Intangible fixed assets
In general terms, fixed assets are business property intended for long-term use. Intangible fixed assets are assets that lack physical form like patents, trademarks, copyrights, and other intellectual property. Intangible fixed assets form much of Inter IKEA Group’s overall assets.Most Inter IKEA Group intangible fixed assets are trademark rights and other intellectual property rights. Inter IKEA Group purchased these rights for EUR 11.8 billion in 2012. As a positive return is expected for a long period, these costs are spread over a period of 45 years.
Tangible fixed assets
Tangible fixed assets are things like real estate and equipment that you can physically touch and feel. Inter IKEA Group tangible fixed assets are mainly factories and distribution centres. A new distribution centre in Malaysia went operational in FY21.
Inter IKEA Group owns several offices and distribution centres, the IKEA Delft store, the IKEA Hotell and IKEA Museum, and around 42 factories. Most of the factories are in Europe. The majority produce IKEA furniture, while two manufacture components, such as screws and wooden dowels used to assemble IKEA furniture.
Inventories and receivables
Inventories mostly consist of IKEA products in warehouses. Inventory levels went down in FY20 and remained low during FY21. Transport constraints in combination with high customer demand created a challenge to replenish inventory to a desired level.
Receivables is money owed to the Inter IKEA Group by business partners. Most receivables relate to franchise fees and products sold and invoiced to IKEA franchisees.
Group equity, provisions and liabilities
Equity is the capital invested by shareholders of Inter IKEA Group plus accumulated profits over time. Equity increased by EUR 600 million during FY21.
Of the EUR 1,433 million profit achieved during FY21, EUR 1,000 million will be distributed as a dividend to Interogo Holding AG, a holding company that is fully owned by the Interogo Foundation. The remaining EUR 433 million will be added to the Inter IKEA Group equity.
Provisions are money set aside for pension commitments, deferred taxes and claims. Liabilities are money owed to others. Most Inter IKEA Group non-current liabilities, which are due over a long period of time, consist of a loan from Interogo Holding AG (a non-controlling shareholder). Current liabilities are short-term loans, money due to suppliers and the current portion of long-term loans from Interogo Holding AG.
