10. Property, plant and equipment
The carrying amounts of all assets summarized in property, plant and equipment, are as follows:
| in thousand EUR | 2019 | 2018 | ||
|---|---|---|---|---|
| Land | 56 331 | 14 204 | ||
| Forest roads | 5 460 | 5 657 | ||
| Buildings and improvements | 5 764 | 5 529 | ||
| Machinery and vehicles | 3 702 | 3 872 | ||
| Leased machinery and vehicles | – | 2 559 | ||
| Furniture and fixtures | 522 | 554 | ||
| Construction in progress | 4 451 | 1 330 | ||
| Advanced payments for PPE | 853 | 1 511 | ||
| Total carrying amounts | 77 083 | 35 217 |
The Group uses different valuation methods for its assets. Beside the land in Brazil and Gabon, which, since 2019, is disclosed at fair value according to the revaluation model of IAS 16 Property, Plant and Equipment, the assets are held at cost. The effects of this revaluation are presented in other comprehensive income and form the revaluation surplus on land in equity, details including land movements within PPE are presented in Note 11.
Since 2019, the leased assets are disclosed separately according to IFRS 16 Leases, details are presented in Note 22. Also since 2019, the forests in Brazil are disclosed separately as biological assets, according to IAS 41 Agriculture and are further detailed in Note 12.
Assets held at cost
| in thousand EUR | Forest roads |
Buildings and improve- ments |
Machinery and vehicles |
Leased machinery and vehicles |
Furniture and fixtures |
Construction in progress |
Advanced payments for PPE |
Total PPE at cost |
||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost | ||||||||||||||||
| At 1 January 2018 | 11 421 | 20 536 | 29 883 | 3 591 | 2 254 | 390 | 2 889 | 67 373 | ||||||||
| Additions | 374 | 275 | 1 272 | 1 082 | 182 | 1 833 | – | 3 935 | ||||||||
| Disposals | – | – | –1 010 | – | –218 | – | – | –1 228 | ||||||||
| Reclassifications land | 124 | 405 | 247 | 105 | – | –881 | –4 | –108 | ||||||||
| Currency effects | –471 | –230 | –709 | – | –26 | –12 | –307 | –1 755 | ||||||||
| At 31 December 2018 | 11 448 | 20 986 | 29 683 | 4 778 | 2 192 | 1 330 | 2 578 | 72 996 | ||||||||
| Reclassification finance leases to right-to-use assets | –4 778 | –4 778 | ||||||||||||||
| At 1 January 2019 | 11 448 | 20 986 | 29 683 | – | 2 192 | 1 330 | 2 578 | 68 218 | ||||||||
| Additions | 150 | 874 | 790 | 120 | 3 747 | – | 5 681 | |||||||||
| Disposals | – | –910 | –1 693 | –0 | –42 | – | –2 645 | |||||||||
| Reclassifications | – | 410 | 145 | 28 | –583 | – | – | |||||||||
| Currency effects | –70 | –34 | –84 | –0 | –1 | –40 | –230 | |||||||||
| At 31 December 2019 | 11 528 | 21 326 | 28 841 | – | 2 340 | 4 451 | 2 538 | 71 024 | ||||||||
| Accumulated depreciation and impairment | ||||||||||||||||
| At 1 January 2018 | 5 694 | 14 888 | 26 301 | 1 618 | 1 707 | – | 1 196 | 51 404 | ||||||||
| Charge for the year | 311 | 715 | 1 138 | 584 | 172 | – | – | 2 920 | ||||||||
| Reversal of impairment | –15 | – | – | – | – | – | –4 | –19 | ||||||||
| Elimination on disposals | – | – | –1 010 | – | –218 | – | – | –1 228 | ||||||||
| Reclassifications | – | – | –17 | 17 | – | – | – | – | ||||||||
| Currency effects | –199 | –146 | –601 | – | –23 | – | –126 | –1 095 | ||||||||
| At 31 December 2018 | 5 791 | 15 457 | 25 811 | 2 219 | 1 638 | – | 1 066 | 51 982 | ||||||||
| Reclassification finance leases to right-to-use assets | –2 219 | –2 219 | ||||||||||||||
| At 1 January 2019 | 5 791 | 15 457 | 25 811 | – | 1 638 | – | 1 066 | 49 763 | ||||||||
| Charge for the year | 323 | 712 | 1 024 | 180 | – | – | 2 239 | |||||||||
| Impairment charge | – | – | – | – | – | 650 | 650 | |||||||||
| Reversal of impairment | –15 | – | – | – | – | – | –15 | |||||||||
| Elimination on disposals | – | –586 | –1 631 | –0 | – | – | –2 217 | |||||||||
| Currency effects | –31 | –21 | –65 | –0 | – | –31 | –148 | |||||||||
| At 31 December 2019 | 6 068 | 15 562 | 25 138 | – | 1 817 | – | 1 685 | 50 272 | ||||||||
| Carrying amount | ||||||||||||||||
| At 31 December 2018 | 5 657 | 5 529 | 3 872 | 2 559 | 554 | 1 330 | 1 511 | 21 013 | ||||||||
| At 1 January 2019 | 5 658 | 5 529 | 3 872 | – | 555 | 1 330 | 1 511 | 18 455 | ||||||||
| At 31 December 2019 | 5 460 | 5 764 | 3 702 | – | 522 | 4 451 | 853 | 20 752 | ||||||||
For certain land acquired by Precious Woods in Brazil, the land title registration is not yet finalized. These transactions are disclosed as advanced payments for property, plant and equipment at historical cost. For advanced payments for land titles with a certain risk of losing the land, an allowance is recorded based on Management’s estimate of the probability of not being able to prove the ownership of the land. Despite the continued efforts to clean the land titles from legal issues, Precious Woods was not able to reclassify in 2019 any advanced payments for property, plant and equipment to land (2018: EUR 3 535).
Accounting policies
In general, assets in property, plant and equipment are recorded at cost less accumulated depreciation and any impairment in value. Depreciation is applied using the straight-line method over the estimated useful life of the assets as follows:
- Permanent forest roads: 25 years
- Buildings and improvements: 3 to 25 years
- Machinery and vehicles: 4 to 10 years
- Furniture and fixtures: 5 to 10 years
The assets’ residual values and useful lives and methods of depreciation are reviewed at each financial year-end and adjusted prospectively, if appropriate. Gains and losses on disposals are determined by comparing proceeds with carrying amounts. These are included in the consolidated statement of profit or loss.