Note 21 – Intangible assets
| Group | Parent Company | |||||
| SEK m | 2018 | 2017 | 2018 | 2017 | ||
| Goodwill | ||||||
| Cost | ||||||
| Opening cost | 1 617 | 1 577 | 2 053 | 2 053 | ||
| Investments | – | – | – | – | ||
| Increase through business combination | 478 | 37 | – | – | ||
| Disposals and retirements | – | – | – | – | ||
| Translation differences | 19 | 3 | – | – | ||
| Closing accumulated cost | 2 114 | 1 617 | 2 053 | 2 053 | ||
| Amortization | ||||||
| Opening accumulated amortization | – | – | -2 053 | -2 053 | ||
| Closing accumulated amortization | 0 | 0 | -2 053 | -2 053 | ||
| Closing carrying amount | 2 114 | 1 617 | 0 | 0 | ||
| Group | Parent Company | |||||
| SEK m | 2018 | 2017 | 2018 | 2017 | ||
| Other intangible assets, customer relationships | ||||||
| Acquisition values | ||||||
| Opening cost | 348 | 322 | – | – | ||
| Investments | – | – | – | – | ||
| Increase through business combination | 115 | 20 | – | – | ||
| Disposals and retirements | – | – | – | – | ||
| Translation differences | 15 | 6 | – | – | ||
| Closing accumulated cost | 478 | 348 | 0 | 0 | ||
| Amortization | ||||||
| Opening accumulated amortization | -108 | -72 | – | – | ||
| Amortization for the year | -40 | -34 | – | – | ||
| Disposals and retirements | – | – | – | – | ||
| Translation differences | -5 | -2 | – | – | ||
| Closing accumulated amortization | -153 | -108 | 0 | 0 | ||
| Closing carrying amount | 325 | 240 | 0 | 0 | ||
| Group | Parent Company | |||||
| SEK m | 2018 | 2017 | 2018 | 2017 | ||
| Trademarks, software and licenses | ||||||
| Cost | ||||||
| Opening cost | 70 | 52 | 50 | 34 | ||
| Investments | 9 | 15 | 8 | 14 | ||
| Increase through business combination | 153 | 1 | – | – | ||
| Disposals and retirements | 0 | – | – | – | ||
| Reclassification | 24 | 2 | 6 | 2 | ||
| Translation differences | 1 | – | – | – | ||
| Closing accumulated cost | 257 | 70 | 64 | 50 | ||
| Amortization | ||||||
| Opening accumulated amortization | -45 | -39 | -29 | -25 | ||
| Amortization for the year | -13 | -6 | -3 | -4 | ||
| Business combinations | 0 | – | – | – | ||
| Disposals and retirements | 0 | – | – | – | ||
| Reclassification | -13 | – | – | – | ||
| Translation differences | -1 | – | – | – | ||
| Closing accumulated amortization | -73 | -45 | -32 | -29 | ||
| Closing carrying amount | 184 | 25 | 32 | 21 | ||
| Group | Parent Company | |||||
| SEK m | 2018 | 2017 | 2018 | 2017 | ||
| Capitalized development expenses | ||||||
| Cost | ||||||
| Opening cost | 160 | 160 | 129 | 130 | ||
| Investments | 19 | 1 | 17 | 1 | ||
| Increase through business combination | – | – | – | – | ||
| Decrease through disposal | – | – | – | – | ||
| Disposals and retirements | – | – | – | – | ||
| Reclassification | -5 | -2 | -6 | -2 | ||
| Translation differences | 1 | 1 | – | – | ||
| Closing accumulated cost | 175 | 160 | 140 | 129 | ||
| Amortization | ||||||
| Opening accumulated amortization | -130 | -120 | -110 | -103 | ||
| Amortization for the year | -12 | -10 | -8 | -7 | ||
| Increase through disposal | – | – | – | – | ||
| Disposals and retirements | – | – | – | – | ||
| Reclassification | – | – | – | – | ||
| Translation differences | -1 | -1 | – | – | ||
| Closing accumulated amortization | -143 | -130 | -119 | -110 | ||
| Impairment losses | ||||||
| Opening accumulated impairment losses | 0 | 0 | 0 | 0 | ||
| Impairment losses for the year | – | – | – | – | ||
| Disposals | – | – | – | – | ||
| Translation differences | – | – | – | – | ||
| Closing accumulated impairment losses | 0 | 0 | 0 | 0 | ||
| Closing carrying amount | 32 | 30 | 21 | 19 | ||
| Intangible assets, total | 2 655 | 1 911 | 53 | 40 | ||
In 2005, the EU introduced an emission rights system as a method for restricting carbon dioxide emissions. For the period 2013 up to and including 2020, Rexcell Tissue & Airlaid AB has been allocated a total of 166,246 metric tons. The allocation for 2018 is 0 metric tons for Dals Långed and 18,078 metric tons for Skåpafors. The total allocation of emission rights will diminish each year up to 2020, when Dals Långed will have emission rights corresponding to 0 tons per year, and Skåpafors 17,349 tons per year.The production plant in Dals Långed is dormant and, when no production takes place, no emission rights are utilized. The allocation of emission rights by the County Administrative Board will be dormant as from 2017, but can be resumed up to 2020 upon application. In total, 13,406 metric tons were consumed in Skåpafors in 2018, compared with 13,308 metric tons in 2017. Received emission rights are reported as intangible assets recognized at an acquisition value of zero.
Impairment testing for goodwill
Impairment testing is performed for goodwill at the end of each financial year. With the implementation of IFRS, allocation of the Group’s goodwill items has taken place through allocation ratios; see Note 4.2.
Acquisitions and goodwill on acquisition in SEK m
| Business Area | Year | Acquisition | Country | Goodwill on acquisition, SEK m |
| New Markets | 2018 | BioPak Pty Ltd | Australia | 4682) |
| Meal Service | 2018 | Kindtoo Limited (Biopac UK Ltd) | UK | 10 |
| New Markets | 2017 | United Corporation Ltd (Sharp Serviettes) | New Zealand | 37 |
| New Markets | 2016 | Terinex Siam Co., Ltd | Thailand | 104 |
| Consumer | 2014 | Paper+Design Group | Germany | 197 |
| New Markets | 2013 | Song Seng Associates Pte Ltd | Singapore | 501) |
1) Asset acquisition
2) Preliminary goodwill on acquisition, the acquisition analysis has not been established
Goodwill is allocated to the Group’s cash-generating units identified per business area as follows:
| SEK m | 2018 | 2017 | |
| Table Top | 1 199 | 1 199 | |
| Meal Service | 10 | – | |
| Consumer | 224 | 215 | |
| New Markets | 680 | 203 | |
| Total | 2 114 | 1 617 | |
Impairment testing for goodwill is performed annually for and when there are indications of impairment. No impairment testing is performed during the year the company is acquired, in other words, for Meal Service in 2018 when Biopak UK Ltd was acquired and for BioPak Pty Ltd in New Markets. Recoverable amounts for cash-generating units are determined based on estimated values in use. The calculations are based on estimated future cash flows before tax, based on financial forecasts approved by company management and which cover the current year as well as a five-year period. Cash flows beyond this period are extrapolated using an estimated growth rate. The growth rate does not exceed the long-term growth rate for the industry as a whole.
The table below shows the rate of growth (on average) used in the calculation for each business area, the figures in brackets show what growth rate was used in last year’s calculation.
| Growth rate | Year 1 | Year 2–5 | Beyond the forecast period |
| Table Top | 2% (2%) | 2% (2%) | 2% (1%) |
| Consumer | 2% (2%) | 3% (3%) | 2% (1%) |
| New Markets | 2% (2%) | 3% (3%) | 3% (1%) |
| Discount rate before tax used per business area | |
| Table Top | 7.6% (8.1%) |
| Consumer | 8.8% (9.3%) |
| New Markets | 10.6% (11.1%) |
Significant assumptions which are used for calculations of values in use are primarily profit margin, growth rate and a nominal discount rate. Which discount rate is used for each business area can be seen in the table above. The discount rate before tax is used in conjunction with present value calculation of estimated future cash flows.
Company management has established the profit margin and growth rate based on previous income and its expectations as regards market growth. The discount rates used are stated before tax and reflect specific risks in the business area. Company management believes that the Group’s operations are stable and there are therefore not any individual significant assumptions that could impact the profit margin. The estimated growth rate is applied in all essential respects to net sales and free cash flow.
Company management believes that reasonably possible changes in the significant assumptions used in the calculations would not have such a major impact as to individually reduce the recoverable amount to a value which is below the carrying amount.