21. Property, plant and equipment

Property, plant and equipment includes own tangible assets and rights of use for leased property, plant and equipment.

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€ million

30/9/2019¹

30/9/2020

Property, plant and equipment

4,260

3,728

Usufructuary rights

2,374

2,084

6,635

5,811

¹	Adjustment of previous year due to full retrospective application of IFRS 16 (Leases).

The inventories and developments are each presented and explained separately below. Previous year’s figures have been adjusted due to the full retrospective application of IFRS 16 (Leases).

The development of own tangible assets is shown in the following table.

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€ million	Land and buildings	Other plant, business and office equipment	Assets under construction	Total
Acquisition or production costs
As of 1/10/2018	6,599	3,189	158	9,946
Currency translation	156	46	3	205
Additions to consolidation group	0	0	0	0
Additions	54	80	161	295
Disposals	−125	−74	−5	−204
Reclassifications in accordance with IFRS 5	−794	−249	−15	−1,058
Transfers	61	100	−186	−24
As of 30/9/2019 and 1/10/2019	5,951	3,093	116	9,160
Currency translation	−457	−136	−7	−600
Additions to consolidation group	0	0	0	0
Additions	24	66	109	198
Disposals	−26	−104	−13	−142
Reclassifications in accordance with IFRS 5	−1	0	0	−1
Transfers	41	72	−109	4
As of 30/9/2020	5,531	2,991	96	8,618
Depreciation
As of 1/10/2018	2,945	2,155	10	5,110
Currency translation	40	26	0	67
Additions, scheduled	202	200	0	401
Additions, impairment	6	1	0	7
Disposals	−72	−67	0	−139
Reclassifications in accordance with IFRS 5	−385	−138	0	−523
Reversals of impairment losses	−4	−1	0	−5
Transfers	−21	4	0	−18
As of 30/9/2019 and 1/10/2019	2,711	2,179	10	4,900
Currency translation	−163	−87	−1	−252
Additions, scheduled	165	181	0	346
Additions, impairment	7	3	1	11
Disposals	−22	−100	0	−122
Reclassifications in accordance with IFRS 5	−1	0	0	−1
Reversals of impairment losses	0	0	0	−1
Transfers	7	1	0	8
As of 30/9/2020	2,703	2,177	10	4,890
Carrying amount as of 1/10/2018	3,655	1,034	148	4,836
Carrying amount as of 30/9/2019	3,240	914	106	4,260
Carrying amount as of 30/9/2020	2,828	814	86	3,728

Of the €533 million decline in property, plant and equipment, €349 million was due to negative currency effects, particularly in Turkey and Russia. Investments were more than offset by ongoing depreciation.

In accordance with IFRS 5, the scheduled depreciation of METRO China in the previous year in the amount of €44 million is not included in the current profit or loss for the period from continuing operations. These impairment losses are included in the movement schedules on the development of financial assets up to the point of reclassification on 30 September 2019; consequently, the amounts stated there may differ from the notes on depreciation.

Restrictions on titles in the form of liens and encumbrances for items of property, plant and equipment amounted to €10 million (30/9/2019: €11 million).

Contractual commitments were recorded for items of property, plant and equipment in the amount of €22 million (30/9/2019: €42 million).

The development of rights of use of leased property, plant and equipment is shown in the following table.

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€ million	Land and buildings	Vehicles	Others	Total
Net carrying amount
As of 1/10/2018	2,524	88	20	2,633
Additions	344	47	21	412
Depreciation	−263	−39	−8	−311
Impairment	−2	0	0	−2
Reclassifications and net change in consolidation group	−343	0	−1	−343
Disposals, currency translation and reversals of impairment losses	−12	−1	0	−14
As of 30/9/2019 and 1/10/2019	2,248	95	32	2,374
Additions	185	61	21	267
Depreciation	−254	−45	−12	−311
Impairment	−4	0	0	−4
Reclassifications and net change in consolidation group	−63	0	−2	−65
Disposals, currency translation and reversals of impairment losses	−165	−9	−4	−178
As of 30/9/2020	1,947	103	34	2,084

The decrease in rights of use of €290 million was mainly due to scheduled depreciation of €311 million. In addition, reclassifications as part of the disposal of the hypermarket business amounting to €141 million reduce the rights of use. They consist of the reclassification of rights of use as investment properties and disposals to receivables from finance leases. In addition, disposals due to termination and modification of contracts amounting to €71 million and negative currency effects amounting to €62 million reduced the number of rights of use. This was offset by investments in rights of use in the amount of €267 million.

In accordance with IFRS 5, the scheduled depreciation of METRO China in the previous year in the amount of €23 million is not included in the current profit or loss for the period from continuing operations. These impairment losses are included in the movement schedules on the development of financial assets up to the point of reclassification on 30 September 2019; consequently, the amounts stated there may differ from the notes on depreciation.

Information on leases is provided in no. 47 – leases.
Disclosures on assets/liabilities held for sale in connection with the sale of the hypermarket business and METRO China can be found under no. 43 – discontinued operations.

Previous year

Period of 12 months relating to the financial year preceding the reporting year, usually cited as reference for statements in an annual report.

Glossary

IFRS (International Financial Reporting Standards)

Internationally applicable rules for financial reporting developed by the IASB. Contrary to the accounting rules under the German Commercial Code, the IFRS emphasise the informational function.

Glossary

Currency effects

Currency effects result from situations where the same amount of currency units is translated into another currency at differing exchange rates.

Glossary

Annual Report 2019/20

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21. Property, plant and equipment