Skanska Annual Report 2003

The due dates of future minimum lease payments for noncancellable operatingleases were distributed as follows.Expenses, due dates 2003 2002Within one year –136 –138Later than one year but within five years –437 –341Later than five years –723 –285Total –1,296 –764Of this amount, SEK 0 M (–3) was related to properties that were subleased. Leaserevenue in 2002 was less than SEK 1 M.B. Skanska as a lessorFinancial leasesSkanska owns a property in Sweden that is leased to a customer under a financiallease. The present value of the claim related to future minimum lease payments isreported in the balance sheet as a financial fixed asset. On the balance sheet date,it amounted to2003 2002Gross investment in financial leases 22– unearned financial revenues –4Net investment in financial leases 18 0– Non-guaranteed residual value belonging to the lessor –2Present value of claim related to futureminimum lease payments 16 0The due dates of the gross investment and present value of future minimum leasepayments were distributed as follows:Present value ofclaim related toGross investment in future minimumfinancial leases lease paymentsRevenues, due dates 2003 2002 2003 2002Within one year 3 3Later than one year but within five years 10 8Later than five years 9 522 0 16 0Reserves for doubtful receivables related to minimum lease payments amountedto SEK 0 M (0). The variable portion of lease payments included in 2003 incomeamounted to SEK 0 M (0).Operating leasesCommercial Project Development carries out Skanska’s operating lease business.These properties are reported as current assets in the balance sheet. For adescription of the Commercial Project Development business stream, see Note 3,”Segment reporting.”In 2003, the Group’s variable leasing income related to operating leasesamounted to SEK 4 M (26). The 2003 amount consisted of sales-based rent forcommercial space.The due dates of future minimum lease payments for non-cancellable operatingleases were distributed as follows:Note 39Events after the balance sheet dateIn January 2004, Skanska announced decisions to divest some of the specializedcompanies in Skanska Sweden as well as portions of Skanska IT Solutions in SkanskaServices, whose businesses are not considered part of the Group’s core operations.The divestment process is intended to take place during 2004 and 2005.The companies affected are Skanska Installation, Myresjöhus, Flexator andTemporent, the portion of Skanska Prefab that works with ground productsand Skanska Glasbyggarna plus the IT section and central staff units of SkanskaIT Solutions. In 2003, the net sales of the businesses included in the planneddivestments was SEK 3.6 billion. The capital employed totaled about SEK 1.1 billion.These businesses have a total of about 2,100 employees.The financial reports were signed on February 12, 2004 and will be submitted tothe Annual Shareholders’ Meeting of Skanska AB on March 30, 2004 for adoption.Note 40 Discontinuing operationsAs a consequence of its strategic plan, Skanska made decisions to discontinue orsell units in the Group. From the Group’s perspective, none of these comprisesan organizational unit as defined in RR 19, ”Discontinuing operations.” Certaininformation about discontinued operations and ongoing discontinuation efforts isprovided below.Businesses discontinued during 2003Skanska’s construction operations in Hungary, Latvia and Lithuania were sold duringthe year.The shareholding in the Norwegian steel and concrete element company ContigaA/S was sold during the year. Half ownership in Contiga was included in Skanska’sacquisition of Selmer in 2000. Contiga has had a large proportion of its sales inSweden, thereby overlapping with the operations of Skanska Prefab.After the approval of Skanska’s 2003 Annual Meeting, the American subsidiarySpectrum Skanska, specializing in residential project development, was sold to thecompany’s management. This reduced the capital employed in the Skanska Groupby about SEK 900 M. At year-end, the Group had an outstanding claim of SEK 125.6M on the buyers.The Group’s residential project development in Denmark also ceased at year-end2003.Meanwhile continued efforts are underway to discontinue or divest additionalbusinesses in small markets.Ongoing discontinuation effortsThe Group initiated the discontinuation of its project export company SkanskaInternational Projects. This company’s business will gradually close as the unit’s nineongoing projects are completed. In 2003, the net sales of Skanska InternationalProjects was SEK 1.2 billion, and its operations had a total of some 2,800 employees.The Skanska Group signed a letter of intent covering the sale of its majorityholding in its mining contracting business in South Africa, Canada and Australia toMurray & Roberts, a publicly listed leading South African construction company. Theplanned sale involves the Group’s 79.1 percent shareholding in the publicly listedThe Cementation Company (Africa) Ltd., the wholly owned subsidiaryCementation Skanska Canada Inc. and a start-up mining contracting operation inAustralia.Revenues, due dates 2003 2002Within one year 873 1,409Later than one year but within five years 2,117 4,081Later than five years 655 2,037Total 3,645 7,527The book value of current-asset properties in Commercial Project Developmenttotaled SEK 9,249 M (12,610).84 Notes, including accounting and valuation principles – Skanska Annual Report 2003