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expenditure of €575 million represented 3.1% of Group revenue (2011: 3.2%), amounting to 77% of depreciation (2011: 78%) as we continue to maintain our discipline while investing in the structure of the business. 

Operating cash outflows include an adjustment to eliminate non-cash items (such as share of results of associates, profit on disposals and share-based compensation expense) which are included in arriving at profit before tax. 

## Cash flows from investing and financing activities 

The Group completed 36 acquisitions and investment transactions in 2012 at a total cost of €649 million. Excluding net deferred payments of €123 million, the cash outflow for the year was €526 million (2011: €610 million). 

Proceeds (including net debt assumed by purchasers) from disposal of non-current assets and businesses amounted to €859 million (2011: €492 million), primarily reflecting the divestment in May 2012 of our 49% stake in the Portuguese cement business Secil and the disposal of our wholly-owned Magnetic Autocontrol business in April 2012. 

Net proceeds from share issues include €88 million (2011: €135 million) arising on the take-up of shares in lieu of dividends, together with proceeds of €16 million (2011: €6 million) from issues under the Group’s share option and share participation schemes. 

Exchange rate movements during 2012 reduced the euro amount of net foreign currency debt by €37 million principally due to the 2% weakening in 

the year-end exchange rate of the US Dollar versus the euro, from 1.2939 at end-2011 to 1.3194 at end-2012. 

## Borrowings and Credit Facilities 

An analysis of the components of net debt, together with information on the currency and maturity profile of our debt and on the interest rates applicable to that debt, are set out in notes 21 to 25 to the financial statements. 

In January 2012 the Group issued €500 million in 7-year Eurobonds at a coupon rate of 5%, the Group’s lowest-ever coupon for a maturity greater than 5 years. 

CRH believes that its current cash and liquid resources of €1.8 billion and committed and undrawn facilities of an additional €1.8 billion are sufficient to meet its capital expenditure and other expenditure requirements for 2013. 

The Group’s major bank facilities and debt issued pursuant to Note Purchase Agreements in private placements require the Group to maintain certain financial covenants, details of which are set out in note 24 to the financial statements. CRH was in full compliance with its financial covenants throughout 2012 and 2011. 

CRH remains committed to maintaining an investment grade credit rating. 

CRH does not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on CRH’s financial condition. 

## Financial Risk Management 

The Board sets the treasury policies and objectives of the Group, which include controls over the procedures used to manage financial market risks. Details of these policies are set out in note 22 to the financial statements. The Group manages its cash transmission, collection and holding policies and practices in order to minimise the risks arising from continued financial market stresses. 

## Sarbanes-Oxley Act 

For the year ended 31 December 2011, management concluded that internal control over financial reporting was effective; Ernst & Young audited the effectiveness of these controls and issued an unqualified opinion thereon. The 2012 assessment and related auditor’s report will be included in the 2012 Annual Report on Form 20-F which will be filed with the Securities and Exchange Commission by the end of the first quarter of 2013. 

