just to look at pipeline at the moment. And we see pipeline in the U.S. We see pipeline as well in Europe, primarily focused obviously on Distribution, but also on some of the heavy end businesses, particularly to the East in Europe. And obviously, we are keen to continue to expand out in some of the emerging regions. So again, a lot of opportunities being worked on at the moment across all segments. But obviously, in Products in Europe, we're going through a tough time restructuring. But there may be some acquisition opportunities there in terms of some of the distressed positions, situations that I mentioned that are now beginning to come to the fore that could make sense in terms of strengthening our position in particular markets. So I think there's an array of things, and we just have to see how the chips fall on some of those as we move through the year. So it continues to be the usual broad perspective, John. Probably not particularly helpful, but we can't predict what's going to happen. One more question. Maybe, Luis, you have one for the end. And we'll just see what's on the phone lines then before we wrap up. We've already kept you long enough.

A very brief question for me. Any idea on general cost inflation for 2013? Anything that worries you? Do you have a number in mind?

I think, as Henry mentioned, we're seeing pretty modest energy cost inflation for our European heavy cement businesses. As we look at things in the U.S. at the moment, asphalt, we mentioned we have a good winter fill. Price is somewhat below last year's levels. Energy costs have moved up a bit in terms of transportation costs in the U.S. over the last couple of weeks. But it's not something that's particularly worrying at the moment. So again, I guess, it's energy would be the main area that we'd be keeping a close eye on. We're largely hedged in our European businesses on the cement side for this year, pretty good prices. But obviously as our big asphalt requirement obviously comes later on in the year, and also our general transportation costs during the year are also an important element. So they would be the main areas of concern. I don't think we have any other particular input costs where you're seeing any particular pressures at the moment. In our Distribution businesses, I think we would expect, particularly in the U.S., to see continuing strong price increases in wallboard and also in some of the roofing products. But again, I think we've probably shown an ability to pass those through in 2012. Again, our glass input cost increases in our BuildingEnvelope business last year would have been relatively strong price increases. But again, we passed those through pretty successfully. And I think we'd expect to do the same in 2013. So if we have anything on the phone lines, I think we have one question, which we might just address before we wrap up.

Robert Eason from Goodbody is on line with a question.

Just 2 questions. In the Investor Day in Q4 of last year, you gave a useful breakout of price versus cost. What's was the price and cost elements in the 2012 results in terms of one offsetting the other? And my second question is on U.S. highways. A lot of your peers have been talking about the buoyancy in contract awards, et cetera, but there's a more of a bias towards new kind of larger-build projects rather than RMI, which is more prevalent and when there was more uncertainty on funding. Just basically looking for a comment on that.

Thanks, Robert. Maybe I'd like just to address that second question, and then pass it on maybe to Doug or Mark just to add some color. I think one of the comments that's been made in relation to the contracts awards already is that the average size of contract award this year is much higher than it was at the same point last year. But the comparison is between, I think, a 1.6 million average and a 2.3 million average. And frankly, 2.3 million average doesn't get you anything much more than a normal repair and maintenance job in the U.S. But maybe just on your wider question as to the mix of spend of this year, Doug, would you like to...

Yes. I'll take that one. In terms of the mix of spend, we don't see a major difference between 2012 and 2013. In fact, the maintenance side of our infrastructure in the U.S., I think, as everybody knows, has been building up, the need to do maintenance. And I think the states more and more realize that they have to spend more on maintenance as opposed to new projects. So we actually foresee a slight increase in maintenance spend in 2013, and then we see a lot of activity in the states to gain additional funding largely to support maintenance activity. So there will be the big projects, but maintenance will still be very strong, and in fact, possibly increasing in the mix in the year to come or the several years to come. So we feel pretty good about that.

I think just in relation to your cost-price question, Albert, would you like to respond to that?

I think in terms of what we see going forward, I think that again, we've always said that the pressure on prices will remain until volumes start to recover. And I think that when we see volumes coming back, that's when we start to see prices coming back as such. In terms of internally within our businesses, we've obviously controlled our prices and controlled our costs quite a bit, so we don't see any big pressure on that. But I think going forward, as the guys have said, both in the U.S. and Europe, I think as we start to see volume recover, that's when we start to see some delivery in prices. In terms of the actual breakdown, probably better to do that offsite rather than here, it's a lot more detail.

Thanks, Albert. And thank you. We've kept you long enough, and we've gone over somewhat. If we just before we finish, could I just recap on some of CRH's key strengths? We obviously have a very strong and proven business model, delivering long-term value for our shareholders. Financial strength, I think, has been very clearly set out in Maeve's presentation in terms of credit rating, in terms of our net debt-to-EBITDA. That enables us to sustain the dividend delivery that we've shown through a recent difficult patch and also enables us to take advantage of value-creating acquisition opportunities across our portfolio. We've done that already significantly in 2012. We hope to do it to a greater extent in 2013, and look forward to reporting to you on the trends in the early months of 2013 with our AGM statement on the 8th of May, and then with our interim results in mid-August. So until then, thank you for being present here in London this morning. Thank you for those, who have listened on dial-in and who've watched on the Web. If there are any queries on unresolved from our Q&A session today and from the presentation, please email us at the CRH Investor Relations contact point. So thank you again for your attention this morning. Thank you.