Development Strategy Update

CRH PLC
04 January 2006


             D E V E L O P M E N T   S T R A T E G Y   U P D A T E


                                                                  4 January 2006


           CRH ANNOUNCES FURTHER SECOND HALF DEVELOPMENT INITIATIVES
        TOTALLING EURO 575 MILLION TO GIVE FULL YEAR DEVELOPMENT TOTAL
                       OF APPROXIMATELY EURO 1.45 BILLION


CRH plc, the international building materials group, today announces 34
development initiatives totalling euro 575 million (including capital
expenditure of euro 19 million on three large capital projects) undertaken
during the second half of 2005. These initiatives are in addition to the three
Materials transactions in the United States totalling euro 344 million announced
on 1 November 2005 and the acquisition of a 26.3% stake in Corporacion Uniland
announced on 30 December 2005 for approximately euro 300 million. These bring
total development spend for the second half of 2005 to over euro 1.2 billion.

With this strong pick-up in the second half of the year, development expenditure
for the full year, including the first half spend of euro 231 million announced
on 5 July 2005, amounts to approximately euro 1.45 billion.


Commenting on these developments, Liam O'Mahony, CRH Chief Executive, said:

'We are very pleased that the level of completed transactions has increased
during recent months following a relatively slow pace of spend in the first six
months of 2005. As previously indicated, we continue to work on opportunities
for acquisitions across all our operations and remain committed to completing
transactions at prices that will contribute to long-term value creation for our
shareholders.'

• Europe Materials - 4 deals for euro 15 million

Acquisition of an additional 31% in a concrete paving producer and the purchase
of an aerated concrete block producer in Poland , and acquisition of two
concrete products businesses in Finland .

• Europe Products & Distribution -  9 deals for euro 358 million

Three acquisitions were completed by the Concrete Products group in Belgium ,
France and Denmark.  The Clay Products group acquired one business in Poland.
The Building Products group acquired a leading pan-European producer of
construction accessories. The Distribution group was expanded with the addition
of four builders merchanting businesses in Switzerland , Austria and Germany.

• Americas Materials:  8 deals totalling euro 31 million

Five acquisitions in the West region, together with one acquisition in each of
the Central, New York/New Jersey and New England regions.

• Americas Products & Distribution: 10 deals & 3 projects totalling euro 171
  million

Four acquisitions in the Architectural Products Group, combined with the
construction of a stone bagging facility in New Jersey and a block plant in
Arizona. Three deals by the Precast Group in Arizona, Kansas and West Virginia,
together with the relocation of an operation in California . Three
acquisitions by the Distribution Group adding a total of 14 branches in Utah,
Michigan, Ohio and Florida.



Contact at Dublin 404 1000  ([phone])
Liam O'Mahony                Chief Executive
Myles Lee                    Finance Director
Eimear O'Flynn               Head of Investor Relations
Maeve Carton                 Group Controller



Europe Materials: euro 15 million

In addition to the investment of approximately euro 300 million in Spanish
cement producer Corporacion Uniland announced on 30 December 2005,  the Europe
Materials Division completed four transactions during the second half of 2005,
at a total cost of euro 15 million. Annual incremental sales amount to euro 20
million.


Poland

In July, CRH acquired an additional 31% stake in Bazaltex, a leading concrete
paving producer based in the Silesia and Opole regions of south-western Poland.
This transaction brings CRH's share in Bazaltex to 80%, following the
acquisition of an initial 49% stake in the business in February 2005. The
remaining shareholding is expected to be purchased in 2008 in line with a
pre-agreed earn-out formula. The investment in Bazaltex extends CRH's position
in the concrete paving segment.

Also in July, CRH extended its aerated concrete activities in Poland with the
acquisition of Prefabet Niegocin, a producer of aerated concrete block based in
the Warminsko-Mazurskie voivodship in the northeast of the country.


Finland

In late December, Lohja Rudus completed two acquisitions, with total annual
sales of euro 13 million, which strengthen its existing position in concrete
products in Finland . Elpotek, which has a production facility at Kotka, 150km
east of Helsinki, is a producer of vertical and horizontal precast concrete
elements which have preinstalled pipes for transporting sewage, water and air
conditioning and other services. Skanska Betoni is a manufacturer of concrete
piles, sound barriers, road wall panels and housing panels with one location in
Nurmijarvi, close to Helsinki . This acquisition will result in increased
production and transport efficiencies in the existing Rudus/Abetoni concrete
pile business in addition to providing access to new products.


Europe Products & Distribution: euro 358 million

The Europe Products & Distribution Division completed nine acquisitions in the
second half of 2005 at a total cost of euro 358 million. This includes four
significant transactions, in the Concrete Products (Stradal), Building Products
(Reuss-Seifert) and Distribution (Quester and Bauking) groups, together with
five smaller deals. The annual incremental sales arising from these transactions
amount to euro 784 million.


Concrete Products

In July, the Concrete Products group acquired Marmorith, a manufacturer of
prefabricated structural concrete elements (shuttering slabs, load-bearing
walls) in Belgium serving the non-residential sector.  With annual sales of euro
18 million, Marmorith operates from a single production plant in Houthalen in
northern Belgium ; 85% of its sales are generated in Belgium while exports to
the Netherlands account for the remaining 15%. The deal strengthens CRH's
position in the Belgian floor market and expands its product assortment in the
reinforced structural sector.

In August, the group acquired Stradal in France . With annual sales of euro 173
million, Stradal operates 24 factories across the country producing landscape,
utility and infrastructure products. It is also a 30% shareholder in ECPC, an
Egyptian concrete pipe and water treatment system producer.  Stradal gives CRH
the opportunity to build a leadership position in concrete products in France
and to realise synergies across its expanded concrete operations in France.

In December, the group acquired RBR, the second largest paving manufacturer in
Denmark. RBR is a highly efficient operator with a significant market position
in the west of the country. It operates from three production locations and has
annual sales of euro 14 million.  The deal represents CRH's first architectural
concrete products investment in Denmark.


Clay Products

In July, the Clay Products group acquired Cerpol, a leading privately-owned
producer of clay blocks in Poland with annual sales of euro 6 million.  With one
production site located in Kozlowice, close to the key markets of Silesia,
Opole and Wroclaw , Cerpol provides CRH with the opportunity to broaden its
product range into clay construction blocks and to build its own platform for
growth in the market.


Building Products

In October, the Construction Accessories division acquired Reuss-Seifert Group,
a leading European producer of construction accessories (plastic, metal and
concrete spacers and other accessories) with annual sales of euro 55 million.
Reuss-Seifert (now renamed Syncotec) operates three plants and one distribution
centre in Germany , together with production plants in France and Poland and
sales offices in Poland and the Czech Republic. This acquisition makes CRH the
market leader in Central Europe ( Germany , Poland and the Czech Republic ) in
spacers and plastic formwork accessories and also provides opportunities for the
distribution of our existing Plakabeton and Aschwanden products in Germany and
eastern Europe through the Syncotec sales network. Annualised sales for the CRH
Construction Accessories group following this deal are approximately euro 150
million.


Distribution

In July, the Distribution group acquired Fr. Schneider, a Swiss builders
merchant with one location operating in the Bern region. In November, the group
acquired Baucasch, a general builders merchant with two branches in the Surselva
valley in the southeast of Switzerland . These two acquisitions, with combined
annual sales of approximately euro 14 million, are an excellent fit with CRH's
existing 32-branch BauBedarf builders merchanting operations and support
BauBedarf's strategy of strengthening its market position in the German-speaking
part of Switzerland.

The acquisition by the Distribution group of Quester, the leading nationwide
Austrian builders merchant with 32 locations (including a central warehouse for
ceramics), was completed in October.  Quester's sales, which amount to
approximately euro 250 million annually, span three product categories: general
building, dry construction materials and ceramics.  The acquisition represents
an excellent platform for further growth in the relatively fragmented Austrian
market.

In December, the Distribution group acquired a 47.8% joint venture interest in
Bauking, a builders merchant and DIY operator with 108 locations primarily in
northern Germany . With annual sales of euro 531 million (CRH share euro 254
million), Bauking is the clear market leader in the region, and has performed
well despite difficult market conditions in Germany. This deal gives CRH
Distribution, which is already one of the largest operators in the Netherlands,
access to the German builders merchanting and DIY markets.


Americas Materials: euro 31 million

In addition to the acquisitions of the Mountain Companies and Southern Minnesota
Construction and the investment in Bizzack at a total combined cost of euro 344
million, which were announced on 1 November 2005, the Americas Materials
Division completed eight bolt-on acquisitions in the second half of 2005 at a
combined cost of US$38 million (euro 31 million).  These eight acquisitions,
which will add annual incremental sales of US$44 million, bring total second
half development spend for the Division to euro 375 million.


New York/New Jersey

In July, the Americas Materials Division acquired the readymixed concrete assets
of Tri-Cities Aggregate located in the greater Albany area of upstate New York.
With annual sales of US$2 million, Tri-Cities is a solid bolt-on to existing
operations in the area.


New England

Blue Rock Industries, an integrated aggregates, asphalt and construction company
based near Portland , Maine with annual sales of US$20 million, was acquired in
mid-December. The deal provides valuable reserves to improve the vertical
integration of our existing operations and gives greater exposure to the private
and commercial sectors in the Portland area.


Central

In November, the Division acquired the trucking assets of the Stansley Group
(annual sales of US$2 million) to enhance the aggregate transportation
capabilities of the Division's existing vertically integrated business in the
Toledo, Ohio area.


West

During the second half of 2005, the Americas Materials Division completed a
total of five bolt-on acquisitions in its West region which strengthen and
complement its existing activities and provide incremental annual sales of US$20
million to this regional group.

Pave & Seal, a small paving and construction services company located in Oregon, 
was acquired in July. This acquisition expands the Division's aggregates,
asphalt and ready-mix concrete operations into the attractive and fast-growing
Oregon residential and commercial paving market.

In August, two small deals were completed in Iowa : KP Materials, an aggregates
business in northwest Iowa which serves both this region and parts of
south-central Minnesota, and Reilly Recycling, a concrete and asphalt recycling
business in Des Moines.  A third business, Kruse Paving, an asphalt paving
business with gravel resources in northwest Iowa and southwest Minnesota, was
added in September.

Also in September, the West group acquired Coppola Concrete Supply, a readymixed
concrete supplier in New Mexico. Coppola is being integrated with the West
group's existing New Mexico aggregates and readymixed concrete operations which
are located near Albuquerque.


Americas Products & Distribution: euro 171 million

The Americas Products & Distribution Division completed a total of 10
acquisitions in the second half of 2005 at a combined cost of US$182 million
(euro 152 million) yielding annual incremental sales of US$279 million. In
addition, the Division has commenced three major capital projects at a combined
cost of US$22 million (euro 19 million).


Precast Group

In July, the Precast Group acquired Contractors/Engineers Supply (CES), a
concrete utility box manufacturer and distributor of water and irrigation
supplies.  CES, which has annual sales of US$7 million from two locations in
Phoenix and Tucson , has been a leader in the Arizona construction products
market for 30 years and is the only Arizona-based manufacturer of concrete
utility boxes. The acquisition is an excellent add-on for the Precast Group's
West division, strengthening its position in the attractive and fast-growing
Arizona market.

The acquisition of Vanguard Products Corp. was also completed in July. Vanguard,
a manufacturer of precast concrete manhole and drainage products and concrete
pipe in Kansas , has annual sales of US$8 million from two locations in Topeka.
Vanguard has been a leader in the Kansas market for nearly 40 years, and this
acquisition adds a new state to the Precast Group's existing operations in the
Mid-western region.

Packaged Systems, a manufacturer of precast concrete pump-stations and manholes
in West Virginia , was acquired in November. With annual sales of US$4 million
and a high value-added product range which is produced at its facility near
Charleston, West Virginia, the company strengthens the Precast Group's
presence in this region of the United States.

In August, the Precast Group decided to replace and relocate its Christy Fremont
facility to a new site in Madera, California. This move facilitates future
development opportunities for the Precast West division.


Architectural Products Group (APG)

In September, APG purchased certain assets of  S.T. Wooten, a concrete block
manufacturer in North Carolina (NC).  S.T. Wooten operates from one facility in
Wilson, NC, and generates annual sales of US$4 million. The acquisition brings
additional manufacturing capacity to our Adams Products companies and will
support their growth in eastern NC through increasing market share with
lightweight block and resale items.

Also in September, APG acquired selected assets in Atlanta, Georgia of Earth
Pak, a producer of bagged soil and mulch and decorative stone with annual sales
of US$9 million. This was followed in October by the purchase of Jolly Gardener,
one of the leading producers of bagged soil and mulch products in the United
States with annual sales of US$119 million. Jolly Gardener operates ten plants
in seven east coast states extending from Florida to Maine. Both these deals
reinforce APG's retail strategy of achieving national coverage in DIY lawn and
garden and building products through product bundling for both the large
homecenter chains and independent retailers.

In November, APG purchased Arkalite Corporation, a lightweight aggregates
producer in Arkansas with annual sales of US$11 million.  The acquisition is a
natural fit with our existing Big River business which is a leading producer of
lightweight aggregates in the United States with production facilities in
Alabama and Louisiana.

During the period, APG also commenced the construction of an automatic stone
bagging facility at the Materials Division's site in Mount Hope, New Jersey.
This development allows APG's Oldcastle Stone Products group to enhance its
service in the New York/New Jersey markets. In October, APG started the
construction of a block plant in Phoenix, Arizona further increasing production
capacity to service strong customer demand in the Phoenix market.


Distribution Group

The acquisition of Interstate Roofing Supply was completed by the Distribution
Group (Allied Building Products) in early November. Interstate is a two-branch
distributor of roofing products in north-central Utah and has annual sales of
US$13 million. The acquisition builds on Allied's existing branch in Salt Lake
City which specialises in serving Allied's core roofing and siding market.

In early December, Allied acquired Astro Building Products, a roofing, siding
and window distributor,  with two locations in Detroit, Michigan and one in
Toledo, Ohio. With annual sales of US$25 million, Astro adds critical mass in
the important metropolitan Detroit market where Allied already has three roofing
and siding branches and one branch specialising in interior products.

As part of the expansion of Allied's interior products division, the acquisition
of Atlantic Building Materials was completed in late December. With nine
branches in central Florida and annual sales of US$90 million, Atlantic will
give Allied a strong presence in the Florida interior products market and will
complement Allied's existing five-branch roofing and siding presence in Florida.


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          CRH plc, Belgard Castle , Clondalkin, Dublin 22, Ireland   
                 TELEPHONE [phone]  FAX [phone]

         E-MAIL [e-mail] WEBSITE www.crh.com  Registered Office, 
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