AS MERKO EHITUS CONSOLIDATED ANNUAL REPORT 2015 AS MERKO EHITUS GROUP CONSOLIDATED ANNUAL REPORT Translation01.01.2015 of the – Estonian31.12.2015 original 01.01.2013 - 31.12.2013 Business namename:: AS Merko Ehitus Main activityactivities:: activitiesHolding companies of holding companies generalGeneral contractingcontracting ofof constructionconstruction managementReal estate development of real estate Commercial Register No.:no: 11520257 RegisteredAddress: address: Järvevana tee 9G, 11314 Tallinn MailPostal ad address:dress: Pärnu mnt 141, 11314 Tallinn PhonePhone:: +372 650 1250 FaxFax:: +372 650 1251 E-mail: [email protected]@merko.ee Web sitesite:: www.merko.eegroup.merko.ee AudiAuditor:tor: AS PricewaterhouseCoopers Supervisory BoardBoard:: Toomas Annus, Teet Roopalu, Indrek Neivelt, Olari Taal Management Board: Andres Trink, Tõnu Toomik 1 WorldReginfo - 39cc2252-0cae-409f-a387-66e5dc4e3e92 AS MERKO EHITUS CONSOLIDATED ANNUAL REPORT 2015 TABLE OF CONTENTS BRIEF OVERVIEW OF THE GROUP ........................................................................................................................................................................................................ 3 STATEMENT OF THE CHAIRMAN OF THE MANAGEMENT BOARD ........................................................................................................................................... 6 MANAGEMENT REPORT ......................................................................................................................................................................................................................... 7 MANAGEMENT DECLARATION ........................................................................................................................................................................................................... 57 FINANCIAL STATEMENTS ................................................................................................................................................................................................................... 58 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME ............................................................................................................................................ 58 CONSOLIDATED STATEMENT OF FINANCIAL POSITION ........................................................................................................................................................59 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ........................................................................................................................................................ 60 CONSOLIDATED CASH FLOW STATEMENT ................................................................................................................................................................................ 61 NOTES ....................................................................................................................................................................................................................................................... 62 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES .................................................................................................................................. 62 NOTE 2 MANAGEMENT ESTIMATES .................................................................................................................................................................................. 71 NOTE 3 OPERATING SEGMENTS ......................................................................................................................................................................................... 72 NOTE 4 COST OF GOODS SOLD ............................................................................................................................................................................................ 75 NOTE 5 MARKETING EXPENSES ......................................................................................................................................................................................... 75 NOTE 6 GENERAL AND ADMINISTRATIVE EXPENSES ................................................................................................................................................. 75 NOTE 7 OTHER OPERATING INCOME ................................................................................................................................................................................ 76 NOTE 8 OTHER OPERATING EXPENSES ............................................................................................................................................................................ 76 NOTE 9 FINANCE INCOME ..................................................................................................................................................................................................... 76 NOTE 10 FINANCE COSTS ........................................................................................................................................................................................................ 76 NOTE 11 CORPORATE INCOME TAX ..................................................................................................................................................................................... 77 NOTE 12 EARNINGS PER SHARE............................................................................................................................................................................................ 77 NOTE 13 DIVIDENDS PER SHARE ......................................................................................................................................................................................... 78 NOTE 14 CASH AND CASH EQUIVALENTS ......................................................................................................................................................................... 78 NOTE 15 TRADE AND OTHER RECEIVABLES...................................................................................................................................................................... 79 NOTE 16 LOANS GRANTED .................................................................................................................................................................................................... 80 NOTE 17 INVENTORIES ........................................................................................................................................................................................................... 80 NOTE 18 SHARES IN SUBSIDIARIES ...................................................................................................................................................................................... 81 NOTE 19 INVESTMENT IN JOINT VENTURES ..................................................................................................................................................................... 86 NOTE 20 OTHER LONG-TERM LOANS AND RECEIVABLES .......................................................................................................................................... 88 NOTE 21 DEFERRED INCOME TAX ASSETS AND LIABILITIES ...................................................................................................................................... 88 NOTE 22 INVESTMENT PROPERTY...................................................................................................................................................................................... 89 NOTE 23 PROPERTY, PLANT AND EQUIPMENT ............................................................................................................................................................... 90 NOTE 24 INTANGIBLE ASSETS ............................................................................................................................................................................................... 91 NOTE 25 LEASED ASSETS ....................................................................................................................................................................................................... 92 NOTE 26 BORROWINGS........................................................................................................................................................................................................... 93 NOTE 27 PAYABLES AND PREPAYMENTS ......................................................................................................................................................................... 94 NOTE 28 PROVISIONS ...............................................................................................................................................................................................................95 NOTE 29 OTHER LONG-TERM PAYABLES ..........................................................................................................................................................................95 NOTE 30 LOAN COLLATERALS AND PLEDGED ASSETS ................................................................................................................................................ 96 NOTE 31 SHARE CAPITAL ......................................................................................................................................................................................................