Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

Q2 2011 Earnings Call Company Participants

Other Participants
Yassine Touahri Robert V. Eason Paraic Quinn Florence O'Donoghue Gregor Kuglitsch Mark Hake

MANAGEMENT DISCUSSION SECTION

Gene M. Murtagh
Thank you and good morning. Gene here, Geoffrey Doherty and Ronan Dowling also on the call here at Kingspan. We'll get right into this and thank you all for joining. We're on slide number four, which deals with the key highlights of the period. No doubt you've all seen this detail and we'll go through it in a lot more depth later on. But, in essence, it was a very strong first half with overall revenues up 32% and overall trading profit up 24%. Again, the detail we'll get into shortly. In all of our businesses but our access floors there was strong growth. Insulated panels, up 22%; insulation, up an underlying 14%, which then combined with the CIE acquisition and its contribution was up 86% in that division in the first half. The environmental and renewables businesses were up 17%, which was largely a combination of inflation and, say, a very strong mainland European growth and particular into France in a particular product suite. The other kind of large feature of the first half was obviously raw materials. Raw materials increased by an approximately 40 million, which we'd have indicated a number of months back. I think just looking ahead, the difference there is that the pace of increase has essentially slowed down and virtually stopped. So, we would have expected, in particular, chemicals to have increased significantly into the second half and, at this point, we'd expect that to be broadly flat and, similarly, the case would be in steel. So, we had earlier indicated inflation expectations of around 80 million. I think, we'll probably think now probably 50 million is more of the kind of area that we'd expect that to be lying for the year as a whole.

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Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

The acquisition, which we'll deal with later on, obviously is fully on track. It's been integrated very well and two out of the planned three disposals have taken place. And aside from that, our R&D initiatives, in particular, around the products of Powerpanel, which is the combination of our solar photovoltaics and the insulated panel, start the sales in earnest during the first half of this year and into quarter three and some very attractive projects in the pipeline there. And our next generation insulation, which we'd expect to launch in early 2013, again our R&D project there has been progressing very well. I think, finally, conversion is probably the key theme in the business. And naturally, in very weak markets right around the world, particularly if you look at non-res in the UK and non-res in the US and so on, I think we could say certainty they've been very weak in the first half yet our business posted very attractive growth, so the conversion story, if you like, is fully intact despite the weaknesses globally. I'll now hand you over to Geoff, who's going to deal with the financial [inaudible] (0:03:31) results.

Geoffrey P. Doherty
Thanks, Gene. Now on slide six which has six or seven of the key financial highlights for the six months. The first is revenue. First half revenue was 736 million, which was up 32% on the comparable period in 2010 or 16% on a like-for-like basis. And where I use the phrase like-for-like, I mean, excluding the acquisition of CRH's European insulation business and excluding currency movements, which indeed were negligible in the period. Trading profits are the profit measure, pre-interest tax and amortization of 44.2 million, which was up 24% or 17% on a like-for-like basis. The trading margin was 6%, which was down 40 basis points on the first half last year and I'll come to deal with margins now in a second. The profit after tax was 29.2 million, which was ahead by 37% in the half year. Basic EPS was 0.173, up 38% on the first half of last year. Free cash flow, 32.4 million are up 13% and the interim dividend of 0.045 are up 12.5% on last year's interim dividend. Turning to slide seven and a sales bridge bridging at first half revenue number for '10 and the first half revenue number for '11, you'll see that the currency impact was negligible. Three key drivers of the growth in sales, the first was 55.5 million due to volume or the 10% volume growth that we saw in the period. About 36.7 million was due to price and mix, which is equivalent to 6.6% across the portfolio, and 85.7 million was due to the contribution of CIE during the period. Moving to slide eight, which deals with trading profit and margins, just to look at the divisional margins, firstly, in panels, you'll see we've been on a steady path of margin expansion over the last 18 months, 5.6% or 4.8% rather in the first half of last year, 5.6% full year '10 and 6.2% in the first half of this year and that's reflective of the operating leverage to the sales growth. In insulation boards, the headline is 6.5% of operating trading margin in the first half of the year. Excluding the CIE acquisition, the underlying margin was 8.8%, which is broadly in line with the first half of last year and up on last year's full year number of 6.7%. Environmental and renewables largely in line with last year's first half number at 1.2%. Access floors, 10.4%, declining from the first half of last year and last year's full year margin, and that's reflective of the reducing sales in access floors, which we'll deal with in the presentation. And the overall group trading margin was 6%, which is in line with last year's full year margin, but 40 basis points behind the first half of last year. What I should highlight is that the impact of the CIE acquisition if you strip that out, the underlying operating margin for the first half of the year was about 6.5%, so largely in line with the first half of last year. Moving on to slide nine, on the trading profit bridge, bridging from the 35.7 million of trading profit that we made in '10 to 44.2 that we made in '11. The first item is you see currency negligible on profit. Volume contributed 15.6% of trading profit, which is effectively the gross margin of 28% on the incremental sales of 55 million. The 7.8 million

Page 2 of 13

Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

margin impact is largely a function of mix. Operating costs increased by 17.4 million. Operating costs were 22% of sales in the first half of '10, 21.5% of sales in 2011. There were some additional overhead incurred in the first half of this year in the business development and commercial areas, principally in Central and Eastern Europe and North America. And the acquisition, the CIE acquisition contributed 2.4 million of trading profit in the period, so all of that bridges to 44.2 in the first half. And just looking that about in percentage terms very quickly on slide 10, very strong profit growth in insulation panels; the like-for-like growth, excluding currency, of 56.9%; insulation boards, the like-for-like growth, 11.4%; the acquisition element contributing 23.1% and currency 1%; environmental and renewables up a little over 19%, and all of that principally like-for-like. Access Floors behind by, on a like-for-like basis, 31.4%, with currency reflecting the impact of US dollar on earnings translation. Currency had an impact there of 2.6%, so on group terms, like-for-like profit growth of 16.6%. The acquisition contribution was 6.9% and currency 0.3%. Moving to cash flow on slide 11, I'm not going to go through every line in the cash flow, just to highlight three or four key lines. The first, as you see, we increased working capital by 14.7 million in the first half of the year. And that's essentially the incremental working capital due to the 16% increase in underlying sales and the financing of that. Capital expenditure was 10.6 million, which is ahead of last year's 4.4 million, but last year's 4.4 million was net of property disposal proceeds of a little over 5 million. So, overall free cash was 32.4 million or 13% ahead of the first half last year. And clearly, the single biggest item in the cash flow statement for the first half was the acquisition line of 108 million, that's largely the acquisition of CIE in the period. Net debt at the end of the period was 216.5 million. In terms of key ratios, moving on to slide 12, gearing, expressed as net debt as a percentage of shareholders funds, 32.1%, up on the 19.3% at the end of FY '10; net debt to EBITDA, a little over 1.8 times; interest cover, a healthy 12.2 times; return on capital employed, 9.1%, ahead of both half year and full year last year; and working capital as a percentage of sales, 12.5%, broadly in line with last year's year-end number of 12.8%. Slide 13, deals with our debt facilities, just to highlight that we have significant available undrawn facilities, total headroom at the end of the first half of the year, 434 million. We have a revolving credit facility of $330 million. We have a 2005 issued private placement and a recently issued private placement, which matures in 2021 of 139 million. We've significant headroom on our covenants, which are, max net debt to EBITDA 3.5 times; we're half that; interest cover, minimum of 4 times and we're actually at 12 times. It's worth highlighting that the weighted average maturity of our net debt is 5.5 years after the private placement we just issued. And that has, more or less, doubled in years over the past six or eight months. And with that, I will hand back to Gene for the business review and outlook.

Gene M. Murtagh
Thanks, Geoff. On slide 15, then we deal with the sales by geography, and the key theme here, obviously, is the shift towards Mainland Europe, and that's something we'd have been planning for some time. And, obviously, the acquisition of the CIE business and indeed our organic growth have both led to significant shift in that. So the UK still remains our largest market at just around 42% of sales and Mainland Europe, 35%. And naturally, as you look forward into next year, I think that's going to become probably about 35% shift more towards around 40% when you get the full year effect of the acquisition into our business as well. So in essence, UK, Mainland Europe will be similar portion of our business into next year. Ireland's fairly steady at 5% as indeed is Australia at 4%. On 16, in essence, it just really highlights what we've discussed before, so I don't propose spending any time on that slide to show the sales by product group and the overall increases. So we'll deal with this in detail starting on slide 17, which is our Western European insulated panels businesses; strong growth essentially in all markets. The UK, obviously, the key core market here, up 16% by volume, which was very strong indeed. The Benelux, up 7%, and that

Page 3 of 13

Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

would have been predominantly growth in the Netherlands and indeed Belgium, reasonably strong as well. Australia and New Zealand, up 52% albeit a relatively low volume the year before and in absolute terms low enough volume but as we said before, it's early stage development in this markets and obviously, and very encouraging growth in this market ahead of the growth that was achieved already last year. And Ireland, up 8% by volume, which is owing in the main to retail and some public spending projects like schools, et cetera, but encouraging volume growth obviously in Ireland in a market that's as depressed as it is. On the intake side of the business, more importantly, looking forward, intake for the first half was up 8%, which leaves the order book, I'd say, constantly ahead of the same period six months ago, which obviously should deliver a fairly robust second half for the business. Raw material recovery, both steel and chemicals in this particular business, is on track. And as with the insulation business that we'll cover shortly, the increases in quarter three are obviously critical to just cementing that recovery process. And as we said earlier, we don't anticipate any further sizable increases in our raw materials in the second half. We'll move to slide 18 now, which is CEMEI, Central and Eastern Europe, the Middle East and India. In this business, again, strong growth overall, up 20% in total, which is all organic growth and as you see volume up 13% in the overall region. Germany is the largest market in this particular business supported predominantly by the Czech manufacturing facility and up 13% in that market. Turkey and the Middle East, up 40%, albeit at relatively lower margins, we'd have to say, in the first half. That's going to be an area of focus at present time and also into 2012, trying to improve the quality of our earnings in that particular geography. Poland and the Czech Republic were disappointingly weak for us. We put that down to macro-environment in both regions, but also an intensity of competition, which is quite unusual relative to other geographies that we're involved in, which has kind of weighed heavily enough on our businesses in that region. The Russian market for us, however, is showing encouraging growth and it's an area that we've identified as having a strong growth potential for us longer term and it's an area that you should hear us support more on over the coming years. We're looking at obviously organic expansion into that region and that we have also examined a number of acquisition opportunities in that region as well. Absolutely, nothing imminent, but as I say, it's an encouraging market for us with the dynamics of Central Europe, I'd say, back probably 15, 20 years ago in terms of the conversion potential. Overall, as for Western Europe, the intake figure was solid, up 9% and the order book similarly is comfortably up from six months ago. Moving to slide 19, which is North America, a very weak market. The market in which we play, which is lower, is non residential metal buildings would be down approximately 10% and that was down on a very weak 2010 figure. So against that backdrop, our performance of overall of 15% I'd say has been quite a solid result. In terms of volume, the US itself up 5% and Canada posting a very strong 14%. What I would say in this region however, is that the intake has been probably weaker than we'd have liked, particularly in Q2 and through mid-year, also into Q3. But for the first half, down 8% and I'd say most notably in that May-June period. So that's something that's clearly we're watching closely. I think Q3 is expected to be relatively weak as well. But having said that, there'd be a number of very strong projects in the pipeline for the fourth quarter and, all in all, we expect to see that minus 8% probably reduced somewhat over the next number of months. The integration of our businesses there has been very much on track. It's fully integrated at this point with five manufacturing sites across the US and Canada, all working as, essentially one operating the unit and that is the way forward. On slide 20 then, we deal with our insulation boards businesses. Just from an underlying perspective, sales in that business were up 14%, strong in the UK, strong in Germany and probably best on Benelux. That's essentially been the theme. Obviously, raw material recovery, which is a huge challenge in this business in terms of the chemical input costs which, in some products, can be up to 80% or 85% of the direct costs of the products, so it was absolutely critical.

Page 4 of 13

Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

And we'll be essentially relying on the quarter three increases to ensure that that's, as we've said earlier, fully cemented in. In all, it's been obviously a very positive period with the integration of the CIE acquisition. Geoff spoke in some detail about that earlier. But operationally it's going exceptionally well. We have disposed off the Nordics businesses. We have disposed off a small polystyrene business in the UK and that's probably where the disposals will end for the time being. And we had hoped to move on both an Ireland and a German-based polystyrene business, which is with the size of them and obviously given the backdrop currently, our strategy is to integrate those businesses with significant restructuring costs into the existing insulation portfolio. And that's something that's underway and will again be complete, particularly in Germany it would be complete in the third quarter. Australia and New Zealand had a solid performance after a fairly weak first quarter. Naturally, there are some concerns about the Australian economy in general at the moment and its own cost competitiveness. But for the time being, I think we're certainly seeing a reasonable project pipeline. And again the profitability of our combined business there, both insulation and panels, will be up year-on-year in the Australian market. And again, just to reiterate, just the level of penetration of high performance insulants and the insulated panels in these markets will be akin to North America which is low-single digit, so the opportunity is still exceptionally compelling for us in those markets. On slide 21, then we've got the environmental and renewables business, up 17% in total, owing in the main to a very strong performance of the environmental products, so fuel storage and water storage treatment plant et cetera. That particular business performed well in the UK and has had very strong sales growth across Continental Europe, in particular, into Germany and into France. And that's something that again we'd expect to continue into the second half of this year. The solar thermal business, our Thermomax Tubes business essentially has been staging a gradual comeback. The business has grown in the first half, and will again grow in the second half, but it is still posting a significant loss and that's something we expect to have to nurse through probably into 2012, but we would expect a to get through to breakeven in that business next year. The Borealis case, which is the legal case against a supplier for faulty raw material over the last well, in fact, it was eight years ago, that we took supply of that material. That case is complete. We were expecting judgment on that case in September, but unfortunately it's not going to come down till early '12, in all likelihood, January 2012. But the case is closed and that's it, we await hearing what the judgment in January. Moving on to our access floors business, we'd have clearly indicated in the past that the office environment for this product suite was going to be weak for the foreseeable future. We're seeing that very strongly in the US in particular where our office construction is really at an all-time low. And that's been compensated to some extent by a fairly robust data center end-market, not just in the US, but internationally as well. And that is going to become more of an area of focus for our business as we try and just hone our product suite towards that particular end-market. The office aspect of it, which in the US is approximately 50% of our business at the moment, which in the past would have been up as high as 75%, is obviously very weak. The project pipeline would be ticking gradually upwards and we'd expect to see probably from the second half of 2012 a resumption of some growth in that area and into 2013, it'll begin to come back gradually as well. So, that seems evident in our pipeline already. In the UK, we had a strong first half. I think we'll probably have weaker second half which is just due to just the completion scheduling of some projects. And as we've said before, 2012 should demonstrate some attractive growth in that business in the UK market. On slide 23 then, our strategy, just to reiterate, there are a couple of points that we focus on all of the times. Penetration is obviously close to the heart of our business. I think we've seen ample evidence of that in our whole conversion strategy over the last number of months and as I said fairly weak markets.

Page 5 of 13

Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

Geographically, it's clearly our ambition to have a much more balanced business, both organically and through acquisition and I think the CIE acquisition early in the year really played into that strategy in terms of just giving us a much more level geographic playing field. I think that's going to remain our focus in terms of trying to build our business in Continental Europe and indeed in North America longer-term. And then in terms of R&D, naturally there's a consistent pipeline of projects large and small coming through the business. And as you said earlier, the power panel development has been going exceptionally well and we'd expect to launch a fairly unique fully integrated photovoltaic product within the next 12 months. And our next-generation insulation project, as we said, 2013, we expect to come to market with that as a fairly revolutionary insulation material for the construction sector, which will focus on essentially decreasing the thicknesses required once again, which has been a key focus of our whole insulation product suite in the past. Finally, in terms of outlook, the order book would seem to support a reasonably strong second half for the business, although we have to say that the pace, again, as I say, we've indicated earlier, has been reduced quarter-on-quarter, not surprisingly given the untypical balance we got in the first quarter of this year, but that's just something to bear in mind. From a materials perspective, obviously, a huge theme six months ago, I'd say less so at the moment as both chemicals and steel have flattened out and then in the case of steel weakened slightly in quarter three. From the chemical side, it's a fairly sudden halt on what was a very aggressive upward trend and that's raw material cost, owing largely to fairly sudden reduction in demand in Asia, in particular. So that's something that we clearly need to watch as we go forward. But for now we'll been planning fairly consistent raw material costs for the next three to six months. And then finally, we're obviously cognizant of the weak macro forecasts that are out there right now. But as things stand, our project pipeline, which has been a very reliable barometer all through this cycle, would tend to indicate that the projects going forward, i.e., in the next six to nine-month horizon for our larger businesses, is gradually up on what it was six months ago. So again, just as another barometer of the many barometers you'll have out there, it's not negative at least. That essentially covers our formal presentation and I'm quite happy now just to hand it over for questions.

Q&A
Operator
Thank you. We will now begin the question-and-answer session. [Operator Instructions] Yassine Touahri is online with a question. <Q - Yassine Touahri>: Yes, good morning, gentleman. A couple of questions, first, on the price cost dynamics in your board business. Could you give us a bit more color on what are you doing in terms of prices? Are you considering further price hikes in order to recover margin? And how do you see the sequential evolution of margin? Could we expect a margin in line with H1 in the second part of the year, or could we see some further deterioration, or even perhaps an increase? That's my first question. <A - Gene M. Murtagh>: Yes, in terms of the pricing, we would expect prices sequentially Q2 and Q3 actually to rise. That will be based on announcements that were made kind of around mid-year. And so, yes, we would expect that to go up, and that's all part of the recovery of the huge cost increase we saw in the first half and particularly in the second quarter. In terms, of margins, yes, if anything, they could probably tick slightly upwards in that particular division. <Q - Yassine Touahri>: In second part of the year versus the first part of the year? <A - Gene M. Murtagh>: Yes, that's correct.

Page 6 of 13

Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

<Q - Yassine Touahri>: Okay, that's very clear. And another question on your order intake, could you give us a bit more flavor on what's happening in terms of the slowdown between the second quarter and the first quarter? <A - Gene M. Murtagh>: Well, that's a long question. I think to try and answer it in simple terms, the first half would have been up 14% or first quarter rather and the second quarter, up 7% in some of the key businesses. Just a gradual reduction. <Q - Yassine Touahri>: Okay, and if you look at the first weeks of the third quarter, is that the same trend, 7%, or is that a bit lower? <A - Gene M. Murtagh>: Kind of 5% to 6%? <Q - Yassine Touahri>: Okay, so it's... <A - Gene M. Murtagh>: And again, bearing in mind, as I said, the second half of last year was a very strong second half for us on that side. <Q - Yassine Touahri>: Okay, I understand. And on your access floors margin, I understand that you had a negative mix effect. Would you expect this negative mix effect to continue in the second part of the year and into 2012? <A - Gene M. Murtagh>: Yes, we would. <Q - Yassine Touahri>: Okay, so we could expect the margin could continue to may be a bit under pressure? <A - Gene M. Murtagh>: That's correct. Margins are likely to reduce slightly from this point. I wouldn't say enormously, just slightly from this point. <Q - Yassine Touahri>: Okay, that's very clear. And my last question would be on the UK. Do you have any concern about the budget cuts and about public spending? Is that something that could impact your order intake and the volume in the coming months, and possibly in 2012? Are you more concerned today than in the past, or what is the development there? <A - Gene M. Murtagh>: We're no more concerned than we were six months ago. About 15% of our business is public spending and that same proportion would apply in the UK. So if anything, we'd have had more of a heightened concern six months ago and we haven't seen the kind of dramatic reduction in planned spending that would have been highlighted six months ago. But naturally, it is going to weaken it to some point, so it's a concern but no more than it was. <Q - Yassine Touahri>: Okay. And, if I may, actually, I forgot the last question on the competitive situation in Poland and Czech Republic. Do you know what's happening exactly there? <A - Gene M. Murtagh>: I know exactly what's happening there, yeah. It's too much capacity. Too much capacity flooded into those markets over the last few years and it's really as simple as that, but it's just the pricing and demand dynamics are wrong. <Q - Yassine Touahri>: Okay, from other foam insulation manufacturers? <A - Gene M. Murtagh>: Not from foam insulation. From insulated panel manufacturers is the issue there. <Q - Yassine Touahri>: Okay. That's very clear. Thank you very much. <A - Gene M. Murtagh>: Thank you.

Operator
Robert Eason is online with a question. <Q - Robert V. Eason>: Hi, good morning guys.

Page 7 of 13

Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

<A - Geoffrey P. Doherty>: Hi, Robert. <A - Gene M. Murtagh>: Who's that? <Q - Robert V. Eason>: It's Robert Eason here actually. <A - Gene M. Murtagh>: Hi, Robert. <Q - Robert V. Eason>: And just in relation to the input cost comments, I think on the conference call in the beginning you said 50 million, and in the statement it's 80 million. Can you just reconcile those two figures for me, or am I just getting things wrong? <A - Geoffrey P. Doherty>: Robert, I'll just clarify that. The 80 million is relative to 2010. So, it's '11 versus '10, whereas I think what we were saying at the outset is that we don't expect a step change in inflation in the second half over the first half of this year. <Q - Robert V. Eason>: So, what's the 50 million referencing then? <A - Gene M. Murtagh>: There's obviously going to be just kind of a gradual spillover of increases into quarter three, Robert. That's really what it is. It's a continuation of that 40 million that we've seen in the first half. So, the price indications we're giving are really through the second half and into next year, the indications we've got so far. So, these things don't obviously stop dead, that it goes up to 40 million and just stops dead. So in essence, there's a dribble forward from that, and that's the incremental hit to us, if you like. <A - Geoffrey P. Doherty>: And if we take, just for absolute clarity, if we take our raw material build this year versus last year and the inflationary element of it, our guidance is still 80 million year-on-year. <Q - Robert V. Eason>: Okay, that's clear. Just in terms of you mentioned in relation to boards in the statement, the trading profit for the acquisition was net of integration costs, and on the conference call you indicated that you have now decided to hold onto the German and Irish assets, which will require significant restructuring. Can you put a bit of scale on those restructuring costs in the first half and what you expect it to be in the second half on the back of holding onto those assets? <A - Gene M. Murtagh>: Yes, Robert, I think, we indicated earlier in the year that the total cost of restructuring stock integration for the CIE business was of the order of 5 million, and that guidance remains intact. We've incurred about half of that in the first half with the remaining element of about 2.5 million to be incurred in the second half of the year and that includes any initiatives for the Irish or German businesses that you referred to. <Q - Robert V. Eason>: Okay, and just kind of a general comment about, you obviously were back in more volatile times at the moment. How is the business reacting now compared to the reaction in 2008 when we had similar volatile times in terms of cancellations, quotations, et cetera? Are you seeing anything like you saw back in '08? <A - Gene M. Murtagh>: No, Robert. We're not and don't mean to say that naively. I think, we keep talking about our pipeline and it informed our strategy essentially around restructuring our business, et cetera, three years ago, and I'd say it very well. And all through the downturn, it's been a reasonably solid barometer of activity. So, I think, we're not seeing a dip at all quite frankly. Like, our intake, with the exception of North America, I wouldn't say it's exciting, but it's been fairly solid like right up to today. The project pipeline, as I said, has been ticking up gradually. Quotation levels, they can be a little bit lumpy, but by and large our quotation levels year-on-year actually are up. So we wouldn't share the concerns that they are out there, but we're clearly, totally cognizant of what's been said. I think you have to bear in mind as well that it's not like we've had a recovery in our end markets, like we had a dramatic collapse in our business really from '08 through to '10 say. Our end markets, in particular, res and non-res in the UK, take our big markets of the UK and North America, for example, they're at all time lows right now. So it's not like they have bounced back in the last six months or anything like it. So, frankly, I think the ability for those markets to actually dip again when you can see there's a base need for

Page 8 of 13

Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

housing and a base need for non-residential buildings, these figures would tend to indicate that we are there and we're knocking around there, and there isn't the same scope to collapse once again. <Q - Robert V. Eason>: And maybe just to follow up, just going back to that original question. There's been no tick up in cancellations. <A - Gene M. Murtagh>: We haven't had cancellations at all, to be honest with you. You get project slippage from time to time. That's just to do with delivery schedules, but cancellations actually isn't a word we've come across in the business. <Q - Robert V. Eason>: And then just my last question just on bad debts. What were they like in the first half? And what are your expectations as you go into the next six to 12 months in terms of where they could trend? <A - Gene M. Murtagh>: Yes, they were a nudge up in the first half of this year versus the first half of last year and I think that would reflect probably, and I wouldn't overstate this, but a little bit more stress around the contracting environment, particularly in the UK. But we're not seeing any further deterioration of that through the second half of the year, and I wouldn't overstate the uptick either versus the first half of last year. <Q - Robert V. Eason>: Okay, thank you. <A - Geoffrey P. Doherty>: Okay, Robert.

Operator
Paraic Quinn is on the line with a question. <Q - Paraic Quinn>: Good morning. <A - Gene M. Murtagh>: Hi, Paraic. <A - Geoffrey P. Doherty>: Hi, Paraic. <Q - Paraic Quinn>: Just a follow-up quickly in terms of that comment on the UK. Just to say is that a reiteration of the previous guidance for, say, the UK commercial market that you'll see I suppose a trough in 2011 and expect growth in 2012? And maybe reading between the lines, as the growth now in 2012 might be a bit more modest than previously expected? <A - Gene M. Murtagh>: Yeah. That's probably fair enough, yes. <Q - Paraic Quinn>: Yes, okay. Thank you. Another question on the environmental and renewables side, I know you previously spoke about looking into public sector projects, things like schools and hospitals, I'm just wondering in terms of the level of success you're having going into that area of the market. <A - Gene M. Murtagh>: On which side? The solar side? <Q - Paraic Quinn>: The Solar side, yes. <A - Gene M. Murtagh>: Yes, actually we're having quite a bit success in that and we'd expect to get a boost on that side of the business in fact from the, let's call it the RHI, the Renewables Heat Incentive in the UK. But that's something that's essentially been signed off and it'll come into effect during 2012. And that should give rise to a lot of larger scale projects. So our focus will be much more so on schools, hotels, swimming pools, et cetera rather than single one-off applications. <Q - Paraic Quinn>: Okay, and maybe just a last question. Following the 200 million private placement announced in the last few weeks, I'm just wondering, should we read anything into that in terms of appetite for acquisitions? The CIE integration appears to be going well.

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Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

<A - Gene M. Murtagh>: It is going well. I wouldn't read into this at all, Paraic. It's just prudent financial planning for the medium term. <Q - Paraic Quinn>: Okay, that's fine. Thanks very much.

Operator
Flor O'Donoghue is online with the question. <Q - Florence O'Donoghue>: Thank you. Good morning, Gene, Ronan and Geoff. <A - Gene M. Murtagh>: Hey, Florence. <Q - Florence O'Donoghue>: Just a couple of questions. Just wondering about you make a very interesting comment in the statement about volumes in UK panels, 20% are now being refurbed, just interested to hear your thoughts on that. Second question is just on gross margins. If my figures are right, they came back about 80 bps in H1, so just some color on that would be helpful. And then finally, going back to what you were saying about the over-capacity in Turkey and Eastern Europe. Can you give us any sense of what your estimate of the level of over-capacity is? <A - Gene M. Murtagh>: Yes. Okay, just dealing with the first bit then, in terms of the renovation piece, if you like, about 20% of our panels business, and it is wider than that, really, Florence, but 30% are insulation board business. And actually at a peak, and I know we're taking an extreme example, but our Insulation business in Ireland, in fact, at this point will be 50% refurb. So, it's something that we see trending upwards in our business, not just because new build is depressed, but just as a dynamic, I think it's something that we're going to see increase over the longer term. And when you consider that the new build environment is probably 1%, 1.5% of the existing built environment per annum. And I think there's obviously between incentives and just voluntary upgrade in buildings, I think it's an area that's going to see significant growth over the long term, right across Europe. And our products are obviously ideally suited for that. And in terms of the margin... <A - Geoffrey P. Doherty>: Just on your gross margin question, Flor, that's a function of two factors. Firstly, mix. The access floors mix would have been less in the first half of '11 versus '12, that's a higher margin business. And then secondly, the impact of the CRH European insulation acquisition as well, at slightly lower margins. And both of those, on a weighted basis, would have meant that gross margin was down by 80 basis points. <A - Gene M. Murtagh>: And then on utilization in Central Europe, our utilization, we see probably at it's hard to be scientific about it, but probably 30% to 40% utilization in Central Europe on insulated panels, which obviously is going to bear on margins there actually for a few years. <Q - Florence O'Donoghue>: Thank you. Just one follow-up; separate question just on the Boards side. It looks like in Europe on the underlying business, you've got extremely strong pricing. That's I presume mix. It's a lot more cool term in there. So is the read-across there that you're really making inroads in terms of the development of the Boards business in Mainland Europe? <A - Gene M. Murtagh>: Yes, that is the read through there, but I wouldn't underestimate just what the actual price increase and PIR has been as well. <Q - Florence O'Donoghue>: Okay. <A - Gene M. Murtagh>: A very significant yank up on the price of that in the last six months. <Q - Florence O'Donoghue>: Great. <A - Gene M. Murtagh>: Thank you.

Page 10 of 13

Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

Operator
Gregor Kuglitsch is online with a question. <Q - Gregor Kuglitsch>: I've got three questions. The first one is just on the recovery of the input costs side of the [indiscernible] (0:42:04). I think you had small slippage in the first half when it comes to both chemicals and steel in terms of just recovering it. Are you therefore saying that in the second half you think you can potentially slightly over-recover? That's the first question. The second question is on the order intake. Just to be very clear, are these numbers which you talk about, obviously right now we're in a relatively inflationary environment, do they relate to volume, or is it a value number? Just to get a sense of where you think the overall sales number is heading? And then, finally, if you can perhaps give a bit of an update of what you are thinking in terms of M&A and other investments at this point in time. Or whether you're pretty comfortable where you are right now and still digesting the CIE business. Or would you be willing to do something more significant in the next 12 months to 18 months. <A - Gene M. Murtagh>: Okay. The first point there was on... <A - Geoffrey P. Doherty>: Just around raw material inflation and lag, I mean I think there was a small lag in the first half of the year. We are likely to make up that lag in the second half of the year. But again, I wouldn't it's not usually material. <A - Gene M. Murtagh>: Not usually material at all. You can just take it, but that side of it has been dealt with essentially. On the when we talk about intake, we talk only about volume. So there's no confusion there in terms of volume or values. So any percentages you see is volume only. <Q - Gregor Kuglitsch>: Okay. <A - Gene M. Murtagh>: And then in terms of further corporate activity, I think we're always in the market. We're well funded. We've 400 million of headroom. But, I think we'll be typically cautious in terms of stretching ourselves. So I wouldn't expect anything out of the ordinary but certainly yes, we're continuing to look at other opportunities. <Q - Gregor Kuglitsch>: Okay. Thank you.

Operator
Mark Hake is online with a question. <Q - Mark Hake>: Yes, guys. I've just got two questions on the housing side of things. Can you just remind me at the group level how much residential accounts for sales? And then secondly, specifically could you give us just a little bit more guidance, a little bit more feel for how the UK new-build residential demand is going at the moment and how that's looking coming into Q3? <A - Gene M. Murtagh>: Sure. Of our group total, it would be about 35% of sales, Mark, would be residential. <Q - Mark Hake>: Okay. <A - Gene M. Murtagh>: And it wouldn't be dissimilar to that in the UK, probably slightly higher in the UK, maybe up to 40% for us in the UK market. <Q - Mark Hake>: Okay. <A - Gene M. Murtagh>: And what we would have seen, by volume, would be slight growth actually in the first half of this year. Naturally, the house builders are all bearish, but that's as much on price as it is on volumes. So we wouldn't anticipate a weakening by volume in the housing market near term in the UK.

Page 11 of 13

Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

<Q - Mark Hake>: Perfect, great. Thank you very much. <A - Gene M. Murtagh>: Okay.

Operator
Robert Eason is on line with a question. <Q - Robert V. Eason>: Just one follow-up question on the environmental and renewables division; just two related questions. Firstly, you mentioned in the statement that the provisioning of the warranty issue has ended now. Was there any provision in the first half? And can you just remind us in terms of the total provisioning that has been made in that division and what has been already expensed out of those provisions? And also on the conference call, you mentioned that the thermal part of that business was I think you used the words significant losses. Can you just give us a quantum on that in terms of the potential drag it has on the divisional margins? <A - Geoffrey P. Doherty>: Robert, I'll help you with that. The additional provision made in the first half of the year was out of the order of 1.5 million. The total provisions that we have made at the end of June 2011 is about 17 million and that's to cover both warranty and indeed legal cost. We don't expect any further provision to be necessary in respect of this issue as we go forward. So, all of the P&L and income statement charges have now been taken at this point. <Q - Robert V. Eason>: And the thermal business in terms of the extent of the losses? <A - Gene M. Murtagh>: Say that again, Robert? The solar-thermal? <Q - Robert V. Eason>: Yes. <A - Gene M. Murtagh>: In the order of a couple of million. <Q - Robert V. Eason>: Okay. Thank you.

Operator
[Operator Instructions] We have no further question at this time.

Gene M. Murtagh
That's great. Thank you all very much for joining and I'm sure we'll see some of you during the week.

Geoffrey P. Doherty
Thank you very much. This transcript may not be 100 percent accurate and may contain misspellings and other inaccuracies. This transcript is provided "as is", without express or implied warranties of any kind. Bloomberg retains all rights to this transcript and provides it solely for your personal, non-commercial use. Bloomberg, its suppliers and third-party agents shall have no liability for errors in this transcript or for lost profits, losses, or direct, indirect, incidental, consequential, special or punitive damages in connection with the furnishing, performance or use of such transcript. Neither the information nor any opinion expressed in this transcript constitutes a solicitation of the purchase or sale of securities or commodities. Any opinion expressed in the transcript does not necessarily reflect the views of Bloomberg LP.

Page 12 of 13

Company Name: Kingspan Group Company Ticker: KSP ID Date: 2011-08-22 Event Description: Q2 2011 Earnings Call

Market Cap: 1,049.28 Current PX: 6.30 YTD Change($): -1.19 YTD Change(%): -15.888

Bloomberg Estimates - EPS Current Quarter: N.A. Current Year: 0.354 Bloomberg Estimates - Sales Current Quarter: N.A. Current Year: 1472.000

COPYRIGHT 2011, BLOOMBERG LP. All rights reserved. Any reproduction, redistribution or retransmission is expressly prohibited.

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