Note 13: Leases

Right-of-use assets

In € millions

Land

Buildings

Other

Total

Balance at January 1, 2020

 

 

 

 

Cost of acquisition

57

355

102

514

Accumulated depreciation/impairment

(14)

(88)

(38)

(140)

Carrying value at January 1, 2020

43

267

64

374

 

 

 

 

 

Movements in 2020

 

 

 

 

Additions/modifications

2

39

44

85

Disposals

(1)

(6)

(9)

(16)

Depreciation

(3)

(60)

(36)

(99)

Impairments

(7)

(7)

Changes in exchange rates

(2)

(8)

(3)

(13)

Total movements

(4)

(42)

(4)

(50)

 

 

 

 

 

Cost of acquisition

55

353

102

510

Accumulated depreciation/impairment

(16)

(128)

(42)

(186)

Carrying value at December 31, 2020

39

225

60

324

 

 

 

 

 

Movements in 2021

 

 

 

 

Additions/modifications

2

35

32

69

Disposals

(5)

(2)

(7)

Depreciation

(3)

(60)

(31)

(94)

Impairments

(2)

(2)

Changes in exchange rates

4

9

1

14

Total movements

3

(23)

(20)

 

 

 

 

 

Cost of acquisition

61

372

109

542

Accumulated depreciation/impairment

(19)

(170)

(49)

(238)

Carrying value at December 31, 2021

42

202

60

304

AkzoNobel mainly leases land, office spaces, stores and cars. Some leases provide for additional rent payments that are based on changes in local price indices.

Some property leases contain extension options exercisable by AkzoNobel up to one year before the end of the non-cancellable contract period. We have estimated that the lease liability would increase by less than 20%, if we would exercise the extension options which are currently not included in the valuation of the lease liability. This excludes so-called “evergreens” or perpetual leases.

Total net cash outflow from financing activities related to leases recognized on the balance sheet was €100 million (2020: €105 million). Net cash outflow for leases not recognized on the balance sheet was €17 million (2020: €17 million).

Refer to Note 27 ‘Financial risk management’ for the maturities of lease liabilities.

The table below shows the total impact from leases on our consolidated statement of income.

Income/(expenses) recognized in the consolidated statement of income

In € millions

2020

2021

Sub lease income

10

3

Depreciation right-of-use assets

(99)

(94)

Impairments for right-of-use assets

(7)

(2)

Interest expense on lease liabilities

(6)

(6)

Short-term lease expenses

(9)

(7)

Expenses relating to low-value assets

(4)

(5)

Variable lease expenses

(4)

(5)

Total expenses

(119)

(116)