10. Property, plant and equipment

The carrying amounts of all assets summarized in property, plant and equipment, are as follows:

in thousand EUR	2023	2022
Land	54 907	47 715
Forest roads	3 477	3 875
Buildings and improvements	5 299	5 352
Machinery and vehicles	7 913	7 715
Furniture and fixtures	296	314
Construction in progress	221	193
Advanced payments for PPE	1 138	1 842
Total carrying amounts	73 251	67 006

The Group uses different valuation methods for its assets. Beside the land in Brazil and Gabon, which is presented at fair value according to the revaluation model of IAS 16 Property, Plant and Equipment, the assets are held at cost.

The forests in Brazil are presented separately as biological assets, according to IAS 41 Agriculture and are further detailed in Note 11; as well as the leased assets, presented separately according to IFRS 16 Leases in Note 21.

a. Land at fair value

Precious Woods applies the revaluation model according to IAS 16 Property, Plant and Equipment for all its land assets. The carrying amount for those assets, if the cost model had been applied, would have been EUR 12.9 million (2022: EUR 12.6 million).

Reconciliation of carrying amount of level 2 land revaluation

in thousand EUR	2023 at Fair Value	2022 at Fair Value
At 1 January	47 715	42 332
Change in fair value	4 949	1 298
Reclassification from/to advanced payments for PPE	91	24
Currency effects	2 152	4 061
At 31 December	54 907	47 715

Accounting policies

The land value is measured at fair value with any changes in value recognized in other comprehensive income under revaluation surplus.

Land revaluation Brazil and Gabon

In 2022, the revaluations were performed by BDO Brazil for the land assets in Brazil and by A.N. Dengue for the land assets in Gabon. These valuators are not related to the Group and have recent experience in location and category of the land being valued. The valuation was based on the market value. The sales comparison approach is used to determine the market value of bare land without biomass. This approach consists of comparing the subject land to similar land sold in the recent past in an open market situation, and adjusting the value for market trends. This results in a market value for the land.

In 2023, the revaluation for the land assets in Brazil, which was again performed by BDO, led to an increase of the fair value by EUR 4.9 million to EUR 44.5 million. The average value increase in 2023 was 12.3 % compared to previous year. The revaluation is based on a land area of 390 328 ha (2022: 388 678 ha). The reason for this slight deviation in land area is legal cases. Further information about these uncertain land titles is disclosed in Note 10 b.

In Gabon, there were no indications of a price fluctuation for land in 2023; the fair value remained stable at EUR 10.4 million, as in 2022.

The fair value measurement for the land has been categorized as a level 2 fair value based on the inputs to the valuation technique used.

b. Other assets at cost

Beside the land, all other asset categories in property, plant and equipment are held at cost.

in thousand EUR	Forest roads	Buildings and improve- ments	Machinery and vehicles	Furniture and fixtures	Construction in progress	Advanced payments for PPE	Total PPE at cost
Cost
At 1 January 2022	10 676	15 361	28 697	1 193	887	2 112	58 926
Additions	143	334	2 024	111	586	953	4 151
Disposals	–	–	–467	–3	–	–	–470
Reclassifications¹	162	468	624	48	–1 302	–24	–24
Currency effects	350	213	760	40	22	207	1 592
At 31 December 2022	11 331	16 376	31 638	1 389	193	3 248	64 175

Additions	–	153	818	38	506	148	1 663
Disposals	–	–35	–218	–7	–	–	–260
Reclassifications¹	–	33	4 217	22	–479	–1 040	2 752
Currency effects	214	125	526	31	1	177	1 074
At 31 December 2023	11 545	16 652	36 981	1 473	221	2 533	69 404

Accumulated depreciation and impairment
At 1 January 2022	6 760	8 596	21 839	952	–	1 225	39 372
Charge for the year	503	624	1 515	76	–	–	2 718
Impairment charge	–	1 652	295	17	–	40	2 004
Reversal of impairment	–12	–	–	–	–	–	–12
Disposals	–	–	–391	–3	–	–	–394
Currency effects	205	152	665	33	–	141	1 196
At 31 December 2022	7 456	11 024	23 923	1 075	–	1 406	44 884

Charge for the year	501	274	2 266	83	–	–	3 124
Reversal of impairment	–12	–	–	–	–	–91	–103
Disposals	–	–33	–172	–7	–	–	–211
Reclassifications¹	–	–	2 657	–	–	–	2 657
Currency effects	123	88	392	26	–	80	709
At 31 December 2023	8 068	11 353	29 067	1 177	–	1 395	51 060

Carrying amount
At 31 December 2022	3 875	5 352	7 715	314	193	1 842	19 291
At 31 December 2023	3 477	5 299	7 913	296	221	1 138	18 344
¹ The reclassifications contain also reclassifications from/to land, leasing and from spare parts (Note 21)

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 Group Management’s estimate of the probability of not being able to prove the ownership of the land. Based on the continued efforts to clean the land titles from legal issues, Precious Woods had on the one hand not to reclassify additional land as advanced payments for property, plant and equipment (2022: EUR 0.0 million). On the other hand, advanced payments for property, plant and equipment have been reversed to land in the amount of EUR 90 900 (2022: EUR 23 800).

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.