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Table of Contents

As filed with the Securities and Exchange Commission on October 22, 2014

Registration No. 333-198736


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549



AMENDMENT NO. 1
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933



Hanson Building Products Limited
(Exact name of registrant as specified in its charter)



Jersey, Channel Islands
(State or other jurisdiction of
incorporation or organization)
  3272
(Primary Standard Industrial
Classification Code Number)
  Not Applicable
(I.R.S. Employer
Identification Number)

Hanson House
14 Castle Hill
Maidenhead SL6 4JJ
United Kingdom
+44 (0) 1628 774 100

(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)



Plamen Jordanoff
Chief Executive Officer and President
Hanson Building Products Limited
300 East John Carpenter Freeway
Irving, Texas 75062
Telephone: (972) 653-5000
Facsimile: (972) 653-6185

(Name, address, including zip code, and telephone number, including area code, of agent for service)



Copies to:

Stephen T. Giove, Esq.
Marc O. Plepelits, Esq.
Shearman & Sterling LLP
599 Lexington Avenue
New York, New York 10022
Telephone: (212) 848-4000
Facsimile: (212) 848-7179

 

Michael H. Hyer, Esq.
General Counsel
Hanson Building Products Limited
300 East John Carpenter Freeway
Irving, Texas 75062
Telephone: (972) 653-5000
Facsimile: (972) 653-6185

 

Joseph A. Hall, Esq.
John Banes, Esq.
Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, New York 10017
Telephone: (212) 450-4000
Facsimile: (212) 701-5565



Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this registration statement.

          If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.    o

          If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

          If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

          If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

          Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer o   Accelerated filer o   Non-accelerated filer ý
(Do not check if a
smaller reporting company)
  Smaller reporting company o



          The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to Section 8(a), may determine.

   


Table of Contents

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED OCTOBER 22, 2014

        Shares

Hanson Building Products Limited

Ordinary Shares



        This is the initial public offering of the ordinary shares of Hanson Building Products Limited. All of our ordinary shares being offered are being sold by the Selling Shareholder, which is a wholly-owned subsidiary of HeidelbergCement AG. We are not selling any of our ordinary shares in this offering and we will not receive any proceeds from the sale of our ordinary shares by the Selling Shareholder.

        After this offering, HeidelbergCement AG will own approximately        % of our ordinary shares (or        % if the underwriters exercise their option to purchase additional ordinary shares in full).

        We currently expect the public offering price to be between $            and $            per ordinary share.

        We intend to apply to have our ordinary shares listed on the New York Stock Exchange, or NYSE, under the symbol "            ."



        Investing in our ordinary shares involves risks. See "Risk Factors" beginning on page 16 to read about factors you should consider before buying our ordinary shares.

        Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.



       
 
 
  Per Share
  Total
 

Initial public offering price

  $           $        
 

Underwriting discounts and commissions

  $           $        
 

Proceeds to the Selling Shareholder (before expenses)

  $           $        

 

        To the extent that the underwriters sell more than                    ordinary shares, the underwriters have the option to purchase up to an additional                    ordinary shares from the Selling Shareholder at the initial public offering price less the underwriting discount.

        The underwriters expect to deliver the shares against payment to purchasers on or about                    , 2014 through the book-entry facilities of The Depository Trust Company.



BofA Merrill Lynch   BNP PARIBAS   Deutsche Bank Securities



Prospectus dated                    , 2014


TABLE OF CONTENTS

 
  Page  

Prospectus Summary

    1  

Risk Factors

    16  

Forward-Looking Statements

    40  

Use of Proceeds

    42  

Dividend Policy

    43  

Capitalization

    44  

Selected Financial Data

    45  

Unaudited Pro Forma Combined Financial Information

    47  

Management's Discussion and Analysis of Financial Condition and Results of Operations

    56  

Industry

    91  

Business

    98  

Management

    116  

Executive Compensation

    123  

Certain Relationships and Related Party Transactions

    124  

Security Ownership of Certain Beneficial Owners

    126  

Description of Certain Indebtedness

    127  

Description of Share Capital

    128  

Shares Eligible for Future Sale

    135  

Comparison of Jersey Law and Delaware Law

    137  

Taxation

    142  

Underwriting

    148  

Enforceability of Civil Liabilities

    156  

Legal Matters

    157  

Experts

    157  

Where You Can Find Additional Information

    157  

Index to Financial Statements

    F-1  



        We have not, the Selling Shareholder has not, and the underwriters and their affiliates and agents have not, authorized any person to provide any information or represent anything about us other than what is contained in this prospectus. None of the information on our website referred to in this prospectus is incorporated by reference herein. We do not, the Selling Shareholder does not, and the underwriters and their affiliates and agents do not, take any responsibility for, and can provide no assurance as to the reliability of, any information that others may provide to you. We are not, the Selling Shareholder is not, and the underwriters and their affiliates and agents are not, making an offer to sell or soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information contained in this prospectus is accurate only as of the date on the front cover of this prospectus. Our business, financial condition, results of operations, cash flows and prospects may have changed since that date.

        Until                    , 2014 (the 25th day after the date of this prospectus), all dealers that effect transactions in our ordinary shares, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer's obligation to deliver a prospectus when acting as an underwriter and with respect to any unsold allotments or subscriptions.

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INDUSTRY AND MARKET DATA

        This prospectus includes estimates regarding market and industry data and forecasts, which are based on publicly available information, industry publications and surveys, reports from government agencies and reports by market research firms.

        In this prospectus:

    Freedonia refers to a special study that we commissioned for a fee specifically for the purpose of this offering by Freedonia Custom Research, Inc., a subsidiary of Freedonia Group, Inc.;

    McGraw-Hill refers to McGraw-Hill Construction's Annual Starts Information (2nd Quarter 2014 Forecast Update—Based on History Through March 2014);

    National Association of Homebuilders refers to the National Association of Homebuilders' Housing and Interest Rate Forecast;

    American Institute of Architects refers to the American Institute of Architects' Billings Index Market Activity;

    Home Improvement Research Institute refers to the Home Improvement Research Institute's HIRI/IHS Global Insight;

    Construction Products Association refers to The Construction Products Association's Construction Industry Forecasts 2014-2018 (Summer 2014 Edition); and

    American Society of Civil Engineers, or ASCE, refers to the American Society of Civil Engineers' 2013 Report Card for America's Infrastructure.

        We have not independently verified market and industry data provided by any of these or any other third-party sources referred to in this prospectus, although we believe such market and industry data included in this prospectus is reliable. This information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in surveys of market size.

        Management estimates are derived from the information and data referred to above, as well as our internal research, calculations and assumptions made by us based on our analysis of such information and data and our knowledge of our industry and markets, which we believe to be reasonable, although they have not been independently verified. While we believe that the market position information included in this prospectus is generally reliable, such information is inherently imprecise. Assumptions, expectations and estimates of our future performance and the future performance of the industry in which we operate are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in "Risk Factors" and "Forward-Looking Statements." These and other factors could cause results to differ materially from those expressed in the estimates made by the independent parties and by us.

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PROSPECTUS SUMMARY

        The following is a summary of material information discussed in this prospectus. The summary is not complete and does not contain all of the information that you should consider before investing in our ordinary shares. You should read this entire prospectus carefully, including the risks discussed under "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus, before making an investment decision to purchase our ordinary shares. Some of the statements in this summary constitute forward-looking statements. See "Forward-Looking Statements."

        Hanson Building Products Limited is a newly formed corporation that has not, to date, conducted any activities other than those incident to its formation and the preparation of the registration statement of which this prospectus forms a part. HeidelbergCement holds all of the historical assets and liabilities related to the business that the Company will acquire. Except where the context otherwise requires or where otherwise indicated, (1) all references to the Selling Shareholder refer to HeidelbergCement BP Limited, which is a wholly-owned indirect subsidiary of HeidelbergCement, (2) all references to HeidelbergCement refer to HeidelbergCement AG and its direct and indirect wholly-owned subsidiaries, unless the context suggests that the term only means HeidelbergCement AG and (3) all references to Hanson Building Products, the "Company," "we," "us" and "our" refer to Hanson Building Products Limited. Unless otherwise indicated, the information described in this prospectus assumes the completion of the corporate separation transactions that we expect to consummate with HeidelbergCement as described in this prospectus under "Certain Relationships and Related Party Transactions" prior to or concurrently with the consummation of this offering. All amounts in this prospectus are expressed in U.S. dollars and the financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("U.S. GAAP"). References herein to the financial measures "EBITDA," "Adjusted EBITDA," "Adjusted EBITDA margin" and "Pro Forma Adjusted EBITDA" refer to financial measures that do not comply with U.S. GAAP. For a reconciliation of "EBITDA," "Adjusted EBITDA," "Adjusted EBITDA margin" and "Pro Forma Adjusted EBITDA" to the most directly comparable U.S. GAAP measures, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Key Business and Financial Metrics Used by Management."

        This prospectus describes the businesses to be transferred to the Company by HeidelbergCement as if the transferred businesses were the Company's businesses for all historical periods described. Except as otherwise noted, references in this prospectus to the historical assets, liabilities, products or activities of the Company's business are intended to refer to the historical assets, liabilities, products or activities of the transferred business as the business was conducted as HeidelbergCement's building products business in the United States, Eastern Canada and the United Kingdom prior to the separation.


Our Company

        We are a leading multinational manufacturer of a diversified range of concrete and clay building products in the United States, Eastern Canada and the United Kingdom. Our primary products are concrete gravity pipe, concrete and steel pressure pipe, precast concrete drainage products, clay bricks and concrete blocks. Our products are used across a broad range of end markets, including residential construction, water and transportation infrastructure and non-residential construction applications. We have established a leading position in most of our products and end markets by leveraging our scale, engineering capabilities, manufacturing excellence, sales and distribution platforms and customer service both prior to and after a sale. Our business has been built through many years of organic expansion and acquisitions prior to its purchase by HeidelbergCement in 2007. With the end markets we serve now in various stages of cyclical recovery, as a new public company we believe we will be well-positioned to pursue profitable organic growth opportunities and selective strategic acquisitions at attractive points in the cycles of our markets. For the latest twelve-month period ended June 30, 2014, we generated net sales of $1,147.7 million, net loss of $246.4 million and Pro Forma Adjusted EBITDA of $104.3 million.

 

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        We operate in the following five business segments:

    North America Gravity Pipe & Precast:  We believe we are the largest manufacturer of concrete gravity pipe in North America and a leading manufacturer of precast concrete drainage products in the United States and Eastern Canada based on estimated manufacturing capacity. Gravity pipe is primarily used for storm water applications such as storm drains for roads and driveways, sanitary sewers, treatment plant piping and utility tunnels. Precast concrete drainage products include box culverts, utility boxes, manholes, drainage inlets and pipe end sections.

    North America Pressure Pipe:  We believe we are the largest manufacturer of concrete pressure pipe and one of the two largest manufacturers of pressure pipe in North America based on estimated manufacturing capacity. Our pressure pipe is used in water transmission and distribution lines, power plant cooling water lines, sewage force mains for wastewater and storm water handling and other diverse applications involving the movement of large volumes of water. Our pressure pipe is highly engineered, includes multi-material components and is built to order for technically demanding applications requiring various thresholds of pressure and loads.

    North America Bricks:  We believe we are one of the two largest clay brick manufacturers in North America based on estimated available manufacturing capacity. Our bricks are used for exterior facades in residential and non-residential structures. We operate brick manufacturing facilities which are strategically located near raw material reserves and major brick consuming metropolitan areas in the United States and Eastern Canada.

    U.K. Bricks & Blocks:  We believe we are one of the two largest manufacturers of clay brick in the United Kingdom based on estimated manufacturing capacity. Our bricks are used for exterior facades in residential and non-residential structures. We also manufacture autoclaved aerated concrete blocks, known as aircrete blocks, aggregate blocks and specialized clay roofing products.

    Other:  This segment includes our precast flooring and other precast products business in the United Kingdom, our structural precast and roof tile businesses in North America and our concrete pavers and external wall insulation products businesses in the United Kingdom.

        Our products are used by a wide variety of customers, including contractors, residential and non-residential building owners and developers, utility companies and governmental authorities, to whom we sell either directly or through our long-standing relationships with independent distributors. No single customer accounted for 10% or more of our net sales in 2013.

        As of June 30, 2014, we have an extensive network of 107 manufacturing plants and eleven distribution facilities strategically located throughout the United States, Eastern Canada and the United Kingdom. Our facilities are generally in or near metropolitan areas, many of which we believe have attractive potential for economic growth based on population trends, increasing business activity, above-average employment growth and significant needs for water and transportation infrastructure development. The geographic footprints within which it is economically viable to ship our products from our manufacturing facilities depend on our products' respective value-to-weight ratios and freight costs. Our local market knowledge and strategically placed locations minimize shipping and freight costs while maintaining a high degree of local market expertise.

 

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        The following maps show our current operating footprint in North America and the United Kingdom.

GRAPHIC


As of June 30, 2014. Includes CP&P joint venture.

        Our broad footprint in the United States, Eastern Canada and the United Kingdom, coupled with a strong local presence, provides us with an advantage compared to many of our competitors in markets that have many small local and regional manufacturers. We believe our products and service have long been associated with quality, dependability and market-leading performance.

        The charts below summarize our net sales for 2013 by region, segment and estimated end market.

GRAPHIC

 

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Our Shareholder

        HeidelbergCement is one of the world's largest building materials companies and operates on five continents. HeidelbergCement's products are used for the construction of houses, infrastructure and commercial and industrial facilities, thus meeting the demands of a growing world population for housing, mobility and economic development.

        HeidelbergCement's core activities include the manufacturing and distribution of cement and aggregates, the two essential raw materials for the manufacture of concrete. Its product range is complemented by downstream activities, such as ready-mixed concrete, concrete products and concrete elements; in some countries, asphalt and building products, such as bricks and roof tiles, lime, or sand-lime bricks, are also manufactured. Furthermore, HeidelbergCement offers services such as worldwide trading in cement and coal by sea.

        HeidelbergCement's shares are listed for trading on the Prime Standard stock market segment of the Frankfurt Stock Exchange and on the Regulated Market of the Stuttgart, Dusseldorf and Munich stock exchanges. HeidelbergCement's shares are included within the German benchmark index DAX, making HeidelbergCement the only company in the construction and building materials industry to be recognized as one of the 30 largest listed companies in Germany.


Our Industry

        We compete in the multibillion dollar concrete and clay building products markets. Our primary products are concrete gravity pipe, concrete and steel pressure pipe, precast concrete drainage products, clay bricks and concrete blocks.

Core Product Categories

    Gravity Pipe and Precast

        Gravity pipe is primarily used for storm water applications such as storm drains for roads and driveways, sanitary sewers, treatment plant piping and utility tunnels. Demand for our gravity pipe products is largely driven by residential construction, water drainage infrastructure spending and the repair and replacement of aging storm water management infrastructure.

        Gravity pipe can be manufactured from several materials, including concrete, iron, steel and plastic. Freedonia estimates that U.S. and Eastern Canada demand for concrete gravity pipe will increase at a compound annual growth rate ("CAGR") of 7.8% from 2013 to 2018 to $1.6 billion, primarily driven by the recovery of general economic and construction activity, as well as the need to repair and upgrade aging and obsolete sewer, drain and water distribution networks.

        According to Freedonia, drainage and sewage applications, which accounted for 90% of U.S. large diameter gravity pipe demand in 2013, are expected to remain the dominant applications for concrete gravity pipe through 2018, with sales projected to increase at a CAGR of 6.4%. Additionally, Freedonia expects concrete gravity pipe to grow relative to other materials due in part to the adoption of the most recent U.S. federal highway bill. This bill no longer requires states to include alternative materials such as plastic pipe in their specifications, but instead leaves responsibility for pipe selection criteria to state engineers, who historically have relied on concrete gravity pipe for highway projects.

    Pressure Pipe

        Our concrete and steel pressure pipe is engineered for a variety of lengths and diameters and is used for high-to-low-pressure applications, including water transmission and distribution lines, in the United States and Eastern Canada. According to Freedonia, water transmission accounts for approximately 75% of the total U.S. demand for pressure pipe and current demand has reached near pre-recession levels. Further growth in demand for new water pipelines is expected to be driven by increased municipal spending on water infrastructure and a recovery in housing starts.

 

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        Freedonia estimates that the large diameter concrete and steel pressure pipe market in the United States and Eastern Canada was $609 million in 2013 and that this market will grow at a CAGR of 6.6% from 2013 to 2018. It is expected that concrete pressure pipe will grow at a CAGR of 7.0% during this period as contractors increasingly utilize more proven material types, such as concrete and steel pressure pipe.

    Brick

        Based on Freedonia estimates, demand for bricks in the United States and Eastern Canada is projected to expand at a CAGR of 10.6% from 2013 to 2018 to $2.1 billion. The residential market is expected to see increasing gains in demand through 2018, supported by a rebounding new housing market.

        According to Freedonia, demand for bricks in the United Kingdom is expected to grow at a CAGR of 6.1% from 2013 to 2018 to $714 million, driven by continued growth in the U.K. residential market. We believe the dollar value of this growth will be significantly higher than that projected by Freedonia due to price increases experienced in the U.K. brick market in 2014. We also believe that a rebound in total new housing starts, which is forecasted by the Construction Products Association to grow at a CAGR of 7.1% from 2013 to 2018, will contribute to brick demand growth in the U.K. residential market. The U.K. residential market is projected to grow faster than the non-residential market.

Core End Markets

        Demand for our products is dependent on key end-market drivers, such as residential construction, water and transportation infrastructure and non-residential construction in the United States, Eastern Canada and the United Kingdom.

    Residential Construction (estimated to be approximately one-half of our Total Net Sales)

        We currently generate net sales from the U.S., Eastern Canada and the U.K. residential construction markets. U.S. residential new construction has begun to recover since reaching historical lows during the recent economic recession. According to the U.S. Census Bureau, total new housing starts peaked in 2005 at approximately 2.1 million units and subsequently declined to approximately 0.5 million units in 2009. Although total new housing starts grew at a CAGR of 16.4% from 2010 to 2013, current levels remain substantially below the long-term average of 1.5 million units since the U.S. Census Bureau began reporting the data in 1950. According to the National Association of Homebuilders, total new housing starts in the United States are expected to increase to approximately 1.0 million units, or 6.6%, in 2014, with further increases to approximately 1.2 million units, or 26.2%, in 2015 and approximately 1.5 million units, or 23.8%, in 2016. According to the Construction Products Association, U.K. total new housing starts are expected to grow at a CAGR of 7.1% from 2013 to 2018.

    Infrastructure (estimated to be approximately one-third of our Total Net Sales)

        We currently generate net sales from the U.S., Eastern Canada and the U.K. infrastructure markets, although a majority of these net sales are generated in the United States. The main drivers of our products in the infrastructure market include the construction of storm water drainage, water transmission to municipalities and streets and highways. The aging infrastructure in the United States is expected to require repair or replacement in the coming years. The U.S. road network consists of approximately four million miles of public roads and highways and sewer mains which, in each case, were primarily constructed more than 50 years ago. The American Society of Civil Engineers, or ASCE, gave the overall U.S. infrastructure a D+ grade in its recent 2013 report card and estimates that $298 billion is needed over the next 20 years to replace and upgrade the existing wastewater infrastructure in the United States. Citing the 2008 Clean Watersheds Needs Survey, the ASCE report states that $64 billion is needed to address combined sewer overflows and storm water management over this 20-year period. Additionally, McGraw-Hill estimates that total U.S. spending on streets and highways will grow at a CAGR of 9.3% from 2014 to 2018.

 

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        U.S. water line infrastructure spending in 2013 was only 45% of the U.S. Environmental Protection Agency ("EPA") forecasted spending need. This represents a five-year low of actual spending relative to the EPA forecasted spending need and we believe there is significant pent-up demand. McGraw-Hill also estimates that U.S. water supply systems spending will grow at a CAGR of 7.2% from 2014 to 2018.

    Non-Residential Construction (estimated to be approximately one-sixth of our Total Net Sales)

        We currently generate net sales from the U.S., Eastern Canada and the U.K. non-residential construction markets, although a majority of these sales are generated in the United States. McGraw-Hill is forecasting U.S. non-residential construction, consisting of commercial, industrial and institutional construction, to grow at a CAGR of 12.5% from 2013 to 2016. Additionally, the American Institute of Architects' survey tracking billing activity for the industrial, non-residential and institutional sectors indicates that these building construction markets continue to recover.


Our Strengths

        Market Leading Positions Across Products and Geographies.    We believe we are the largest manufacturer in many of the markets in which we operate based on estimated manufacturing capacity. We believe we are the largest manufacturer of concrete gravity pipe and the largest manufacturer of concrete pressure pipe in North America. We believe we are one of the two largest brick manufacturers in North America based on estimated manufacturing capacity. We believe we are the second largest manufacturer of brick in the United Kingdom and the largest brick manufacturer in Eastern Canada. We are the only U.S. pressure pipe manufacturer with a full line of prestressed concrete, steel and bar-wrapped pressure pipe for water transmission and distribution applications. Our extensive footprint of 89 manufacturing facilities in North America and 18 manufacturing facilities in the United Kingdom provides us with a scale advantage relative to many of our competitors.

        Several of our products require significant technical expertise and customer interaction and we believe our expertise and field service throughout the product life cycle are distinct competitive advantages. Several of our products are also highly differentiated in the marketplace. As the only manufacturer of the iconic Fletton, or London, brick in the United Kingdom, we are uniquely positioned to benefit when homeowners remodel or extend their London brick built homes.

        Diversified Products, Geographies, End Markets and Customers.    We are strategically diversified across a broader range of products, geographies, end markets and customers than most other building products companies. As a result, our products are subject to varied drivers of demand, with demand for gravity pipe primarily dependent on the storm water drainage needs from road infrastructure and residential spending, pressure pipe primarily dependent on water transmission and distribution development and bricks primarily dependent on new residential construction and residential remodeling. We are also diversified across various regions in the United States, Eastern Canada and the United Kingdom, whose economies are each affected by distinct drivers of regional demand. In 2013, we sold at least one of our products in nearly every state in the United States and maintain a strong presence in the southeastern United States, including the Texas and Florida markets, which we believe exhibit strong population growth and demand for building products. In Texas, we offer a comprehensive line of gravity pipe, pressure pipe and brick products.

        The population of Texas has grown significantly and is expected to continue to grow despite severe drought conditions. We believe population growth and increasing water requirements will drive continued investment in the state's water infrastructure to bring additional water supplies to population centers. Based on estimated manufacturing capacity, we believe we are the largest manufacturer of large diameter pressure pipe in Texas, where we supply prestressed concrete cylinder pressure pipe, spiral-welded steel pressure pipe and bar-wrapped concrete pressure pipe. Our management believes

 

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that Texas is the largest pressure pipe market in the United States. We have recently invested in pressure pipe capacity expansion at our Grand Prairie, Texas plant to maintain our leading market position in the state. Our management believes that Texas is also the largest concrete gravity pipe market in the United States and we expect Texas's expanding economy and strong population trends to continue to drive growth in the gravity pipe market. We believe we are the largest manufacturer of concrete gravity pipe and precast concrete drainage products in Texas based on estimated manufacturing capacity. Our broad manufacturing footprint and strong customer relationships position us well to capitalize on the continued growth in this market.

        Attractive End Markets in Various Stages of Cyclical Recovery.    Our products are used across several end markets, including residential construction, infrastructure and non-residential construction. While these markets operate on different cycles, we believe they are all in various early stages of a cyclical recovery. According to the National Association of Homebuilders, residential total new housing starts in the United States are expected to increase to 1.2 million units, or an increase of 26.2%, from 2014 to 2015. Total new housing starts in the United Kingdom are expected to grow at a CAGR of 7.1% from 2013 to 2018 according to the Construction Products Association. Since both new residential development and municipal water infrastructure upgrades and replacements were impacted by the recent economic recession, we believe there is significant pent-up demand for new residential development and municipal water infrastructure. Additionally, McGraw-Hill is forecasting U.S. non-residential construction to grow at a CAGR of 10.5% from 2013 to 2017.

        Significant Operating Leverage.    In the recent economic downturn, we reduced our fixed costs, which we believe will provide for significant operating leverage as demand for our products increases. Since 2007, we have closed 70 plants and disposed of two businesses. In addition, since 2007, we have significantly restructured and re-sized our workforce and overhead. We estimate these actions have generated fixed cost savings in 2013 of more than $189 million as compared to 2007. Our gravity pipe, pressure pipe and brick businesses exhibit relatively high fixed costs and we expect to achieve significant margin improvement as volumes grow. In North America, our businesses are operating at capacities well below historical norms, and as demand increases, we expect to see further significant improvement in our margins. In the United Kingdom, after curtailing capacity and experiencing a rebound in demand, we are currently operating at capacity utilization levels similar to 2007. As a result, our operating margins in the United Kingdom have rebounded to near 2007 levels in 2014.

        Experienced Senior Management Team with a Successful Operating Track Record.    Our senior management team has extensive industry and operational experience and has been instrumental in developing a strategy to position our Company for growth. Our ten person senior management team has an average of 18 years of experience in the building products industry and an average of 13 years experience with the Company or its predecessors. Our CEO and President, Plamen Jordanoff, joined Hanson PLC in January 2004 and has 12 years of industry experience. Our CFO, Mark Conte, joined Hanson PLC in July 2000 and has 18 years of industry experience. Team members have led or supported 31 M&A transactions over the past 12 years specifically related to the development of Hanson Building Products. We believe the proven abilities of our senior management team will allow us to actively manage a diverse portfolio of businesses across various geographies and economic cycles.


Our Strategy

        Pursue Organic Growth Opportunities as an Independent Company.    As a public company, we will be able to pursue our own distinct operating priorities and strategies, including pursuing new organic growth opportunities designed to increase net sales and profitability. For example, we are significantly increasing our capacity for steel pressure pipe at our Grand Prairie, Texas plant to secure significant new business in steel pressure pipe. We are evaluating adding brick manufacturing capacity in the United Kingdom as this market is constrained and current demand exceeds domestic supply. We also

 

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expect to continue to selectively enter new geographies in our pressure pipe and gravity pipe and precast businesses, leveraging our sales and distribution platforms, engineering capabilities and existing customer relationships. As a public company, we also expect to improve performance through greater cost efficiencies. For example, we expect to benefit in the areas of raw material purchasing, information technology systems and hedging practices.

        Pursue Attractive Acquisitions Across Selected Markets.    Throughout our history, we have successfully used acquisitions and joint venture arrangements to capitalize on opportunities that enhance our operations and business lines. We will have a greater opportunity to pursue this strategy as a public company. Prior to the purchase by HeidelbergCement, between 2003 and 2007, we acquired and integrated 31 businesses into Hanson Building Products. We intend to selectively pursue acquisitions of businesses that we believe are a complementary geographical or product offering fit with our existing operations and that provide an opportunity to generate attractive returns. We believe there are numerous current acquisition opportunities and significant synergies will be available upon acquisition. Additionally, we believe there are opportunities for joint ventures offering efficiencies while involving low capital requirements. For example, our pipe and precast joint venture with Americast, Inc. that began in 2012 has resulted in significant efficiencies.

        Capitalize on Growth In Our Primary End Markets.    We believe we are well positioned to take advantage of renewed growth and recovery in the residential, infrastructure and non-residential construction markets in the United States, Eastern Canada and the United Kingdom. According to Freedonia, demand for concrete gravity pipe in the United States and Eastern Canada is expected to grow at a CAGR of 7.8% from 2013 to 2018. According to the American Waterworks Association, required investment in drinking water infrastructure in the United States is expected to total more than $1 trillion in the next 25 years. According to Freedonia, sales of large diameter concrete and steel pressure pipe in the United States and Eastern Canada are expected to increase at a CAGR of 6.6% from 2013 to 2018 driven by rebounding construction expenditures, particularly in water and sewer applications. According to Freedonia, the U.S. and Eastern Canada demand for brick is projected to expand at a CAGR of 10.6% from 2013 to 2018, with bricks continuing to draw homeowner appeal for their look, durability and fire resistance. U.K. demand for brick is expected to benefit from the current shortage of housing in the United Kingdom as well as continued remodeling of existing structures built with Fletton brick.

        Continued Focus on Maximizing Our Operating Leverage and Improving Our Cost Structure.    We are actively engaged in continuous improvement in our operating segments. In 2013, our Adjusted EBITDA improved by 100.1% despite a 4.5% decline in net sales largely as a result of efficiency improvements and improved operating leverage in certain of our segments. We anticipate that as our markets continue to recover we will benefit from our operating leverage and focus on operating efficiency. While we have reduced our manufacturing capacity during the past several years, we have retained the flexibility to restore certain idled lines, facilities and manufacturing shifts in order to increase our production as market conditions improve. This incremental capacity can be selectively restarted, providing us with the ability to match increasing levels of customer demand as our markets improve, without the need for significant capital investment.


Corporate Separation Transactions

        The Company was incorporated on August 14, 2014 for the purpose of effecting this offering and holds no material assets and does not engage in any operations. Currently, we are a wholly-owned subsidiary of HeidelbergCement BP Limited, which is a wholly-owned subsidiary of HeidelbergCement. HeidelbergCement holds all of the historical assets and liabilities related to its building products business in the United States, Eastern Canada and the United Kingdom that we will acquire. Prior to or concurrently with the completion of this offering, we and HeidelbergCement will enter into an

 

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agreement that provides for the separation of our business from HeidelbergCement and into the Company.

        The following chart summarizes our ownership structure following our separation and this offering:

GRAPHIC


(1)
Our subsidiary Hanson Brick America, Inc. will be the borrower under a $50 million term loan from HeidelbergCement UK Holding II Ltd., a subsidiary of HeidelbergCement AG. In addition, our subsidiary Hanson Pipe & Precast LLC will be the borrower under a $70 million revolving line of credit from HeidelbergCement AG. For additional information regarding this indebtedness, see "Description of Certain Indebtedness."

(2)
Our subsidiary Hanson Brick Limited will be the borrower under a CAD45 million term loan from Lehigh Hanson Materials Limited, a subsidiary of HeidelbergCement AG, and under a CAD20 million revolving line of credit from HeidelbergCement AG. In addition, our subsidiary Hanson Pipe & Precast Ltd. will be the borrower under a CAD110 million term loan from Lehigh Hanson Materials Limited. For additional information regarding this indebtedness, see "Description of Certain Indebtedness."

(3)
Our subsidiary Hanson Building Products Ltd., U.K., will be the borrower under a GBP95 million term loan from Hanson Packed Products Ltd., a subsidiary of HeidelbergCement AG, and under a GBP42 million revolving line of credit from HeidelbergCement AG. For additional information regarding this indebtedness, see "Description of Certain Indebtedness."

        Historically, HeidelbergCement has provided and, following our separation, will continue to provide significant corporate and shared services functions to us. The terms of these services and amounts to be paid by us to HeidelbergCement will be provided in the transitional services agreement. In addition to the costs for these services, we may incur other corporate and operational costs, which may be greater than historically allocated levels, to replace some of these services or for additional services relating to our being a public company, including those related to the reporting and

 

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compliance obligations as a public company. See "Management's Discussion and Analysis of Financial Condition and Results of Operations."

        In addition to the foregoing agreements, we and HeidelbergCement will enter into various other agreements relating to the relationship between the Company and HeidelbergCement following this offering, including two cement supply agreements and an aggregates supply agreement, tax matters agreement, tax receivable agreement, employee matters agreement and shareholders agreement. See "Certain Relationships and Related Party Transactions."

        Prior to the completion of this offering, we expect to enter into a new credit facility and incur indebtedness thereunder. See "Description of Certain Indebtedness."

        Upon completion of this offering, we will be a public company and HeidelbergCement will own approximately      % of our outstanding ordinary shares, or approximately       % if the underwriters exercise their option to purchase additional ordinary shares in full.


Risks Affecting Our Business

        Our business is subject to numerous risks and uncertainties, including, but not limited to, those arising from the following:

    demand for our products is closely related to construction activity in the United States, Eastern Canada and the United Kingdom and such demand is cyclical;

    our business is partly based on government-funded infrastructure projects and building activities;

    the lack of a multiyear U.S. federal funding and authorization bill could cause U.S. states to spend less on infrastructure;

    competition from substitutes for our products and the development of new construction techniques and new materials;

    competition generally;

    fluctuations in the prices of certain of our products;

    increases in the cost of raw materials and energy or raw material shortages;

    environmental regulations may limit the supply of fly ash;

    our ability to successfully implement expansion plans and other strategic initiatives;

    the failure of a joint venture partner to fulfill its obligations;

    changes in environmental, health and safety laws and regulations;

    reclamation obligations in connection with clay pits;

    our lack of long-term contracts with our customers;

    changes to the U.K. Parliament in 2015 may result in changes in the government housing incentive programs that support our U.K. businesses;

    a tightening of mortgage lending or mortgage financing requirements or other reductions in the availability of credit to consumers;

    our U.K. brick business may be affected by competition from imported bricks;

    adverse developments in the U.K., Texas and Eastern Canada construction markets as we conduct a significant portion of our business in these markets;

    a material disruption at one of our manufacturing facilities or at one of our suppliers' facilities;

 

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    labor disruptions or cost increases;

    delays in construction projects;

    significant changes in the cost and availability of transportation; and

    demographic and government policy changes in Eastern Canada that may result in increased construction of medium- and high-density housing.

        We are also subject to numerous risks relating to:

    the debt obligations we will have after this offering, which could adversely affect our business and our ability to meet our obligations or could restrict the manner in which we operate or return cash to shareholders;

    our relationship with HeidelbergCement after this offering, including the risk that our historical financial information as a division of HeidelbergCement may not be representative of our results as an independent public company; and

    this offering and ownership of our ordinary shares, including the risk that a trading market for our ordinary shares may never develop following this offering and our ordinary share prices may be volatile and could decline substantially following this offering.

        You should carefully consider all of the information set forth in this prospectus and, in particular, the information under the heading entitled "Risk Factors" beginning on page 16 of this prospectus prior to making an investment in our ordinary shares. These risks, together with the other risks identified under "Risk Factors," could prevent us from successfully executing our strategies and could result in a material adverse effect on our business, financial condition, results of operations, cash flows and prospects.



Principal Executive Offices

        Hanson Building Products Limited, a corporation established under the laws of Jersey, Channel Islands, was incorporated on August 14, 2014. Upon completion of the corporate separation transactions described in this prospectus, we will own HeidelbergCement's building products business in the United States, Eastern Canada and the United Kingdom. Our principal executive offices are located at Hanson House, 14 Castle Hill, Maidenhead SL6 4JJ, United Kingdom and our telephone number at this address is +44 (0) 1628 774 100. We maintain a website at                . Information on or accessible through our website is not a part of, and is not incorporated into, this prospectus or the registration statement of which it forms a part.

 

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THE OFFERING

Ordinary shares offered by the Selling Shareholder

          shares (or        shares if the underwriters exercise their option to purchase additional ordinary shares in full).

Ordinary shares outstanding after this offering

 

        shares.

Use of proceeds

 

We will not receive any proceeds from the sale of our ordinary shares by the Selling Shareholder, including any proceeds that the Selling Shareholder may receive from the exercise by the underwriters of their option to purchase additional ordinary shares from the Selling Shareholder. See "Use of Proceeds."

Dividend policy

 

We have no present intention to pay cash dividends on our ordinary shares. Any determination to pay dividends to holders of our ordinary shares will be at the discretion of our board of directors and will depend upon many factors, including our financial condition, results of operations, projections, liquidity, earnings, legal requirements, restrictions in our debt agreements and other factors that our board of directors deems relevant. See "Dividend Policy."

Risk factors

 

You should carefully read and consider the information set forth under "Risk Factors" beginning on page 16, together with all of the other information set forth in this prospectus, before deciding to invest in our ordinary shares.

Proposed NYSE symbol

 

We intend to apply to list our ordinary shares on the NYSE under the symbol "            ."



        Unless we indicate otherwise, all information contained in this prospectus:

    assumes an initial public offering price of $            per share, the midpoint of the price range set forth on the cover page of this prospectus;

    assumes no exercise by the underwriters of their option to purchase up to                additional ordinary shares from the Selling Shareholder; and

    assumes the completion of the corporate separation transactions as described in "Certain Relationships and Related Party Transactions."

 

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SUMMARY HISTORICAL AND PRO FORMA FINANCIAL INFORMATION

        The following summary combined predecessor financial information should be read in conjunction with our audited and unaudited combined predecessor financial statements and the notes thereto appearing elsewhere in this prospectus, as well as "Capitalization," "Selected Financial Data," "Unaudited Pro Forma Combined Financial Information," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Certain Relationships and Related Party Transactions" and "Description of Certain Indebtedness," and the other financial information included elsewhere in this prospectus.

        The Company was formed on August 14, 2014 and has not, to date, conducted any activities other than those incident to its formation and the preparation of the registration statement of which this prospectus forms a part. Therefore, we believe that a presentation of the historical results of the Company would not be meaningful. Accordingly, the following presents the historical financial information for HeidelbergCement's building products business in the United States, Eastern Canada and the United Kingdom. HeidelbergCement holds all of the historical assets and liabilities related to the business that the Company will acquire.

        The financial statements included in this prospectus may not necessarily reflect our financial position, results of operations and cash flows as if we had operated as a stand-alone public company during all periods presented. Accordingly, the historical results should not be relied upon as an indicator of our future performance.

        The summary combined predecessor statement of operations data and the summary combined predecessor statement of cash flows data for the years ended December 31, 2013, 2012 and 2011 and the summary combined predecessor balance sheet data as of December 31, 2013 and 2012 have been derived from our audited combined predecessor financial statements, which are included elsewhere in this prospectus. The summary combined predecessor statement of operations data for the years ended December 31, 2010 and 2009, and the summary combined predecessor balance sheet data as of December 31, 2011, 2010 and 2009 have been derived from unaudited combined predecessor financial information not included in this prospectus.

        The summary combined predecessor statement of operations data and the summary combined predecessor statement of cash flows data for the six months ended June 30, 2014 and 2013 and the summary combined predecessor balance sheet data as of June 30, 2014 are derived from our unaudited combined predecessor financial statements, which are included elsewhere in this prospectus. We prepared our unaudited combined predecessor financial statements on the same basis as our audited combined predecessor financial statements and have included all adjustments, consisting of normal and recurring adjustments, that we consider necessary to present fairly our predecessor's financial position and results of operations for the unaudited periods. Operating results for the six-month periods are not necessarily indicative of results for a full financial year, or any other periods, including future periods.

        Our historical combined predecessor financial statements have been prepared on a stand-alone basis in accordance with U.S. GAAP and are derived from HeidelbergCement's consolidated financial statements and accounting records using the historical results of operations and assets and liabilities attributed to HeidelbergCement's building products business in the United States, Eastern Canada and the United Kingdom, and include allocations of expenses from HeidelbergCement. Our predecessor's historical results are not necessarily indicative of our results in any future period.

        The summary unaudited pro forma combined financial information consists of unaudited pro forma combined statement of operations data for the six months ended June 30, 2014 and for the year ended December 31, 2013 and unaudited pro forma combined balance sheet data as of June 30, 2014. The unaudited pro forma combined financial information has been derived by application of pro forma adjustments to our historical combined predecessor financial statements included elsewhere in this prospectus.

 

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        The summary unaudited pro forma combined financial information assumes the retention of certain assets and liabilities by HeidelbergCement, the incurrence of indebtedness under our new credit facility (and related issuance costs) to be entered into prior to, or concurrently with, this offering, the corporate separation transactions as described in "Certain Relationships and Related Party Transactions" and the completion of this offering.

        The summary unaudited pro forma combined financial information is presented for illustrative purposes only and does not purport to represent what our combined income statement and combined statement of financial position would have been if the relevant transactions had occurred on the dates indicated. The unaudited pro forma combined financial information is not intended to project our consolidated results of operations or consolidated financial position for any future period or date.

 

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  Six months ended
June 30,
  Year Ended December 31,  
 
   
   
   
  Historical  
 
  Pro forma
2014
  Historical
2014
  Pro forma
2013
 
 
  2013   2012   2011   2010   2009  
 
  (In thousands)
 

Statement of Operations Data:

                                                 

Net sales

  $     $ 597,347   $     $ 1,124,363   $ 1,177,621   $ 1,221,007   $ 1,181,212   $ 1,296,362  

Cost of good sold

          505,892           984,695     1,060,668     1,097,410     1,056,870     1,192,288  
                                   

Gross profit

          91,455           139,668     116,953     123,597     124,342     104,074  
                                   
                                   

Selling, general and administrative expenses

  $     $ (76,309 ) $     $ (137,635 ) $ (153,760 ) $ (158,270 ) $ (174,331 ) $ (197,100 )

Income (loss) from operations

          20,352           (249,898 )   (36,641 )   (52,510 )   (65,913 )   (2,110,699 )

Net income (loss)

          14,929           (252,711 )   (59,209 )   (58,101 )   (97,848 )   (2,236,159 )
                                   
                                   

 

 
  As of June 30,   As of December 31,  
 
  Pro forma
2014
  Historical
2014
  2013   2012   2011   2010   2009  
 
  (In thousands)
 

Balance Sheet Data:

                                           

Cash and cash equivalents

  $     $ 28,997   $ 22,821   $ 21,960   $ 25,568   $ 3,779   $ 22,723  

Trade receivables, net

          211,072     167,893     179,694     186,786     204,107     201,998  

Inventories, net

          237,654     205,342     226,967     239,447     270,430     300,112  

Property, plant and equipment, net

          722,854     735,351     788,105     878,026     934,557     1,028,341  

Total assets

          1,415,409     1,345,197     1,697,367     1,836,914     1,965,025     2,148,044  

Total liabilities

          335,351     296,369     312,123     315,492     295,483     302,882  

Total parent company net investment

          1,080,058     1,048,828     1,385,244     1,521,423     1,669,555     1,845,163  

 

 
  Six months ended
June 30,
  Year ended December 31,  
 
  2014   2013   2013   2012   2011  
 
  (In thousands)
 

Statement of Cash Flows Data:

                               

Net cash provided by (used in) operating activities

  $ (2,906 ) $ 5,687   $ 67,466   $ 27,732   $ 92,307  

Net cash provided by (used in) investing activities

    (2,273 )   3,550     11,047     68,131     13,433  

Net cash provided by (used in) financing activities

    10,500     (535 )   (78,125 )   (100,538 )   (82,452 )

 

 
   
  Year ended December 31,  
 
  Latest twelve
months ended
June 30, 2014
 
 
  2013   2012   2011  
 
  (unaudited)
   
   
   
 
 
  (In thousands, except percentages)
 

Other Financial Data:

                         

Pro Forma Adjusted EBITDA(1)(2)

  $ 104,340   $ 89,551   $ 78,608   $ 91,296  

Pro Forma Adjusted EBITDA margin(1)

    9.1 %   8.0 %   6.7 %   7.5 %

(1)
Pro Forma Adjusted EBITDA and Pro Forma Adjusted EBITDA margin are non-GAAP measures. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Key Business and Financial Metrics Used by Management".

(2)
Adjusted EBITDA for the six months ended June 30, 2014 and 2013 were $51.4 million and $39.4 million, respectively, and for the years ended December 31, 2013, 2012 and 2011 were $65.9 million, $32.9 million and $41.2 million, respectively. Adjusted EBITDA is a non-GAAP measure. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Key Business and Financial Metrics Used by Management".

 

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RISK FACTORS

        Investing in our ordinary shares involves a high degree of risk. You should carefully consider the risks and uncertainties described below, together with all of the other information in this prospectus, including the combined predecessor financial statements and the related notes appearing elsewhere in this prospectus, before making an investment decision. If any of the following risks actually occurs, our business, financial condition, results of operations, cash flows and prospects could be materially and adversely affected. The trading price of our ordinary shares could decline due to any of these risks, and as a result, you may lose all or part of your investment in our ordinary shares.

Risks Relating to Our Business and Industry

Demand for our products is closely related to construction activity, particularly residential construction and renovation, infrastructure and non-residential construction, all of which are cyclical.

        Historically, demand for our products has been closely correlated with residential construction and renovation activities and non-residential construction activity in the United States, Eastern Canada and the United Kingdom as well as spending on infrastructure construction in the United States and Eastern Canada. The level of residential construction and renovation activity is influenced by mortgage availability, interest rates, employment levels, household formation rates, domestic population growth, immigration rates, residential vacancy and foreclosure rates, demand for second homes, existing home prices, rental prices, housing inventory levels, consumer confidence, seasonal weather factors, government policy and incentives and other general economic factors. Non-residential construction activity is primarily driven by business investment, availability of credit, interest rates and general economic factors. Spending on infrastructure depends on the availability of public funds, which is influenced by various factors, including the level of public debt, interest rates, anticipated tax revenues and the political climate. Certain regions or states require (or possess the means to finance) only a limited number of large infrastructure projects, meaning that periods of high demand may be followed by years of lower demand.

        In 2008, residential construction and renovation activities and non-residential construction activity in the United States dipped to historically low levels with only modest gains incurred since that time. As a result, demand for many of our products in the United States has been weak and may fail to reach previous levels. There is significant uncertainty regarding the timing and extent of the current recovery in the United States and resulting product demand levels. The residential and non-residential construction markets in Canada also suffered and Eastern Canada, a key market of ours, has not yet begun to recover. The residential housing market in the United Kingdom, a primary source of demand for our United Kingdom businesses, was also significantly affected by the 2008 financial crisis and despite recent improvements in home building and construction, is still well below peak levels.

        Our growth prospects depend, to a significant extent, on the degree to which conditions in the residential construction, infrastructure and non-residential construction markets continue to improve in the future. We cannot control the foregoing, and as a result, our results of operations may vary materially in response to market conditions and changes in the supply and demand for our products. We may incur losses during global, national, regional or local cyclical downturns in our markets. As a result of any possible future cyclical downturns, the price of our ordinary shares may decline, and you may lose a portion of, or all, of your investment.

Our business is partly based on government-funded infrastructure projects and building activities, the reduction or altered allocation of which could have a negative impact on our net sales and results of operations.

        Governments' policies relating to infrastructure projects, public sector construction and housing have a significant effect on demand for our products and, as a result, on our results of operations. A

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large proportion of our net sales in the United States in our North America Gravity Pipe & Precast and North America Pressure Pipe segments are generated through infrastructure projects in which we are subcontractors to the primary construction contractors who are our customers. Reductions in government funding for infrastructure projects or existing tax incentives, could limit the amount of funding for public infrastructure projects available for spending on our products, therefore potentially reducing our net sales. In 2013, less than 1% of our net sales were derived from direct sales to U.S. government agencies at the federal, state, provincial or local level.

        Our future net sales will also depend in part on current or expected subsidies, including those that are part of public economic stimulus plans in the building industry contemplated or already being implemented in the United States, Eastern Canada and the United Kingdom. If the subsidies are reduced, delayed or not utilized, the demand for our building materials would be lower than anticipated. The expiration of the Canadian government stimulus package in early 2012, for example, had an adverse impact on the net sales and results of operations of our Canadian operations. Downward changes in government spending policies and subsidy programs benefiting the building industry could have a material adverse effect on our business, financial condition and results of operations.

Lack of a multiyear U.S. federal funding and authorization bill could cause U.S. states to spend less on infrastructure, which may negatively affect our net sales.

        In the United States, federal and state government funding for infrastructure projects is usually accomplished through multiyear funding and authorization bills known as highway bills. The current authorization bill, the Moving Ahead for Progress in the 21st Century Act, or MAP-21, was originally scheduled to expire on September 30, 2014. In July 2014, the U.S. Congress passed a bill, the Highway and Transportation Funding Act of 2014, which is intended to maintain the U.S. federal infrastructure funding system's solvency through May 31, 2015. It is not known when the U.S. Congress will adopt the next multiyear funding and authorization bill. In addition, the U.S. Congress could pass legislation in future sessions that would divert funds previously allocated to infrastructure projects to other purposes or would restrict funding for infrastructure projects unless states comply with certain federal policies. These actions may result in state departments of transportation failing to undertake large multiyear infrastructure projects, which could, in turn, negatively affect our net sales.

Increasing market share of substitutes for our products and the development of new construction techniques and materials could have a material adverse effect on us.

        Various building products can be used as substitutes for many of our products. For example, storm water pipe can be manufactured from concrete, steel, high-density polyethylene (HDPE), polypropylene (PP) or polyvinyl chloride (PVC). The market share of HDPE and PP pipe, which competes with gravity pipe and pressure pipe for certain applications, has increased in recent years. Our bricks compete with other materials that can be used for the cladding of a house or non-residential building such as vinyl, fiber cement, plasters, wood, stucco, natural stone and glass. Sales of our Fletton brick, which we sell in the United Kingdom and of which we are the sole manufacturer, will likely decline further over the long term because this type of brick is rarely used for new construction and as a result, the number of Fletton-clad buildings that are available for remodelling or extension is slowly declining. In addition, our position as the sole manufacturer of Fletton brick has been challenged in the past, and may be challenged again in the future, by other manufacturers attempting to replicate this product. Our aggregate blocks and aircrete blocks manufactured in the United Kingdom compete with wood as the structural element of residential homes. New construction techniques and materials developed in the future could further decrease the demand and prices for our products, which could have a material adverse effect on our business, financial condition and results of operations. Furthermore, governments

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have provided in the past, and may continue to provide in the future, incentives that support products with which we compete and which may correspondingly reduce demand for our products.

If we cannot effectively compete in our markets, our business, financial condition and operating results may be materially and adversely affected.

        We face significant competition from local, regional and national building product manufacturers, including privately-owned single-site enterprises. Competition among manufacturers is based in large part on price, as well as service, quality, range of products and product availability. Competition in certain of our product segments, such as the brick market in the United States, is also based, in part, on styles and trends, which we may not accurately forecast. Our competitors may foresee the course of market development more accurately than we do, provide superior service, sell preferable products, possess the ability to manufacture or supply similar products and services at a lower cost, develop a more comprehensive product portfolio, establish stronger relationships with customers and distributors, adapt more quickly to new technologies or evolving customer requirements, manage customer relationships during product shortages more effectively, build a superior sales and distribution network or obtain access to financing on more favorable terms than we may obtain. As a result, we may not be able to compete successfully.

        At times, the price for any one or more of the products we manufacture may fall below our manufacturing costs, requiring us to either incur losses on product sales or cease manufacturing at one or more of our manufacturing facilities. This occurred, for example, following the recession during 2009 and 2010 and forced us to undertake significant cost-cutting measures, including reductions in headcount and product and capacity rationalization, to curb losses.

        Actions of our competitors, including restoring idled facilities or developing additional manufacturing capacity, competition from imported products or the entry of new competitors into our markets, particularly in product segments where the barriers to entry are relatively low, could lead to lower pricing by us in an effort to maintain our customer base and may result in lower net sales and harm our results of operations.

Certain of our products are widely available from other manufacturers or distributors and fluctuations in the prices of these products could affect our operating results.

        Certain of our products, including gravity pipe, brick, aircrete blocks, aggregate blocks and roof tiles, are volume manufacturing products that are widely available from other manufacturers or distributors, with prices and volumes determined frequently based on participants' perceptions of short-term supply and demand factors. A shortage of capacity or excess capacity in the industry can result in significant increases or declines in the market prices for these products, often within a short period of time. Prices of these products may also change as a result of global, national, regional or local economic conditions, fluctuations in energy, labor and freight costs and competition (including imports, for example, from Mexico into the southern United States or from Continental Europe into the southeastern United Kingdom).

        We generally attempt to pass increases in the cost of raw materials, energy, labor and freight onto our customers, but pricing pressure from our competitors or the market power of our customers may limit our ability to pass on such price increases. Low market prices for our products over a sustained period can adversely affect our financial condition and operating results.

Increases in the cost of raw materials and energy may adversely affect our operating results. Furthermore, raw material shortages could affect our business, financial condition and results of operations.

        We purchase raw materials, including steel and cement, and energy supplies, including natural gas and electricity, for use in the manufacturing, distribution and sale of our products. Prices for raw

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materials and energy have been volatile in recent years. Factors such as adverse weather conditions, including hurricanes, and other disasters may disrupt raw material and fuel supplies and increase our costs. In addition, many raw material suppliers decreased manufacturing capacity during the recent economic recession. The decrease in manufacturing capacity along with strengthening global demand for certain raw materials has, from time to time, caused and may continue to cause tighter supply and significant price increases. There may be substantial increases in the price of raw materials or energy in the future, which may be pronounced if there are dislocations in the related markets because of political instability or other unforeseeable events. Unexpected shortages and increases in the cost of raw materials or energy, or any deterioration in our relationships with or the financial viability of our suppliers, may have an adverse effect on our results of operations in the event we are unable to offset higher costs in a timely manner by sufficiently decreasing our operating costs or raising the prices of our products.

        Our energy costs in connection with the purchase of natural gas and electricity constitute a significant portion of our costs, particularly in our brick operations. Our energy costs accounted for 7.8% of our net sales for the six months ended June 30, 2014 and 6.1% of our net sales in 2013. Natural gas is one of the principal sources of energy we use to fuel our brick operations and we rely heavily on being able to procure a steady supply of natural gas. We also use a substantial amount of electricity in our manufacturing processes. Our results of operations may be adversely affected by rising energy costs if such costs cannot be recovered through higher prices for our products. Although we have entered into hedging transactions with respect to our raw material and energy positions in the past and may do so in the future, we currently have no hedges in place and consequently may be adversely affected by increases in price more than competitors which utilize a more comprehensive hedging strategy.

        Our ability to offer our products to our customers is dependent upon our ability to obtain adequate supplies of raw materials. Generally, our raw materials are obtainable from various sources and in sufficient quantities. Although in many instances we have agreements with our suppliers, these agreements are generally terminable by either party on limited notice. Many of our suppliers also offer us favorable terms based upon the volume of our total purchases. If market conditions change, suppliers may discontinue offering us favorable terms. Failure by our suppliers to supply us with raw materials on favorable terms, commercially reasonable terms, or at all, may put downward pressure on our operating margins or have a material adverse effect on our financial condition and operating results.

Environmental regulations may limit the supply of fly ash, an ingredient in our aircrete blocks in the United Kingdom, and alternatives may be more difficult to obtain or more expensive.

        Fly ash, which is used in our aircrete blocks in the United Kingdom, is a by-product of the combustion of coal in coal-fired power plants. Due to more stringent environmental regulations and the availability of alternative fuel sources such as biomass, the number of coal-fired power plants in the United Kingdom is declining sharply, resulting in decreased production of fly ash. If we are unable to meet our needs for fly ash in future years, we may be required to seek alternative sources such as reclaiming fly ash that has previously been discarded, importing fly ash from abroad or using other materials such as silica sand as substitutes for fly ash in our aircrete blocks. Such alternative sources could be more difficult to obtain or less efficient to integrate into our manufacturing process than our current supplies of fly ash, which could have a material adverse effect on our financial condition, operating results and cash flows.

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We may be unable to successfully implement the expansion plans and other strategic initiatives included in our business strategy.

        Our business plan provides for our continued growth through expansions of our existing facilities, the construction of new facilities and selective acquisitions. Failure to identify and acquire suitable acquisition candidates on appropriate terms may have a material adverse effect on our growth strategy. There may also be limitations under antitrust or competition laws on our ability to acquire competitors or enter into joint ventures or similar arrangements, particularly in markets in which we currently possess a sizable presence. Moreover, a significant change in our business or the economy, an unexpected decrease in our cash flows or the requirements imposed by our debt may result in our inability to obtain the capital required to effect new acquisitions or expansions of existing facilities. In addition, we may be unable to integrate the operations of future acquired businesses with our own in an efficient and cost-effective manner or without significant disruption to our existing operations. Acquisitions, moreover, involve significant risks and uncertainties, including difficulties integrating personnel and other corporate cultures into our business, the potential loss of key employees, customers or suppliers, difficulties in integrating computer and accounting systems, exposure to unforeseen liabilities and the diversion of management attention and resources from existing operations. We may also be required to incur additional debt in order to consummate acquisitions, which debt may be substantial and may limit our flexibility in using our cash flow from operations for other purposes.

From time to time, we may enter into joint ventures whose success depends on the performance of a joint venture partner. The failure of a partner to fulfill its obligations could adversely affect our results of operations and require us to dedicate additional resources to these joint ventures.

        In July 2012, we entered into a joint venture agreement with Americast, Inc. to form Concrete Pipe & Precast LLC ("CP&P"). From time to time, we may enter into additional joint ventures as part of our growth strategy. The nature of a joint venture requires us to share control with unaffiliated third parties. If our joint venture partners do not fulfill their obligations, the affected joint venture may be unable to operate according to its business plan. In that instance, our results could be adversely affected or we may be required to increase our level of commitment to the joint venture. Differences in views among joint venture participants could also result in delayed decisions or failures to agree on major issues. If these differences cause the joint ventures to deviate from their business plans, our results of operations could be adversely affected.

We are subject to environmental, health and safety laws and regulations and these laws and regulations may change. These laws and regulations could cause us to make modifications to how we manufacture and price our products. They could also require that we make significant capital investments or otherwise increase our costs or result in liabilities to us.

        We are subject to federal, state, provincial and local laws and regulations in the United States, Canada and the United Kingdom governing the protection of the environment and natural resources and health and safety, including those governing air emissions, wastewater discharges, the use, storage, discharge, handling, disposal, transport and cleanup of solid and hazardous materials and wastes, the investigation and remediation of contamination and the health and safety of our employees. We are also required to obtain permits from governmental authorities for certain operations including, in the United Kingdom, Integrated Pollution Prevention and Control permits and if we expand or modify our facilities or if environmental, health and safety laws change, we could be required to obtain new or modified permits. If we were to fail to comply with these laws, regulations or permits, we could incur fines, penalties or other sanctions. In addition, we could be held responsible for costs and damages arising from claims or liabilities under these laws and regulations, such as with respect to any exposure to hazardous materials or contamination at our facilities or at third-party waste disposal sites. We

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cannot completely eliminate the risk of contamination or injury resulting from hazardous materials. Environmental, health and safety laws and regulations, including those related to energy use and climate change, tend to become more stringent over time, and we could incur material additional expenses relating to compliance with future environmental, health and safety laws. For instance, in the United Kingdom, we are required to purchase carbon dioxide allowances in order to discharge carbon dioxide into the atmosphere. The market price of these allowances is subject to volatility and could increase substantially in the future. In addition, as our manufacturing processes use a significant amount of energy, increased regulation of energy use to address the possible emission of greenhouse gases and climate change could materially increase our manufacturing costs or require us to install emissions control or other equipment at some or all of our manufacturing facilities, requiring significant additional capital investments.

        In June 2009, the EPA initiated a rule-making process to establish limitations for hydrogen fluoride, hydrogen chloride and metals emitted from brick and clay ceramics kilns and from dryers and glazing operations at clay ceramic manufacturing facilities in the United States. The rule, referred to as the National Emission Standards for Hazardous Air Pollutants: Brick and Structural Clay Products Manufacturing; and Clay Ceramics Manufacturing (the "Brick and Clay NESHAP"), is expected to be proposed in September 2014 and finalized in July 2015. This rule would require the installation of "maximum achievable control technology" or "MACT" at affected facilities. Twelve of our facilities will be covered by this rule. Of those, we currently believe at least seven will be required to install new MACT-compliant pollution control equipment. While we have budgeted $12.0 million for capital expenditures to achieve compliance with this rule ($4.0 million estimated to be spent in each of 2015, 2016 and 2017), we cannot assure you that our actual total compliance costs will not be higher.

We are subject to reclamation obligations in connection with clay pits.

        We own and operate surface mines from which we excavate clay for our brick manufacturing. With these operations, certain reclamation obligations arise under federal, state, provincial or local laws and regulations, which may lead to cash outflows upon complete or partial closure of a pit. As of June 30, 2014, provision for such measures amounted to a total of $22.4 million. However, the estimated provisions resulting from reclamation obligations may change and the proportion of cost not covered by provisions could increase if the assumptions underlying our estimates are inaccurate or the underlying facts or legal requirements change. This could require us to spend greater amounts than anticipated and could have a material adverse effect on our business, financial condition and results of operations.

We do not have long-term contracts with our customers and our net sales could be reduced if our customers switch some or all of their business with us to other suppliers.

        Although we have long-standing relationships with many of our customers, they generally do not enter into long-term contracts with us. Our customers may choose to stop or reduce purchases of our products at any time in the future. A significant loss of our customers or a significant reduction in their purchases could have a material negative impact on our net sales and business or cause us to reduce our prices, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Potential changes to the U.K. Parliament in 2015 may affect the Help to Buy Program and other housing incentive programs, which may negatively affect our net sales.

        The Help to Buy Program was instituted in 2013 in the United Kingdom, which aims to subsidize homebuying for first time homeowners by providing, for example, equity loans of up to 20% of a property's value and allowing homebuyers to purchase homes with a smaller deposit. The current U.K. Parliament has announced that the program will continue until 2020, but potential changes to U.K. Parliament in the 2015 general election may impact the continuation and budget of such programs. This

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could result in reduced residential construction activity in the United Kingdom, which could, in turn, negatively affect the sale of our products in the United Kingdom.

A tightening of mortgage lending or mortgage financing requirements or other reduction in the availability of credit to consumers could harm our results of operations, cash flows and financial condition.

        Most home sales in North America and the United Kingdom are financed through mortgage loans. A significant percentage of home repair and remodeling activities are financed either through mortgage loans or other available credit. The recent economic recession resulted in a reduction of credit available to consumers as macroeconomic factors affected the financial position of consumers and as suppliers of credit adjusted their lending criteria. The mortgage lending and mortgage finance industries experienced significant instability because of, among other factors, delinquencies, defaults and foreclosures on home loans and resulting declines in their market value. These developments resulted in a significant reduction of total new housing starts in the United States and consequently a reduction in demand for our products in the residential sector. If such a tightening of mortgage lending and mortgage financing requirements or other reduction of credit availability were to recur, this could significantly harm our results of operations, cash flows and financial condition.

Our brick business may be affected by competition from imported bricks.

        During the downturn in the U.K. housing market that began in 2008, we and our U.K. brick competitors discontinued significant domestic brick manufacturing capacity. The U.K. housing market began to recover in April 2013 and by 2014 the market had recovered enough such that domestic manufacturing output was insufficient to satisfy demand, leading to a sharp increase in brick imports into the United Kingdom from Continental Europe. It is estimated that demand for bricks in the United Kingdom will exceed domestic production capacity (including current idled capacity) in 2015. As such, if our production capacity does not increase to meet the higher levels of demand, among other factors such as price competition and lower barriers to entry, we may face increasing levels of competition from such imports and potential loss of market share.

        In addition, competition from brick imports from Mexico and abroad may adversely impact our brick business in the United States and Eastern Canada.

Construction activities in Texas, the United Kingdom and Eastern Canada have historically had a large impact on our results of operations because we conduct a significant portion of our business in these markets.

        We currently conduct a significant portion of our business in Texas, the United Kingdom and Eastern Canada, which represented approximately 26%, 35% and 12% of our 2013 net sales, respectively. Residential, infrastructure and non-residential construction activity in these markets have declined from time to time, particularly as a result of slow economic growth. Local economic conditions largely depend on a variety of factors, including national economic conditions, local, provincial and state budget situations and the impact of federal cutbacks. If construction activity declines in one or more of Texas, the United Kingdom or Eastern Canada, there may be a material adverse impact on our results of operations and cash flows.

A material disruption at one of our manufacturing facilities or at one of our suppliers' facilities could prevent us from meeting customer demand, reduce our net sales and negatively affect our results of operations.

        Any of our manufacturing facilities or any of our machines within an otherwise operational facility could cease operations unexpectedly because of a number of events, including but not limited to:

    major equipment failure;

    fires, floods, earthquakes, hurricanes, environmental incidents or other catastrophes;

    utility and transportation infrastructure disruptions;

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    labor conflicts;

    other operational problems; or

    war, acts of terrorism or other unexpected events.

        Any downtime or facility damage could prevent us from meeting customer demand for our products or require us to make unplanned capital expenditures. If our machines or facilities were to incur significant downtime, our ability to satisfy customer requirements could be impaired, resulting in decreased customer satisfaction and lower net sales.

        In addition, our suppliers are subject to the manufacturing facility disruption risks noted above. Our suppliers' inability to manufacture or supply the necessary raw materials for our manufacturing processes may adversely impact our results of operations and cash flows.

Labor disruptions or cost increases could adversely affect our business.

        A work stoppage at one of our facilities could cause us to lose net sales or to incur increased costs and could adversely affect our ability to meet customers' needs. A plant shutdown or a substantial modification to employment terms could negatively affect us. Approximately 30% of our workforce in North America is covered by collective bargaining agreements and nearly half of these employees are included in collective bargaining agreements that expire within one year. In the United Kingdom, we recognize trade unions at most, but not all, of our plants. Union-organized work stoppages have occurred at some of our plants in the United Kingdom in the past and may occur again in the future. We have not had any work stoppages in the United States or Eastern Canada over the last ten years, but they may occur in the future. We have experienced one union organizing effort directed at our non-union employees in the past ten years and such efforts may occur again in the future. We may also experience labor cost increases or disruptions and any limitations on our manufacturing or sales in our non-union plants in circumstances in which we must compete for employees with necessary skills and experience or in tight labor markets. Any such cost increases, work stoppages or disruptions could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Delays in construction projects could adversely affect our business.

        Many of our products are used in water transmission and distribution projects and other large-scale construction projects, which generally require a significant amount of planning and preparation before construction commences. It is not unusual for construction projects to be delayed and rescheduled. Projects are delayed and rescheduled for a number of reasons, including unanticipated soil conditions or adverse weather, changes in project priorities, difficulties in complying with environmental and other government regulations or permits and additional time required to acquire rights-of-way or property rights. Delays in construction projects may occur with too little notice to allow us to replace those projects in our manufacturing schedules, causing inefficiencies in our operations. As a result, our business, financial position, results of operations and cash flows may be adversely affected by unplanned downtime.

Significant changes in the cost and availability of transportation could adversely affect our results of operations.

        Because manufacturers in our industry are frequently responsible for delivering products to the customer, transportation costs associated with the delivery of our products, in most cases by truck, constitute a significant portion of our costs. Increases in the cost of fuel or energy can result in increases in the cost of transportation, which could materially and adversely affect our results of operations. Also, shortages in trucking capacity, the risk of which has increased because the number of trucking companies with suitable vehicles for handling our products decreased as a result of the economic downturn, could limit our ability to deliver our products and therefore adversely affect our results of operations.

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The nature of our business may expose us to warranty claims and to claims for product liability, construction defects, project delay, property damage, personal injury and other damages.

        We generally provide warranties on our products against defects in materials and workmanship. Some of our products are used in applications where a product failure or construction defect could result in significant project delay, property damage, personal injury or death or could require significant remediation expenses. For example, our pressure pipe is used in nuclear and coal-fired power generation facilities as well as in the water transmission systems of cities and municipalities. Product failures may also arise out of the quality of the raw materials we purchase from third-party suppliers or the quality of the work performed by the contractors installing our products, over which we do not have direct control. Product liability claims can be expensive to defend and can divert the attention of management and other personnel for significant time periods, regardless of the ultimate outcome. An unsuccessful product liability defense could be highly costly and result in charges that would have a material adverse effect on our results of operations. In addition, even if we are successful in defending any claim relating to the products we distribute, claims of this nature could negatively affect customer confidence in us and our products.

Our financial results may be affected by various legal and regulatory proceedings.

        We are subject to litigation and regulatory proceedings in the normal course of business and could become subject to additional claims in the future, some of which could be material. The outcomes of litigation and similar disputes are often difficult to predict reliably and existing legal proceedings may result in decisions or settlements more adverse to us than our expectations. Various factors and developments could lead us to make changes in current estimates of liabilities and related insurance receivables, where applicable, or make additional estimates, including new or modified estimates as a result of a judicial ruling or judgment, a settlement, regulatory developments or changes in applicable law. A future adverse ruling, settlement or unfavorable development could result in charges that have a material adverse effect on our financial condition and results of operations. Additionally, defending against these lawsuits and proceedings may involve significant expense and diversion of management's attention and resources from other matters.

Insurance coverage may not be sufficient to cover the risks related to our operations and losses.

        We may experience major accidents in the course of our operations. Although we maintain liability insurance, such an insurance program does not cover, or may not cover adequately, every potential risk associated with our operations and the consequences resulting from them. In addition, as a result of market conditions, premiums and deductibles for our existing insurance policies can increase substantially and, in some instances, our existing insurance may become unavailable or available only for reduced amounts of coverage. Furthermore, we may not be able to obtain meaningful coverage at reasonable rates for certain types of environmental hazards. The occurrence of an accident, the losses and damages of which are not fully covered by insurance, could have a material adverse effect on our business, financial condition and results of operations.

We may be unable to attract and retain key management employees.

        Our key management personnel are important to our success. Our ability to retain our key management personnel or to attract suitable replacements should any members of our management team leave is dependent on the competitive nature of the employment market. The loss of services from key management personnel could materially and adversely affect our business.

If we fail to attract and retain skilled technical personnel, our operations could be adversely affected.

        Our success depends on our ability to attract and retain skilled employees, particularly engineering and technical personnel. Without a sufficient number of skilled employees, our operations and

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manufacturing quality could suffer. Competition for qualified technical personnel and operators is intense and replacing or finding new skilled employees can be difficult. The reduction in demand for products in our industry that occurred beginning in 2008 has caused a portion of skilled workers to leave our industry permanently, further reducing the labor pool. Failure to attract and retain our technical personnel and other employees may adversely affect our business and our operating efficiency may deteriorate.

We may experience delays or outages in our information technology system and computer networks.

        We may be subject to information technology system failures and network disruptions. These may be caused by delays or disruptions due to system updates, natural disasters, malicious attacks, accidents, power disruptions, telecommunications failures, acts of terrorism or war, computer viruses, physical or electronic break-ins or similar events or disruptions. Because we have grown over the years through various acquisitions and our operations are geographically diverse, we have many disparate information technology systems across our organization, certain of which are outdated and due for replacement. As a result of these disparate information technology systems, we face the challenge of supporting older systems and implementing upgrades when necessary. We may in the future add applications to replace outdated systems and to operate more efficiently. Predictions regarding benefits resulting from the implementation of these projects are subject to uncertainties. We may not be able to successfully implement the projects without experiencing difficulties. In addition, any expected benefits of implementing projects might not be realized, or the costs of implementation might outweigh the benefits realized.

        A disruption in our information technology systems because of a catastrophic event or security breach could interrupt or damage our operations. In addition, we could be subject to reputational harm or liability if confidential customer information is misappropriated from our information technology systems. Despite our security measures and business continuity plans, these systems could be vulnerable to disruption, and any such disruption could negatively affect our financial condition and results of operations.

We have substantial fixed costs and, as a result, our income from operations is sensitive to changes in our net sales.

        A significant portion of our expenses are fixed costs (including personnel), which in the short-term do not fluctuate with net sales. Consequently, a percentage decline in our net sales could have a greater percentage effect on our income from operations if we do not act to reduce personnel or take other cost-reduction actions. Any decline in our net sales would adversely affect our results of operations.

        Our fixed costs as a percentage of total expenses were 16.1%, 19.1% and 18.6% in 2013, 2012 and 2011, respectively. Our fixed costs as a percentage of total expenses, excluding impairment costs, were 20.0%, 19.5% and 19.1% in 2013, 2012 and 2011, respectively.

If we are unable to successfully manage our inventory levels for our products, our results of operations could be adversely affected.

        We maintain an inventory of certain of our products, particularly bricks and roof tiles. Because bricks and roof tiles have decorative functions, we attempt to predict customers' changing tastes in order to ensure that we keep certain items in inventory that will be high in demand and to limit our inventory of items that are low in demand. Unexpected changes in customers' tastes could result in increased levels of obsolete inventory of bricks and roof tiles, which could negatively affect our results of operations.

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We are exposed to the credit and non-payment risk of our customers, especially during times of economic uncertainty and tight credit markets.

        The majority of our sales are to customers on an open credit basis, with standard payment terms of 30 days. While we monitor individual customer payment capability in granting such open credit arrangements and seek to limit such open credit to amounts we believe are reasonable, we may experience losses because of a customer's inability to pay. Our extension of credit involves considerable judgment and is based on an evaluation of each customer's financial condition and payment history. While we maintain an allowance for doubtful receivables for potential credit losses based upon our historical trends and other available information, in times of economic uncertainty and tight credit markets, there is heightened risk that our historical indicators may prove to be inaccurate. The inability to collect on sales to significant customers or a larger number of customers could have a material adverse effect on our results of operations.

Our business can be seasonal in nature and can be affected by adverse weather conditions, and this may cause our quarterly results to vary.

        Sales of our products in some markets, including Canada, the United Kingdom and the Northeast and Midwest regions of the United States, are seasonal in that sales are generally somewhat higher from spring through autumn when construction activity is greatest. Construction activity declines in these markets during the winter months due to inclement weather, frozen ground and shorter daylight hours. Construction activity can also be affected in any seasonal period by adverse weather conditions, hurricanes, severe storms, torrential rains, floods, natural disasters and similar events. Unfavorable weather conditions during peak construction periods can result in a material reduction in demand for our products and consequently have an adverse effect on our sales. As a result, our quarterly results have varied in the past and may vary from quarter to quarter in the future. Such variations could have a negative impact on the price of our ordinary shares.

We may be adversely affected by fluctuations in foreign exchange rates.

        Approximately 49% and 47% of our net sales were received or denominated in foreign currencies (primarily the British pound and the Canadian dollar) for the six months ended June 30, 2014 and the year ended December 31, 2013, respectively. Since our results are reported in U.S. dollars, exchange rate movements may affect our operating results, assets and cash balances.

        Fluctuations in foreign exchange rates, such as those between the U.S. dollar and the Mexican peso or Canadian dollar or between the British pound and the Euro, may also impact competition in our product markets by causing relative prices of cross-border substitutes to vary, and thereby encouraging imports of competitor products.

Our project-based business requires significant amounts of liquidity and we may not be able to ensure adequate financing or guarantees for large projects in the future.

        The projects in which we participate, particularly in our pressure pipe business, can be capital-intensive and often require substantial amounts of liquidity. In line with industry practice, we receive prepayments from our customers as well as milestone payments. A change in the prepayment patterns or our inability to receive third-party guarantees in respect of such prepayments could force us to seek alternative sources of financing, such as raising debt from banks or in the capital markets, which could harm our results of operations.

        As is customary in some of our business segments, we provide our customers with performance guarantees and other guarantee instruments such as surety bonds. These guarantees and instruments guarantee the timely completion of a project pursuant to defined contractual specifications. If we fail to meet any of these specifications, we will be required to make payments under such guarantees and

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instruments. Some customers require the performance guarantees to be issued by a reputable and creditworthy financial institution in the form of a letter of credit, surety bond or other financial guarantee. Financial institutions consider our credit ratings and financial position in the guarantee approval process. Our credit ratings and financial position could make the process of obtaining such guarantees from financial institutions more difficult and expensive. If we cannot obtain such guarantees from financial institutions on reasonable terms, or if we cannot obtain such guarantees from reputable and creditworthy institutions, we could face higher financing costs or even be prevented from bidding on or obtaining new projects. Such obstacles could have a material adverse effect on our business, financial condition and results of operations.

The age of some of our facilities means that they are less efficient and at an increased risk for unplanned downtime, which may require us to make significant capital expenditures.

        We own and operate facilities of various ages and levels of automated control. Older facilities are generally less energy efficient, require more manual manufacturing processes and are at an increased risk of damage or equipment failure, resulting in unplanned downtime. The equipment required to manufacture certain of our products is specialized and the time required for replacement of such equipment can be lengthy, which could result in extended downtime in the affected unit. Potential age-related issues have occurred in the past and may occur in the future and could affect our operating results, liquidity and financial position. If such issues occur, we may need to make significant capital expenditures to repair or replace the affected assets.

Demographic and government policy changes in Eastern Canada may result in increased construction of medium- and high-density housing, which use fewer bricks and less pipe and precast.

        We are the largest manufacturer of bricks in Eastern Canada. Our bricks manufactured in Eastern Canada are primarily used in the construction of single-family homes in Ontario and Quebec. We expect that certain demographic trends, such as the aging of the baby boomer generation and immigration patterns, will result in increased construction of medium- and high-density housing, such as rental apartments and condominiums, in future years. This trend is reinforced by government policies that encourage denser developments in order to revitalize downtown areas and to reduce greenhouse gas emissions. If the increased construction of medium- and high-density housing, which often uses materials other than brick for cladding and uses less pipe and precast, is accompanied by a decrease in the construction of single-family housing, this could result in a decrease of our brick sales in Eastern Canada.

Consolidation in the U.S. homebuilding industry may adversely affect our business by increasing the market and pricing power of our customers.

        Since the global economic recession, there has been significant consolidation in the homebuilding industry in the United States, with many smaller homebuilders going out of business or being acquired and larger homebuilders significantly increasing their market share. The continuing consolidation in the U.S. homebuilding industry has strengthened the market and pricing power of the large homebuilders. As a result, we have experienced and expect to continue to experience pricing pressure on sales of brick to U.S. homebuilders.

A decline in the economy and a deterioration in expectations regarding the housing recovery could result in our taking additional significant non-cash impairment charges, which may reduce our financial resources and flexibility and could negatively affect results of operations and reduce stockholders' equity.

        At December 31, 2013, we had 13 reporting units, of which four units carried goodwill in an aggregate amount of $105.5 million. For the fiscal year ended December 31, 2013, we recorded a $236.6 million goodwill impairment charge in our North America Pressure Pipe reporting unit. A decline in the

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expectation of our future performance or deterioration in expectations regarding the timing and the extent of the recovery of our end markets may cause us to recognize additional non-cash, pre-tax impairment charges for goodwill and other indefinite-lived intangible assets or other long-lived assets, which are not determinable at this time. If the value of goodwill or other intangible assets is impaired, our results of operations and stockholders' equity would be adversely affected. As of June 30, 2014, $105.5 million of goodwill was included on our balance sheet.

The possibility of the United Kingdom leaving the European Union may affect our business, financial condition and results of operations.

        In January 2013, the U.K. Government announced the possibility of a referendum on the United Kingdom's membership in the European Union, which would take place after 2015. An exit of the United Kingdom from the European Union could significantly affect the fiscal, monetary and regulatory landscape in the United Kingdom and could have a material impact on its economy and the future growth of its various industries, including the construction industry. Although it is not possible to predict fully the effects of an exit of the United Kingdom from the European Union, if it were to occur, it could have a material adverse effect on our business, financial condition and results of operations.

We have identified material weaknesses in our internal control over financial reporting which could result in material misstatements in our combined predecessor financial statements or, if not remediated, our future consolidated financial statements. If we fail to maintain proper and effective internal control over financial reporting in the future, our ability to produce accurate and timely consolidated financial statements could be impaired, which could harm our operating results, investors' views of us and, as a result, the value of our ordinary shares.

        In connection with this offering we are separating from HeidelbergCement, and as a result, we are currently operating with limited accounting personnel and other resources with which to address our internal controls and procedures. In connection with the preparation and external audit of our combined predecessor financial statements as of and for the years ended December 31, 2013, 2012 and 2011, we identified material weaknesses in our internal controls over financial reporting. Our independent public accounting firm has not yet performed an audit of our internal controls over financial reporting and is not required to report on management's assessment of our internal controls until one year following the filing of our first annual report with the U.S. Securities and Exchange Commission, or the SEC. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company's annual or interim consolidated financial statements will not be prevented or detected on a timely basis. The material weaknesses identified are that the Company (i) does not have adequate systems in place for recording transactions, (ii) does not have well-defined processes under which it can complete its financial statement close process and (iii) is heavily dependent on HeidelbergCement for legal, accounting and finance services and general administrative support functions. The Company is presently dependent on systems, processes and people whose primary focus and responsibility is reporting for HeidelbergCement under International Financial Reporting Standards. The Company has retained contractors to assist with its application of U.S. GAAP. In order to remediate the material weaknesses, we are actively seeking additional accounting and finance staff members to augment our current staff, formalizing our accounting policies and internal controls documentation, strengthening supervisory reviews by our management and developing a financial reporting platform to address the requirements of SEC reporting. We have not incurred any material costs to date and are not able to estimate with reasonable certainty the costs that we will need to incur to remediate the material weaknesses and improve our internal control over financial reporting in the future.

        To comply with the requirements of being a public company, we may need to undertake various additional actions, such as implementing new internal controls and procedures and hiring accounting or

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internal audit staff. Pursuant to Section 404 of the Sarbanes-Oxley Act ("Section 404"), our management will be required to report upon the effectiveness of our internal control over financial reporting beginning with the annual report for our fiscal year ending December 31, 2015. Testing and maintaining internal controls can divert our management's attention from other matters that are important to the operation of our business. In addition, when evaluating our internal controls over financial reporting, we may identify additional material weaknesses that we may not be able to remediate in time to meet the applicable deadline imposed upon us for compliance with the requirements of Section 404. If we identify additional material weaknesses in our internal controls over financial reporting or are unable to comply with the requirements of Section 404 in a timely manner or assert that our internal controls over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal controls over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our ordinary shares could be negatively affected, and we could become subject to investigations by the SEC or other regulatory authorities, which could require additional financial and management resources.

Risks Relating to Our Indebtedness

We will have debt obligations that could adversely affect our business and our ability to meet our obligations or could restrict the manner in which we operate or return cash to shareholders.

        Prior to the completion of or concurrent with this offering, we will enter into a new credit facility, which could have important consequences to our investors, including:

    requiring a significant portion of our cash flow from operations to make interest payments (historically we have only incurred an insignificant amount of interest expense in connection with our capital leases);

    increasing our vulnerability to downturns in our business and industry;

    reducing the cash flow available for working capital, to fund capital expenditures and other corporate purposes and to grow our business;

    limiting our ability to pay future dividends;

    limiting our ability to incur new debt or liens;

    limiting our ability to sell assets and conduct certain corporate transactions; and

    limiting our flexibility in planning for, or reacting to, changes in our business and the industry.

        It may be necessary in the future to refinance our indebtedness. If, at such time, market conditions are materially different or our credit profile is worse, the cost of refinancing such debt may be significantly higher than our existing indebtedness, or we may be unable to procure refinancing at all. To the extent we cannot meet any future debt service obligations through use of cash flow, refinancing or otherwise, we will risk having our outstanding debt accelerated.

        We may incur substantial additional indebtedness in the future, subject to the restrictions contained in our new credit facility. If new indebtedness is added to our current debt levels, the related risks that we now face could intensify.

        The terms of our new credit facility may contain covenants restricting our financial and operational flexibility, including, among other things, restrictions on the payment of dividends and other distributions to our ordinary shareholders. If we breach a restrictive covenant under any of our indebtedness, or an event of default occurs in respect of such indebtedness, our lenders may be entitled to declare all amounts owing in respect thereof to be immediately due and payable, which could have a material adverse effect on our business, prospects, liquidity, financial condition and results of operations.

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Risks Related to Our Relationship with HeidelbergCement

Our historical financial information as a group of businesses of HeidelbergCement may not be representative of our results as an independent public company.

        The historical financial information that we have included in this prospectus has been derived from the historical financial statements of HeidelbergCement and does not necessarily reflect what our financial position, results of operations or cash flows would have been had we been an independent entity during the historical periods presented. The historical costs and expenses reflected in our combined predecessor financial statements include an allocation for certain corporate functions historically provided by HeidelbergCement. Substantially all of the Company's senior management is employed by HeidelbergCement and certain functions critical to the Company's operations are centralized and managed by HeidelbergCement. Historically, the centralized functions have included executive senior management, financial reporting, financial planning and analysis, accounting, information technology, tax, risk management, treasury, legal, human resources, land management and strategy and development. Additionally, the Company resides in office space provided by HeidelbergCement. As a result, the Company enters into numerous transactions with HeidelbergCement. Costs allocated to the Company are primarily related to such activities. While we believe that these allocations are reasonable reflections of the historical utilization levels of these services in support of our business, we have not made adjustments to reflect many significant changes that will occur in our cost structure, funding and operations as a result of our separation from HeidelbergCement, including changes in our employee base, changes in our legal structure, potential increased costs associated with reduced economies of scale, migration of our informational technology systems, increased marketing expenses related to establishing a new brand identity and increased costs associated with being a public company. We do not have any history of functioning as a stand-alone company and do not present financial results in this prospectus as a stand-alone company for any full financial reporting period. As a result of these factors, the historical financial information is not necessarily representative of the amounts that would have been reflected in our financial statements had we been a stand-alone company or indicative of our future results of operations, financial position, cash flows or costs and expenses. For additional information, see "Selected Financial Data," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Unaudited Pro Forma Combined Financial Information" and our audited and unaudited combined predecessor financial statements and notes thereto.

The transitional services that HeidelbergCement currently provides to us may not be sufficient to meet our needs and our ability to change the scope of the services provided may be limited.

        Historically, HeidelbergCement has provided significant corporate and shared services related to corporate functions, such as executive senior management, financial reporting, financial planning and analysis, accounting, information technology, tax, risk management, treasury, legal, human resources, land management and strategy and development. Following our separation from HeidelbergCement, HeidelbergCement has agreed to continue to provide many of these services on a transitional basis for a fee. While these services are being provided to us by HeidelbergCement, these services may be insufficient to meet our needs, and our operational flexibility to modify or implement changes with respect to such services or the amounts that we pay for them will be limited.

After the expiration of our transitional services agreement, we will no longer have access to the resources of HeidelbergCement and we may have difficulty finding replacement services or experience increased costs resulting from decreased purchasing power.

        After the expiration of the transitional services agreement, we may not be able to replace the services provided to us by HeidelbergCement or enter into appropriate third-party agreements on terms and conditions, including cost, comparable to those that we will receive from HeidelbergCement under the transitional services agreement. Although we intend to replace portions of the services currently

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provided by HeidelbergCement, we may encounter difficulties replacing certain services or be unable to negotiate pricing or other terms for such services or for other goods, services or supplies as favorable as those we currently have in effect.

To the extent we are required to purchase larger quantities of cement and aggregates in the open market, increases in the cost of cement or aggregates could have an adverse effect on our results of operations.

        We have historically purchased a substantial portion of our cement and aggregates from HeidelbergCement. Cement is a significant component of our variable costs. To the extent we are required to purchase larger quantities of cement or aggregates on the open market following our separation from HeidelbergCement, the related costs will be subject to market conditions and can increase, which could have an adverse effect on our results of operations.

We may not be able to favorably resolve disputes that arise between HeidelbergCement and us with respect to our past and ongoing relationships.

        Following our separation from HeidelbergCement, disputes may arise between HeidelbergCement and us in a number of areas relating to our past and ongoing relationships, including:

    labor, tax, employee benefit, indemnification and other matters arising from our separation from HeidelbergCement;

    employee retention and recruiting;

    business combinations involving us;

    sales or dispositions by HeidelbergCement of all or any portion of its ownership interest in us; and

    the nature, quality and pricing of services HeidelbergCement has agreed to provide us.

        We may not be able to resolve any potential disputes or conflicts, and even if we do, the resolution may be less favorable to us than if we were dealing with an unaffiliated party. The agreements that we will enter into with HeidelbergCement may be amended upon agreement between the parties. Following this offering, while HeidelbergCement will retain approximately            % of our outstanding ordinary shares, or approximately            % if the underwriters exercise their option to purchase additional ordinary shares in full, we may not possess the necessary leverage to negotiate amendments to these agreements, if required, on terms favorable to us.

Some of our directors and officers may have conflicts of interest.

        Some of our directors and officers own HeidelbergCement ordinary shares and equity awards or other instruments, the value of which is related to the value of HeidelbergCement ordinary shares, or will be designated for nomination and election to our board of directors by HeidelbergCement pursuant to our shareholders agreement, which could create, or appear to create, conflicts of interest that result in our not acting on opportunities on which we would otherwise act.

        Pursuant to our shareholders agreement, HeidelbergCement will have the right, for so long as it maintains a significant holding of our ordinary shares, to designate directors for nomination and election to our board of directors.

        In addition, some of our directors and officers will be granted equity awards in the Company, the value of which is related to the value of our ordinary shares. The direct and indirect interests of these directors and officers could create, or appear to create, conflicts of interest with respect to decisions involving both us and HeidelbergCement that could have disparate implications for HeidelbergCement and us. These decisions could, for example, relate to:

    disagreement over corporate opportunities;

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    competition between us and HeidelbergCement;

    management share ownership;

    employee retention or recruiting;

    our capital structure;

    our use of capital, including for acquisitions and dividends; and

    the services and arrangements from which we benefit as a result of our relationship with HeidelbergCement.

        Conflicts of interest could also arise if we enter into any new, or amend existing, commercial arrangements with HeidelbergCement in the future, or if HeidelbergCement decides to compete with us. Our directors and officers who have interests in both HeidelbergCement and us may also face conflicts in allocating their time between HeidelbergCement and us.

        As a result of any such conflicts of interest, we may not pursue certain opportunities that we would otherwise pursue, including growth opportunities, which may negatively affect our business and results of operations.

HeidelbergCement controls the direction of our business, and so long as it does, the concentrated ownership of our ordinary shares and certain governance arrangements will prevent other shareholders from influencing significant decisions.

        After the completion of this offering, HeidelbergCement will own approximately        % of our outstanding ordinary shares, or approximately        % if the underwriters exercise their option to purchase additional ordinary shares in full. As long as HeidelbergCement owns a majority of our outstanding ordinary shares, HeidelbergCement will be able to control any corporate action that requires a shareholder vote irrespective of the vote of any other shareholder. As a result, HeidelbergCement will have the ability to control significant corporate activities, including:

    the election of our board of directors and, through our board of directors, decision making with respect to our business direction and policies, including the appointment and removal of our officers;

    acquisitions or dispositions of businesses or assets, mergers or other business combinations;

    our capital structure;

    the payment of dividends; and

    the number of shares available for issuance under our equity incentive plans for our prospective and existing employees.

        This voting control and influence may discourage transactions involving a change of control of the Company, including transactions in which you as a holder of our ordinary shares might otherwise receive a premium for your shares.

        Even if the ownership interest of HeidelbergCement is reduced to less than a majority of our outstanding ordinary shares, so long as HeidelbergCement retains a significant portion of our outstanding ordinary shares, it will have the ability to substantially influence these significant corporate activities. HeidelbergCement may have interests that conflict with the interests of other shareholders.

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We are exempt from certain corporate governance requirements since we are a "controlled company" within the meaning of NYSE rules, and as a result, you will not have the protections afforded by these corporate governance requirements.

        Following the consummation of this offering, HeidelbergCement will hold a majority of our ordinary shares. As a result, after the completion of this offering, we will be considered a "controlled company" for the purposes of the NYSE listing requirements. Under these rules, a company of which more than 50% of the voting power is held by a group is a "controlled company" and may elect not to comply with certain corporate governance requirements, including the requirements that our board of directors, our compensation committee and our nominating and corporate governance committee meet the standards of independence established by those corporate governance requirements. The NYSE independence standards are intended to ensure that directors who meet the independence standard are free of any conflicting interest that could influence their actions as directors. Accordingly, you may not have the same protections afforded to shareholders of companies that are subject to all of the NYSE corporate governance requirements and the ability of our independent directors to influence our business and affairs will be reduced.

We will be required to pay HeidelbergCement, 85% of certain tax benefits we may claim as a result of certain tax assets transferred to us in connection with this offering and the amounts we may be required to pay could be significant.

        We will enter into a tax receivable agreement with HeidelbergCement, providing for the payment by us to HeidelbergCement of 85% of the U.S. federal tax benefits, if any, that we realize as a result of the utilization of certain net operating loss carry forwards, or NOLs. See "Certain Relationships and Related Party Transactions—Tax Receivable Agreement."

        We expect the payments that we may make under the tax receivable agreement will be substantial. There may be a material negative effect on our liquidity if, as a result of timing discrepancies or otherwise, distributions from our subsidiaries are not sufficient to permit us to make payments under the tax receivable agreement after we have paid taxes. The payments under the tax receivable agreement are not conditioned upon HeidelbergCement's continued ownership of us.

        Estimating the amount of payments that may be made under the tax receivable agreement is by its nature imprecise, insofar as the calculation of amounts payable depends on a variety of factors. The amount and timing of any payments under the tax receivable agreement will vary depending upon a number of factors, including the amount and timing of the taxable income we realize in the future and the tax rate then applicable, our use of NOLs and other factors.

HeidelbergCement will retain certain names and trademarks such as the "Hanson" brand. This could adversely affect our business if our market perception or recognition is negatively affected.

        Pursuant to a license from HeidelbergCement, we will have the right to use the "Hanson" name, branding and related intellectual property for                    following the separation. Accordingly, we expect to discontinue the use of the Hanson name, branding and related intellectual property and change the Company's name by                     . As a result of our name change, some existing and potential customers, suppliers and market participants may not recognize our new name, which may hinder our ability to maintain and develop our customer base, at least during an initial transition period. Our name change also may affect our ability to recruit qualified personnel. We may need to expend significant resources to develop our new brand in the marketplace, and if we fail to build strong new brand recognition, our net sales and profitability may decline and our business prospects may suffer.

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Risks Related to This Offering and Ownership of Our Ordinary Shares

There is currently no public market for our ordinary shares, a trading market for our ordinary shares may never develop following this offering and our ordinary share prices may be volatile and could decline substantially following this offering.

        Prior to this offering, there has been no market for our ordinary shares. Although we intend to apply to list our ordinary shares on the NYSE under the symbol "            ," an active trading market for our ordinary shares may never develop or, if one develops, it may not be sustained following this offering. Accordingly, no assurance can be given as to the following:

    the likelihood that an active trading market for our ordinary shares will develop or be sustained;

    the liquidity of any such market;

    the ability of our shareholders to sell their ordinary shares; or

    the price that our shareholders may obtain for their ordinary shares.

        If an active market does not develop or is not maintained, the market price of our ordinary shares may decline and you may not be able to sell your shares. Even if an active trading market develops for our ordinary shares subsequent to this offering, the market price of our ordinary shares may be highly volatile and subject to wide fluctuations.

        Some of the factors that could negatively affect or result in fluctuations in the market price of our ordinary shares include:

    actual or anticipated variations in our quarterly operating results;

    changes in market valuations of similar companies;

    changes in the residential, infrastructure and non-residential construction markets;

    additions or departures of key personnel;

    actions by shareholders, including the sale by HeidelbergCement of its holdings of our ordinary shares;

    speculation in the press or investment community;

    general market, economic and political conditions, including an economic slowdown or dislocation in the global credit markets;

    changes in interest rates;

    our operating performance and the performance of other similar companies;

    changes in securities analysts' estimates of our financial performance or lack of research and reports by industry analysts;

    changes in accounting principles;

    changes in tax laws; and

    passage of legislation or other regulatory developments that adversely affect us or the construction industry.

        These and other factors may lower the market price of our ordinary shares, regardless of our actual operating performance. As a result, our ordinary shares may trade at prices significantly below the public offering price.

        Furthermore, in recent years, the capital markets have experienced significant price and volume fluctuations. This volatility has had a significant impact on the market price of securities issued by many companies, including companies in our industry. The changes frequently appear to occur without

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regard to the operating performance of the affected companies. Hence, the price of our ordinary shares could fluctuate based upon factors that have little or nothing to do with us, and these fluctuations could materially reduce our share price and materially affect the value of your investment.

The offering price per ordinary share offered under this prospectus may not accurately reflect the value of your investment.

        Prior to this offering, there has been no market for our ordinary shares. The offering price per ordinary share offered by this prospectus was negotiated among HeidelbergCement, the underwriters and us. Factors considered in determining the price of our ordinary shares include:

    the history and prospects of companies whose principal business is the manufacturing and sale of building products;

    market valuations of those companies;

    our capital structure;

    general conditions of the securities markets at the time of this offering; and

    other factors that we deemed relevant.

        The offering price may not accurately reflect the value of our ordinary shares and may not be realized upon any subsequent disposition of the shares.

Our future operating results may fluctuate significantly and our current operating results may not be a good indication of our future performance. Fluctuations in our quarterly financial results could affect our share price in the future.

        Our net sales and results of operations have historically varied from period to period and we expect that they will continue to do so as a result of a number of factors, many of which are outside of our control, including the cyclicality and seasonality of our industry. If our quarterly financial results fail to meet the expectations of securities analysts and investors, our share price could be negatively affected. Any volatility in our quarterly financial results may make it more difficult for us to raise capital in the future or pursue acquisitions that involve issuances of our shares. Our operating results for prior periods may not be effective predictors of future performance.

We have no present intention to pay dividends on our ordinary shares.

        We have no present intention to pay cash dividends on our ordinary shares. Any determination to pay dividends to holders of our ordinary shares will be at the discretion of our board of directors and will depend upon many factors, including our financial condition, results of operations, projections, liquidity, earnings, legal requirements, restrictions in our debt agreements and other factors that our board of directors deems relevant. See "Dividend Policy." Accordingly, you may need to sell your ordinary shares to realize a return on your investment, and you may not be able to sell your shares at or above the price you paid for them.

If securities or industry analysts do not publish research or reports about our business, publish inaccurate or unfavorable research about our business or change their recommendations regarding our shares adversely, our share price and trading volume could decline.

        The trading market for our ordinary shares will be influenced in part by the research and other reports that industry or securities analysts may publish about us or our business. We do not currently have, and may never obtain, research coverage by industry or financial analysts. If no or few analysts commence coverage of us, the trading price of our shares would likely be negatively affected. Even if we do obtain analyst coverage, if one or more of the analysts who cover us downgrade our shares, or if analysts issue other unfavorable commentary or inaccurate research, our share price would likely

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decline. If one or more of these analysts cease coverage of our Company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our share price or trading volume to decline.

Future sales of our ordinary shares in the public market could cause our share price to fall.

        If our existing shareholder sells substantial amounts of our ordinary shares in the public market following this offering, the market price of our ordinary shares could decrease significantly. The perception in the public market that our existing shareholder might sell substantial amounts of our ordinary shares could also depress the market price of our ordinary shares. Any such sale or perception could also impair our ability to raise capital or pay for acquisitions using our equity securities.

        Immediately after completion of this offering, we will have                ordinary shares outstanding, including                ordinary shares that will be beneficially owned by HeidelbergCement (or                ordinary shares if the underwriters exercise their option to purchase additional shares in full). Following completion of this offering, HeidelbergCement will beneficially own approximately        % of our outstanding ordinary shares (or        % if the underwriters exercise their option to purchase additional shares in full) and, unless such shares are registered under the Securities Act of 1933, as amended, or the Securities Act, such shares may only be resold into the public markets in accordance with the requirements of Rule 144, including the volume limitations, manner of sale requirements and notice requirements thereof. See "Shares Eligible for Future Sale." In addition, our remaining ordinary shares that will be outstanding immediately after completion of this offering will become eligible for sale in the public markets from time to time, subject to Securities Act restrictions, following the expiration of lock-up agreements. We, HeidelbergCement, and our officers and directors have signed lock-up agreements with the underwriters that will, subject to certain exceptions, restrict the sale of our ordinary shares held by them for 180 days following the date of this prospectus. The underwriters may, without notice except in certain limited circumstances, release all or any portion of the ordinary shares subject to lock-up agreements. See "Underwriting" for a description of these lock-up agreements. Upon the expiration of the lock-up agreements described above, all of such shares will be eligible for resale in the public market, subject, in the case of shares held by our affiliates, to the volume, manner of sale and other limitations under Rule 144. We expect that HeidelbergCement will be considered an affiliate of us after this offering based on their expected share ownership following this offering.

        After completion of this offering, HeidelbergCement will have the right to demand that we file a registration statement with respect to our ordinary shares held by it and will have the right to include its shares in any registration statement that we file with the SEC, subject to certain exceptions. See "Shares Eligible for Future Sale." Any registration of the shares owned by HeidelbergCement would enable those shares to be sold in the public market, subject to certain restrictions in our registration rights agreement and the restrictions under the lock-up agreements referred to above.

        The market price for our ordinary shares may drop significantly when the restrictions on resale by our existing shareholder lapse or if those restrictions on resale are waived. A decline in the price of our ordinary shares might impede our ability to raise capital through the issuance of additional ordinary shares or other equity securities. In addition, following this offering, we intend to file a registration statement on Form S-8 under the Securities Act registering shares under our share incentive plan. Subject to the terms of the awards granting the shares included in this registration statement and except for shares held by affiliates who will have certain restrictions on their ability to sell, the shares will be available for sale in the public market immediately after the registration statement is filed. See "Shares Eligible for Future Sale."

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In the future, we expect to issue options, restricted shares and other forms of share-based compensation, which have the potential to dilute shareholder value and cause the price of our ordinary shares to decline.

        We expect to offer share options, restricted shares and other forms of share-based compensation to our directors, officers and employees in the future. If any options that we issue are exercised, or any restricted shares that we may issue vest, and those shares are sold into the public market, the market price of our ordinary shares may decline. In addition, the availability of ordinary shares for award under our equity incentive plan, or the grant of share options, restricted shares or other forms of share-based compensation, may adversely affect the market price of our ordinary shares.

Our ability to raise capital in the future may be limited.

        Our business and operations may consume resources faster than we anticipate. In the future, we may need to raise additional funds through the issuance of new equity securities, debt or a combination of both. Additional financing may not be available on favorable terms, or at all. If adequate funds are not available on acceptable terms, we may be unable to fund our capital requirements. If we issue new debt securities, the debt holders would have rights senior to ordinary shareholders to make claims on our assets, and the terms of any debt could restrict our operations, including our ability to pay dividends on our ordinary shares. If we issue additional equity securities, existing shareholders will experience dilution, and the new equity securities could have rights senior to those of our ordinary shares. Because our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future offerings. Thus, our shareholders bear the risk of our future securities offerings reducing the market price of our ordinary shares and diluting their interest.

We are a holding company and depend on the cash flow of our subsidiaries.

        We are a holding company with no material assets other than the equity interests of our subsidiaries. Our subsidiaries conduct substantially all of our operations and own substantially all of our assets and intellectual property. Consequently, our cash flow and our ability to meet our obligations and pay any future dividends to our shareholders depend upon the cash flow of our subsidiaries and the payment of funds by our subsidiaries directly or indirectly to us in the form of dividends, distributions and other payments. Any inability on the part of our subsidiaries to make payments to us could have a material adverse effect on our business, financial condition and cash flows.

Provisions of our Articles of Association and other documents could discourage, delay or prevent a merger or acquisition at a premium price.

        Provisions in our Articles of Association may have the effect of delaying or preventing a change of control or changes in our management. Our Articles of Association include provisions that:

    permit us to issue, without shareholder approval, preferred shares in one or more series and, with respect to each series, fix the number of shares constituting the series and the designation of the series, the voting powers, if any, of the shares of the series and the preferences and other special rights, if any, and any qualifications, limitations or restrictions, of the shares of the series;

    restrict the ability of shareholders to act by written consent;

    limit the ability of shareholders to amend our Articles of Association;

    require advance notice for nominations for election to the board of directors and for shareholder proposals; and

    establish a classified board of directors with staggered three-year terms.

        These provisions may discourage, delay or prevent a merger or acquisition of our company, including a transaction in which the acquirer may offer a premium price for our ordinary shares. See

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"Description of Share Capital—Anti-Takeover Effects of Certain Provisions of Our Articles of Association."

        In addition, our new credit facility, and other debt instruments we may enter into in the future, may include provisions entitling the lenders to demand immediate repayment of all borrowings upon the occurrence of certain change of control events relating to our company, which also could discourage, delay or prevent a business combination transaction. Under Jersey law, the right to vote cumulatively does not exist, which means that the holders of a majority of the outstanding ordinary shares can elect all of the directors standing for election and the holders of the remaining shares will not be able to elect any directors.

The requirements of being a public company may strain our resources and divert management's attention and our lack of public company operating experience may impact our business and share price.

        As a U.S. public company, we will be subject to the reporting requirements of the U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of the NYSE and other applicable securities rules and regulations. Compliance with these rules and regulations will increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources.

        As a result of disclosure of information in this prospectus and in filings required of a public company, our business, financial condition, results of operations and cash flows will become more visible, which we believe may result in threatened or actual litigation, including by competitors and other third parties. If such claims are successful, our business and operating results could be harmed, and even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and resources necessary to resolve them, could divert the resources of our management and adversely affect our business, brand and reputation and results of operations.

        We also expect that being a public company and these new rules and regulations will make it expensive for us to obtain director and officer liability insurance and we may be required to incur substantial costs to obtain coverage. Potential liability associated with serving on a public company's board could make it difficult for us to attract and retain qualified members of our board of directors, particularly to serve on our audit committee and compensation committee and qualified executive officers.

        Our lack of public company operating experience may make it difficult to forecast and evaluate our prospects. If we are unable to execute our business strategy, either as a result of our inability to effectively manage our business in a public company environment or for any other reason, our business, financial condition and results of operations may be harmed, which could cause our share price to decline.

We will incur increased costs as a result of being a publicly traded company.

        As a company with publicly traded securities, we will incur significant legal, accounting and other expenses not presently incurred. In addition, the Sarbanes-Oxley Act and rules promulgated by the SEC and NYSE require us to adopt corporate governance practices applicable to U.S. public companies. These rules and regulations will increase our legal and financial compliance costs and may place a strain on our systems and resources. The Sarbanes-Oxley Act requires that we maintain effective disclosure controls and procedures and internal controls over financial reporting. To maintain and improve these controls, we will need to commit significant resources, hire additional staff and provide additional management oversight. We will be implementing additional procedures and processes for the purpose of addressing the standards and requirements applicable to public companies.

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Our ordinary shares are issued under the laws of Jersey, which may not provide the level of legal certainty and transparency afforded by incorporation in a U.S. state.

        We are organized under the laws of the Bailiwick of Jersey, a British crown dependency that is an island located off the coast of Normandy, France. Jersey is not a member of the EU. Jersey legislation regarding companies is largely based on English corporate law principles. A further summary of applicable Jersey company law is contained in this prospectus. However, there can be no assurance that Jersey law will not change in the future or that it will serve to protect investors in a similar fashion afforded under corporate law principles in the United States, which could adversely affect the rights of investors.

A change in our tax residence could have a negative effect on our future profitability.

        Although we are organized under the laws of Jersey, the affairs of the Company are and are intended to continue to be managed and controlled in the United Kingdom and therefore we are resident in the United Kingdom for U.K. and Jersey tax purposes. It is possible that in the future, whether as a result of a change in law or the practice of any relevant tax authority or as a result of any change in the conduct of our affairs following a review by our directors or for any other reason, we could become, or be regarded as having become, a resident in a jurisdiction other than the United Kingdom. If we cease to be a U.K. tax resident, we may be subject to a charge to U.K. corporation tax on chargeable gains on our assets and to unexpected tax charges in other jurisdictions on our income or net profit. Similarly, if the tax residency of any of our subsidiaries were to change from their current jurisdiction for any of the reasons listed above, we may be subject to a charge to local capital gains tax on the assets.

U.S. Holders of our ordinary shares could be subject to material adverse tax consequences if we are considered a Passive Foreign Investment Company (or PFIC) for U.S. federal income tax purposes.

        The Company believes it would not have been a passive foreign investment company ("PFIC") for U.S. federal income tax purposes in the 2013 tax year had it been a separate taxable entity from HeidelbergCement and will not be a PFIC in its initial tax year. The Company also does not expect to become a PFIC in the foreseeable future, but the Company's possible status as a PFIC must be determined annually and therefore may be subject to change. If we are at any time treated as a PFIC, such treatment could result in a reduction in the after-tax return to U.S. Holders of our ordinary shares and may cause a reduction in the value of such shares. Furthermore, if we are at any time treated as a PFIC, U.S. Holders of our ordinary shares could be subject to greater U.S. income tax liability than might otherwise apply, imposition of U.S. income tax in advance of when tax would otherwise apply and detailed tax filing requirements that would not otherwise apply. For U.S. federal income tax purposes, "U.S. Holders" include individuals and various entities. A corporation is classified as a PFIC for any taxable year in which (i) at least 75% of its gross income is passive income or (ii) at least 50% of the average value of all its assets produces or are held for the production of passive income. For this purpose, passive income includes dividends, interest, royalties and rents that are not derived in the active conduct of a trade or business. The PFIC rules are complex and a U.S. Holder of our ordinary shares is urged to consult its own tax advisors regarding the possible application of the PFIC rules to it in its particular circumstances. For information on the U.S. federal tax implications on U.S. Holders, see the section entitled "Taxation."

U.S. shareholders may not be able to enforce civil liabilities against us.

        A number of our directors and executive officers and a number of directors of each of our subsidiaries are not residents of the United States, and all or a substantial portion of the assets of such persons are located outside the United States. As a result, it may not be possible for investors to effect service of process within the United States upon such persons or to enforce against them judgments obtained in U.S. courts predicated upon the civil liability provisions of the federal securities laws of the United States. We have been advised by our Jersey solicitors that there is doubt as to the enforceability in Jersey of original actions, or of actions for enforcement of judgments of U.S. courts, for civil liabilities to the extent predicated upon the federal and state securities laws of the United States.

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FORWARD-LOOKING STATEMENTS

        This prospectus contains "forward-looking statements." These forward-looking statements are included throughout this prospectus, including in the sections entitled "Prospectus Summary," "Risk Factors," "Use of Proceeds," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Business" and "Certain Relationships and Related Party Transactions," and relate to matters such as our industry, business strategy, goals and expectations concerning our market position, future operations, margins, profitability, capital expenditures, financial condition, liquidity, cash flows, capital resources and other financial and operating information. We have used the words "approximately," "anticipate," "assume," "believe," "contemplate," "continue," "could," "estimate," "expect," "future," "intend," "may," "plan," "potential," "predict," "project," "seek," "should," "target," "will" and similar terms and phrases to identify forward-looking statements in this prospectus. All of our forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we are expecting, including:

    cyclicality in our markets in the United States, Eastern Canada and the United Kingdom, especially the new residential, infrastructure and non-residential construction and infrastructure markets;

    the highly competitive nature of our markets and the substitutability of competitors' products;

    disruptions in our supply of fly ash, an ingredient in our aircrete blocks in the United Kingdom, due to regulatory change and the difficulty in finding alternatives;

    the potential loss of customers;

    changes in affordability of energy or freight costs;

    indebtedness that we intend to incur prior to the completion of this offering under our new credit facility;

    material disruptions at our facilities or the facilities of our suppliers;

    changes in, cost of compliance with or the failure or inability to comply with governmental laws and regulations, in particular environmental laws and regulations;

    our involvement in legal and regulatory proceedings;

    our ability to attract and retain key management employees;

    disruptions in our information technology systems;

    labor disruptions;

    the seasonal nature of our business;

    the effectiveness of our internal controls over financial reporting;

    increased costs and demands on management as a public company;

    our lack of public company operating experience;

    our reliance on HeidelbergCement for many of our administrative services;

    our relationship, and actual and potential conflicts of interest, with HeidelbergCement; and

    additional factors discussed under the sections captioned "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business."

        The forward-looking statements contained in this prospectus are based on historical performance and management's current plans, estimates and expectations in light of information currently available

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to us and are subject to uncertainty and changes in circumstances. There can be no assurance that future developments affecting us will be those that we have anticipated. Actual results may differ materially from these expectations due to changes in global, regional or local political, economic, business, competitive, market, regulatory and other factors, many of which are beyond our control. We believe that these factors include those described in "Risk Factors." Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove to be incorrect, our actual results may vary in material respects from what we may have expressed or implied by these forward-looking statements. We caution that you should not place undue reliance on any of our forward-looking statements. Any forward-looking statement made by us in this prospectus speaks only as of the date on which we make it. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by applicable securities laws.

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USE OF PROCEEDS

        We will not receive any proceeds from the sale of our ordinary shares by the Selling Shareholder offered pursuant to this prospectus, including any proceeds that the Selling Shareholder may receive from the exercise by the underwriters of their option to purchase additional ordinary shares from the Selling Shareholder. The net proceeds from this offering will be received by the Selling Shareholder.

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DIVIDEND POLICY

        We have no present intention to pay cash dividends on our ordinary shares. Any determination to pay dividends to holders of our ordinary shares will be at the discretion of our board of directors and will depend upon many factors, including our financial condition, results of operations, projections, liquidity, earnings, legal requirements, restrictions in our debt agreements and other factors that our board of directors deems relevant. Pursuant to the Companies (Jersey) Law 1991, we may only pay a dividend if the directors who authorize the dividend make a prior solvency statement in the statutory form.

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CAPITALIZATION

        The following table sets forth our cash and cash equivalents and capitalization as of June 30, 2014:

    on an actual basis; and

    on a pro forma as adjusted basis to give effect to:

    the retention of certain assets and liabilities by HeidelbergCement;

    the incurrence of indebtedness under our new credit facility (and related issuance costs) to be entered into prior to, or concurrently with, this offering;

    the corporate separation transactions as described in "Certain Relationships and Related Party Transactions"; and

    the completion of this offering.

        Collectively, the transactions underlying these adjustments are referred to as the "Pro Forma Transactions."

        Cash and cash equivalents are not components of our total capitalization. You should read this table in conjunction with our audited and unaudited combined predecessor financial statements and the notes thereto appearing elsewhere in this prospectus, as well as "Selected Financial Data," "Unaudited Pro Forma Combined Financial Information," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Certain Relationships and Related Party Transactions" and "Description of Certain Indebtedness," and the other financial information included elsewhere in this prospectus.

 
  June 30, 2014  
 
  Actual   Pro Forma
As Adjusted
 
 
  (In thousands,
except share data)

 

Cash and cash equivalents(1)

  $ 28,997   $               
           
           

Long-term debt (including current portion)

                      

Capital lease obligations (including current portion)

    21,107                   
           

Parent company net investment(2)

             

Accumulated other comprehensive income (loss)

    29,542                   

Accumulated net contributions from parent

    1,050,516                   
           

Total parent company net investment

    1,080,058                   
           

Shareholders' equity(3)

             

Ordinary shares, nominal value $0.01 per share;        shares authorized and        shares issued and outstanding on a pro forma basis

                      

Additional paid-in capital

                      
           

Total shareholders' equity

                      
           

Total capitalization

  $ 1,101,165   $               
           
           

(1)
We use HeidelbergCement's centralized systems for cash management. As a result, all cash related to our operations is commingled with HeidelbergCement's general corporate funds and is not specifically allocated to us. The commingling of cash processes will cease upon completion of this offering. Pro forma as adjusted cash and cash equivalents includes cash of $        , representing an amount agreed upon between us and HeidelbergCement, pursuant to the separation and purchase agreement, to be retained by us following our separation to fund working capital needs and other operating requirements of our business.

(2)
Parent company net investment represents the cumulative net investment in us, inclusive of operating results. In connection with this offering, HeidelbergCement's investment will be converted into shares of Hanson Building Products Limited.

(3)
Shareholders' equity reflects the conversion of the parent company net investment into our ordinary shares and sale of                  ordinary shares in this offering at an assumed initial public offering price of $        per share, the midpoint of the range set forth on the cover of this prospectus, after deducting underwriting discounts and estimated offering expenses.

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SELECTED FINANCIAL DATA

        The following selected combined predecessor financial data should be read in conjunction with our audited and unaudited combined predecessor financial statements and the notes thereto appearing elsewhere in this prospectus, as well as "Capitalization," "Unaudited Pro Forma Combined Financial Information," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Certain Relationships and Related Party Transactions" and "Description of Certain Indebtedness" and the other financial information included elsewhere in this prospectus.

        The Company was formed on August 14, 2014 and has not, to date, conducted any activities other than those incident to its formation and the preparation of the registration statement of which this prospectus forms a part. Therefore, we believe that a presentation of the historical results of the Company would not be meaningful. Accordingly, the following presents the historical financial information for HeidelbergCement's building products business in the United States, Eastern Canada and the United Kingdom. HeidelbergCement holds all of the historical assets and liabilities related to the business that the Company will acquire.

        The financial statements included in this prospectus may not necessarily reflect our financial position, results of operations and cash flows as if we had operated as a stand-alone public company during all periods presented. Accordingly, the historical results should not be relied upon as an indicator of our future performance.

        The selected combined predecessor statement of operations data and the selected combined predecessor statement of cash flows data for the years ended December 31, 2013, 2012 and 2011 and the selected combined predecessor balance sheet data as of December 31, 2013 and 2012 have been derived from our audited combined predecessor financial statements, which are included elsewhere in this prospectus. The selected combined predecessor statement of operations data for the years ended December 31, 2010 and 2009 and the selected combined predecessor balance sheet data as of December 31, 2011, 2010 and 2009 have been derived from unaudited combined predecessor financial information not included in this prospectus.

        The selected combined predecessor statement of operations data and the selected combined predecessor statement of cash flows data for the six months ended June 30, 2014 and 2013 and the selected combined predecessor balance sheet data as of June 30, 2014 are derived from our unaudited combined predecessor financial statements, which are included elsewhere in this prospectus. We prepared our unaudited combined predecessor financial statements on the same basis as our audited combined predecessor financial statements and have included all adjustments, consisting of normal and recurring adjustments, that we consider necessary to present fairly our predecessor's financial position and results of operations for the unaudited periods. Operating results for the six-month periods are not necessarily indicative of results for a full financial year, or any other periods, including future periods.

        Our historical combined predecessor financial statements have been prepared on a stand-alone basis in accordance with U.S. GAAP and are derived from HeidelbergCement's consolidated financial statements and accounting records using the historical results of operations and assets and liabilities attributed to HeidelbergCement's building products business in the United States, Eastern Canada and the United Kingdom, and include allocations of expenses from HeidelbergCement. Our predecessor's historical results are not necessarily indicative of our results in any future period.

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  Six Months Ended
June 30,
  Year Ended December 31,  
 
  2014   2013   2013   2012   2011   2010   2009  
 
  (In thousands)
 

Statement of Operations Data:

                                           

Net sales

  $ 597,347   $ 573,990   $ 1,124,363   $ 1,177,621   $ 1,221,007   $ 1,181,212   $ 1,296,362  

Cost of good sold

    505,892     497,577     984,695     1,060,668     1,097,410     1,056,870     1,192,288  
                               

Gross profit

  $ 91,455   $ 76,413   $ 139,668   $ 116,953   $ 123,597   $ 124,342   $ 104,074  
                               
                               

Selling, general and administrative expenses

    (76,309 )   (69,206 )   (137,635 )   (153,760 )   (158,270 )   (174,331 )   (197,100 )

Income (loss) from operations

    20,352     8,753     (249,898 )   (36,641 )   (52,510 )   (65,913 )   (2,110,694 )

Net income (loss)

  $ 14,929   $ 8,576   $ (252,711 ) $ (59,209 ) $ (58,101 ) $ (97,848 ) $ (2,236,159 )

 

 
  As of
June 30,
  As of December 31,  
 
  2014   2013   2012   2011   2010   2009  
 
  (In thousands)
 

Balance Sheet Data:

                                     

Cash and cash equivalents

  $ 28,997   $ 22,821   $ 21,960   $ 25,568   $ 3,779   $ 22,723  

Trade receivables, net

    211,072     167,893     179,694     186,786     204,107     201,998  

Inventories, net

    237,654     205,342     226,967     239,447     270,430     300,112  

Property, plant and equipment, net

    722,854     735,351     788,105     878,026     934,557     1,028,341  

Total assets

    1,415,409     1,345,197     1,697,367     1,836,914     1,965,025     2,148,044  

Total long-term liabilities

    98,992     90,019     87,216     93,556     89,042     90,078  

Total liabilities

    335,351     296,369     312,123     315,492     295,483     302,882  

Total parent company net investment

    1,080,058     1,048,828     1,385,244     1,521,423     1,669,555     1,845,163  

 

 
  Six months ended
June 30,
  Year ended December 31,  
 
  2014   2013   2013   2012   2011  
 
  (In thousands)
 

Statement of Cash Flows Data:

                               

Net cash provided by (used in) operating
activities

  $ (2,906 ) $ 5,687   $ 67,466   $ 27,732   $ 92,307  

Net cash provided by (used in) investing
activities

    (2,273 )   3,550     11,047     68,131     13,433  

Net cash provided by (used in) financing
activities

    10,500     (535 )   (78,125 )   (100,538 )   (82,452 )

 

 
   
  Year ended December 31,  
 
  Latest twelve
months ended
June 30, 2014
 
 
  2013   2012   2011  
 
  (unaudited)
   
   
   
 
 
  (In thousands, except percentages)
 

Other Financial Data:

                         

Pro Forma Adjusted EBITDA(1)(2)

  $ 104,340   $ 89,551   $ 78,608   $ 91,296  

Pro Forma Adjusted EBITDA margin(1)

    9.1 %   8.0 %   6.7 %   7.5 %

(1)
Pro Forma Adjusted EBITDA and Pro Forma Adjusted EBITDA margin are non-GAAP measures. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Key Business and Financial Metrics Used by Management".

(2)
Adjusted EBITDA for the six months ended June 30, 2014 and 2013 were $51.4 million and $39.4 million, respectively, and for the years ended December 31, 2013, 2012 and 2011 were $65.9 million, $32.9 million and $41.2 million, respectively. Adjusted EBITDA is a non-GAAP measure. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Key Business and Financial Metrics Used by Management".

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UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

        The unaudited pro forma combined financial information and the related notes should be read in conjunction with our audited and unaudited combined predecessor financial statements and the notes thereto appearing elsewhere in this prospectus, as well as "Capitalization," "Selected Financial Data," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Certain Relationships and Related Party Transactions," "Description of Certain Indebtedness" and the other financial information included elsewhere in this prospectus.

        The following unaudited pro forma combined financial information consists of unaudited pro forma combined statement of operations data for the six months ended June 30, 2014 and for the years ended December 31, 2013, 2012 and 2011 and unaudited pro forma combined balance sheet data as of June 30, 2014. The unaudited pro forma combined financial information has been derived by application of pro forma adjustments to our historical combined predecessor financial statements included elsewhere in this prospectus.

        The Company was formed on August 14, 2014 and has not, to date, conducted any activities other than those incident to its formation and the preparation of the registration statement of which this prospectus forms a part. Therefore, we believe that a presentation of the historical results of the Company would not be meaningful. Accordingly, the following presents the pro forma financial information for HeidelbergCement's building products business in the United States, Eastern Canada and the United Kingdom. HeidelbergCement holds all of the historical assets and liabilities related to the business that the Company will acquire.

        We have included the unaudited pro forma combined financial information to reflect the following, on a pro forma basis:

    the retention of certain assets and liabilities by HeidelbergCement;

    the incurrence of indebtedness under our new credit facility (and related issuance costs) to be entered into prior to, or concurrently with, this offering;

    the corporate separation transactions as described in "Certain Relationships and Related Party Transactions"; and

    the completion of this offering.

        We have accounted for the retention of assets and liabilities described above, using the predecessor values, given that these will be transactions between entities under common control. Any difference between the consideration given and the aggregate book value of the assets and liabilities of the acquired entities as of the date of the transaction will be reflected as an adjustment to parent company net investment. We present herein pro forma statements of operations for the years ended December 31, 2013, 2012 and 2011, which are the same periods included in our audited combined predecessor financial statements.

        The events above are described in more detail in the notes to this "Unaudited Pro Forma Combined Financial Information."

        We have assumed that the above transactions have been completed on:

    January 1, 2011 for purposes of presenting the Unaudited Pro Forma Combined Statements of Operations for the six months ended June 30, 2014 and the years ended December 31, 2013, 2012 and 2011.

    June 30, 2014 for purposes of presenting the Unaudited Pro Forma Combined Balance Sheet as of June 30, 2014.

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        The unaudited pro forma combined financial information is presented for illustrative purposes only and reflects estimates and certain assumptions made by our management that are considered reasonable under the circumstances as of the date of this prospectus and which are based on the information available at the time of the preparation of the unaudited pro forma combined financial information. Actual adjustments may differ materially from the information presented herein. The unaudited pro forma combined financial information does not purport to represent what our combined income statement and combined statement of financial position would have been if the relevant transactions had occurred on the dates indicated and is not intended to project our consolidated results of operations or consolidated financial position for any future period or date.

        We have calculated earnings per share assuming a total of             ordinary shares outstanding after the consummation of this offering. Since our predecessor is a combination of entities under common control and did not have any share capital as of December 31, 2013, 2012 and 2011, we have not calculated earnings per share on a historical basis.

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Hanson Building Products

Unaudited Pro Forma Combined Statement Of Operations

For the Six Months Ended June 30, 2014

(In Thousands, Except Per Share Data)

 
  Historical   HeidelbergCement
Retained Assets(1)
  New
Indebtedness(2)
  Corporate
Separation
Transactions(3)
  Pro Forma  

Net sales

  $ 597,347   $ (46,274 ) $     $     $    

Cost of goods sold

    505,892     (45,121 )                  
                       

Gross profit

    91,455     (1,153 )                  

Selling, general and administrative expenses

    (76,309 )   2,250                    

Impairment and restructuring charges

    (110 )                      

Equity in earnings (loss) of investee

    741                        

Gain (loss) on sale of property, plant and equipment and business, net

    2,887     (175 )                  

Other operating income

    1,688     (1,035 )                  
                       

Income from operations

    20,352     (113 )                  

Other income (expenses)

                               

Other income (expenses), net

    (1,058 )   28                    
                       

Income from continuing operations before income taxes

    19,294     (85 )                  

Income tax expense

    (4,789 )   519                    
                       

Income from continuing operations

    14,505     434                    
                       

Discontinued operations

                               

Income from discontinued operations (including gain (loss) on HeidelbergCement Retained Assets)

    424                        

Income tax benefit (expense) from discontinued operations

                           
                       

Gain (loss) on discontinued operations, net of income tax

    424                        
                       

Net income

  $ 14,929   $ 434   $     $     $    
                       
                       

Net income per share, basic and diluted:

                               

Basic

                          $    

Diluted

                          $    

Weighted average shares outstanding:

                               

Basic

                          $    

Diluted

                          $    

   

See notes to unaudited pro forma combined financial information.

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Hanson Building Products

Unaudited Pro Forma Combined Statement Of Operations

For the Six Months Ended June 30, 2013

(In Thousands, Except Per Share Data)

 
  Historical   HeidelbergCement
Retained Assets(1)
  New
Indebtedness(2)
  Corporate
Separation
Transactions(3)
  Pro Forma  

Net sales

  $     $     $     $     $    

Cost of goods sold

                               
                       

Gross profit

                               

Selling, general and administrative expenses

                               

Impairment and restructuring charges

                             

Equity in earnings (loss) of investee

                             

Gain (loss) on sale of property, plant and equipment and business, net

                               

Other operating income

                               
                       

Income from operations

                               

Other income (expenses)

                               

Other income (expenses), net

                               
                       

Income from continuing operations before income taxes

                               

Income tax expense

                               
                       

Income from continuing operations

                               
                       

Discontinued operations

                               

Income from discontinued operations (including gain (loss) on HeidelbergCement Retained Assets)

                             

Income tax benefit (expense) from discontinued operations

                           
                       

Gain (loss) on discontinued operations, net of income tax

                             
                       

Net income

  $     $     $     $     $    
                       
                       

Net income per share, basic and diluted:

                               

Basic

                          $    

Diluted

                          $    

Weighted average shares outstanding:

                               

Basic

                          $    

Diluted

                          $    

   

See notes to unaudited pro forma combined financial information.

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Hanson Building Products

Unaudited Pro Forma Combined Statement Of Operations

For the Year Ended December 31, 2013

(In Thousands, Except Per Share Data)

 
  Historical   HeidelbergCement
Retained Assets(1)
  New
Indebtedness(2)
  Corporate
Separation
Transactions(3)
  Pro Forma  

Net sales

  $ 1,124,363   $ (73,901 ) $     $     $    

Cost of goods sold

    984,695     (77,081 )                  
                       

Gross profit

    139,668     3,180                    

Selling, general and administrative expenses

    (137,635 )   4,453                    

Impairment and restructuring charges

    (267,131 )   6,295                    

Equity in earnings (loss) of investee

    221                        

Gain (loss) on sale of property, plant and equipment and business, net

    8,674     (607 )                  

Other operating income

    6,305     759                    
                       

Loss from operations

    (249,898 )   14,080                    

Other income (expenses)

                               

Other income (expenses), net

    270     750                    
                       

Loss from continuing operations before income taxes

    (249,628 )   14,830                    

Income tax expense

    (3,069 )   (4,934 )                  
                       

Loss from continuing operations

    (252,697 )   9,896                    
                       

Discontinued operations

                               

Loss from discontinued operations (including loss on disposal of $(174))

    (14 )                      

Income tax benefit from discontinued operations

                           
                       

Gain (loss) on discontinued operations, net of income tax

    (14 )                      
                       

Net loss

  $ (252,711 ) $ 9,896   $     $     $    
                       
                       

Net loss per share, basic and diluted:

                               

Basic

                          $    

Diluted

                          $    

Weighted average shares outstanding:

                               

Basic

                          $    

Diluted

                          $    

   

See notes to unaudited pro forma combined financial information.

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Hanson Building Products

Unaudited Pro Forma Combined Statement Of Operations

For the Year Ended December 31, 2012

(In Thousands, Except Per Share Data)

 
  Historical   HeidelbergCement
Retained Assets(1)
  New
Indebtedness(2)
  Corporate
Separation
Transactions(3)
  Pro forma  

Net sales

  $ 1,177,621   $ (78,484 ) $     $     $    

Cost of goods sold

    1,060,668     (87,447 )                  
                       

Gross profit

    116,953     8,963                    

Selling, general and administrative expenses

    (153,760 )   4,865                    

Impairment and restructuring charges

    (22,441 )   7,963                    

Equity in losses of equity method investee

    (870 )                      

Gain (loss) on sale of property, plant and equipment and business, net

    17,741     (3,161 )                  

Other operating income

    5,736     1,504                    
                       

Loss from operations

    (36,641 )   20,134                    

Other income (expenses)

                               

Other income (expense), net

    (1,328 )   (239 )                  
                       

Loss from continuing operations before income taxes

    (37,969 )   19,895                    

Income tax expense

    (4,373 )   (6,782 )                  
                       

Loss from continuing operations

    (42,342 )   13,113                    
                       

Discontinued operations

                               

Loss from discontinued operations (including loss on disposal of ($15,553)

    (18,841 )                      

Income tax benefit from discontinued operations

    1,974                        
                       

Gain (loss) on discontinued operations, net of income tax

    (16,867 )                      
                       

Net loss

  $ (59,209 ) $ 13,113   $     $     $    
                       
                       

Net loss per share, basic and diluted:

                               

Basic

                          $    

Diluted

                          $    

Weighted average shares outstanding:

                               

Basic

                          $    

Diluted

                          $    

   

See notes to unaudited pro forma combined financial information.

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Hanson Building Products

Unaudited Pro Forma Combined Statement Of Operations

For the Year Ended December 31, 2011

(In Thousands, Except Per Share Data)

 
  Historical   HeidelbergCement
Retained Assets(1)
  New
Indebtedness(2)
  Corporate
Separation
Transactions(3)
  Pro Forma  

Net sales

  $ 1,221,007   $ (85,675 ) $     $     $    

Cost of goods sold

    1,097,410     (93,177 )                  
                       

Gross profit

    123,597     7,502                    

Selling, general and administrative expenses

    (158,270 )   5,485                    

Impairment and restructuring charges

    (31,062 )   10,464                    

Gain (loss) on sale of property, plant and equipment and business, net

    8,588     (127 )                  

Other operating income

    4,637     1,177                    
                       

Loss from operations

    (52,510 )   24,501                    

Other income (expenses)

                               

Other income (expenses), net

    686     7                    
                       

Loss from continuing operations before income taxes

    (51,824 )   24,508                    

Income tax expense

    (2,108 )   (8,395 )                  
                       

Loss from continuing operations

    (53,932 )   16,113                    
                       

Discontinued operations

                               

Loss from discontinued operations (including gain on disposal of $382)

    (3,300 )                        

Income tax benefit from discontinued operations

    (869 )                      
                       

Gain (loss) on discontinued operations, net of income tax

    (4,169 )                      
                       

Net loss

  $ (58,101 ) $ 16,113   $     $     $    
                       
                       

Net loss per share, basic and diluted:

                               

Basic

                          $    

Diluted

                          $    

Weighted average shares outstanding:

                               

Basic

                          $    

Diluted

                          $    

   

See notes to unaudited pro forma combined financial information.

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Hanson Building Products

Unaudited Pro Forma Combined Balance Sheet

As of June 30, 2014

(In Thousands, Except Per Share Data)

 
  Historical   HeidelbergCement
Retained Assets(1)
  New
Indebtedness(2)
  Corporate
Separation
Transactions(3)
  Pro Forma  

ASSETS

                               

Current assets

   
 
   
 
   
 
   
 
   
 
 

Cash and cash equivalents

  $ 28,997   $ (314 ) $     $     $    

Trade receivables

    211,072     (30,639 )                  

Inventories

    237,654     (1,120 )                  

Preferred investment in equity method investee

    15,000                        

Related party receivable

    617                        

Assets held for sale

    13,432                        

Other current assets

    10,868     (301 )                  
                       

Total current assets

    517,640     (32,374 )                  
                       

Non-current assets

                               

Property, plant and equipment, net

    722,854     (73,268 )                  

Goodwill and other intangible assets, net

    116,219                        

Investment in equity method investees

    47,359                        

Assets held for sale

    10,502     (10,502 )                  

Other long term assets

    835                        
                       

Total assets

  $ 1,415,409   $ (116,144 ) $     $     $    
                       
                       

LIABILITIES AND INVESTED EQUITY

                               

Current liabilities

   
 
   
 
   
 
   
 
   
 
 

Trade payables

  $ 126,375   $ (14,443 ) $     $     $    

Accrued liabilities

    74,454     (2,451 )                  

Related party payables

    20,291                        

Liabilities under asset backed security arrangements

    2,501                        

Employee benefit obligations

    329                        

Deferred revenue

    7,414     (2,467 )                  

Capital lease liability

    3,423     (15 )                  

Liabilities held for sale

    1,572     7,139                    
                       

Total current liabilities

    236,359     (12,237 )                  
                       

Non-current liabilities

                               

Capital lease liability

    17,684     (38 )                  

Employee benefit obligations

    11,997                        

Deferred tax liabilities

    10,384                        

Other long term liabilities

    58,927     (2,118 )                  
                       

Total liabilities

    335,351     (14,393 )                  
                       

Parent company net investment

                               

Accumulated other comprehensive income (loss)

    29,542     12                    

Accumulated net contributions from parent

    1,050,516     (101,763 )                  
                       

Total parent company net investment

    1,080,058     (101,751 )                  
                       

Total liabilities and parent company net investment

  $ 1,415,409   $ (116,144 ) $     $     $    
                       
                       

   

See notes to unaudited pro forma combined financial information.

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Hanson Building Products

Notes To Unaudited Pro Forma Combined Financial Information

(1)
Reflects the assets and liabilities that are included in our historical combined predecessor financial statements that will be retained by HeidelbergCement and therefore will not be associated with the ongoing business of the Company. These amounts include:

    net sales for the Maple Grove structural precast manufacturing business of $22.8 million for the six months ended June 30, 2014 and $34.7 million, $30.9 million and $20.8 million for the years ended December 31, 2013, 2012 and 2011, respectively;

    net sales for Irvine Whitlock Ltd., a building contracting business ("Irvine Whitlock"), of $23.4 million for the six months ended June 30, 2014 and $37.4 million, $30.4 million and $37.5 million for the years ended December 31, 2013, 2012 and 2011, respectively;

    net sales for the 35 excess properties in the United States and United Kingdom that are classified as assets and liabilities held for sale in our combined financial statements (the "Excess Properties") for the six months ended June 30, 2014 were $0.1 million and $0, respectively, and for the years ended December 31, 2013, 2012 and 2011 were $1.8 million, $17.2 million and $27.4 million for the United States, respectively, and $0 for all years for the United Kingdom, respectively;

    net income (loss) for Maple Grove of $0.3 million for the six months ended June 30, 2014 and $(1.3) million, $(3.1) million and $(3.7) million for the years ended December 31, 2013, 2012 and 2011, respectively;

    net income (loss) for Irvine Whitlock of $(0.1) million for the six months ended June 30, 2014 and $(1.7) million, $(1.1) million and $(0.9) million for the years ended December 31, 2013, 2012 and 2011, respectively;

    net income (loss) for the Excess Properties of $(0.6) million for the six months ended June 30, 2014 and $(6.8) million, $(8.9) million and $(11.5) million for the years ended December 31, 2013, 2012 and 2011, respectively; and

    total assets for Maple Grove, Irvine Whitlock and the Excess Properties were $123.3 million, $118.5 million, $                        and $                        , at June 30, 2014 and December 31, 2013, 2012 and 2011 respectively.

(2)
Reflects the incurrence of $                        of indebtedness, net of debt issuance costs of $                        . The $                        of indebtedness consists of a new credit facility. The initial target debt level was determined based on a review of a number of factors including credit ratings considerations, forecast liquidity and capital requirements, expected operating results and general economic conditions.

(3)
Reflects the execution of a transitional services agreement with HeidelbergCement under which the Company will pay for certain services provided by HeidelbergCement. These expenses will be reduced from the corporate overhead allocations included in the combined predecessor financial statements for the six months ended June 30, 3014 in the amount of $            and by $            , $            and $            for the years ended December 31, 2013, 2012 and 2011, respectively.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

        The following discussion and analysis should be read in conjunction with our audited and unaudited combined predecessor financial statements and the related notes, and our unaudited pro forma combined financial information and the related notes, included elsewhere in this prospectus.

        The Company was formed on August 14, 2014 and has not, to date, conducted any activities other than those incident to its formation and the preparation of the registration statement of which this prospectus forms a part. Therefore, we believe that a discussion of the historical results of the Company would not be meaningful. Accordingly, the following analyzes the historical financial information for the United States, Eastern Canada and United Kingdom building products business of HeidelbergCement. HeidelbergCement holds all of the historical assets and liabilities related to the business that the Company will acquire.

        Unless otherwise specified, any references that speak as of the period prior to the completion of this offering to "our," "we" and "us" in this discussion and analysis refer to the United States, Eastern Canada and United Kingdom building products business of HeidelbergCement and references to "our," "we" and "us" that speak as of or after completion of this offering refer to Hanson Building Products Limited.

        This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. See "Forward-Looking Statements" for a discussion of the risks, uncertainties and assumptions associated with those statements. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including, but not limited to, those in "Risk Factors" and in other portions of this prospectus.

Overview

Our Company

        We are a leading multinational manufacturer of a diversified range of concrete and clay building products in the United States, Eastern Canada and the United Kingdom. Our primary products are concrete gravity pipe, concrete and steel pressure pipe, precast concrete drainage products, clay bricks and concrete blocks. Our products are used across a broad range of end markets, including residential construction, water and transportation infrastructure and non-residential construction applications. We have established a leading position in most of our products and end markets by leveraging our scale, engineering capabilities, manufacturing excellence, sales and distribution platforms and customer service both prior to and after a sale.

Basis of Presentation

        The historical combined predecessor financial statements, which are discussed below, are prepared on a stand-alone basis in accordance with U.S. GAAP, are derived from HeidelbergCement's consolidated financial statements and accounting records using the historical results of operations and assets and liabilities attributed to HeidelbergCement's building products business in the United States, Eastern Canada and the United Kingdom and include allocations of expenses from HeidelbergCement.

        The combined predecessor statements of operations include expense allocations for certain corporate functions historically provided by HeidelbergCement. Substantially all of our senior management is employed by HeidelbergCement and certain functions critical to our operations are centralized and managed by HeidelbergCement. Historically, the centralized functions have included executive senior management, financial reporting, financial planning and analysis, accounting, information technology, tax, risk management, treasury, legal, human resources, land management and strategy and development. Additionally, we reside in office space provided by HeidelbergCement. The costs of each of these services have been allocated to us on the basis of our relative net sales or

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headcount as compared to that of HeidelbergCement depending upon which allocation methodology is more meaningful for each such service. These allocations are reflected in selling, general and administrative expenses in the combined predecessor statements of operations and totaled $20.7 million and $21.0 million for the six months ended June 30, 2014 and 2013, respectively, and $44.9 million, $48.0 million and $49.1 million for the years ended December 31, 2013, 2012 and 2011, respectively. HeidelbergCement and we consider these allocations to be a reasonable reflection of the utilization of services provided. The allocations may not, however, reflect the expense that we would have incurred as a stand-alone company. We estimate that we would have incurred approximately $37.6 million of selling, general and administrative expenses in 2014 as a stand-alone entity to replace the services provided by HeidelbergCement which have been allocated to us in our combined financial statements. Actual costs that may have been incurred if we had been a stand-alone public company in the six month periods ended June 30, 2014 and 2013, and during the years ended December 31, 2013, 2012 and 2011 would depend on a number of factors, including our chosen organizational structure, what functions were outsourced or performed by our employees and strategic decisions made in areas such as information technology systems and infrastructure. We estimate that our annual selling, general and administrative expenses will increase by approximately $3.5 million as a public company with a one-time cost of approximately $11.3 million in the first year as a public company. These services will be provided pursuant to a transitional services agreement which will become effective at the closing of this offering and will expire in            . The allocation of costs described above will be replaced with fees paid to HeidelbergCement for services provided under the transitional service agreement and expenses incurred by us to replace services no longer provided by HeidelbergCement.

        Due to these and other changes that we anticipate in connection with this offering, the historical financial information included in this prospectus is not necessarily indicative of our financial position, results of operations and cash flows in the future or what our financial position, results of operations and cash flows would have been had we been a separate, stand-alone entity that operated independently of HeidelbergCement during the periods presented.

Our Segments

        Our operations are organized into the following reportable segments: North America Gravity Pipe & Precast, North America Pressure Pipe, North America Bricks, U.K. Bricks & Blocks and Other.

North America Gravity Pipe & Precast

        This segment includes our gravity pipe and precast operations in the United States and Eastern Canada. For the six months ended June 30, 2014 and for the year ended December 31, 2013, our North America Gravity Pipe & Precast segment contributed 33% and 31%, respectively, of our net sales and 33% and 20%, respectively, of our Adjusted EBITDA.

North America Pressure Pipe

        This segment includes our pressure pipe operations in the United States and Eastern Canada. For the six months ended June 30, 2014 and for the year ended December 31, 2013, our North America Pressure Pipe segment contributed 10% and 15%, respectively, of our net sales and (6%) and 27%, respectively, of our Adjusted EBITDA.

North America Bricks

        This segment includes our brick operations in the United States and Eastern Canada. For the six months ended June 30, 2014 and for the year ended December 31, 2013, our North America Bricks segment contributed 11% and 13%, respectively, of our net sales and 4% and 22%, respectively, of our Adjusted EBITDA.

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U.K. Bricks & Blocks

        This segment includes our brick, aircrete block and aggregate block and specialized clay roofing products operations in the United Kingdom. For the six months ended June 30, 2014 and for the year ended December 31, 2013, our U.K. Bricks & Blocks segment contributed 28% and 23%, respectively, of our net sales and 73% and 38%, respectively, of our Adjusted EBITDA.

Other

        This segment includes our precast flooring and other precast products business in the United Kingdom, our structural precast and roof tile businesses in the United States and our concrete pavers and external wall insulation businesses in the United Kingdom. For the six months ended June 30, 2014 and for the year ended December 31, 2013, our other operations contributed 18% and 18%, respectively, of our net sales and (4%) and (8%), respectively, of our Adjusted EBITDA.

Factors Affecting Our Financial Statements

Separation Transactions

        Our business has been operated as part of HeidelbergCement since 2007. Our assets, liabilities and operating results have been included in the consolidated financial statements of HeidelbergCement since that time. As part of our separation from HeidelbergCement, HeidelbergCement expects to transfer to us the assets and liabilities of its United States, Eastern Canada and United Kingdom building products business reflected in the combined predecessor financial statements included elsewhere in this prospectus with the exception of the retention of certain assets and liabilities by HeidelbergCement, including the Maple Grove structural precast manufacturing business in the United States, the Irvine Whitlock building contracting business in the United Kingdom and 33 excess properties in the United States and the United Kingdom that are classified as assets and liabilities held for sale in our combined predecessor financial statements. We incurred costs and expenses of $(0.2) million and $1.0 million for the six months ended June 30, 2014 and 2013, respectively, and $4.2 million, $10.1 million and $15.2 million for the years ended December 31, 2013, 2012 and 2011, respectively, attributable to the above-described assets to be retained by HeidelbergCement. See "Certain Relationships and Related Party Transactions."

        In connection with this offering and our separation from HeidelbergCement, certain defined benefit pension plans which cover our employees will be retained by HeidelbergCement. The amount of pension expense attributable to these pension plans included in costs and expenses in our combined financial statements for the six months ended June 30, 2014 and 2013 was $5.8 million and $6.0 million, respectively, and for the years ended December 31, 2013, 2012 and 2011 was $12.1 million, $15.9 million and $15.7 million, respectively.

        Our audited and unaudited combined predecessor financial statements included elsewhere in this prospectus, which are discussed below, reflect the historical financial position, results of operations and cash flows of the business that will be transferred to us from HeidelbergCement pursuant to the separation.

Discontinued Operations and Operational Improvement Measures

        The recent global economic recession generally led to a reduction in our net sales as the residential and non-residential construction industry declined. As a result, we undertook a number of initiatives designed to resize our operations and improve our profitability and operational efficiency.

        As part of these initiatives, we disposed of our North America paver business and exited two markets in California in 2012. Net proceeds from the sale of the paver business were $60.6 million,

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resulting in a loss on sale of $15.4 million. The results of these disposed operations have been classified in our financial statements as discontinued operations.

        In addition, we implemented various operational efficiency measures with respect to our business. In the period from January 1, 2009 to June 30, 2014, we closed 48 plants in North America and 15 plants in the United Kingdom. The plant closures were necessary to streamline our manufacturing footprint and reduce overcapacity, reduce our headcount and reduce capital expenditures. Closed plants that have been marketed for sale have been written down to their fair value less costs to sell. These properties are classified as assets held for sale in our financial statements.

        We believe that these measures have substantially increased our operational efficiency in our remaining manufacturing plants and will enable us to improve our financial results in future periods.

        Although we believe we are well positioned to utilize our excess manufacturing capacity to meet increasing market demand despite our resizing measures and significant headcount reductions undertaken in the last few years, there can be no guarantee that we will be able to respond in a timely manner to increased demand on our manufacturing capacity. In addition, where we are required to quickly react to such increase in demand, the costs associated with the accelerated ramp-up could have an adverse impact on our gross margin.

CP&P Joint Venture

        In July 2012, we entered into a joint venture agreement with Americast, Inc. to form Concrete Pipe & Precast LLC ("CP&P"). We contributed plant assets and related inventory from nine plants as part of the agreement to form CP&P and, in return for the contribution, we obtained a 50% ownership interest in the joint venture. CP&P is engaged primarily in the manufacture, marketing, sale and distribution of concrete pipe and precast products. Its operations are primarily in Virginia, West Virginia, Maryland, North Carolina, South Carolina and Georgia with sales to contiguous states. Upon the contribution of these assets to CP&P, we began to recognize our proportionate share of the joint venture's net income (loss) in the third quarter of 2012 in the "equity earnings (losses) from equity method investees" line of our combined predecessor statements of operations. Prior to contributing these assets to CP&P in July 2012, the results of operations for these assets were included in our net sales, cost of goods sold and gross profit.

Principal Factors Affecting Our Results of Operations

        Our operating results and financial performance are influenced by a variety of factors, including conditions in the residential, infrastructure and non-residential construction markets, general economic conditions, changes in raw material and energy costs, seasonality and weather conditions and changes in currency exchange rates. Some of the more important factors are discussed below.

Residential and Non-Residential Construction Activities and Infrastructure Spending

        Historically, demand for our products has been closely correlated with residential and non-residential construction activities in the United States, Eastern Canada and the United Kingdom. Demand for our pressure pipe and a portion of our precast business has been driven by infrastructure spending in the United States and Eastern Canada. The level of residential construction and renovation activities is influenced by a number of factors, including mortgage availability, interest rates, employment levels, household formation rates, domestic population growth, immigration rates, residential vacancy and foreclosure rates, demand for second homes, existing home prices, rental prices, housing inventory levels, consumer confidence, seasonal weather factors, government policy and incentives and other general economic factors. Non-residential construction activity is primarily driven by business investment, availability of credit, interest rates and general economic factors. Spending on

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infrastructure depends on the availability of public funds, which is influenced by various factors, including the level of public debt, interest rates, anticipated tax revenues and the political climate.

        In 2008, residential and non-residential construction activities in the markets in which we operate were at historically low levels and, correspondingly, demand for many of our products was weak. According to the National Association of Homebuilders, the number of total new housing starts in the United States grew from approximately 554,000 units in 2009 to 781,000 units and 925,000 units during 2012 and 2013, respectively. The general macroeconomic environment has significantly improved, as evidenced by management's estimate of the plant capacity utilization within the North America Gravity Pipe & Precast business of 40% in 2010 compared to plant capacity utilization of nearly 54% in the six months ended June 30, 2014. The recovery period for the construction industry in the United States began in 2010 and 2011. The first two years of recovery saw a modest growth in residential construction, with total new housing starts increasing 5.8% in 2010 and 4.4% in 2011. Non-residential construction growth, as measured by millions of square feet put in place, declined 12.4% in 2010 and increased by 3.4% in 2011. In 2012 and 2013, both total new housing starts and non-residential construction increased as the economic recovery continued. Total new housing starts increased 28.2% in 2012 and 18.5% in 2013 while total non-residential construction put in place increased 10.5% in 2012 and 9.1% in 2013. According to the National Association of Homebuilders, this growth is expected to increase with total new housing starts forecasted to increase at a CAGR of 18.5% between 2013 and 2016. Additionally, according to McGraw-Hill, non-residential construction is expected to increase at a CAGR of 12.5% between 2013 and 2016. In the United Kingdom, beginning in the second quarter of 2013, there has been a marked increase in housing market activity. This was stimulated by government intervention increasing home-ownership affordability through a mortgage guarantee program. House prices, housing transactions, mortgage lending and new house building have all increased. In addition, the U.K. brick market is capacity constrained as a result of both ourselves and our competitors taking inefficient capacity offline over the last several years. It is estimated that demand for bricks in the United Kingdom will exceed domestic production capacity (including current idled capacity) in 2015. These factors have allowed us to realize improved pricing, driving higher net sales and Adjusted EBITDA.

        A large proportion of our net sales in North America in our Gravity Pipe & Precast and Pressure Pipe segments are generated through infrastructure projects. Many of these projects are dependent on government funding, including subsidies and stimulus programs. Increases or reductions in governmental funding for infrastructure projects often have a material effect on our net sales and results of operations. For example, the expiration of the Canadian government stimulus package in early 2012 had an adverse impact on the net sales and results of operations of our Canadian operations. In the United States, federal and state government funding for infrastructure projects is usually accomplished through multiyear funding and authorization bills known as highway bills. The current authorization bill, the Moving Ahead for Progress in the 21st Century Act, was originally scheduled to expire in September 2014. In July 2014, the U.S. Congress passed a bill, the Highway and Transportation Funding Act of 2014, which is intended to maintain the U.S. federal infrastructure funding system's solvency through May 2015. It is not known when the U.S. Congress will adopt the next multiyear funding and authorization bill. However, we believe that the aging infrastructure in the United States is expected to require repair or replacement in the coming years. McGraw-Hill estimates that total U.S. spending on streets and highways will grow at a CAGR of 9.3% from 2014 to 2018. Additionally, McGraw-Hill also estimates that U.S. water supply systems spending will grow at a CAGR of 7.2% from 2014 to 2018. We believe that our financial performance will improve as a result of this growth, although there can be no assurance it will.

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Mix of Products

        We derive our sales from both the sale of products which are manufactured to inventory, such as gravity pipe, bricks, concrete blocks and roof tiles, and highly engineered products which are made to order, such as pressure pipe and structural precast. These two components of our business differ in their dynamics. We estimate that in 2013, approximately two-thirds of our net sales were derived from the sale of products which are manufactured to inventory and approximately one-third came from highly engineered products which are made to order. This mix of products varies from period to period. For some of our highly engineered products, we recognize revenue on a percentage of completion method, which amounted to $101.6 million in 2013.

        Products which are manufactured to inventory are typically sold on a one-off basis, with volumes and prices determined frequently based on participants' perceptions of short-term supply and demand factors. A shortage of capacity or excess capacity in the industry, or in the regions where we have operations, can result in significant increases or decreases in market prices for these products, often within a short period of time.

        By contrast, our project driven business involves highly engineered and customized products with a wide range of contract values, with larger contracts exceeding $40 million. The products for these projects are engineered, manufactured and delivered on the basis of contracts that tend to extend over periods of several months or, in some cases, several years. The timing of the commencement of a project and the progress and completion of work under the contract, therefore, can have a significant effect on our results of operations for a particular period.

Costs of Goods Sold

        Raw material and supplies, labor (including contract labor), freight and energy costs constitute a large portion of our manufacturing costs and fluctuations in the prices of these materials and inputs affect our results of operations. Our primary raw materials are cement, aggregates, steel and clay. Our raw material and other supplies, labor (including contract labor) and freight costs amounted to $318.7 million, $268.0 million and $88.7 million, or 28%, 24% and 8% of our net sales, in 2013, respectively. In addition, our manufacturing, especially brick manufacturing, is energy intensive. Our energy costs primarily consist of the cost for the supply of electricity and natural gas used in various manufacturing processes and amounted to $40.3 million, or 7% of our net sales, for the six months ended June 30, 2014 and $68.8 million, or 6% of our net sales, in 2013.

        Historically, we have purchased a significant portion of our cement and aggregates from HeidelbergCement and purchased the remainder of our cement and aggregates from third-party suppliers. In connection with this offering, we intend to enter into two cement supply agreements and an aggregates supply agreement with HeidelbergCement. While we do not hedge against steel prices, we typically buy approximately two months of steel in advance in the open market from multiple third-party suppliers for the North America Gravity Pipe & Precast segment. For North America Pressure Pipe segment, we pre-purchase steel for large pressure pipe projects. A substantial portion of the clay that is used in the production of bricks by our North America Bricks and U.K. Bricks & Blocks segments is obtained from properties that are owned by the Company. For these clay reserves, the Company is responsible for the costs to mine the reserves and any reclamation costs. These costs are all included in cost of goods sold.

        We do not generally hedge our raw material purchases, except that we may increase our inventory of certain materials in the short term in anticipation of future price increases. Prices for energy, including natural gas and electricity, have been volatile in recent years and have been a driver of our raw material and energy costs in the past. We generally purchase natural gas and electricity at spot prices in the open market. In the United Kingdom, from time to time, we enter into forward contracts with respect to our energy costs. While we base forward buying decisions on a number of factors,

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historically we have been governed by HeidelbergCement's forward buying policy. HeidelbergCement's policy provides various percentage levels four quarters ahead at a reducing scale each quarter. However, as a public company, we may re-evaluate our hedging strategy.

        We attempt to pass on price increases of raw materials, energy and certain other manufacturing costs to our customers. We typically revise prices as new customer agreements are negotiated throughout the year in order to, among other things, reflect increases in raw material costs. In addition, certain of our customer contracts, primarily in our projects business, contain price modification mechanisms pursuant to which we may increase the prices of our products to follow corresponding increases in raw material costs. As a result, we believe we have been able to manage our exposures to fluctuations in our raw material and energy costs, although there can be no assurance that we will continue to be able to do so in the future.

Seasonality and Weather Conditions

        The construction industry, and therefore demand for building products, is typically seasonal and dependent on weather conditions, with periods of frost, snow or heavy rain negatively affecting construction activity. This applies particularly in the more northern markets in which we operate, such as Eastern Canada, the United Kingdom and the northeastern and midwestern United States. Lower demand for our products tends to occur in periods of cold weather, particularly during winter, and such conditions or other unfavorable weather conditions generally lead to seasonal fluctuations in our quarterly financial results. Historically, our net sales in the second and third quarters have been higher than in the other quarters of the year, particularly the first quarter.

        Construction activity can be affected in any particular period by adverse weather conditions, hurricanes, severe storms, torrential rains, floods, natural disasters and similar events. Unfavorable weather conditions during peak construction periods can result in a material reduction in demand for our products and consequently have an adverse effect on our net sales. Public holidays and vacation periods constitute an additional factor that may exacerbate certain seasonality effects, as building projects or industrial manufacturing processes may temporarily cease. Results of a fiscal quarter might therefore not be a reliable basis for the expectations of a full fiscal year and may not be comparable with the results in the other fiscal quarters in the same year or previous years.

Currency Exchange Rates

        Since our results are reported in U.S. dollars, exchange rate movements may affect our reported net income or loss, assets and cash balances. In the ordinary course of business, we typically buy and sell in the local currency and we do not enter into hedging transactions to hedge this risk. Approximately 49% and 47% of our combined net sales were received or denominated in foreign currencies (primarily the British pound and the Canadian dollar) for the six months ended June 30, 2014 and the year ended December 31, 2013, respectively. Consequently, our reported net income or loss could fluctuate materially as a result of changes in foreign currency rates.

Principal Components of Results of Operations

Net Sales

        Net sales consist of the consideration received or receivable for the sale of products in the ordinary course of business and include the billable costs of delivery of our products to customers, net of discounts given to the customer. Net sales include any outbound freight charged to the customer, which amounted to $90.4 million in 2013. Revenue on long-term engineering and construction contracts in our structural precast as well as building contracting businesses is recognized under the percentage-of-completion method. See Note 2 to our audited combined predecessor financial statements included elsewhere in this prospectus. Certain of our businesses, primarily our pressure pipe

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business, also enter into agreements to provide inventory to customers for long-term construction projects. With respect to these agreements, we recognize revenue upon shipment of the respective goods, whereas billings are based on contract terms and may or may not coincide with shipments, which gives rise to either unbilled or deferred revenue.

Cost of Goods Sold

        Cost of goods sold includes raw materials (cement, aggregates, steel and clay) and supplies, labor (including contract labor), freight (including outbound freight for delivery of products to end users and other charges such as inbound freight), energy, depreciation and amortization, repairs and maintenance and other costs of goods sold.

Selling, General and Administrative Expenses

        Selling, general and administrative expenses include expenses for sales, marketing, legal, accounting and finance services, human resources, customer support, treasury and other general corporate services. See "—Basis of Presentation" for a description of the expense allocation for certain corporate and other functions historically provided to us by HeidelbergCement.

Gain on Sale of Property, Plant and Equipment, Net

        Gain on sale of property, plant and equipment, net includes the net gain or loss on the sale of assets including property, plant and equipment and sales of businesses that do not otherwise qualify as discontinued operations.

Other Operating Income

        The remaining categories of operating income and expenses consist of scrap income (associated with scrap from the manufacturing process or remaining scrap after plants are closed), rent income, income from the sale of carbon dioxide emission credits in the United Kingdom and income generated from exhausted clay quarries that are used for landfill.

Interest Expense

        Historically, we have incurred an insignificant amount of interest expense in connection with our capital leases. In the future, however, we expect to incur substantial interest expense under our new credit facility.

Income Tax Expense

        Income tax expense consists of federal, state, provincial, local and foreign taxes based on income in the jurisdictions in which we operate. Historically, our subsidiaries in the United Kingdom and Eastern Canada have filed their own separate tax returns, while our U.S. subsidiaries were included in HeidelbergCement's U.S. consolidated federal and state income tax returns. In the combined predecessor financial statements, income tax benefit (expense) is calculated as if our U.S. subsidiaries filed separate tax returns. In the past, our subsidiaries in the United Kingdom were eligible to claim group relief under U.K. tax rules with HeidelbergCement. After our separation from HeidelbergCement, our subsidiaries will only be eligible to claim group relief under U.K. tax rules with each other, which may cause our income taxes payable in the United Kingdom to increase.

        Assuming our separation from HeidelbergCement constitutes a change in ownership under Section 382 of the Internal Revenue Code, use of our pre-separation U.S. federal net operating losses, or NOLs, to offset taxable income from post-separation operations may be limited. Similar limitations may also exist under the laws of certain states in which we operate. Any limitation of our ability to use our accumulated pre-separation U.S. federal NOLs may cause our income tax payable in the United States to increase.

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        We will enter into a tax receivable agreement with HeidelbergCement prior to our separation from HeidelbergCement whereby we will be obligated to make annual payments to HeidelbergCement equal to 85% of the U.S. federal tax benefit realized from the utilization of NOLs that were generated when we were owned by HeidelbergCement and filed as part of the consolidated HeidelbergCement U.S. federal group tax return. The determination of the amount payable to HeidelbergCement will be based on an annual calculation comparing the U.S. federal cash taxes which would have been payable without the benefit of applying any pre-separation U.S. federal NOLs to the actual cash taxes paid for such tax year. The amount payable to HeidelbergCement will equal 85% of the excess of the U.S. federal cash taxes which would have been payable without the application of pre-separation NOLs over the actual U.S. federal cash taxes paid for the tax year.

Key Business and Financial Metrics Used by Management

EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Pro Forma Adjusted EBITDA and Pro Forma Adjusted EBITDA margin

        EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Pro Forma Adjusted EBITDA and Pro Forma Adjusted EBITDA margin, which are non-GAAP financial measures, have been included in this prospectus as supplemental measures of financial performance that are not required by, or presented in accordance with, U.S. GAAP. We calculate EBITDA as net income (loss) attributable to the Company before income (loss) from discontinued operations, interest, income taxes, depreciation and amortization. We calculate Adjusted EBITDA as EBITDA before non-cash items, including impairment charges and (gains)/losses on the sale of property, plant and equipment and certain other income and expenses, such as transaction-related costs. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of net sales. We calculate Pro Forma Adjusted EBITDA as Adjusted EBITDA modified to reflect the items described in the table below. Items described in the table primarily relate to operating as a stand-alone company, independent of HeidelbergCement. Pro Forma Adjusted EBITDA margin represents Pro Forma Adjusted EBITDA as a percentage of net sales.

        EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Pro Forma Adjusted EBITDA and Pro Forma Adjusted EBITDA margin are included in this prospectus because they are key metrics used by management to assess our financial performance. EBITDA, Adjusted EBITDA and Adjusted EBITDA margin are frequently used by analysts, investors and other interested parties to evaluate companies in our industry. In addition to executive performance assessments, we use Adjusted EBITDA and Pro Forma Adjusted EBITDA to supplement GAAP measures of performance to evaluate the effectiveness of our business strategies, to make budgeting decisions and compare our performance relative to our peers.

        Adjusted EBITDA and Adjusted EBITDA margin are key measures for assessing our operating results and evaluating each operating segment's performance on a consistent basis, by excluding the impacts of depreciation, amortization, tax expense and exit costs from restructuring. Management believes Adjusted EBITDA and Adjusted EBITDA margin are useful in analyzing operating costs compared to our operating plan, thereby assessing the staffing levels, raw material costs, utility costs and other general and administrative costs of each operating segment. We also use Adjusted EBITDA and Adjusted EBITDA margin to benchmark our operating performance against peer group companies on a pre-financing and pre-tax basis to normalize for differences in capital and corporate structure.

        EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Pro Forma Adjusted EBITDA and Pro Forma Adjusted EBITDA margin are non-GAAP measures of our financial performance or liquidity and should not be considered as alternatives to net income as a measure of financial performance or cash flows from operations as a measure of liquidity, or any other performance measure derived in accordance with GAAP and they should not be construed as an inference that our future results will be unaffected by unusual or nonrecurring items. Additionally, EBITDA, Adjusted EBITDA, Pro Forma

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Adjusted EBITDA and Pro Forma Adjusted EBITDA margin are not intended to be measures of free cash flow for management's discretionary use, as they do not reflect certain cash requirements such as tax payments, debt service requirements, capital expenditures and certain other cash flow costs that may recur in the future. EBITDA, Adjusted EBITDA, Pro Forma Adjusted EBITDA and Pro Forma Adjusted EBITDA margin contain certain other limitations, including the failure to reflect our cash expenditures, cash requirements for working capital needs and cash costs to replenish assets being depreciated. In evaluating Adjusted EBITDA and Pro Forma Adjusted EBITDA, you should be aware that in the future we will incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of Adjusted EBITDA and Pro Forma Adjusted EBITDA should not be construed to imply that our future results will be unaffected by such adjustments. Management compensates for these limitations by relying on our GAAP results in addition to using EBITDA, Adjusted EBITDA, Pro Forma Adjusted EBITDA and Pro Forma Adjusted EBITDA margin supplementally. Our measures of EBITDA, Adjusted EBITDA, Pro Forma Adjusted EBITDA and Pro Forma Adjusted EBITDA margin are not necessarily comparable to other similarly titled captions of other companies due to different methods of calculation.

 
  Six Months Ended
June 30
  Fiscal Year Ended
December 31
 
 
  2014   2013   2013   2012   2011  
 
  (unaudited)
   
   
   
 
 
  (In thousands, except percentages)
 
 
     

Net income (loss)

  $ 14,929   $ 8,576   $ (252,711 ) $ (59,209 ) $ (58,101 )

Income (loss) from discontinued operations, net of tax

    (424 )   242     14     16,867     4,169  

Income tax expense

    4,789     67     3,069     4,373     2,108  

Depreciation & amortization

    28,510     28,912     57,066     66,198     70,544  
                       

EBITDA

    47,804     37,797     (192,562 )   28,229     18,720  

Impairment and restructuring charges

    110     3,625     267,131     22,441     31,062  

Gain on sale of property, plant and equipment and business, net

    (2,887 )   (1,998 )   (8,674 )   (17,741 )   (8,588 )

Transaction-related costs

    6,386                  
                       

Adjusted EBITDA(1)

  $ 51,413   $ 39,424   $ 65,895   $ 32,929   $ 41,194  
                       
                       

Adjusted EBITDA margin

    8.6 %   6.9 %   5.9 %   2.8 %   3.4 %

 

 
   
  Fiscal Year Ended
December 31
 
 
  Latest Twelve
Months Ended
June 30, 2014
 
 
  2013   2012   2011  
 
  (unaudited)
   
   
   
 
 
  (In thousands)
 

Adjusted EBITDA

  $ 77,885 (1) $ 65,895   $ 32,929   $ 41,194  

Stand-alone cost savings(2)

    8,892     9,814     13,692     15,300  

Pension plan cost savings(3)

    11,843     12,081     15,934     15,716  

CP&P depreciation and amortization(4)

    4,052     4,013     1,843      

Costs attributable to retained assets(5)

    2,332     4,243     10,148     15,161  

Identifiable non-recurring transactions & other(6)

    (664 )   (6,495 )   4,062     3,925  
                   

Pro Forma Adjusted EBITDA

  $ 104,340   $ 89,551   $ 78,608   $ 91,296  
                   
                   

Pro Forma Adjusted EBITDA margin

    9.1 %   8.0 %   6.7 %   7.5 %

(1)
Reflects the sum of the Adjusted EBITDA for the six months ended June 30, 2014 of $51.4 million and Adjusted EBITDA for the six months ended December 31, 2013 of $26.5 million.

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(2)
Reflects cost savings associated with becoming a stand-alone company equal to the difference between costs allocated to us for services rendered by HeidelbergCement and our estimate of stand-alone costs.

(3)